Lawyers for the Riverhead Town, Luminati Aerospace and John Catsimatidis are still negotiating the terms of a contract on the proposed sale of vacant land at the Calverton Enterprise Park.
The lawyers hired by the town board to negotiate the contract and handle vetting the purchaser as a “qualified and eligible sponsor” are very close to finalizing the contract terms, Supervisor Sean Walter announced this morning at the beginning of the public portion of the town board work session. The board had just concluded a meeting behind closed doors with attorneys Frank Isler and Michael Heller.
He said the town’s attorneys had a five-hour meeting with lawyers for Luminati and Catsimatidis.
Walter said that he, Councilman Tim Hubbard and Deputy Supervisor Jill Lewis went into the city to meet with Catsimatidis on Monday “to talk about his plans.”
“He and Preston are working on their agreement,” Walter said. “It will be some form of a joint venture, not conventional financing.”
A Catsimatidis representative told RiverheadLOCAL last month that was the structure of an arrangement being negotiated between the New York City billionaire and Luminati founder Daniel Preston. Today, the representative, Nelson Happy, confirmed that negotiations are ongoing.
The proposed contract can’t take its final form until the town provides Luminati and Catsimatidis with a survey of the property, which has not yet been completed. Preston paid for the survey in June and the town ordered it from VHB Engineering.
Once the contract terms are finalized, the town will be able to schedule a “qualified and eligible sponsor” hearing. A determination that an proposed purchaser of town-owned property in a designated urban renewal zone like EPCAL is “a qualified and eligible sponsor” is required before the sale can take place.
The “sponsor” will be an entity formed by Luminati and Catsimatidis, Walter said in an interview after today’s work session. “We always anticipated it would be an entity other than Luminati Aerospace, an entity formed as a real estate holding compay,” Walter said. “The letter of intent contemplates that.”
The town signed a letter of intent with Luminati Aerospace in April, in which Luminati agreed to purchase the remaining town-owned land at the EPCAL site — approximately 1,400 acres — for $40 million. That document gave the parties 30 days to negotiate a “definitive agreement,” after which the “qualified and eligible sponsor” hearing would be held.
In July, with no agreement finalized and doubts about Preston’s abilty to perform mounting, a majority of the town board said they we’re ready to cancel the letter of intent. The town sent Luminati an ultimatum letter. Then, Catsimatidis stepped forward with an announcement that his company, United Refining Energy Corp., was “highly interested” in providing Luminati the financing needed to purchase the EPCAL land. The board members who were ready to cut ties with Luminati changed their minds and agreed to continue negotiations.
That remains the status quo, according to Walter. He said this afternoon he would not push to get the deal to a “qualified and eligible sponsor” hearing before the upcoming election. In July, the supervisor said he intended to hold the hearing before the end of August.
“We don’t want this to be a casualty of the election season,” Walter said.
The survival of local journalism depends on your support.
We are a small family-owned operation. You rely on us to stay informed, and we depend on you to make our work possible. Just a few dollars can help us continue to bring this important service to our community.
Support RiverheadLOCAL today.