, Newburyport, MA

September 29, 2006

Major local player leaves Karp's development team

By Stephanie Chelf

NEWBURYPORT - Ralph Cox was hired by Stephen Karp's development firm to help lead the transformation of the city's waterfront, in part because Cox has a vested interest in its outcome - he lives here.

Cox, working with a team from billionaire Karp's New England Development and local property owners, laid the foundation for the multimillion dollar redevelopment of the area known as Waterfront West - between the Black Cow Restaurant and Route 1 - that could include residences, businesses and a hotel.

But Cox, a Plum Island resident, will no longer play a lead role in those changes. After two and a half years, he has decided leave Karp's firm to run his own real estate investment firm. Karp, who owns over two dozen buildings and lots in the downtown area, is one of Newburyport's biggest landowners.

"I really care about this community a ton," said Cox, a long-time real estate executive. "Another one of my dreams was to have my own development investment firm. It was an agonizing decision, but I had to try it now."

Cox's decision to leave raises questions about the status of the waterfront project. For over two years Newburyporters have waited to see what Karp wants to do, but so far no plans have been issued and Karp has remained mum.

Cox said the development team, operating under the name Newburyport Waterside Group, does not want to rush into a project.

"The next challenge is coming up with something we all like, people like and has economic vitality to it," Cox said. "That's the same in every development project."

Charles Lagasse, one of Karp's local partners, said there is no specific timeline when a plan will be released. But no plan will be revealed until the city has a new planning director.

"It's best if we wait so the planning director and the city can support a plan along with us," Lagasse said. "It's much better if we have a planning director (to work with), it makes things easier. We're watching for that."

A planning director is not expected to be hired until at least November.

Cox left New England Development to create Cox Development Group. Currently, he is working with other partners on two large industrial seaport distribution and warehouse projects in Boston and Seattle.

During his time working for New England Development, Cox worked closely with local property owners Charles and Ann Lagasse to form a unique business partnership. Karp's company purchased more than a dozen of Lagasse-owned properties in 2005.

"I'm as excited and concerned with how the city evolves as any citizen," Cox said. "Change can be good and I feel confident the city will manage it appropriately."

Karp, chief executive officer of Newton-based New England Development, is the developer behind the Cambridgeside Galleria and Chestnut Hill Mall. In 1999, he sold 14 of his malls - including the Liberty Tree Mall in Danvers and the Mall at Rockingham Park in Salem, N.H., for $1.73 billion. Karp was recently ranked number 374 in Forbes Magazine's top 400 richest Americans list.

Karp's current projects include the new Westin South Boston waterfront hotel and shops and more than 1 million square feet of residential, office and retail development in Chevy Chase, Maryland.

In Newburyport, New England Development and the Lagasses are managing properties and seeking redevelopment opportunities. Karp's holdings in Newburyport include most of the land in the Waterside West area, roughly one fifth of the downtown business and retail buildings along State Street, Green Street and Pleasant Street, and waterfront land at the eastern end of the city's downtown boardwalk.

Cox and the Lagasses worked closely with city planners to rezone the Waterside West area in order to pursue a mixed-use residential, retail and commercial development that will blend with the rest of the downtown.

Cox is confident that vision will be followed through.

"Chuck, Ann and New England Development care deeply about doing the right thing - or they won't do it," Cox said. "I believe a very thoughtful project will be put in place that is consistent with peoples' vision for growth in downtown."

They have been working on a number of different development scenarios for Waterside West such as where parking is located, the types of uses and whether a hotel fits into the mix.

"We're looking at all that stuff," Charles Lagasse said.

Many residents have been eager to see what Karp's plans entail, but so far no plans have been released.

"They're not just going to jump into something until they tie up the loose ends," said Mayor John Moak, who has met with the Lagasses since Cox resigned. "New England Development has a tremendously talented group of people. His team has a sense of what works for the community they are in."

Both Charles and Ann Lagasse said Cox had a great opportunity to pursue and support his decision. Cox will still serve an advisory and consulting role to the development group, Ann Lagasse said.

Several years ago, Cox worked with the Lagasses on their waterfront inn proposal and they have a long friendship. "Ann and I and Steve Karp will carry on," Charles Lagasse said. "We've been here and we're still here. We miss Ralph. I don't think it affects the project at all. Ann and I have been working on this for 25 years."

Land holdings

The following downtown Newburyport properties were purchased by Steven Karp's development company:

2-8 Center

10 Center

14 Center

18 Center

35 Liberty

38R Merrimac

44R Merrimac

54R Merrimac

58R Merrimac

58-62 Merrimac

81-83 Merrimac

72 Merrimac

74-80 Merrimac

82-84 Merrimac

86-90 Merrimac

85 Merrimac

16-20 Pleasant

24-26 Pleasant

131/2 Pond

1-5 State

2 State

4-8 State

10-26 State

7-15 State

5-7 Titcomb

1 Tournament Wharf

13-15 Water

19-23 Water

49 Water