Groton — Jeffrey Respler, the developer proposing a mixed-use community at the Mystic Oral School property, has confirmed he has an agreement to sell Respler Homes LLC to a company that specializes in developing elder care and age-restricted independent living communities.

Blue Lotus Group, described as a real estate consultancy group based in Port Washington, N.Y., has entered into an agreement to acquire Respler Homes, Blue Lotus Group confirmed on Wednesday.

Blue Lotus Group said in a statement Wednesday that it aspires "to be the new development partner for the town and bring forward a new vision that is in keeping with the heritage of the Oral School, the character of Mystic, the beauty of the Mystic River and the size and scale of the property. If given the opportunity to reset and rescale this project, we want to develop an age-restricted independent and assisted living community that is informed and shaped by listening to the people who we hope will be our neighbors."

The town and Respler Homes are in a dispute over each other's responsibilities under a development agreement they entered into in 2020. Town Manager John Burt said Wednesday that the town is "continuing with the mediation process with the same goal of ending the development agreement."

Eric Callahan, an attorney for the Town of Groton, told the Town Council late Tuesday during its Committee of the Whole meeting that the town had been made aware that evening that Jeffrey Respler has the agreement to sell the full membership interest after a "due diligence period." Respler Homes would still exist, but its ownership would transfer to Blue Lotus.

"The Blue Lotus Group specializes in senior housing and assisted living facilities, and it appears that that developer plans to propose a development that is substantially smaller than the one currently planned by Respler Homes LLC," Callahan said.

Respler Homes was selected as the developer for the vacant, state-owned site after responding to a request for proposals issued in 2017. The state has an agreement to sell the property to Respler Homes, which has a development agreement with the town.

Respler Homes had proposed to redevelop the former Mystic Oral School site, also known as the Mystic Education Center, with multifamily housing and to renovate the main Oral School building into a multi-use commercial building and fix up the Pratt Building to serve as a recreation center for the town.

"My plan for a mixed use community at the former Mystic Oral School site still offers the Town of Groton the best opportunity to satisfy key housing needs," Jeffrey Respler said in a statement Wednesday. "I believe that certain factors beyond my control have created enormous obstacles for this project. The sale of my membership interest in Respler Homes to a new development team with a project of smaller scale may be in the best interests of everyone, including the Town."

"Hopefully, this will be a fresh start for everyone, and the abandoned school can be redeveloped to a use appropriate and beneficial to the residents of Groton," he added.

Respler added that if the deal does not close with Blue Lotus Group, he would pursue his proposal for a mixed-use community.

In the statement, Blue Lotus Group said it "looks forward to introducing ourselves to the people of Mystic and the state and local officials to turn the page on the past and hopefully take on the role of developing this beautiful property in conjunction with the town of Groton and state of Connecticut."

Burt told The Day the town has limited information and he is eager to learn more about Blue Lotus Group.

Callahan said mediation sessions with Respler Homes are scheduled for March 3 and 4, after informal negotiations — the first step in the dispute resolution process outlined in the agreement — "proved unproductive."

Discussions about executive session, question of recusal

During Tuesday's meeting, Town Councilor Rachael Franco asked Town Councilor Scott Westervelt to recuse himself from the executive session because he is co-chair of the Mystic Oral School Advocates, a group that has opposed Respler's proposal, and has an attorney who represents him and other residents who live near the Mystic Education Center. She said "a councilor should be unbiased in relation to the decisions that he's going to be making."

Westervelt said he'd have to think about that because the Mystic Oral School Advocates is a neighborhood group, not a political association of any kind. He does not believe the ethics ordinance applies to this situation.

"I believe that’s only for financial gain or for financial malfeasance, so I'm not sure that the ethics ordinance applies in this situation," he said.

Westervelt, who did not recuse himself, added that the session is for informational purposes, not voting.

Town Mayor Juan Melendez Jr. said his understanding of the ethics ordinance is that it's Westervelt's decision about whether or not to recuse himself, so he doesn't think the councilors should get in a debate about it.

Town Councilor Portia Bordelon said Westervelt was elected at large and he represents and is a voice for the part of town near the Mystic Oral School. She also pointed out that the executive session is for informational purposes, not to take a vote.

Town Councilor Melinda Cassiere asked if a councilor's retention of a lawyer indicates a financial interest, and Rich Cody, an attorney for the town, said residents are free to hire lawyers. Cassiere added that she attended an ethics class for newly elected officials and to keep in mind that there doesn't have to be a rule in order for someone to recuse themselves, but it could also be "the appearance of something that just doesn't seem right."

The council moved to go into executive session with the attorneys and town staff to discuss "strategy and negotiations related to pending claims involving the development agreement between the Town of Groton and Respler Homes."

Burt said the town is in a legal process with Respler Homes so the town is going into executive session under the litigation clause allowed in Freedom of Information law.

Town Councilors Bordelon, Aundré Bumgardner and Westervelt opposed going into executive session.

Bordelon said she felt the council should share as much as it can with the public at large first. Then, if there's a reason to, the council could go into executive session after that. 

k.drelich@theday.com