Goodman Capital Lends $28M on Hamptons Build-for-Sale Luxury Homes

Call this one the big Hamptons financing. 

Eckell Development has secured a $27.8 million debt package to build luxury single-family homes on two Southampton properties, one of which was previously owned by famed hedge fund manager John Paulson, Commercial Observer has learned, 

Paulson, known for his bet against the housing market prior to the 2007 subprime mortgage crisis featured in the 2015 film “The Big Short,” sold his vacant 3.6-acre lot at 153 Pond Lane Road in Southampton Village in an off-market transaction to Eckell for $16 million. 

Goodman Capital supplied the loan covering both the acquisition and construction costs for Eckell to develop the build-for-sale homes on Paulson’s property as well as  another one at 446 Seven Ponds Towd Road in Water Mill, N.Y., that Eckell acquired for $4 million. 

Eric Goodman, co-founder and managing partner of Goodman Capital, said that the nearly $28 million loan financing is the largest commercial real estate loan in the Hamptons this year.  Goodman noted that both properties should draw strong demand from homebuyers given that 153 Pond Lane has a water view overlooking Lake Agawam and 446 Seven Ponds Towd overlooks an 18-acre agriculture reserve.

Paulson’s lot at 153 Pond Lane will likely break a new record for Southampton Village, exceeding $40 million, according to Goodman, aided by its history as formerly part of John Randolph’s Hearst estate while also having space for amenities such as a pool, tennis courts or cabana.  He noted that another home on 0.9 acres built by Eckell less than a mile away at 242 South Main Street broke a Southampton record with a $24.5 million sale. 

Paulson, a former investment banker at Bear Stearns, has a big presence in Southampton as owner of 10.4-acre property called Old Trees with 13 bedrooms that he bought from Rodney Propp for $41.3 million in 2008. His Southampton purchase came a year after netting billions betting the housing market would collapse, which was detailed in Gregory Zuckerman’s 2009 book, “The Greatest Trade Ever.”

Goodman, who has provided around $150 million of loans across more than 20 build-for-sale single-family residential projects in the Hamptons, said there is strong demand across the Eastern Long Island region for spec homes given a lack of supply.

“A lot of the homes are dated and having difficulty selling as finished product,” Goodman told CO. “The buyer profile for luxury single-family wants new construction, ground-up and turn-key, and if you build and price that product correctly, it sells very quickly.”

The two build-for-sale homes are slated for completion in two to three years, according to Goodman. 

Eckell Development and Paulson did not immediately return requests for comment.

Andrew Coen can be reached at acoen@commercialobserver.com.