Bar at motel never received a building permit, Town Attorney’s office says

Sparks Fly Over Oceanside Bar

August 8 proved to be a stormy session before the East Hampton Town Planning Board for the owners of the Oceanside Beach Resort, also known as the Hero Beach Club. In particular, the presence of a bar that, the board was told, never received a building permit or a certificate of occupancy when it was installed was a major friction point during the back and forth between board members, the board’s attorney, the planning department, the attorney for the applicant, as well as one of the owners.

The motel is located on Montauk Highway and South Eton Street, opposite Second House. It was built before the introduction of the town’s zoning code. It has long been known by its nickname, the “Smiley Face” motel, for the yellow smiling face painted on its eastern exterior wall. It was purchased in 2016 for $9.6 million by an ownership group headed up by Jon Krasner, and the group has poured millions more into the property’s redevelopment.

The town’s planning department has warned the planning board that, under the liquor license the new owners have, which allows up to 499 people to be present and potentially drinking at one time, and the presence of a great lawn area behind the motel where a mass gathering could occur, that any site plan approval should spell out exactly where on the property liquor and food can be served. “You need to say where, exactly, this is going to be,” planning director Marguerite Wolffsohn told the board at a previous meeting.

Tiffany Scarlato, attorney for Hero Beach, addressed that concern. “We don’t have any objection to limiting outdoor dining to the deck area,” she said, which is on the Montauk Highway side of the property, and apparently includes the area around the pool. “The lawn is a family gathering place,” she continued.

“Can you address the issue of the bar?” asked Job Potter, the board’s chairman.

“It is an indoor bar,” Scarlato responded. “That was not there at the time of the application,” Potter replied. “It is not in the photographs. It is not in the site plan.”

“It’s not really a bar,” Scarlato continued “It is more where everybody is checking in. It is not intended to be a bar area.”

“Did you look at the website? It sure looks like a bar. It has happy hour. All kinds of stuff that sounds like a bar,” responded Wolffsohn.

“It’s a bar in the sense that it has discreet stools and a counter,” Potter answered. “The question is, it’s not in the site plan. I don’t know how we deal with this.”

Krasner then spoke. “I’ve been running this hotel for two years now. We have not had gatherings. It has been very quiet. It has been quiet at night. We are a high-end resort. We love it there. Children are there,” he said. He went on, “We want to continue in that direction. All these narratives that are given by all these people who actually don’t know us and the property are completely false,” and he added that he had sat through meetings hearing that the hotel was throwing parties when that was not the case. “We raised money for Wounded Warriors this weekend,” he said.

John Jilnicki, the board’s attorney, then stepped in. “The questions relate to your own website.” The board had been presented screenshots from the website. “You have a happy hour.”

“It’s a happy hour,” Krasner answered. “Every bar in Montauk has a happy hour. We are happy to do away with the happy hour if that makes everyone happy.”

“You don’t have an approved bar,” countered Jilnicki. “That is the question. So you’re having a happy hour at a bar that has no approval.”

“We have a 100-percent legal liquor license,” Krasner retorted. “You never came in and made an application for the bar,” Jilnicki said. “You never obtained a building permit or a C of O for it. To say ‘I have a liquor license’ is not really relevant.”

“Everything we’ve done has been 100-percent legal,” Krasner shot back. “And my lawyer can take over from there. I’m here to talk about the narrative. We are not a party hotel. We have not had parties. It has been a lovely hotel. Please come and look for yourself. That’s it.” He turned and walked away from the podium.

Scarlato took over. “I don’t have much more to say except that the application before this board is complete, and at this point, should be scheduled for a public hearing.”

A public hearing is required before the planning board can act on the site-plan application. “Except the bar is not in the site plan,” Jilnicki answered. “The town code has a requirement about what elements are on a site plan. And all existing conditions. “If you have a bar, that is an existing condition.”

“I will speak to the client about it. Does this mean we are not scheduling a public hearing?” Scarlato asked.

“We need to clear up this little bar thing,” board member Nancy Keeshan answered.

Woffsohn asked the applicant to provide a new narrative. What the board currently has on file “does not seem to match what is on their own website. I think they should submit, in writing, how this matches a restaurant. It seems to match a bar.”

Scarlato was also told by Potter and Wolffsohn that the new narrative needed to address several other things shown on the resort’s website, such as yoga classes, an exercise room, and a spa. “Clarify what is for the guests of the motel and what is also open to the public,” Wolffsohn suggested.

Potter said that the images on the website and that have popped upon social media of the resort “look really fun,” but don’t have the appearance of what’s described in the original narrative.