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NOV 05 - NOV 12, 2015

DiCienzo Offer Shows Hamister Deal For What it is A Complete Scam

Mike Hudson

NOV 05, 2015

Michael DiCienzo offered to develop the Hamister parcel.
Mark Hamister can't get his hotel built.
The exaggerated value of the smallish Hamister hotel in one of the prime locations in Niagara Falls is satirized by the locating of a Hotel 8 style Hamister hotel next to the Washington Monument in DC.
The site of the proposed hotel.
The Hamister hotel was touted as the savior of Niagara Falls.
In reality the proposed $36 million Hamister hotel is nothing more than an $18 million Hyatt Place.

Michael DiCienzo, whose family owns and operates more than 3,000 hotel rooms on both sides of the Niagara River here, recently made a modest proposal to Niagara Falls Mayor Paul Dyster.

Since do nothing “developer” Mark Hamister has done nothing whatsoever except seek additional taxpayer subsidies since Dyster named him as the preferred developer for a hotel project downtown way back in 2013, DiCienzo proposed his own deal to the city.

Sell him the parcel of land Hamister has missed the deadline on closing on, and he would build the hotel for about half of what Hamister is telling people it would cost.

Dyster rejected the proposal out of hand.

Why?

Under the development agreement signed between the city and the Hamister Group’s HH 310 LLC – a contract finalized in November 2013 – ground was to have been broken in the spring of 2014. That was pushed back to the autumn of 2014 and then the spring of 2015. Now they’re saying next year.

Also under the agreement, which has been amended more times than the United States Constitution, the land deal was to have been closed – Hamister was to have paid the city a paltry $100,000 for a piece of property appraised at $1.5 million – back in September. He missed that deadline as well.

Mortgage brokers and bankers contacted by the Niagara Falls Reporter confirmed that Hamister has been all over Western New York looking for finance what he claims will be the $35 million Hyatt Place Hotel he has proposed.

The problem is that a nearly identical Hyatt built earlier this year in Amherst cost just $18 million, and no lender in his right mind would loan $35 million to build something that’s valued at $18 million.

Both hotels are six stories, though the Amherst establishment has 137 rooms as opposed to the 128 of its proposed Niagara Falls counterpart. Both feature pools, spas and fitness centers, having been pressed out of the same cookie cutter responsible for 205 Hyatt Place hotels, mostly located adjacent to truck stops or airstrips throughout the country.

A building permit for the 128-room hotel was issued to R&P Oak Hill Development, a contractor for Hamister, on June 24.

The project is receiving $3.85 million in funding from the state, upped from an original $2.75 million after Hamister claimed the project’s costs grew. The more the hotel costs, the more Hamister receives in taxpayer funded subsidies.

The Hamister Group also is expected to save about $4.25 million over 10 years in tax breaks approved by the Niagara County Industrial Development Agency. The city provided no funding to the project, but agreed to sell the land, valued at $1.5 million, to Hamister for only $100,000, a sale price which Dyster said reflects the fact that the city did not put its own cash incentive into the deal.

Again. Nothing has been built. And there is no realistic sign that anything will ever be built by Hamister, who has never built a hotel before.

What Hamister has done is donate significantly and act as a “bundler” of donations for New York Gov. Andrew Cuomo. Which is maybe why Cuomo personally intervened in the 2013 Niagara Falls City Council election, targeting the formerly popular councilman Sam Fruscione, for asking the simple questions about the Hamister deal.

Cuomo again intervened in the election this year, endorsing Dyster in the primary against Glenn Choolokian, who also committed the sin of questioning the Hamister deal.

Something stinks here. The $18 million, six-story Iskalo Development hotel in Amherst represents the first incarnation of the Hyatt Place brand in the Buffalo Niagara market. Unlike its Niagara Falls counterpart, the project ran into stiff opposition from neighbors and local politicians, who objected to their height and scale, which they said was out of place with the surrounding buildings and homes. Litigation followed.

Land acquisition costs were many times the $100,000 Hamister still has not paid the city.

So why did Iskalo manage to bring the project in for around half of what Hamister keeps telling the rubes in Niagara Falls it’s going to cost?

Dyster served as cheerleader for the Hamister hotel, a role to which he is admirably suited. The hotel project would be “transformational,” a “gamechanger” that would provide a once in a lifetime opportunity that would provide the “tipping point” that would forever serve to revitalize the city’s tourist district, the mayor gushed.

He was reelected this week, largely on the basis of these promises.

 

 

 

 

 

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