Lake Joseph Mired in More Mishigas

Philip Barry, the Bay Ridge, Brooklyn real estate investor and investment advisor who owns Lake Joseph (through investment subsidiaries he controls), wound up in bankruptcy court this month. The bankruptcy proceeding apparently followed a series of lawsuits filed by his investors and judgements in their favor. Some of his investors have accused Barry of running a Ponzi scheme (although no criminal charges have been filed.) Google "Philip Barry" + Ponzi and you'll come up with a lot of hits. Or just check out this article in the Brooklyn Eagle.

So how does the bankruptcy of a Brooklyn real estate investor affect Sullivan County, and Lake Joseph in particular. Well, the bankruptcy judge has scheduled an auction on Oct. 20th of Barry's upstate lakefront property, which I assume is essentially Lake Joseph. There is an existing small residential community on the western side of the lake, developed about 20 years ago. Most of the lake, which is one of the prettiest lakes in the county, remained undeveloped. There were plans to continue development around the lake, but those plans were never realized by the previous owner of the lake. In 2000, Phil Barry purchased the lake and the undeveloped property, with, I'm assuming, plans to develop it and make money.

Those plans were never realized, either, and most of the land surrounding the lake remains undeveloped — one of the last large undeveloped lake holdings here in Sullivan County.

A new owner of the lake and undeveloped acreage could be good news for the existing homeowners on Lake Joseph. In 2007, teh DEC ordered repairs on the Lake Joseph dam or threatened to breach the dam (and drain the lake) if repairs weren't made and the DEC believed there was a downstream safety issue. That led to lots of meetings, and promises and plans by Phil Barry to repair the dam. But to my understanding, to date those repairs haven't been made.

The uncertainty over the dam and lake has made the sale of lakefront houses at Lake Joseph very challenging. (Real estate brokers in New York are required to disclose known material facts about the property, and the dam situation at Lake Joseph is a material fact.) Hopefully a new owner will have the resources to make the necessary repairs to the dam and remove the uncertainty from the lake.

In my mind, the best scenario would be to have the county or state purchase the lake and turn it into a park. It's surprising, given the number of lakes we have here in Sullivan County, how few public lakes and lake parks we have. A park at Lake Joseph would be a very welcome public asset.

Comments

[Bix]

How will this affect the Inn at Lake Joseph? That's one of the best inns in the area, and lake access is one of its key features.

[abc]

"It's surprising, given the number of lakes we have here in Sullivan County, how few public lakes and lake parks we have. "

That dear David is the heart of the matter. It's not just tea rooms, antique shops and winding scenic roads that that are needed to sustain the area's growth.

Missed opportunities will be the hallmark of what went wrong. It actually began with Black Black. After the death of Tom Fry, the original owner of Black Lake, New York State could have purchased the entire lake for less than $800,000. (It was first left to he nurse and then given to the Church.) Then a decade later Swan Lake was the second missed opportunity. Would you care to know how many years that was on the market? (The total number of people that are legally permitted to go on Black Lake AND Swan Lake now is less than one hundred.)

Having fished every lake in this county, including Clifford Lake, I can tell you that Lake Joseph is the most fragile of them because of its shallow areas. (You are not a fisherman as I remember one of your emails informed me! At that time I was in the market for a waterfront home.)

Anyone coming into the county now is literally being herded into either Lake Superior or White Lake. There are several other small access points along Planck Road but finding them for the weekender may be problematic. It is safe to say the county would have benefited if not thrived with public access to both Swan Lake and Black Lake. (Think of the missed revenue!!)

If one wants people to come to a recreational area, you cannot shut off lake access. That's exactly what has happened to this region in the past thirty years.

As a footnote---

You posted several waterfront homes for sale recently here. Two of them mark the end of an era.

[David Knudsen]

We actually have more lakes with public access than you mention above.
- Swinging Bridge Reservoir
- Toronto Reservoir
- Lake Superior State Park
- Mongaup Pond
- Crystal Lake
- White Lake
- Lake Waneta
I'm not sure what the public access is to the Mongaup and Rio reservoirs south of Swinging Bridge.

[abc]

- Swinging Bridge Reservoir--Two small Planck Road Parking Lots. I want to stress the word SMALL.
- Toronto Reservoir-- It helps to have water and a cement ramp.
- Lake Superior State Park-- Lovely but crowded.
- Mongaup Pond- Impossible steep ramp to back car or boat down. Check it out.
- Crystal Lake NOPE
- White Lake. Sunday at the Zoo.
- Lake Waneta. NOPE.

The nicest one of all is at the top of the Rio, which you did not mention.
For hikers try Clifford Lake.

[Hobart Gapp]

David-
Please post information on the bankruptcy auction - who, what, when, where.
This could be an asset worth bidding on.
Thanks
HG

[Hobart Gapp]

Would you please post the auction information here?

Cordially,

HG

[David Knudsen]

I don't have the auction information. If someone does, please post it.

[David Knudsen]

Someone emailed me the auction link. It's scheduled for October. 15th. Here's the link:
http://www.maltzauctions.com/auction_detail.php?id=116817