Blue Flag Capital, a real estate investment firm that has purchased several hotels on the East End over the past few years, has added Baron’s Cove in Sag Harbor to its list of offerings.
“We are honored to be the next stewards of Barons Cove, which is truly an iconic fixture of Sag Harbor,” says Jason Brown, the CEO of Blue Flag Captial. “We’re excited to leverage our deep hospitality experience to invest in the hotel’s future with the goal of offering exceptional hospitality and positively impacting the community and its residents for decades to come.”
In recent years, Blue Flag has acquired Sunset Montauk, Haven Montauk and the Greenporter on the North Fork. In addition, the Boston-based firm has purchased properties all over the United States, such as Jackson Hole, Wyoming. Blue Flag is behind the award-winning Faraway Hotels on Martha’s Vineyard and in Nantucket, such as the Beachside that opens this month.
The Baron’s Cove acquisition took place last week, but the purchase price was not revealed.
The sellers were Cape Resorts, which has owned the hotel and restaurant on the harbor since 2013. Cape Resorts operates several hotels including the iconic Congress Hall and The Virginia in Cape May, New Jersey, and will continue to manage Baron’s Cove.
The property includes a restaurant, lounge and 67 guest suites, some facing the harbor.
Last summer, Baron’s Cove celebrated the 65th anniversary since Tom and Arthur Baron opened the doors on Memorial Day weekend in 1958. It became a favorite hangout for John Steinbeck. The original building down the block has been replaced by condos, but in 2015, Cape Resorts unveiled a new, high-end set-up.
“We built a new building that looks old,” Curtis Bashaw, co-founder and managing partner of Cape Resorts, told Behind The Hedges last summer. “Baron’s Cove was a storied place that had fallen on hard times when we met it. It had lost its marina and its restaurant, and it was really a remnant motel. Our new building replaced the original restaurant and anchors the front of the property.”
Bashaw and his sister, the designer Collen Bashaw, worked with the architect Richard Stokes on the design, as they also did with the recent renovation of the Pridwin Hotel on Shelter Island, which reopened in 2022.
“The property we built really harkens back to the original,” Bashaw said last year. “We didn’t want to be a nightclub pretending to be a hotel. We wanted it to be an authentic space. We tried to give it that nautical-casual, almost tavern-like vibe that the original Baron’s Cove had.”
Around the same time, Blue Flag spent $13.5 million to purchase the eight properties that makeup Sunset Montauk in late 2022. Formerly called Sunset Beach Montauk, the transaction included two vacant properties and four waterfront parcels in Montauk Harbor, totaling 3.46 acres, all within walking distance of Gosman’s Dock.
In 2023, Blue Flag also bought Haven Montauk for $14,940,000. The 27-room property has a pool and picnic area just across the street.
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