Carnegie Abbey gets luxury neighbor

By Patrick Anderson
PBN Staff Writer

At a time when small and simple are fashionable, the owner of the Carnegie Abbey Club in Portsmouth has doubled down on large and opulent. More

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REAL ESTATE

Carnegie Abbey gets luxury neighbor

COURTESY O’NEILL PROPERTIES
EXCLUSIVE CLUB: O’Neill Properties Group is planning the 150-acre Newport Beach Club in Portsmouth.

By Patrick Anderson
PBN Staff Writer

Posted 12/3/12

At a time when small and simple are fashionable, the owner of the Carnegie Abbey Club in Portsmouth has doubled down on large and opulent.

O’Neill Properties Group, which three years ago opened a 22-story, $80 million condominium tower located on the exclusive 450-acre golf enclave at the bottom of the worst real estate crash in a generation, is charging ahead with the Newport Beach Club, an equally luxurious gated community next door.

Built on the site of a former lumber yard and aluminum factory just north of Carnegie Abbey, the 150-acre Beach Club aims to deliver a resort lifestyle for everyday existence with amenities like a man-made beach (with sand dunes), pool complex, spa, tennis club, heated paddle-ball courts, equestrian center and marina.

After unveiling two model homes this summer, Newport Beach broke ground just before Thanksgiving on the centerpiece beach and pool complex, which is expected to open by next July.

“For everybody who lives here, it will be like a vacation every day of the year,” said Michelle Faust, Newport Beach Club director of sales. “And because Carnegie Abbey is next door, you have access to that too. It’s all about the amenities.”

With 152 separate homes planned, ranging from one-bedroom cabanas to 4,000-square-foot seaside mansions, Newport Beach Club is the final piece of a vision for the western Portsmouth shoreline embraced by the town more than a decade ago.

But in large part due to a radically transformed real estate market, both Carnegie Abbey and Newport Beach Club are far different from the gentlemanly sportsman’s retreat envisioned by original developer Peter de Savary in the 1990s.

Well-heeled families with children are the new target market of Carnegie Abbey, which added “Camp Carnegie” and numerous youth programs, and especially Newport Beach Club, where kids’ pools and sandboxes are among the built-in amenities.

“Family is front and center in [O’Neill Properties Group owner J. Brian O’Neill’s] life, and he almost immediately started making it more family-centric,” said Maureen Fraser, director of sales and marketing at the Carnegie Abbey Club.

Creating a new destination at Newport Beach Club is not only about developing a new revenue stream, it is also part of the plan to fully realize Carnegie Abbey, which is just now gaining some post-recession momentum.

Even after five sales this year, only 12 of 79 units are now occupied in the 22-story Carnegie Abbey tower, which at the end of 2010 looked like an empty white elephant in the moribund condominium market.

“Newport Beach enhances the experience for Carnegie Abbey,” Fraser said. “Already 22 Carnegie Abbey members have gotten on a waiting list for Newport Beach Club membership and we haven’t even presented it to them yet.”

Like Carnegie Abbey, Newport Beach Club is so large it has its own neighborhoods and most of them are being built as they are sold, instead of on spec.

The most exclusive properties are on the beach and include 16 buildable lots with prices ranging from $1.6 million to $2.8 million.

None of the beach-village lots have been sold yet.

Further south from the beach village is the tennis center, which is surrounded by 20 lots, including one featuring the “Simplicity” model tennis cottage.

The three Newport Beach sales so far are all of furnished “Simplicity” model tennis cottages, which start at $625,000 and are 2,412 square feet, with three bedrooms and three-and-a-half bathrooms.

One of the cottages sold is under construction, another is in permitting and the owner of the third is still customizing the design.

Slightly more expensive than the 12 available cottages are 20 “tennis village” houses, which start at $748,000. A model tennis-village house is planned for next year.

Up the hill from the tennis center are 17 “Cielo” lots, which start at $1.2 million and are described in a promotional flyer as “heavenly home of the angels.”

At the equestrian center “Camelot Village” lots start at $550,000 and provide a “place of glittering romance.”

A decision hasn’t been made yet on whether to build a model Camelot or Cielo, Fraser said.

At the pool complex, Newport Beach plans to build 24 cabanas around an 80-foot lap pool. The cabanas are still being designed, but should go on the market before the end of the year and start in the mid-$500,000s, Fraser said.

Four multifamily buildings between the pool/beach complex and marina are expected to fill out the last of the residential properties.

Of course, it wouldn’t be a beach club without a beach and since Portsmouth’s west shore isn’t sandy, O’Neill is bringing in its own, complete with dunes and built-in “loungers” on the ocean side of the pool complex.

After the beach is in, O’Neill plans to start constructing a 120-slip marina capable of docking yachts up to 110-feet long. The current Carnegie Abbey yacht club only has 25 slips and the largest is about 45-feet long.

Based in King of Prussia, Pa., O’Neill bought the long-term land lease de Savary had signed with the Benedictine monks to develop Carnegie Abbey and the former Weyerhauser lumber yard where Newport Beach is in 2005.

The housing market collapsed just before the condominium tower opened and as the rest of Carnegie Abbey was being built.

Complicating the already difficult circumstances caused by the crash of the condo market, O’Neill was unable to offer financing because Fannie Mae and Freddie Mac refused to buy condominium mortgages in largely empty buildings. Finding a portfolio lender during the credit crisis proved impossible

With sales in the tower, which cost at least $80 million to build, almost nonexistent, O’Neill fell behind on Carnegie Abbey’s property taxes and mortgage.

Last year, O’Neill recapitalized the development by selling four units in the tower worth $6.6 million.

In March, Carnegie Abbey paid off $2 million in back taxes to the town and put Newport Beach back on track.

This past summer, with signs that the high-end housing market had turned a corner, O’Neill hired a new sales and marketing team to launch Newport Beach and build demand throughout the two enclaves.

In February, a 2.6-acre estate in the Carnegie Heights section of the enclave sold for $5.2 million.

Paul Leys, an agent with Gustave White Sotheby’s International Realty in Newport, said high-end luxury sales have come on strong this year, which should “bode well” for Carnegie Abbey in general and Newport Beach in particular.

“They have had a long, hard time with the tower because of bad timing and the tower is the most different from what buyers coming to Newport and Rhode Island are used to,” Leys said.

A better climate for Carnegie Abbey would also be good for Portsmouth, where the combined properties represent a major chunk of the town’s tax base and led to budget gaps when expected growth did not occur.

“We view their activity as a positive for the town, because they add a lot to the tax base and don’t draw as much in services as an average house,” said Portsmouth Director of Business Development William Clark. •

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