ACR awaits first sales

Developers say Tupper Lake project remains on course, but big things won’t happen overnight.

By Brian Mann

Last winter, the massive Adirondack Club and Resort proposed for Tupper Lake cleared its final major hurdle. After more than a decade of debate and controversy, environmental activists and a handful of local property owners who fought to block the project were dealt a sweeping defeat by the Appellate Division of State Supreme Court.

The December 2014 ruling, upholding permits issued by the Adirondack Park Agency two years earlier, appeared to open the way for the $500 million project to move forward. It was hailed as a historic moment for the community. “I think the pieces are now in place to do what Tupper Lake and the Adirondack Park need,” said Tupper Lake Mayor Paul Maroun.

But nearly five months later, ACR developers, local pro-development activists, and business leaders acknowledge that considerable uncertainty remains about the timeline for construction and about the broader viability of the resort’s ambitious business plan.

The vision remains a bold one. Philadelphia businessman Michael Foxman and Tupper Lake developer Tom Lawson hope to build more than 650 vacation homes—including condos, ski chalets, and luxury “Great Camp” mansions— long with a marina and an equestrian center. The development would border the Big Tupper Ski Area, which would be refurbished, and the municipal golf course.

During the APA’s review, the resort’s boosters suggested that it would transform the regional economy for much of the northern Adirondacks. Speaking in late March, lead developer Michael Foxman stuck by those predictions, but he said it could take as long as another year before significant progress is seen, and he acknowledged that it remains unclear when the first sales will be consummated.

“You’ll see things snowball, but snowballs start out small. A resort has a lot of moving parts, and they will come together slowly and hopefully inexorably,” Foxman said during a lengthy interview with the Adirondack Explorer.

Tupper Lake realtor Jim LaValley, co-founder of a group called ARISE that formed to support the project, is urging local residents to be patient as momentum builds. “I’m more anxious than they are to see it all get going. We are in what I call the i-dotting and t-crossing phase, all leading up to what will be this launch of the transformation of the community.”

But the project’s most passionate supporters acknowledge that a big test lies ahead as properties are placed on the market. Will parcels around the Big Tupper Ski Area sell at the premium prices that developers need in order to finance later stages of the resort? Speaking on background, some realtors knowledgeable about the Park’s market expressed skepticism that the project would survive on the scale originally conceived.

They point to the fact that in recent years, sales for vacation-home properties have slowed significantly and rarely match the premium price tags that Foxman has placed on the parcels.

No one is more bullish about ACR’s future than Tom Lawson, a Tupper Lake resident and former luxury-home developer in the Bahamas who says he initially opposed Foxman’s ambitious plan. But he invested heavily in the project nine years ago after reviewing the details. Now a full partner, Lawson was working on a recent afternoon in the resort’s plush, Adirondack-camp-style office on the village’s main street.

At the front of the office, a large diorama shows what the vast resort will look like if fully built. “We’re good to go on the Great Camps,” Lawson said, pointing to a sweeping forested area where he hopes to see construction begin soon. He pointed to a number of colored thumbtacks that represent properties he says are “spoken for.”

Lawson himself has invested not only in the resort itself, but also in a broader vision of Tupper Lake’s rebirth, purchasing numerous retail properties and also acquiring the village’s private airport. “There are three or four projects that are starting now, several of the big storefront projects for the downtown. We can’t have ACR without a thriving downtown,” he added.

Asked to provide a detailed timeline of the resort’s build-out, Lawson acknowledged that progress would hinge on sales and on whether new investors join the project. “It’s all dependent on money. We got put behind the eight ball financially with the legal fees and how long this has dragged out, but we do have some people who are coming in with some money.”

In early April, Lawson toured the project with golfing legend Greg Norman, who has invested in resort properties around the world. ACR’s backers say other potential investors are reviewing the project. “We’re doing OK in that we have several investors who want to come in. We’ll pick and choose our partner when we identify the right one,” Lawson said.

Despite the numerous delays and the national realestate slump that has softened vacation-home sales in the Park since the 2007 financial crisis, Lawson says he has no doubts that the project will eventually pay off. During an interview, he showed the Explorer four letters of interest, which he said were signed by potential buyers who want first crack at several of the most valuable Great Camp lots, worth collectively more than $10 million.

One premium parcel is priced at more than $5 million. Asked how firm those deals are, Lawson said, “I don’t think we’re going to lose any of them, but we won’t know until we know. They all are antsy, and they want to get started on their own homes here.” He noted that the resort’s first sales can’t be finalized until a homeowner’s association agreement is approved by the state attorney general’s office.

It remains to be seen, however, whether potential home-and land-buyers will be willing to pay high-end prices for a resort in Tupper Lake that will be largely undeveloped in the early phases of the project. Initially, Lawson acknowledged, the owners of the Great Camps may be forced to use generators to provide power until more infrastructure is built. The logging road that leads to many of the lots also remains in rough shape.

A realtor who agreed to speak on condition of anonymity pointed to the fact that premium parcels in the more desirable Lake Placid market have sold for much lower prices. One lot on the shore of Mirror Lake sold for $1.3 million, while a 160-acre property on Adirondak Loj Road with stunning views of the High Peaks sold for roughly $1.15 million. “No one’s getting close to $5 million. It’s not going to happen,” he said.

But Lawson counters that he has a proven track record of finding buyers, both in the Adirondacks and overseas, and he describes many of ACR’s potential clients as close friends. “Keep in mind that I’ve spent the last thirty-eight years of my life down in the Bahamas building fabulous homes for people,” he said.

Lawson and Foxman have insisted for years that they see value in Tupper Lake, and a market for resort properties in the Adirondacks, that other realtors haven’t tapped into. “The fact of the matter is that there’s an awful lot of money out there. We’re getting a lot of interest from a lot of people,” Lawson added.

Even if the first Great Camp lots sell, bringing an infusion of cash to the project, questions will remain about how this bold, multiyear project will be financed. Lawson and Foxman have suggested that they plan to work in stages, raising a mix of public and private dollars, including capital from commercial investors and regular home-buyers, along with the possible use of federal incentives for foreign backers, who would gain residency in exchange for large capital investments.

They’ve also expressed interest in taxpayer-funded investments from New York State’s Regional Economic Development Council program, an initiative created by Governor Andrew Cuomo that has provided incentives recently for other tourism-related projects in the Park, including two hotels in neighboring Saranac Lake. But so far no applications for the Tupper Lake project have been filed.

In 2007, ACR’s team also proposed raising much of the initial capital through the sale of $10 million worth of bonds through the Franklin County Industrial Development Authority. That remains an option, the developers say, but IDA Executive Director John Tubbs told the Explorer that no substantive talks have been held in recent years. “We have had contact of a general nature, but they have not made another application to us or updated the old one,” Tubbs said, adding that any proposal would require a detailed review and a public hearing process.

Many of these questions aren’t new. While much of the decade-long debate over ACR focused on possible environmental impacts, concerns about its financial viability first arose early in the review. A 2006 report funded by the town of Tupper Lake found that the developers’ sales projections were not based on “reasonable and substantive” data and questioned whether the resort could be “successfully marketed given the number of units and prices being proposed.”

An investigative report by the Explorer published in 2011 found skepticism among many of the Park’s realtors, who questioned whether the developers could achieve their goal of selling between forty and fifty homes each year. One realtor called the plan “far-fetched.” Mark Bergman, a veteran realtor who sells vacation property in North Creek and Lake George said at the time, “Those numbers in Tupper Lake are, to be polite, very aggressive.”

Half a decade later, there are signs of new caution in the developers’ approach. The economic analysis submitted to the Adirondack Park Agency as part of the permit application estimated that the company would invest as much as $15 million in infrastructure and amenities in the first four years, generating hundreds of construction jobs. Foxman now outlines a much more wait-and-see timeline, based on the actual pace of sales.

Indeed, Foxman’s team of investors doesn’t yet own the parcel that encompasses most of the 6,200-acre development tract, though they hold an option on it. Nor have they upgraded key roads or installed a crucial power line. Foxman said those steps could be taken by September. He also suggested that construction of the new marina on Tupper Lake, expected to be one of the first amenities, likely won’t begin until next spring. “We’ll build it as needed. One of the reasons I like the Great Camps so much is that so little infrastructure is needed,” Foxman added.

But there have been indications that the lengthy legal and regulatory review has placed financial strain on the project’s core team. In 2011, the Adirondack Daily Enterprise reported that Lawson had fallen into arrears by more than $100,000 on property taxes owed to Franklin County. According to the county treasurer’s office, he is still paying on an installment plan to retire those debts, though officials declined to disclose the amount owed.

Although many questions remain about next steps for the project, ARISE’s LaValley said Lawson and Foxman deserve praise for maintaining their faith in the future of Tupper Lake. “The community and the region should be thankful because they have hung in there. They’ve invested their entire life in this project,” he said.

That view is shared by David Tomberlin, a longtime booster of the project who leads the town’s Chamber of Commerce. He opened a high-end eatery on the downtown’s main street called the Well Dressed Food Company. The hardwood floors, stylish fixtures, and bistro menu wouldn’t look out of place in Lake Placid or Saratoga Springs. He said his decision to invest in Tupper Lake was inspired in large part by the ACR vision.

“We’re extremely hopeful. That’s why we invested hundreds of thousands of dollars. We’re very much looking forward to the development happening and a much more vibrant economy here,” Tomberlin said. “I do know there’s a lot of interest, people interested in buying property here. Tupper Lake’s very well positioned to take advantage of that.”

Many local residents and elected officials view ACR as a desperately needed lifeline for one of the Park’s most populous villages, a former logging and manufacturing community that has struggled with the loss of population, a shrinking school system, and steady economic decline. Mayor Maroun is counting on the Big Tupper Ski Area to re-emerge as a regional winter destination, creating hundreds of jobs and boosting the local property-tax base.

“I’m confident it has legs,” he said. “I think you’ll see big investors looking to work with Tom and Mike. It’s not going to happen overnight. You don’t revitalize a ski center and build condos overnight. This will be a place for tourism, a place to meditate, a place to ski, and a place to enjoy small-town life.”

As time passes, however, one of the thorniest challenges for the developers and community leaders will be keeping the ski area operational without a major new investment or salaries. In recent years, volunteers organized by ARISE refurbished the trails, repaired two of the mountain’s ski lifts, and began operating the lodge as a community enterprise. Foxman said he’s convinced that downhill skiing will be one of the major draws for home-buyers, but he declined to say when ACR will step in with more dollars.

“When we build that ski area, it’s going to take a substantial investment, and this is a rotten financing market,” he said. “We’re going to have to do it right, or we’re not going to attract skiers from outside the local area.”

LaValley acknowledged that ARISE faces growing pressure to ease the burden on unpaid workers at the mountain. “I think we’ll see improvements at Big Tupper this summer. There are industry experts within our volunteer pool, and I hope they become compensated early,” he said, referring to the team that has maintained equipment and provided grooming services over the last five years.

Given the challenges that lie ahead, local leaders say the time is ripe for New York State and the region’s economic development non-profits to play a bigger role jump-starting the project. Maroun said he hoped to see the Regional Economic Development Council and the state Department of Environmental Conservation help with major investments in sewer lines and in a water system that would feed a snow-making operation on the slopes of Big Tupper. “It’s our turn to get into the mix for that money,” Maroun said.

He and others pointed to the fact that Tupper Lake faces a threat of a long-term economic decline, as well as growing questions about the future of a major employer, the state-run Sunmount home for persons with developmental disabilities, which has experienced a number of scandals in recent years.

LaValley said that with patience and the right optimism and the right mix of private and public investment, the resort around Big Tupper would grow to offer the kind of ski-from your-door appeal that has boosted mountain villages in Vermont.

“We’ve waited a long time. I think there’s never been a greater opportunity for the state of New York to step up and be involved,” he said.