December 14, 2006

Hard Work on Canon Deal: Developers Vying for Right to Sell Melville Site for Headquarters in Marathon Meeting With Mediators

By Elizabeth Moore, Newsday, Melville, N.Y.

Dec. 14--Two distinguished former judges, half a dozen lawyers, the offices of the Suffolk County executive and a pizza delivery man were set in motion yesterday afternoon and evening to help resolve the dispute over who should have the right to sell Melville's pumpkin farm property to Canon USA.

More than seven hours after they sat down eyeball to eyeball, developers Roger Tilles and Gerald Monter were still talking, with the help of former appellate division presiding justice Milton Mollen, behind closed doors -- and county officials called that good news.

"We're cautiously optimistic that a deal can be struck," said Ed Dumas, spokesman for County Executive Steve Levy, after supper yesterday as negotiators continued to shuttle from room to room behind the closed doors of Levy's offices in Hauppauge. Dumas described the tone as "amicable."

Levy convened the meeting in hopes of breaking the deadlock between the Tilles Investment Co. and Monter's Holiday Organization over a sale contract they signed last year for the prime 52-acre parcel at the corner of Walt Whitman Road and the Long Island Expressway.

Tilles had sold the commercially zoned farmland to Holiday for roughly $70 million, but Holiday's deal was conditioned on winning a residential rezoning for senior housing.

Then in the spring, Canon, based in Lake Success, came along looking for a new North American headquarters, a move state and local officials greeted with open arms and tax incentives as a boon to the local economy. Holiday arranged to flip the Pumpkin Farm to the imaging company for a reported $102 million, in a deal brokered by Bruce Blakeman, former presiding officer of the Nassau County Legislature. But Tilles last month sued, arguing the property is his, not Holiday's, to sell, especially after Huntington town officials refused to consider a residential rezoning.

The prospect of a lengthy court battle has alarmed government officials, who hoped to break the deadlock swiftly through yesterday's dialogue.

In addition to his attorneys, Tilles was accompanied yesterday by former Court of Appeals Chief Judge Sol Wachtler. Holiday vice presidents Marilyn Monter and Richard Spirio were there, too, as was Blakeman. They were greeted not only by Levy, but also by Long Island Association President Matthew Crosson and Huntington Supervisor Frank Petrone and town board member Mark Cuthbertson, who made statements emphasizing the importance of the Canon headquarters to the region's economic health, before leaving to let the developers get down to the business of cutting a deal.

"The stakes have never been higher with respect to the perception of Long Island as a desirable place to locate a major corporation," Cuthbertson said Tuesday of the meeting. " ... Anything that gets them into a room together at this point is significant and worth doing."

The key players


The broker on the Canon deal and partial funder of yesterday's mediation session, Blakeman served as presiding officer of the Nassau County Legislature from 1996 to 2000. Born to a political family -- his father, Robert, served in the State Assembly in the 1960s -- Blakeman practiced with his family's law practice in Valley Stream before an unsuccessful attempt to gain the Republican nomination for Ray McGrath's seat in Congress in 1992.


The 86-year-old mediator for yesterday's session has served in public life since the early 1950s. He has been a State Supreme Court justice, state appeals court judge, and New York City deputy mayor under David Dinkins. In the 1990s, Mollen chaired a special commission to investigate New York City police corruption and was president of the National Council of Chief Judges of Intermediate Courts of Appeals. He has worked part time for a private, California-based mediation company called Judicial Arbitration and Mediation Services Inc. since opening its New York office 1992.


Founder and chief executive of The Holiday Organization, a Westbury-based developer of more than 8,000 homes and apartments including the Hamlet communities. To sell his condominiums, he started the exhibition that became the Hamlet tennis tournament. In the late 1980s, he served 18 months in prison for bribing a witness who accused him of involvement in the death of an employee whom it was alleged he wanted roughed up. He was acquitted of manslaughter.


Tilles Investment Co.'s only remaining commercial property is the 52-acre "pumpkin farm" in Melville. But before 2004, when Roger Tilles and his brother Peter liquidated their family's extensive real estate portfolio, the group held as much as 3 million square feet of Long Island office space. The son of a pre-eminent Long Island development family, Tilles worked for the Michigan state government, ran for U.S. Congress and practiced law in Washington, D.C., before returning to Long Island to direct the Tilles Investment Cos. in 1983. A New York State Regent since last year, Tilles also comes from a famously philanthropic family.


President and chief executive of Canon USA Inc. and a managing director of the imaging company's board, "Joe" Adachi leads Canon's North American headquarters, based in Lake Success. He joined Canon in 1970 and led Canon Canada during its transition from analog to digital products.


Copyright (c) 2006, Newsday, Melville, N.Y.

Distributed by McClatchy-Tribune Business News.

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