By MIKE BARON

The shareholders of Rumson-Fair Haven Bank & Trust have spoken, and they apparently aren’t all that worried that hedge fund honcho George Hall is going to turn the their well-heeled area into a Pottersville.

Hall is the founder of investment firm Clinton Group, which has more than $2.5 billion in assets under management, according to its website. On May 11, he won his battle to remove William Barrett as chairman of of the five-branch bank after an independent judge finalized the results of the bank’s annual shareholder vote. Hall is replacing Barrett on the board, and a new chairman is set to be chosen when the bank’s directors meet on Monday.

While the area is undoubtedly a far cry from Bedford Falls, the fictional setting of the classic movie “It’s a Wonderful Life,” Barrett had reportedly likened Hall to Henry Potter, the film’s villain, amid criticism by Hall that the bank wasn’t doing enough local lending.

In a letter to shareholders, Dennis Flanagan, Rumson-Fair Haven Bank & Trust CEO, said that Barrett “continues as a significant shareholder and has indicated that he will remain supportive of the bank.”

Greg Taxin, a Clinton Group managing director, said Hall is looking to help both Rumson-Fair Haven shareholders and the community. Hall and entities controlled by Hall currently have a 7.2 percent stake in the bank and, according to an April 12 proxy statement , those holdings could be bumped up as high as 9.9 percent now that Hall is on the board.

Taxin doesn’t expect Hall to replace Barrett as chairman and is optimistic the other directors won’t be at odds with Hall.

“We hope it’s not contentious,” he said. “Our interests are aligned with shareholders, as the rest of the board’s should be.”

Flanagan is also confident that the bank and Hall will be able to turn the page and move forward together.

“The vote is done, it’s finalized, and Mr. Hall is on the board,” he said. “The board and I are looking forward to working together. We have basically the same goals. Loan production has been growing since last year, and we’re highly optimistic that can continue.”

Taxin said that Rumson-Fair Haven’s stock, which trades on the Pink Sheets, has been flat for more than a decade, mainly because the bank’s leadership has been “incredibly conservative.”

“They’ve basically taken in deposits and bought Treasuries and high-quality bonds but done very little lending,” Taxin explained. “This [the Rumson-Fair Haven area] isn’t some troubled backwater. The real estate here is solid collateral. There have been plenty of good loans out there to make and they haven’t. Those are missed opportunities.”

That sentiment is similar to what was put forth in Hall’s proxy statement, which said:

“We believe the company has a duty to serve the community by providing loans to qualified borrowers. The bank is located in a vibrant area, and there should be ample opportunity to make quality loans to local residents and business. Instead, the current approach of the company appears to be to emphasize using its cash and deposits to purchase government bonds and securities; we do not believe this should a major endeavor of a community bank.”

The bank is already moving in this direction. Flanagan also announced in the May letter to shareholders that Rumson-Fair Haven is “re-entering the residential mortgage market” and hiring Scott Keller, an experienced mortgage banker, to lead the charge.

The clash between Hall and Barrett has received attention in the New York tabloids, in part because Hall is a high-profile name in horse racing, having bred Ruler on Ice, the winner of Belmont Stakes in 2011.

Last year, Hall paid $12 million for Long Point, a sprawling estate fronting on the Navesink River in Rumson, from Heisman Trophy winner Pete Dawkins.

Hall’s link to the area goes back nearly two decades. According to property records, Hall purchased a home at 23 North Ward Avenue in Rumson in May 1995 for $1.45 million. In April 2004, he paid $6.79 million for a home at 2 Brown’s Dock Road in Middletown.

Red Bank-based homebuilder Hovnanian Enterprises notched a 6.7-percent sales gain in the first fiscal quarter from a year ago, the company reported Tuesday morning.

The closely-held publicly traded company continued to lose money in the quarter, but narrowed the loss to $18.3 million, down from $64.14 million a year ago, it said in an announcement.

The net loss marked the 21st time in the last 22 quarters that Hovnanian, New Jersey’s largest homebuilder, has failed to generate a profit.

From the announcement:

“We were very pleased with the 27% year-over-year growth in net contracts, the 28% year-over-year increase in backlog and the 100 basis point sequential improvement in gross margin during our first quarter,” commented Ara K. Hovnanian, Chairman of the Board, President and Chief Executive Officer. “Additionally, the spring selling season is off to a good start in February 2012, with 38% year-over-year growth in net contracts and home prices remained relatively stable throughout the first quarter. We are hopeful that these positive trends continue throughout the spring selling season,” concluded Mr. Hovnanian.

By JOHN T. WARD

Eight months after selling one of Rumson’s most jaw-dropping homes for $12 million, Heisman Trophy winner and financier Pete Dawkins has picked up a relatively modest house across town.

Monmouth County property records show Dawkins and his wife, Judy, closed on a house on Highland Avenue earlier this month, paying $1.3 million.

Unlike Long Point, the Dawkinses’ former Navesink River-front estate whose driveway was nearly as long as their new street, the new place has neighboring homes just a dozen feet away on either side.

As to what he Dawkinses plan to do with the house, they’re not saying.

“That’s not something I can help you with, thank you,” a woman who answered the phone at the Dawkinses number told redbankgreen before hanging up Tuesday afternoon.

The new abode appears to represent a striking change in lifestyle for the couple.

Seventy-three-year-old Pete Dawkins, who won the 1958 Heisman at West Point, went on to become a Rhodes scholar, a career Army officer, a onetime Senate hopeful and Wall Street executive, ending his career as vice chairman at Citigroup.

In 2000, he and his wife bought Long Point from the widow of an heir to the A&P supermarket fortune for $4.5 million, and then promptly tore down the existing mansion.

When they were finished rebuilding, the 10.4-acre property featured a sumptuous 18,000-square-foot showcase main residence with 180-degree views along the river. A ginormous poolhouse that the couple wanted to build spurred a long court battle with their next-door neighbors, Wall Street trader Mickey Gooch and his wife, Diane, publisher of the Two River Times. The Dawkinses won.

The couple sold the West River Road estate last June to George Hall, a hedge fund manager and champion horse owner, grossing less than half the original asking price of $29.9 million.

The new Dawkins crib, which had been on the market for a year at $1.4 million, is a buff gray three-level built in 2008 with five bedrooms – the master of which is a not-ostentatious 19 feet by 15 – and four full baths. Listing literature said the house “exudes a Nantucket ambiance” with cedar shakes siding, two fireplaces, Brazilian cherry floors and a butler’s pantry, but its most prominent exterior feature is a two-car garage that hides the front door.

The house is also on the waterfront, but in this case on a creek that separates mainland Rumson from Barley Point Island.

Gloria Nilson, of Gloria Nilson Realtors, represented the Dawkinses in the transaction. She did not return a request for comment.

The sellers were Dennis and Suzanne Shea.

By JOHN T. WARD

Framed by talk about its positive effects on lunchtime restaurant business, a plan for an office bridge between two downtown buildings won easy approval from the Red Bank zoning board Thursday night.

With no objectors present, the plan by property owner Downtown Investors drew a smattering of questions about window placement and parking, as well as praise by board members.

“I do want to say, another wonderful project by the Hermans,” said member Karen Waldmann, speaking of Downtown Investors principals Jay and Todd Herman.

The father-and-son Hermans presented a plan to join two buildings they own on the south side of Linden Place near Broad Street via the “floating” structure.

The two existing buildings and the addition, which is no mere breezeway but 2,750 square feet of office space as well, will be occupied by the retail brokerage Morgan Stanley. According to Jay Herman, “in terms of production, it will be the third-largest Morgan Stanley office in the northeast,” after New York and Boston.

The board granted the project a parking variance for a 55-space deficiency, though the Hermans said that number was both theoretical and artificially high.

A 2010 change in the formula that the borough uses to calculate the space needs of businesses put the existing buildings at a paper shortage of 69 spaces, even though in reality they have a parking surplus, said Jay Herman.

The additional footage, offset by a new parking area created on the opposite side of Linden Place in recent months, reduces the paper deficiency to 55 cars, though in fact the completed project will have exactly the number of spaces required by actual usage, he said.

After 20 years in town, Morgan Stanley had considered leaving Red Bank, he told the board, because “they have a great need to consolidate buildings.

“The good news is their preference is to be here in Red Bank,” he said.

Construction is slated to begin in early March.

The red ink continued to flow at Red Bank homebuilder Hovnanian Enterprises in the recently ended fiscal fourth quarter, though the size of the loss was smaller than that in the year-prior period.

Hovnanian reported an after-tax net loss of $98.3 million, or 90 cents per share, compared with a $132.1 million loss, or $1.68 per share, in the comparable 2010 period.

It was the 20th loss in the last 21 reporting periods for the publicly traded company, which is New Jersey’s largest homebuilder, according to Bloomberg.com.

For the year ended October 31, the after-tax net loss was $286.1 million, compared with net income of $2.6 million last year. That gain was a result of tax legislation changes that yielded a federal income tax benefit of $291.3 million.

From a Bloomberg report on the results:

Hovnanian, the worst-performing homebuilder stock this year, has depleted cash as it tries to boost margins by buying land at distressed prices. Sales of new U.S. homes are being limited by competition from lower-priced foreclosures and an unemployment rate of 8.6 percent.

“Regardless of what the earnings are, the key metric is how many homes have they sold,” Steve Blitz, senior economist at ITG Investment Research Inc. in New York, said yesterday by telephone. “Their long-term survival is much more dependent on a turnaround in the U.S. housing market than their competitors because they’re much more highly leveraged.”

By JOHN T. WARD

One of the Wall Street brokerages that help stock Red Bank’s downtown office population is looking skyward as it plans an expansion.

Morgan Stanley, which occupies nearly all of two adjoining office buildings on Broad Street and Linden Place, wants to connect them at the second-floor level, according to plans on file with the borough.

Plans show a pair of additions, the more striking of which is a second-story of 2,750 square feet spanning the opening to the complex’s parking lot. Cars would pass under the addition to access the lot.

Building owner Downtown Investors also plans to fill-in what’s left of underside parking at one of the structures, 20 Linden. The firm converted some of the ground-level parking to office space about two years ago to meet demand, and now the remaining 4,500 SF will be built out for Morgan Stanley, Downtown principal Jay Herman tells redbankgreen.

Though he didn’t immediately know the number, Herman said Morgan Stanley will boost employment at the complex, making the office the third-largest of in the Northeast for the firm, after New York and Boston.

“They wanted to have one building,” Herman says. “It’s much more efficient for them to be in one building, even though they were already side-by-side and just 50 feet apart.”

To accommodate the cars that the addition is expected to attract, Downtown Investors recently tore down three homes it owned on the north side of Linden Place and plans to create 46 parking spots there, Herman says.

The plans are still under review by the borough engineer, Christine Ballard, and no hearings have yet been scheduled. But Herman says he expects to need only one technical variance.

Councilman Mike DuPont, who heads the borough’s finance committee, said investors had snapped up $5.4 million worth of bonds offered in a recent refinancing. The followed Moody’s report at the end of October, which said that its Aa3 rating on $25.2 million worth of general-obligation bonds could be downgraded if “recent fiscal strain” continues.

“The investors disregarded the outlook, and looked to the steps we took to be fiscally responsible,” DuPont said at the council’s bimonthly meeting.

He said the bonds had gone at a “phenomenally low” 1.13 percent interest rate.

Mayor Pasquale Menna reiterated comments he made at the time of the Moody’s warning, saying that it was prompted by steps that Red Bank, like all other other municipalities, had been pressed by Governor Chris Christie to adopt.

Net income for the Philadelphia-based clothing retailer was down sharply, however.

The company, which also owns the Anthropologie and Free People brands, said sales at Urban Outfitters rose 9.4 percent, to $291 million, from $266 million in the third quarter of the prior year.

Sales are not broken down by location.

The company said the decline in net income, to $50.7 million, from $73.1 in the year-prior third quarter, “was primarily due to increased merchandise markdowns to clear slow moving women’s apparel inventory at both Anthropologie and Urban Outfitters, as well as occupancy deleverage caused by negative comparable store sales.”

Urban Outfitters opened its Red Bank store, at the corner of Broad and West Front Streets, in November, 2009. In addition to 187 Urban Outfitters stores, the parent company runs 164 Anthropologie stores and 55 Free People stores around the world.

By JOHN T. WARD

Wall Street debt-rating agency Moody’s has raised concerns about Red Bank’s $25.2 million worth of general-obligation bonds.

In a announcement posted on its website late last Friday, Moody’s affirmed its prior Aa3 rating on the debt, but revised its outlook to “negative,” citing a drop in the town’s current-fund balance to 2.14 percent of revenue in 2010, from 9.14 percent in 2007.

The agency indicated that a downgrade of the debt could follow if “recent fiscal strain” continues.

Republican council candidate Joe Mizzi, who raised concern about debt levels at last month’s candidate’s debate, seized on the report, offering it as evidence that “Red Bank cannot sustain these debt levels.”

If elected, he said he “would use surpluses in the water fund to pay down debt.”

Borough officials, however, countered the Moody’s rationale for the revision, while calling attention to the affirmation of the bond rating, which Councilman Mike DuPont, who chairs the governing body’s finance committee, called “the highest you can get.”

“That in and of itself means we’re operating with solid financial principals,” he said. “But it is also a notice that we have to build our surplus back up, which is a goal we already have.”

Chief Financial Officer Colleen Lapp confirmed that the general fund surplus had declined to $409,000 at the end of 2010, from $1.58 million at the end of 2008.

But like DuPont and Mayor Pasquale Menna, she attributed the decline in large part to a drawdown of surpluses mandated by Governor Chris Christie in order to cushion taxpayers against rising local property taxes.

“Of course it is,” Lapp told redbankgreen. “Governor Christie has made it clear that he doesn’t think there’s a need for large reserves, and they should be used for ta relief.”

Menna suggested that Moody’s was penalizing Red Bank, and presumably other municipalities and school districts, for following “the boss’ orders.”

Even with the drawdowns, though, the three officials said that Red Bank had dealt well with adverse conditions in getting concessions from unions and cutting other costs to keep the growth of the budget in check.

“They’ve been thrown some curveballs and taken them in stride,” said Lapp, who replaced Frank Mason as CEO in August.

By JOHN T. WARD

Any expectations that a gathering dubbed Occupy Red Bank would attract throngs of longterm visitors similar to those protesting near Wall Street in Manhattan and elsewhere around the world proved mistaken Saturday.

Instead, a brief, low-key assemblage of about three-dozen people lived up, or down, to billing, as nothing more than an opportunity for participants to air concerns about economic and political trends, and to agree to meet again.

“The strength of this is what we agree on,” Connor Walby, who in his word “facilitated” the discussion, told the attendees arrayed in a loose circle on a concrete pad in Marine Park. “We agree that this is a broken system.”

Inspired by the month-old Occupy Wall Street movement, the session aimed for, and delivered, a rancor-free merging of frustrations over income equality and the influence of big money in politics.

One participant urged those in attendance to read Howard Zinn’s “A People’s History of the United States,” while another reported on what he’d seen over five consecutive days of visiting the OWS camp in Zuccotti Park in Lower Manhattan. A third suggested everyone participate in a November 9 national effort to overturn the U.S. Supreme Court’s Citizen’s United decision, which found that political spending by corporations and unions is protected by the First Amendment.

A suggestion that the group reach out to elected officials in an effort to work within the political system was met with polite pushback. “I think what you do is create something that frightens the politicians,” said one man.

“Nobody got angry today,” Walby said afterward, as clusters of participants broke into working groups to formulate strategy on topics such as legal issues, media outreach and more. “We all agree there’s something wrong with the economic system of the world. This was a really successful event.”