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October 15, 2006 The developers strutting their stuff along the boulevards that crisscross this city's downtown represent some of the most prominent names in the trade. Lowe Enterprises, a national development company based in Los Angeles; W&M Properties, a New York real estate management firm affilated with the owner of the Empire State Building; and Donald J. Trump are backing projects that could bring some 1,100 residential units, 325,000 square feet of office space and 140,000 square feet of retailing to the downtown area in the next few years. Yet these projects are overshadowed by what Michael Freimuth, the city's economic development director, calls "the 800-pound gorilla" proposed by a lesser-known entity, Antares Investment Partners. Its $3.5 billion plan to revitalize the city's underused South End over 10 years covers "easily a third of the real estate in that neighborhood," Mr. Freimuth said, adding that the site's prime location on a peninsula on Long Island Sound and within walking distance of the city's transportation center "makes it seem even larger." Called Harbor Point, the mixed-use project is the latest in a series of bold, if not always immediately successful, moves by Antares, a Greenwich-based development and private equity firm. "We're looking for things that are big and are transforming to the markets that we do business with," said Joseph P. Beninati, the former chief executive of a 615-employee technology firm. Mr. Beninati co-founded Antares in 1996 with a prep school buddy, James P. Cabrera, then a president for the Galbreath Company. Antares was named after one of the brightest stars in the sky, the developers said, describing the name as a symbol of their aggressive corporate philosophy. Since it began acquiring properties in the tristate area five years ago, Antares has amassed billions of dollars in capital from the likes of Goldman Sachs, Lehman Brothers and, for the South End project, Lubert-Adler Real Estate Funds. The company estimates the value of its real estate portfolio at $4.5 billion, including $171 million in land bought for Harbor Point. Spread across 82 acres of former industrial sites, abandoned factories and a boatyard-marina, the project calls for the creation of five distinct neighborhoods set around parks and waterfront promenades. New pedestrian walkways and the extension of major access roads from downtown will feed traffic toward the waterfront and the 15.8-acre Kosciusko Park. The plan calls for roughly 4,000 residential units interspersed with at least 400,000 square feet of retail outlets, 200,000 square feet of office space, a 60-room "boutique" hotel and a marina. Ten percent of the residences will be reserved for families earning 30 to 80 percent of the Stamford area median family income, currently about $116,300. The project, now before Stamford's Planning Board, has so far generated little opposition, largely because city officials, major employers and residents of the neglected area are eager for its revitalization. Some downtown merchants have expressed concern that the project's stores and restaurants might shift the focus away from the downtown core, but even Sandra Goldstein, the downtown's main advocate, is careful in her criticism. "We love probably 80 percent of the plan," said Ms. Goldstein, executive director of the Downtown Special Services District. "Our concern relates to the intensive destination retail, which will have four or five big-box retailers on the Yale & Towne site," a factory site now partially occupied by antique and art dealers. Though her organization would like the city to prohibit additional retail development there, Ms. Goldstein emphasizes that "we don't want to stop this plan." The Harbor Point project comes fast on the heels of Antares's $223 million acquisition in February of two apartment complexes in Greenwich for conversion to condominiums. The company is also building mansions starting at $10 million on some 50 acres in backcountry Greenwich; a $40 million retail development in Armonk, N.Y.; and a 27-lot private gated community there called CiderMill. "We can't confidently say that we're the largest and the most active developer in the tristate area," Mr. Beninati said, "but we're pretty sure there's no one doing more than us." Some of Antares's investments have proved spectacularly successful. The holder of a 22 percent equity stake in the Pickwick Plaza office park in Greenwich and manager of the site, Antares will share in the profit of some $120 million from the pending sale of that property, which is under contract for $230 million. The firm is equally pleased with its 50 percent ownership stake in the Delamar Hotel, also in Greenwich, where showy yachts are commonly moored at the private dock and the average room goes for more than $300 a night. But the company's record on its residential projects is less impressive. More than two years ago, Mr. Beninati said that at least 130 people were on a waiting list for 27 town homes and single-family homes at the CiderMill development in Armonk. To date, however, only 11 have sold, at prices of $1.1 million to $2.7 million. "Our sales have not gone as fast as we like because the product is more of a Ferrari than a Lexus," Mr. Beninati said. "There's obviously a smaller market for that." Sales are also slow at the two Greenwich complexes being converted to condominiums: Greenwich Oaks and Greenwich Place. Tenants renting at the multibuilding complexes were offered "insider" incentives to buy their units, priced at an average $1 million, with reductions that the developers say exceed $100,000 in some cases. Yet, Mr. Beninati said, fewer than 10 tenants have signed contracts to buy any of the 462 units. He ascribes the lack of interest to a hesitancy among longtime renters to buy and dismisses suggestions that Antares misread the market. "It's a complicated conversion process that has made for some confusion on just how they can become owners there at reasonable prices," he said. About 260 tenants are still renting at the complexes, which are being converted building by building. Antares at first contracted with Greenwich Fine Properties to handle sales there but has now decided to use an in-house team, and recently began advertising the condominiums in earnest to outside buyers. The starting price for a one-bedroom is less than $500,000, down from the previous estimate of $600,000. Now, as it gears up for the Harbor Point undertaking, Antares is thinking bigger than ever. In the future, projects like Armonk Square - a villagelike retailing and housing plan totaling 54,000 square feet - may be deemed too small for the company. After all, boasted Mr. Beninati, the Harbor Point project will probably be "the largest commercial job creator in the history of the state of Connecticut."
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