Buying Up Reading
Ex-Citigroup Oil Trader’s Vt. Purchases Have Some Neighbors Skeptical
Newhall Farm in Reading,Vt., where Andrew Hall has been buying property since the 1980s. Citigroup awarded Hall about $100 million for his work in 2008 -- the year it received a $45 billion taxpayer bailout. (Bloomberg News - Max Abelson)
Andrew Hall, whose pay package of about $100 million ensnared him in the fight over compensation at bailed-out banks in 2009, has bought more than 2,400 acres valued at more than $13.8 million in Reading, Vt., where he has torn down at least half a dozen homes. (Bloomberg News - Max Abelson)
You cant fight big money, says Carl Stariknok, who lost a dispute with Andrew Hall over a proposed power line route to his hunting and fishing camp through Hall's property. (Bloomberg News - Max Abelson)
New York — Andrew Hall, the former Citigroup oil trader whose pay package of about $100 million ensnared him in the fight over compensation at bailed-out banks in 2009, is selling handmade lavender soap and grass-fed Angus beef from a farm in Reading, Vt.
Hall has bought more than 2,400 acres in the central Vermont town and his holdings, including Newhall Farm, are valued at more than $13.8 million, according to local real estate records. He has torn down at least half a dozen homes in town and opened an art museum.
“Look at the rest of the world: It’s going to hell in a wheelbarrow, and he’s trying to keep a little section of Vermont the way it was,” said John Mitchell, a former auditor of the 251-year-old town, population 666.
Mitchell called Hall’s work in Reading “wonderful,” More than a dozen other residents said they were less sure, citing razed homes, the lower tax rate Hall pays on some of his land and a dispute with a next-door neighbor over power lines.
The Briton, chief executive officer of Occidental Petroleum’s commodity-trading unit Phibro, wagered on skyrocketing oil prices last decade and is referred to as “God” by competitors, according to Tom Bower’s Oil. The 2010 book credits Hall with “perfecting the ‘squeeze,’ causing the oil market to change, and forcing other traders to buy from him at a premium.”
Citigroup, which acquired Phibro in 1998, awarded Hall about $100 million for his work in 2008 — the year Citigroup received a $45 billion taxpayer bailout, according to a person at the bank with knowledge of his compensation who asked not to be identified because the information isn’t public.
His pay was criticized in 2009 by Kenneth Feinberg, who oversaw compensation at rescued banks for the Treasury Department, and Vikram Pandit, Citigroup’s then-CEO. The lender agreed to sell Phibro to Occidental that year, saying 2009 pay for some executives would be deferred and reinvested.
Hall, also CEO of hedge fund Astenbeck Capital Management, which managed $4.8 billion according to December filings, declined to comment about his pay. He wrote in an email that his 18th-century farmhouse and three guest homes are “modest in scale” compared with “other ‘high-end’ dwellings in Vermont.”
Hall, 62, has been buying property in Reading since the 1980s, town records show. Land he owns valued at $6 million is enrolled in the current use program, which lowers taxes on farms and forests to encourage agriculture and curb commercial development.
His farm makes wood-fired maple syrup, which it sells for $65 a gallon, as well as botanical soaps, ice cider, wildflower honey, eggs and Berkshire pig breakfast sausages, its website shows. The products are available in Vermont and Connecticut stores and online.
Newhall is “preserving Vermont’s heritage for our farm and your future,” according to the website, which lists “heritage breed Berkshire pigs,” “heritage breed chickens,” and “Randall Cattle, Vermont’s only declared Heritage Breed.”
“It’s kind of an enlightened Downton Abbey,” said Laird Bradley, principal broker at Woodstock-based Williamson Group Sotheby’s International Realty, referring to the TV drama about an English estate. “You can come up to a place like this, you can acquire some land, you can exercise vision, you can do some things that really have an impact.”
Hall isn’t the only wealthy American who transformed the landscape. His farm is about 15 miles from Laurance Rockefeller’s Woodstock estate, now a national historical park that displays the Standard Oil heir’s art. Industrialist William Koch is building a private Wild West town with saloon and jail in Colorado, while last year Oracle Corp. CEO Larry Ellison agreed to buy 98 percent of Lanai, the Hawaiian island.
A new addition to Hall’s domain is the Hall Art Foundation, which displays works from his private collection in a renovated dairy farm. The inaugural exhibit features paintings by Georg Baselitz, whose castle in Germany was bought by Hall, and Edward Burtynsky’s photographs of an abandoned Vermont quarry, which shows mining’s “environmental impact as an ecological wound,” according to the foundation’s website. Hall and his wife, Christine, were included in a 2012 list of 200 top collectors by ARTnews.
In 2011, Hall’s Westport, Conn.-based Astenbeck owned a stake exceeding $1 million in Brazil’s Vale, one of the world’s largest nickel producers, a regulatory filing shows. Besides oil, Phibro trades precious and base metals, according to the company’s website.
Hall draws mixed reviews in Reading.
William Hunt, whose family has grown timber in Vermont for half a century, said the homes Hall bought and razed could have housed less affluent locals.
“The fact that he’s buying up land and tearing houses down, I’m against that,” said Hunt, 61. “I think the people who grew up here should be able to live here.”
Hall said the houses were uninhabitable, former auditor Mitchell said, “and he’s right.”
Hall said in his email that he has improved the area by contributing money and land and by buying dilapidated property. “The ‘houses’ that we razed were in general shacks, camps or trailer homes,” he wrote. “The sellers were happy to sell to us at prices that were MORE than fair.”
Retired firefighter Paul Mendoza said Hall bought his father’s house across the road from Newhall for about $250,000 and razed the 2,000-square-foot, four-bedroom house.
“He has so much money that he’s just decided that he’d rather not see something there when he can see nothing,” Mendoza, 46, said.
Last year, the Public Service Board investigated a dispute over a proposed power line route through Newhall to electrify neighbor Carl Stariknok’s house and hunting camp.
State law requires utilities to provide service, but customers must pay to secure rights-of-way, according to a report on the dispute. It recommended closing the investigation, citing Stariknok’s concerns about expense and court time. “I should have gotten power with no questions asked, without a war,” Stariknok, 62, said this month.
Hall wrote in his email that he would have granted an easement if the power lines were buried, “for aesthetic reasons,” and offered to pay half the burial cost. “You can’t fight big money,” said Stariknok, who instead installed solar panels.
A Newhall sign greets drivers on the road to the Hall and Stariknok properties. Ad agency Shark Communications updated the Newhall logo “from one of ‘farm’ to something closer to ‘estate’ quality,” according to a 2010 blog post for the Burlington-based agency. Branding changes would help Newhall sell new products “in upscale locales” and “chichi boutiques everywhere.”
“He keeps everything in a Vermont style, the way Vermont should look,” said neighbor Sally Barngrove. “He’s a Brit. I suspect this part of Vermont is maybe a little reminiscent.