Niagara Gazette

September 6, 2013

Hamister talks hotel deal

By Justin Sondel
Niagara Gazette

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

Mark Hamister, chairman and CEO of the Hamister Group, told the Gazette on Friday that he was prepared to announce that he was walking away from investing $22 million in a hotel 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 his office worked to urge local politicians 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 before a political attack mailer, funded by the recently-formed political action committee Western New York Progressive Caucus, was circulated earlier this week. The mailer characterized the developer's plan as a "con game" and suggested Hamister was looking to fleece the taxpayers of Niagara Falls.

The mailer lauded 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," Hamister 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 terms of the hotel proposal.

The WNY Progressive Caucus counts among its donors several current and former politicians and political party officials, from Western New York, including former Erie County Democratic Party Chairman and local attorney Steve Pigeon and state lawmaker Tim Kennedy. 

On Thursday, Dan Jones, a spokesperson for the WNY Progressive Caucus, said the group paid a private vendor to print and distribute the postcard in an effort to educate voters. Jones said the group produced the mailer to support Fruscione which it believes has done a good job of asking tough questions and standing up for taxpayers in Niagara Falls. Jones indicated that the mailer was not intended as a personal attack on Hamister, adding that the group did not have a position on the hotel project one way or another. 

The Hamister Group was selected as the preferred developer for a city owned parcel at 310 Rainbow Blvd. in February 2012, the result of a request for proposals process led by the state's local economic development arm, USA Niagara Development Corp. The "preferred developer" status was approved unanimously by all five members of the city council.

The company and USA Niagara negotiated the terms of a proposed deal that would allow the developer to buy the parcel for $100,000 and receive a $2.75 million state grant. The remainder of the $25.3 million project would be funded by Hamister. The proposal was presented 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 agreement saying the state run procurement process lacked transparency while raising concerns over the price of the land. In recent weeks, all three lawmakers have suggested the proposed agreement lacks adequate protective measures for the city and its residents.

Hamister said he will stick to his stated end-of-September deadline for movement on the project before walking away. After talking to Cuomo and local officials, he said 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.