The Mill shopping center in Water Mill will soon be under new ownership with a vision to fully cultivate it into a destination stop.
Robert Zecher, the principal in Vault Development Partners, which has also invested in residential real estate in the Hamptons, is preparing to close on 760 Montauk Highway in two weeks.
“I’m very excited about this purchase. I’ve been looking at the asset for a number of years,” Zecher told Behind The Hedges this week.
The 3.64-acre retail shopping center offers 29,314 square feet of space among six buildings in a village square atmosphere with the convenience of a traffic light. An array of tenants call the property home including Provisions Natural Food Market, Tight Medical Spa, Water Mill Wine & Spirits and Hamptons Float.
Hal Zwick and Jeff Sztorc of Hamptons Compass Commercial said they represented both sides of the deal, the terms of which were not disclosed. The last asking price was $15.9 million. Built in 2002, it last changed hands in 2021.
“The hamlet of Water Mill has been completely transformed over the past few years, not only from amenities of The Mill, but also from the development of Watermill Crossings,” the Compass team said, referencing the 38 townhomes being built directly adjacent to The Mill.
Watermill Crossing, located just north of Montauk Highway at 66 Nowedonah Avenue, is well under construction, and in development by JS Squared. Prices range from $2 to $3 million each and, already more than half of the units have been sold. Construction is slated for completion by the fall of 2023.
“It’s never been a walkable residential district,” Zecher said. “It’s the missing piece to Water Mill. Now that it is there, the rest of Water Mill really has the ability to rethink itself.”
“We’re the right owners for the property next door to embrace that,” Zecher added. “That’s really what will bring in new tenants and more people to that whole zone,” he said of the commercial property.
Water Mill offers some of the most high-priced real estate on the South Fork (including the biggest sale of 2021), but the hamlet center is small. The business district, with its Post Office and a few mainstays, like Suki Zuki, is located on the highway between Bridgehampton and Southampton and has always been more of a pass-through than a destination.
In the past decade, the hamlet also saw the addition of the Watermill Station office condominium complex, behind The Mill, which quietly traded in 2022 for $11 million.
One of his partners is an owner in the Water Mill Square, a nearby commercial complex. Together, they will work to make both commercial areas a more “recognizable, identifiable, frequented district.”
“We have a great canvas to do it and it’s now a matter of operationalizing it,” he said.
This is not the first commercial purchase for Vault Development Partners in the Hamptons. The company bought the mixed-use property at 105-107 Newtown Lane in East Hampton Village in 2021 for $7.2 million. Zwick and Sztorc also represented Zecher in that deal.
The tallest building in the village at three stories, it is now home to Hampton Chutney and Zakura’s Takeaway, as well as apartments on the second and third floors.
Zecher, an East Hampton resident for 7 years, takes pride in the fact the property is bustling with activity, even in the off-season.
“When you drive down in East Hampton, most of the restaurants are closed,” he says. “But at the end of Newtown Lane, the lights are on and people are eating in those two establishments.”
Water Mill, he says, is lacking that sense of a community center and he is hoping once he purchases The Mill and develops plans for its future that it too will serve as a destination for all.
“It takes a lot of time to figure out what the community needs first,” he said.
“Does the community have a place where kids can go ice skating in the off-season, for a tree lighting during the holidays?”
While it will take him some time to formulate his long-term plans, for now, he is hoping to make some changes soon, including leasing out the building that had been occupied by Soul Cycle by summer.
The 4,690-square-foot available space offers highway exposure and direct access to the parking lot, which can hold 154 vehicles and features nine Tesla charging stations. Building No. 4 is built-out as a fitness studio and is considered to be in turnkey condition, but it can be customized for any business.
The center has a mix of wet and dry use, falling in the Village Business zoning, which offers some of the most flexible commercial/retail space within Southampton Town’s building code.
By the start of the 2023 summer season, he hopes to see “a little bit more life pushed into the center” and has plans for new landscaping.
Looking ahead to summer 2024, that is when there will be some material changes to the center for the consumer
“It’s all about the community helping drive the inertia of the center and that doesn’t happen overnight. It will take some time for everybody to realize it’s there,” he said.
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