Niagara Gazette

September 6, 2013

Cuomo kept Hamister from walking away from Falls hotel project

Staff Reports
Niagara Gazette

A downtown hotel project that was on the verge of unraveling remains alive for the time being.

Mark Hamister, the Chairman and CEO of the development firm the Hamister Group, told the Gazette he was prepared to announce that he was walking away from investing $22 million in a mixed-use building project in downtown Niagara Falls before he got a call from Gov. Andrew Cuomo.

"We were within an hour of finalizing the decision to walk away when the governor called," Hamister said.

Cuomo convinced the developer to stay on board while the governor worked to urge the politicians involved to settle their differences, Hamister said.

"He made it clear to me that this project was important to his overall plan for the region and he would get personally involved to make sure it goes forward," Hamister said.

Hamister has been frustrated with the slow progress on the deal, but was committed to sticking it out until the end of September until a political attack mailer, funded by the recently-formed political action committee Western New York Progressive Caucus, was circulated earlier this week characterizing the developer as a con man looking to fleece the taxpayers of Niagara Falls.

The mailer lauded City Councilman Sam Fruscione, who is running for reelection and faces a primary next week, for "asking tough questions" of the state and the developer.

Hamister described the flyer as "despicable" and said he was astonished, as a private business man, that he would be dragged into a political fight.

"I personally feel that there is no excuse for the disturbing and reprehensible mailer that was circulated on behalf of a certain councilman," he said.

Hamister called the mailer "libelous" and said it is an example of the type of mud slinging that is "everything that's wrong with politics today."

"It sends the wrong message to people who want to do business in Niagara Falls," Hamister said.

The developer said he is considering legal action.

Fruscione told the Gazette on Wednesday that he had nothing to do with the mailer and disagreed with the characterization of Hamister as a criminal, but did agree with the information praising his questioning of the terms.

The Hamister Group was selected as the preferred developer for a city-owned parcel at 310 Rainbow Blvd. in February of 2012, the result of a request for proposals process led by the state's local economic development arm USA Niagara Development Corp., a decision that was approved unanimously by the City Council.

The company and USA Niagara then negotiated the terms of the deal - the developer would receive the parcel for $100,000 and a state grant of $2.75 million and would fund the remainder of the $25.3 million project — and brought the proposed development agreement to the council for approval in July.

A trio of council members — Fruscione, Council Chairman Glenn Choolokian and Councilman Robert Anderson Jr. — voted to table the deal saying that the state run procurement process lacked transparency and raising concerns over the price of the land and the lack of protective measures for the city in the proposed terms.

Hamister said he will stick to his stated deadline of the end of September for movement on the project before walking away, but that after talking to Cuomo and local officials he is confident that an agreement can be reached even sooner.

"We're hoping to get it wrapped up in the next one to two weeks," Hamister said.