Category Archives: Elm Court

Something Stirring

Amidst ongoing speculation regarding the future use of Elm Court following the failure of the illusory “Travaasa” scheme to attract a single dollar of investment, and subsequent sale to Linda S. Law, we read the recent report in the Berkshire Edge with interest, particularly the closing paragraph:

“In the press release by Lefkowitz, she wrote that both Law and Peiser were considering opening a luxury resort. During their interview, however, both Law and Lefkowitz would not say what their plans for the property would be. “We have something stirring up that I think is going to happen, but I can’t talk about it yet,” Law said. “It is something that will be remarkable for the community. It’s something that is very special and no one else has thought of. I think that we don’t need another wellness and health spa, I can tell you that. Even though everyone wants to do health and wellness, we’ve got plenty in the community. We’re looking at some interesting alternatives. My background has always been in public-private partnerships, always. It has to make everyone happy. But of course, that never happens. But I want both sides happy, not just one.” Law added, ‘I think what we’re cooking up is going to be a killer.’ “

We agree that the last thing Lenox/Stockbridge needs is yet another luxury “wellness” resort, given that all of the existing options are operating way below capacity. The neighborhood would wholeheartedly welcome and support the sort of creative public/private (and possibly non-profit?) use Ms. Law seems to be hinting at.

As we have noted before, there is precedent for such creative, transformative use of previous Gilded Age Vanderbilt mansions, north on Route 7: Shelburne Farms.

A Sudden Change of Tune

Just a few short weeks ago, new Elm Court owner Linda S. Law, having relieved “Front Yard LLC” of the property, used rather exalted language to describe her plans.

In response to questions from a Berkshire Eagle reporter, she exclaimed that she wanted Elm Court, a sprawling Vanderbilt trophy house dating from the Gilded Age, to “shine a bright light globally, and be a beacon for Lenox, Stockbridge and the entire Berkshire region.”

Here in the neighborhood, having been through the Front Yard (Amstar) chapter marked by years of cynical misrepresentations of their true agenda, we were skeptical, while remaining open to the possibility that Ms. Law might be serious about shining light, through the establishment of some sort of non-profit use, contributing to the public good within the Berkshires and beyond.

In fact, within the very same Vanderbilt family, there is a visionary, thriving precedent for such benevolent use on the shores of Lake Champlain: Shelburne Farms, now a globally recognized center for place-based, sustainable education and regenerative agriculture. Possibly, Elm Court might shine a similar sort of bright light here in the Berkshires?

Alas, according to recent reporting in the New York Post, Ms. Law appears to have changed her tune. She now claims to be “talking with three different resort companies about managing the property,” and wants ” to add more amenities,” such as “a speakeasy, a movie theater and a place for gardening classes to honor the gardening legacy.” The basement will also offer a variety of pampering services within a 15,000-square-foot spa. In other words: same old, same old.

To be sure, we take any story published in the New York Post with a boulder-sized grain of salt. Yet according to our own sources, the new owner has yet to reach out to the Stockbridge Board of Selectman nor to the surrounding neighborhood. Not good signs, regarding attention to the public interest. Not good signs at all. Here we go again?

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Fresh Vision

As reported recently in the Berkshire Eagle, “Front Yard LLC” (Amstar) has finally managed to attract a buyer for its distressed Elm Court property, for the exact amount of the promissory note (0% APR!) that had been held by Elm Court Realty LLC (Robert and Sonya Berle) since 2012: $8,000,000.

So ends the sad chapter of “cradle to grave” (their term, not ours) real estate speculators, and their ill-fated attempt to steamroll a neighborhood while bamboozling local boards with the tantalizing promise of joining a lucrative “world class wellness resort brand” that sounds like a spin-off from The White Lotus: Travaasa.

Where is Travaasa now? Maui, sold. Austin, sold. Berkshires, finally sold. Their tacky plan to attract investors for what was essentially a generic four-story motel using the disintegrating mansion as a Gilded Age fig leaf finally fades to black. It seems that sometimes you get the cradle, and sometimes the grave.

Now comes Linda Law, a new owner with a fresh & promising vision, an investor with experience in restoration and renovation (Blantyre), one who clearly treasures the historic character and cultural legacy of the Berkshires. She speaks of conducting extensive architectural research, and of a deeply felt duty of care. She also expresses the aspiration to recover “vibrancy,” and suggests a use that is “accretive to the community”. As a primary goal, she wants Elm Court to “shine a bright light globally, and be a beacon for Lenox, Stockbridge and the entire Berkshire region.”

Following the grim saga of Amstar, we welcome such a vivid and positive vision, and hope that she sees our neighborhood (her new neighbors) as potential sources of creativity, collaboration and support. Nobody cares about the distinctive character and rich history of Old Stockbridge Road more than the people who live here.

As for beacons of light during our deepening climate emergency, for further inspiration she may want to research the extraordinary non-profit Shelburne Farms, sited along the shores of Lake Champlain, once owned by a different set of heirs to the same Robber Baron fortune, and now the highly respected global leader in place-based, farm-based and sustainability education .

As relayed from their website:

Shelburne Farms is an education nonprofit on a mission to inspire and cultivate learning for a sustainable future. We believe that transformative learning experiences sow the seeds for a thriving and more just world. Our work seeks to create the space, spark the conversations, and share the stories to inspire educators, students, and learners of all ages to build a better future for everyone.

Sounds eminently “Berkshires” to us!

THE INN AT SHELBURNE FARMS

A New Chapter

As we have long predicted, “Front Yard LLC” has not been able to find investment capital for the implementation of a resort plan that made no sense from day one; a plan unsupported by market research and hospitality industry trends, even before the pandemic. Thus it has now been put up for sale as a private residence.

To recapitulate for new readers of this blog, including potential buyers:

Front Yard LLC is an investment shell within private equity real estate corporation Amstar. Amstar has never been a resort developer; they are a self-described “cradle to grave” fund that generates most of its return on exit.

The Travaasa brand was simply “feel good” smoke generated to enhance value in the short term and maximize profit on exit. Where is Travaasa now? Sold.

And what about the President of Travaasa Adam Hawthorne, who assured local boards during countless meetings of his firm commitment to build a global upscale wellness brand that would thrive for decades to come? Well, at least he is still at Amstar, though no longer any mention of Travaasa.

Also of interest: According to the Registry of Deeds, Elm Court LLC (the previous owners) still holds a promissory note for $8 million at 0% APR; the note has not been discharged.

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The neighborhood would of course extend a warm and grateful welcome to a new owner willing to undertake a responsible and environmentally sensitive renovation and restoration of the estate. If that is only feasible/sustainable within a vastly reduced footprint for the rambling pile at its heart, so be it! As we have stated from day one, we would also welcome and support a limited residential development such as Winden Hill or Bishop Estate.

We urge any potential buyer or investor to approach the neighborhood in a spirit of open and respectful dialogue, keeping in mind that we are an established & closely-knit neighborhood looking to retain the special qualities and historic character of Old Stockbridge Road.

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Elm Court Investors

Both the Stockbridge and Lenox Zoning Boards recently approved extensions to the special permit granted to Front Yard LLC for the creation of a “Travaasa”-branded resort on the property. At those meetings, as reported by the Berkshire Eagle, an attorney representing the applicant alluded to delays caused by litigation filed by owners of neighboring properties; increased material prices; and the “complexity” of the project.

We have a few other ideas why investors may be leery of throwing money into the potentially bottomless money pit at Elm Court:

I The project makes no economic sense. There is already existing over-capacity in the Berkshire hospitality industry. The expansion at Cranwell/Miraval will certainly put increased pressure on the industry, above all in the market segment targeted by Amstar/Travaasa. Demographic trends also pressure the market, with younger generations staying away from “destination resorts”, expressing preferences for Airbnb, glamping or smaller inns touch as Tourists in North Adams. In turn, older guests prefer the familiar traditional choices such as Blantyre, Wheatleigh and the Red Lion, all of which are running well below capacity. Then there are Canyon Ranch and Kripalu in the “Wellness” category to which Travaasa also aspires: formidable, established competition, with recently expanded capacity presently not being filled. Where is the market for Elm Court “Travaasa”? We don’t know, because Front Yard never made their case for economic viability during any of their appearances before local boards.

II. The risks and costs associated with the promised “extensive renovation” of the existing Elm Court mansion are unknown. Are there serious lead paint and asbestos issues? Are the foundations for the wings structurally sound? Do other aspects of the rotting mansion retain structural integrity, or will it become necessary to essentially rebuild a sprawling Gilded Age trophy house? If that is the case, then why build a four-story big box right next to the “renovated” sprawling mansion, with all the associated costs of new construction?

III. In order to obtain the special permits, the Amstar CEO at the time, Mr. Gabe Finke, promised to pay for both extensive municipal infrastructure (a complicated and expensive sewage connection as well as water upgrades), together with a sidewalk that would run from Elm Court to the town of Lenox, a sidewalk that many — if not most — of the impacted properties oppose. What are the risks and costs associated with this work? Here again, no specificity was provided regarding the budget nor engineering for these promised improvements in any of Front Yard’s appearances before local planning boards. Investors would need to carefully evaluate how these substantial risks and hidden costs might negatively impact their return.

IV. Front yard/ Amstar has no development experience for a property of this size — or any size! Zero. They are a “cradle to grave” fund that buys properties, tries through a variety of strategies to add value to those properties, and then sell to the highest bidder. They make their money on the exit. Do investors trust Front Yard LLC and Travaasa — a brand now limited to a single operating property, in Hawaii — to manage a major development project such as this? Obviously, they would need a development partner; but would any experienced developer be willing to assume the many known unknowns and unknown unknowns associated with this project? Amstar/Front Yard are promising a return of 7 or 8 percent based on 60 to 70 percent occupancy. Everyone has a dream, but are these numbers even remotely grounded in reality?

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Obviously, there are future uses for the property that would make economic sense, and that the neighborhood would support. For example, the rotting wings could be removed, leaving the original (and far more architecturally distinguished) core of the residence as a small, boutique luxury inn. Such an Inn would be the heart of a limited residential development along the lines of nearby Bishop Estate, with most of the land held in common, and managed by an HOA. Canyon Ranch has struggled to sell its two million dollar condos, but the market for second homes, above all in prime locations such as Old Stockbridge Road, remains strong. As many of us who live here have submitted from the start of this long process, a reasonable, low impact use would be welcomed and supported. The existing plan, a plan that adds a second huge structure directly next door to what was once the largest private residence in North America in a market already saturated with resorts, hotels and other options, is just plain silly. No wonder the Front Yard attorney reports “difficulties” in rounding up investors!

As We Predicted

From the recent edition of “Travel Weekly”:

Miraval Group has acquired the Travaasa Austin Resort from Amstar Group and will spend the next two years expanding and redeveloping the 220-acre property into what will become the Miraval Austin.

Miraval will increase the hotel’s room count to 120 from 70, expand the property’s main restaurant and more the double the spa space. Miraval plans to finish the redevelopment in January 2019.

Miraval, which operates its eponymous resort in Tucson, Ariz., earlier this year took over spa operations at Southern California’s Monarch Beach Resort as part of its expansion plans for its Life in Balance Spa brand. Miraval also said this year that it will redevelop the Cranwell Resort in western Massachusetts.

As opponents of the Dumb Growth project to “save” a rotting Gilded Age mansion by building a massive new big box franchise-style hotel have stated from the start: Amstar, the Otto Happel family office real estate portfolio, is not in the hospitality business.

Amstar buys and sells commercial properties. Most of their total return is generated in the exit strategy, also known as “the grave”. Main investor Otto Happel may eventually decide to exit the “Travaasa wellness” brand entirely; then what happens with Elm Court?

In our opinion, bamboozled by unrealistic promises of tax revenues, boards in the towns of Stockbridge and Lenox failed to grasp what was behind the bizarre idea of using a derelict mansion as a fig leaf for a Courtyard By Mariott or Hilton Gardens, or whatever is at the end of the exit ramp when Amstar dumps the property. Let us hope that Amstar investor Otto Happel has a closer look at the project and concludes that building a project in a neighborhood overwhelmingly opposed to the idea is just plain bad business.

The purchaser of the Travaasa “flagship” in Austin, Miraval, recently purchased the nearby Cranwell resort, slated for significant expansion during 2017. With massive development also proposed for the former Desisto property across the town boundary in Stockbridge, we ask once again: how is any of this sustainable? Dumb Growth compounds to absurdity and then inevitably collapses.

Due Diligence?

Anyone who has been involved in the ongoing struggle to prevent a monstrous big-box style franchise-ready motel — not unlike the one that now looms over Route 7 north of Lenox — from being dropped into the middle of a historic, residential neighborhood, will remember the spectacle of a red-faced Amstar CEO Gabe Finke lecturing and chastising the “little people” gathered inside the Stockbridge Town Hall.

HOW DARE YOU GET IN MY WAY

Having heard Finke express Amstar’s long-term commitment to the well-being of the town and for the careful restoration of Elm Court, grandly throwing in an offer to pay for a controversial, unwanted and unnecessary sidewalk that would forever change the character of the road and the neighborhood, the curious reader might ask: where is Gabe Finke now? For that matter, where is Amstar?

Amstar Group, the real estate fund that owns the Travaasa brand, represents one part of the global real estate holdings of German billionaire industrialist Otto Happel, with a family office based in Lucerne, Switzerland. Finke once worked for Happel, but roughly a year ago the boss apparently had enough. Who knows what the distinguished Mr. Happel made of the Elm Court acquisition and the absurd plan to hatch a luxury resort in the middle of a neighborhood overwhelmingly opposed; what we do know is that Finke was shown the door in a split described in the business press as a “messy divorce”, with Amstar Advisors (Finke still at the helm) parting company with Amstar Group.

A year later, even the name is gone: Finke re-incorporating as Ascentris. We note the complete absence of any holdings in the hospitality industry in the revamped Ascentris portfolio. In any event, Finke, the man who hoodwinked a naive Stockbridge Select Board, is long gone from the Elm Court scene. So much for long-term commitments!

WHICH SHELL HIDES THE PEA?

None of the town boards reviewing the proposal seemed at all concerned that Amstar Group lacks a track record in the hospitality industry; by industry standards the Travaasa “brand” is both too small (a mere two resorts in operation) and too young to have been adequately tested by market cycles. In any event, Amstar Group is not in the hospitality business. They are in the “cradle to grave” portfolio flipping business.

We predict that such lack of basic due diligence regarding the private partner in this high-impact and dumb-growth project will come to haunt both towns with a long list of unintended consequences. If the monstrous thing is ever built. Maybe the honorable Mr. Happel will finally have a closer look at where his money is being spent, grasp the fundamental unsustainability of the idea, and pull the plug.

Occupy Elm Court

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From our perspective, the public review of the Front Yard/Amstar proposal for Elm Court represents a Berkshires variation on a “too big to fail” bail-out, strikingly similar to the sorts of public bail-outs of fraudulent corporate activities during the financial crisis of 2008-2009, bail-outs that precipitated the Occupy movement.

In the case of Elm Court, a wealthy family (Vanderbilt-Wilde-Berle) has allowed their sprawling mega-mansion to decay, and then has effectively transferred the cost of the repair to the public, by selling the derelict property to a corporate “partner” who will dump a four-story spa hotel into the heart of our densely settled residential neighborhood, all in the name of “saving” Elm Court.

We are disappointed that our local boards appear to be playing along with this toxic bail-out, without giving serious, detailed consideration to the carefully researched and wide-ranging objections submitted by the neighborhood.

Elm Court is not the only history worth preserving. Our neighborhood, including other former Gilded Age properties such as Bishop Estate and Winden Hill, has its own strong, vital history worthy of respect and preservation. Instead, we now face a future of digital speed signs, road-widenings and other so-called traffic calming measures that will forever change one of the most distinctive and appealing roads in the Berkshires. Over the long run, this will be seen as a profound loss to the town, and to the Berkshires.

Why has everyone — from Selectmen to town staff — so passively lined up behind such a preposterous scheme, without exploring more sustainable and more reasonable alternative uses? Why is the disrepair of a private property, once owned by one of the wealthiest families in United States history, a matter of public interest? Is there some deeply entrenched pattern of obedience to the Lord of the Manor in play here?

From the start of this long process, the applicant has refused to budge on the core issues of massive scale and high intensity of use. We hope that the Lenox ZBA will listen carefully to the depth and seriousness of our concerns, and impose strict conditions on the special permit, introducing a measure of moderation and balance to Front Yard LLC’s monolithic proposal.

Without such moderation and restraint, Front Yard can be sure that the neighborhood will be openly hostile to their wretched big-box “Travaasa” spa-hotel for many years to come. Further, the town of Lenox will have alienated an entire neighborhood by selling us out to a shadowy real estate “fund” who successfully played rope-a-dope with town boards, slipping through review with major aspects of their plans left undisclosed and undiscussed.

The problem with such actions? Public trust and good will are currencies you can only spend once. Once they are gone, they are likely gone for a long time.

Neither Restored Nor Preserved

SAVE THE MANSION AND DESTROY THE NEIGHBORHOOD?

Architectural historian Carole Owens has written an excellent essay for the Berkshire Edge. Her analysis of the relationship between the “cottagers” and the Berkshire economy is well worth reading in its entirety. We excerpt only the concluding paragraphs below:

Another big change is that today corporations not individuals are developing properties. The difference in density and land use is significant. Elm Court is an example. Instead of a single family residence (however grand), the developers propose 112 bedrooms, a 60 seat restaurant, and a spa. The original house is 53,538 square feet and the addition is over 52,000 square feet for a total over 105,500 square feet. The developers project 100 jobs on the site. Elm Court sits on 90 acres, and next, without undue legal machinations, the developers could build homes or town homes on the massive acreage as they did at Wyndhurst and Erskine Park. If they did, the concentration of commercial and residential square footage and people on that site, in that corner of Stockbridge, would be greater than on Main Street Stockbridge. Developers could create the new town of Stockbridge next door to the old: hard to overestimate the impact.

Is the impact negative or positive? The arguments made in the affirmative were that the project would create jobs and save an architectural gem. However, jobs in the Berkshire hospitality industry are most often lower-paid and seasonal. And it is hard to argue that the plan for Elm Court is preservation. The proposed addition is a change in size and style so significant that is cannot be identified as a model of preservation or even a restoration.

Will corporate development help or harm the Berkshires? In the absence of hard facts, an argument could be made either way. However, we already know two things: corporate development is distinctly different from a return of the Cottagers, and second, the Stockbridge Select Board made a mistake approving the Elm Court plan.

It was an error for three reasons: first the citizenry opposed it; second the fundamental nature of Berkshire County is to be sparsely populated and the fundamental nature of corporate development is to propose density, and third Elm Court established a frightening precedent for how the remaining cottages in Stockbridge can be used.

Round Two

As reported by the Berkshire Eagle, Front Yard LLC recently submitted its application for a Special Permit to the Lenox Zoning Board of Appeals. The Lenox Zoning Bylaw identifies conditions for approval that are strikingly similar to the Stockbridge criteria, though they were largely ignored or trivialized by the Stockbridge Selectmen.

Those six specific areas of concern are highlighted below, in bold. We trust that the Lenox ZBA, with input from the Planning Board, and from truly independent consultants, will carefully consider the long list of questions that went unanswered in Stockbridge.

1. Community needs served by the proposal.

Has the applicant persuasively demonstrated the need for yet another spa resort in our community? What market analysis and demographic projections have they submitted to substantiate the need for this resort? What is their business model, and how does it compare to other large resorts such as the recently permitted Spring Lawn development? What impact will this massive development have on our B & Bs and existing inns and resorts?

As for claims of new jobs: have they submitted detailed information as to the wage and salary structure of their proposed staff? Will these wages and salaries permit employees to actually live in Lenox, with their children attending Lenox schools?

Does this proposal meet the statewide criteria for “Smart Growth”? The answer to that would be an obvious “NO”, in stark contrast to the Spring Lawn development, which does in fact meet most of those criteria. Numerous young (21 and under) Berkshire residents stated during the Stockbridge “hearing” that their vision of the future Berkshire economy centers on local food production, small creative businesses and sustainable enterprises, NOT on franchise-style resorts such as the proposed big-box annex at Elm Court. Such testimony fell on deaf ears. While many will pay lip service to the “needs of Berkshire young people”, very few ever listen to what they have to say.

We urge everyone within the process to keep in mind that the parent company Amstar is not in the resort or hospitality business; they make their money on the exit from properties. There is no guarantee that the “Travaasa” brand will be around in five years from now, let alone a generation or two. What happens when they flip the property to Hilton, who then flips to Holiday Inn, and onwards down the food chain?

2. Traffic flow and safety, including parking and loading.

The materials submitted by the applicant are restricted to idiotic “level of service” traffic studies, using a methodology that is truly in the dark ages of pseudo-science. Our position from the start has been that this methodology may be fine for evaluating whether to put another Dunkin’ Donuts in downtown Pittsfield, but is wholly irrelevant to evaluating the impact of dropping a 112 room mega-resort into an historic, residential neighborhood. Our concerns center around safety, having to do with the road topography and alignment characteristics, as well as with speeding and other driving behaviors that suggest that adding a major new category of traffic will end in tragedy.

Beyond those “big picture” concerns: how will staff be trained to arrive and depart work? How will large commercial service vehicles be routed, to mitigate safety and noise concerns in the neighborhood? How will guests be directed to arrive to the resort?

Much has been written about the idea of a sidewalk; it should be clear that while there are some neighborhood residents who favor a sidewalk, there are many others who believe that such an “amenity” will further destroy the character of our neighborhood. Surely, such a major project can only be pursued on the basis of solid consensus. At present, there is no such consensus – far from it!

3. Adequacy of utilities and other public services.

We are aware that there is adequate capacity at present to serve the water and waste needs of the proposed development. However, large projects inevitably carry unforeseen consequences, and thus it is prudent to make sure that the town is protected should the sewage hit the proverbial fan in the future. To build new town infrastructure just because because a single corporate land owner promises to pay for it (short term) represents a terrible way to conduct local planning. It’s the sort of impulsive money-grabbing that invariably creates major headaches down the road.

4. Neighborhood character and social structures.

The most respected neighborhood character expert in New England expressed dismay that such a massive project would ever be considered in a low-key, family oriented neighborhood such as Old Stockbridge Road. His detailed report is available here, and summarized here. For a general description of existing neighborhood character from the point of view of those who live here, see this post.

There is a persistent rumor that the applicant intends to market the Elm Court facility as a regional Wedding Mill, with multiple weddings scheduled every day of the wedding season. Such intensive use (particularly on weekends) would have massive impacts on the ability of residents to enjoy their properties in peace and quiet, as well as raising serious safety concerns of alcohol use and driving on our hilly, winding road. Reasonable limits must be placed on the hosting of weddings and other such events, e.g. one per weekend.

Similarly, the restaurant should not be open to the public; does the town of Lenox truly suffer from a dearth of restaurant options? We think not.

5. Impacts on the natural environment.

Much has been said about how this proposal protects “open space”; yet there is presently no guarantee that this is not merely Phase A of a far more intensive development yet to come in Phase B and Phase C, via townhouses, condos, mansion “units” and other amenities such as tennis courts, stables, etc. Will the applicant agree to placing a Conservation Restriction on the rest of the property, held by the Lenox Land Trust, or by the Berkshire Natural Resources Council?

6. Potential economic and fiscal impact to the Town, including impact on town services, tax base, and employment.

We do not know what the impact will be; and in the absence of a professional, independent study and analysis based on hard data from the hospitality industry, neither does anybody else. It is easy to say that “all development is positive”, but what happens if, over the long term, as this resort slides down the hospitality industry food chain, the value of adjacent properties (most of which are in Lenox) depreciates by 30%, or even 50%? What happens to the tax base then? Or: what happens if this resort is the final blow to our B & Bs, most of which are already struggling to sustain themselves? Lenox could well end up with a net fiscal loss to the Town, a loss that will make any short-term fee revenues appear like fool’s gold.

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Following the one-sided and unfair process that unfolded in Stockbridge, we trust that the Lenox Planning Board and ZBA will consider all issues objectively, with particular attention to the legitimate and deeply held concerns of abutters and other directly impacted neighbors and longstanding town citizens, concerns that were summarily dismissed during the sham process in Stockbridge.

We urge that Town Manager Chris Ketchen, Town Planner Gwen Miller and members of both the Planning Board and ZBA walk (not just drive) down Old Stockbridge Road, and get a sense for the neighborhood and the character of the road, from ground level. We extended this same invitation to the Stockbridge Selectmen, though it seems they were only willing to attend tea & champagne parties at Elm Court.