Walter: Rechler developer set to pay $250K owed to town

09/15/2011 1:24 PM |

Gregg Rechler, head of Rechler Equity Partners has agreed to pay the $250,000 his Repcal organization owed the town after the group’s deal to buy 300 town-owned acres in Calverton fell apart, town officials said Thursday.

Riverhead Supervisor Sean Walter made the announcement at Thursday’s public Town Board work session in Town Hall.

“I am happy to report that after a review by our attorneys and REPCAL’s attorneys, REPCAL has agreed to pay us the $250,000 that was due with the terminated constract,” Mr. Walter said Thursday.

The Town Board then called a special meeting and unanimously voted to accept the money.

Last month, the supervisor’s office issued a press release Friday stating the supervisor had “uncovered a potential windfall for taxpayers” — a reference to a $250,000 letter of credit Rechler Equities had posted as part of the sales contract that would be paid to the town if the group backed out of the deal. But that letter of credit had already expired in May.

Former supervisor Phil Cardinale, a Democrat who is challenging Mr. Walter, a Republican, in this year’s election for supervisor then publicly criticized Mr. Walter’s handling of the matter, insisting he had told the sitting supervisor in April he should double check the contracts to be sure Mr. Rechler didn’t owe the town any more money.

Mr. Cardinale at the time speculated the town wouldn’t be seeing the $250,000, “because REPCAL is a Delaware-based shell corporation set up just for the purposes of this [high-tech park] project. It has no assets.”

Mr. Rechler didn’t dispute the fact that REPCAL was a single-purpose corporation, but told News-Review he did plan to pay.

Rechler Equity Partners once envisioned building a hi-tech industrial park over 10 years at the former Grumman naval weapons reserve now called the Enterprise Park at Calverton, or EPCAL.

But in October 2010 he announced his group’s decision to pull the plug on the $18 million contract for the land.

He blamed the deal’s demise in part on town officials, who had rejected a pitch to alter his plan and add a housing component.

In a letter sent to Town Board members last year, Mr. Rechler cited “a sluggish economy and a Town Board that was not willing to adapt to the changing economic landscape,” as reasons for the decision.

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