Blue Flag Says Plan To Reopen Woodbox Now "Not Financially Viable"

More than two years have passed since Blue Flag Partners secured permits to reopen the historic Woodbox Inn on Fair Street. But the structure - one of the oldest on Nantucket - remains vacant and deteriorating, with neighbors filing complaints over its state of disrepair.

And now Blue Flag Partners, the Boston-based real estate investment firm that purchased the Woodbox back in 2021, has stated its plan to revive the historic property is "not financially viable."

The latest developments in the Woodbox saga came this week as a result of Emmy Kilvert's formal complaint to the Historic District Commission (HDC) that Blue Flag Partners allowed the structure to deteriorate in violation of the town's so-called minimum maintenance bylaw.

The law requires the owners of historic properties to "provide sufficient minimum maintenance...to the minimum extent necessary to keep such buildings from falling into a state of poor repair."

In her complaint to the HDC, Kilvert stated that Blue Flag had not done any maintenance at the Woodbox since it purchased the property in 2021 and that it is now "deteriorating rapidly due to lack of care, maintenance, and attention by the owner."

In their deliberations on the complaint during a meeting on Tuesday, the members of the HDC acknowledged that parts of the structure needed maintenance and repair but stopped short of issuing Blue Flag Partners a formal violation notice. Instead, they voted unanimously to give the real estate firm time to complete the necessary repairs by December 10, when the HDC will revisit the issue. 

But Kilvert's complaint rekindled the lingering questions about the Woodbox - most importantly, why hasn't Blue Flag done anything with the property, and is it seeking a demolition by neglect? In an email response to questions from island resident Kit Murphy that was entered into the HDC's record, Blue Flag Partners co-founder and chief development officer Brad Guidi stated that his firm remained "prepared to invest a tremendous amount of money into restoring this property." However, Guidi stated that the current economic conditions and the limitations of the approval granted by the Planning Board due to concerns raised by neighbors have "left the project, as it stands now, as not financially viable."

He was also emphatic that Blue Flag would not allow the Woodbox to deteriorate further.

"We are absolutely not going to allow the Woodbox building to decay, and there is no plan to ever file for a demolition permit," Guidi stated. "After careful consideration, we actually just started work on the building, which will continue until it is in accordance with Chapter 395 (the minimum maintenance bylaw)."

After a protracted dispute between Blue Flag Partners and neighbors of the Woodbox in 2022, the Planning Board approved a scaled-back plan to reopen the historic property that included 17 guest rooms and a private restaurant available only for guests of the inn.

"During the course of the entitlement process, the neighbors hired Attorney Arthur Reade resulting in a Planning Board approval of 17 guest rooms and a 'guest-only' restaurant," Guidi wrote. "For countless years, the Summer House ran the property with 24 bedrooms and a restaurant open to the public. The Woodbox restaurant was a beloved part of the island and the approval we received essentially ceased its operations. As you can imagine, losing seven bedrooms and making the restaurant only available to guests - combined with a hyper-inflationary environment and rising construction costs - has left the project, as it stands now, as not financially viable. We would love nothing more than to preserve and restore this building but without the ability to have a public restaurant (of note, this was the oldest restaurant in Nantucket) the numbers simply don't work."

Neighbors of the Woodbox, including Kilvert and Hank Gutman, immediately disputed the suggestion that abutting property owners had pushed for a private restaurant. The goal in raising concerns, they said, was to seek a restaurant operation similar to what had existed in the past - dinner only with two seatings - instead of the more expansive plans Blue Flag originally floated.

"It's total nonsense," Gutman said of Guidi's suggestion. "From the very beginning, and throughout the hearings, we made public statements to the Planning Board and in private in negotiations (with Blue Flag), and what we said is we would be delighted to have a restaurant like the old Woodbox or even 29 Fair when it was running properly or like the Ship's Inn down the street which we all adore...Saying we were forcing them to do this? That’s a total lie." 

Kilvert responded to both the HDC's decision on Tuesday, as well as Guidi's email message.

"I am also encouraged that the commission acknowledges the obvious deteriorating condition of 29 Fair Street," Kilvert said of the HDC's discussion on Tuesday. "It is my hope that the repairs will not be a temporary patch job, that would not protect the property from the upcoming harsh winter weather. The current owners purchased the property with an understanding of its historic significance as well as the ongoing required maintenance...It appears that Blue Flag no longer views the Woodbox as a viable financial investment property. To be clear, the neighbors supported a restaurant open to the public for dinner. It is my hope that Blue Flag has the ability to bring the Woodbox back to its former glory. This is a 1709 structure that was built before the country was founded, and its unique significance should be protected."

Guidi did not return a message seeking comment Tuesday night.

The Woodbox is indeed one of the oldest and most historic structures on Nantucket, dating back to 1709 – making it just slightly younger than the Oldest House. But the building was condemned by the Health Department in 2019 as unfit for human habitation. Two years later, in April 2021, Blue Flag Partners purchased the Woodbox property at 27-29 Fair Street as part of a $13.3 million deal to acquire the Summer House’s downtown lodging properties.

It is just one of numerous residential, commercial, and lodging properties acquired by Blue Flag Partners over the past five years on Nantucket.