HK Ventures and Riverhead Planning Board settle lawsuit over conditions of site plan approval

A lawsuit brought against the Riverhead Planning Board by the developer of a major industrial complex in Calverton has been settled.

HK Ventures, which gained the Planning Board’s preliminary site plan last year, sued the Riverhead Planning Board over a condition that the New York State Department of Transportation must complete the planned reconstruction of the Edwards Avenue/Route 25 intersection before town can issue building permits for the project. The lawsuit was dismissed by the trial court and HK Ventures filed an appeal, which remains pending.

The stipulation of settlement, authorized by the Planning Board at its meeting Thursday evening, allows the town to issue building permits but not certificates of occupancy for any of the buildings in the 412,629-square-foot industrial complex.

The Edwards Avenue intersection reconstruction “has made significant progress and is likely to be completed during the 2025 construction season,” according to the stipulation, a copy of which was obtained through a Freedom of Information Law request.

Since HK Ventures still hasn’t met all conditions for final site plan approval — the developer still needs approval of a stormwater management plan, the stipulation says — “it is likely that the intersection reconstruction will be completed before [the HK Ventures] project would qualify for a certificate of occupancy.”  That would still be true “even if building permits were issued now for the project,” the stipulation states.  

The parties agree in the stipulation that the reconstruction project at the Route 25-Edwards Avenue intersection will not be a basis to deny building permits for the HK Ventures project, and that upon final approval of the developer’s site plan, it shall be eligible to apply for building permits.

HK Ventures also agreed it will not apply for a certificate of occupancy until the intersection reconstruction is completed.

The HK Ventures project calls for constructing eight buildings for warehousing and manufacturing on 30 acres of vacant land on the south side of Route 25 (Middle Country Road), about 400 feet east of Fresh Pond Avenue. The space will be able to accommodate 60 tenants, mainly small- and medium-sized businesses, the developers have said.

The proposal was subject to a lengthy environmental review process. The environmental impact study identified significant adverse impacts from traffic as a result of the new development. Among them are the expected impacts on the already congested and problematic intersection of Route 25 and Edwards Avenue, located approximately 1.4 miles to the east of the HK Ventures site.

The intersection has regular traffic backups and congestion. A study by the DOT found that the intersection also had a significantly higher crash rate — about 165% higher — than the state-wide average for similar roadways. More than half of the crashes recorded in the study are rear-end and left-turn crashes.

The intersection will be widened to include new left-turn lanes for each direction. A new enhanced traffic signal compliant with the Americans with Disabilities Act will also be installed, according to NYSDOT plans. The project cost was estimated at about $5.1 million, according to the NYSDOT project design report.

The Planning Board’s adopted findings statement, a document required by the State Environmental Quality Review Act, states that the project will not have significant negative environmental impacts, as long as certain conditions are met. Among those conditions is the NYSDOT’s completion of the intersection reconstruction at Edwards Avenue and Route 25 which has “significant congestion,” the findings statement says.

The board approved that condition over the strong objection of the developer’s attorney, Keith Brown, who argued that it was unfair to tie up his client’s project in the unpredictable work schedule of a “behemoth” state agency like the NYSDOT. Brown called the condition “an absolute deal-killer.”

HK Ventures then sued over the inclusion of the intersection improvement condition in the findings statement. 

Last December, State Supreme Court Justice Joseph Santorelli ruled the Planning Board’s findings were supported by the record of its review and its “determination was not arbitrary and capricious or an abuse of discretion.” The court denied the developer’s petition and dismissed the case. 

HK Ventures filed notice of appeal. The stipulation requires the appeal to be withdrawn.