Monday, April 12, 2010

Tribe In The Media Series On Montville Land

Feather News

This installment of The Tribe In The Media series is an article in The Day newspaper about what could happen to 344 acres of prime land in Montville. The Feather News is not convinced that the sale to Lew Rome's secret partner will happen, at least not at the price mentioned in the article. We believe the land will be put on the market and then Rome's secret partner can bid on the land. Granted, we don't know all of the details of Tarragon's bankruptcy but that is generally how the bankruptcy court can ensure that the highest payment is received for that land. As always, the Feather News is happy to accept comments on this article from those that think otherwise.

Pending land sale poses concern for Montville officials
By Megan Bard
The Day
April 10, 2010

Montville - About 344 prime acres between Route 32 and Massapeag Side Road are likely to change hands again, a prospect that has town officials concerned about the future of the area.

On March 29, an agreement between sellers Mohegan Hill Development LLC and Mohegan Hill Development/Wilson LLC and buyer attorney Lewis B. Rome, listed as a trustee of an unidentified party, was filed on the town's land records.

The pending sale was made for $9 million and required Rome to put $500,000 into escrow. If various requirements are fulfilled, the closing is scheduled for June 15.

Almost immediately, town officials began trying to obtain details of what is to come and how it could affect plans to designate that area as the heart of the town's future economic-development initiative.

"It will have a major impact, without a doubt, to the town," Mayor Joseph Jaskiewicz said Friday evening. "We can't dispute that. We really don't know the details but we're looking into what they want it for."

When reached Friday afternoon, Rome said he was not "at liberty to discuss" the transaction and added that he was acting as a trustee.

In the past, Rome has acted as counsel for the Mohegan Tribe. A tribal official Friday deferred comment to Rome.

Tribal officials with the authority to comment on the transaction could not be reached Friday.

The property has been ripe for development speculators for the majority of the past decade. During that time, the tribe has expressed interest and negotiated with several property owners in an attempt to purchase some of the parcels included in the 344-acre tract. The property also includes an area that is significant in Mohegan tribal history.

In the early 2000s, Hackman Capital Partners LLC, a California-based firm, began buying individual parcels at above-market prices.

In October 2005, Mohegan Hill, backed by Tarragon Corp., paid $33.3 million for about 246 acres in the area and continued the trend of buying parcels at inflated prices.

In 2006, Tarragon officials said they intended to build a hotel, an 18-hole golf course, luxury condominiums, upscale stores and a marina on the properties. In all, the sale price for all the properties included was about $48 million, according to Town Planner Marcia Vlaun.

In 2008, Tarragon filed for bankruptcy. According to documents filed in the Town Clerk's office, the 35 properties listed in the current Purchase-and Sale Agreement are not part of the bankruptcy proceeding. However, they are considered an asset and any sale of the parcels must first be approved by the bankruptcy court.

"At this point, it's a very cloudy picture as to what's going on," Vlaun said. "We're not going to jump to conclusions. Everything we do, we'll do in the best interest of the taxpayer."

Vlaun has been closely monitoring activity on the property for years. In the proposed Montville Plan of Conservation and Development, which is slated to be approved in the coming weeks and is subject to a public hearing Tuesday night, the area is identified as a primary location for the town to expand its economic development base.

According to the proposed Plan of Conservation and Development, the land is identified as one of the town's key job-investment areas, meaning it is one of the primary areas in the town where officials hope to create commercial, light industrial, industrial, mixed-use and municipal development, along with substantial infrastructure investments.

In the commercial build-out maps, some of the properties subject to the sale are also identified as having the greatest potential for large development. Much of the property is currently zoned either commercial or residential.

One of the biggest concerns town officials have is the possibility that the tribe could purchase the properties, then file with the federal government to take the land into trust, thus removing it from the tax rolls.

The properties are within the tribe's settlement area and are contiguous with other tribal properties, making the area eligible for casino-type development.