Fire District Deal Had Tangled History

    Four days before voters in the Amagansett Fire District approved the $2.8 million purchase of a two-acre parcel next door to the firehouse, the site of the former Pacific East restaurant, some residents learned that it had been sold by court order in May for $500,000 when a routine notice of the transfer appeared in The East Hampton Star.

    On Oct. 3, the vote was 140 in favor, 102 opposed, and the fire district then moved rapidly to prepare a 30-year bond offering to raise the money.

    The May sale followed years of contentious lawsuits involving the dissolution of the partnership that had run the restaurant, which closed on Sept. 29, 2007. In 2008, Judge Elizabeth Hazlitt Emerson of the Suffolk Supreme Court commercial division dissolved the partnership, called M.A.C. Duff Inc., whose principals were Aram Sabet and Michael Castino Jr., and turned its assets over to a receiver.

    Mr. Castino Jr. and Mr. Sabet had also formed a corporation, Asmac L.L.C., to buy the property from Pat Struk in October 2000, but they were unable to obtain a full mortgage. Mr. Sabet’s father, Hormoz Sabet, offered to finance the purchase, provided that his son became sole owner of the property. Asmac paid Ms. Struk, the former owner of the Amagansett Farmers Market, $1.68 million for it.

    Aram Sabet fell behind on his mortgage payments, and his father foreclosed. A court then ordered the property sold. Under the law, Hormoz Sabet would receive from the sale an amount equal to the mortgage; any excess would go to his son. The amount of the mortgage is not known.

    The Suffolk County sheriff’s office conducted the court-ordered May sale. It was advertised in The Star’s legal notices for five weeks beforehand, though it was not mentioned in the news pages.

    The winning bidder, at $500,000, was the elder Mr. Sabet, the chairman and chief executive officer of Gulf Associates, a multinational investment advisory company, which, according to its Web site, brokers “profitable business ventures around the world.” Mortgage tax records from the county clerk’s office show that the deal closed on June 2.

    Htun Han, an Amagansett real estate broker and ambulance volunteer who was active, pro bono, in the negotiations between Hormoz Sabet and the fire district commissioners, said last week that he had not known about the May sale. Jack Emptage, the commissioner who spearheaded the purchase, said he had not known of it either.

    But Amber Waves, an organic farm north and just west of Pacific East, did. Aram Sabet e-mailed Amber Waves two days before the sale was to be held, offering to cancel it if the farm would buy the property for $3 million.

    Jennifer Desmond attended the sale as executive director of the Amagansett Food Institute, the farm’s educational arm, which hopes one day to build a center in the hamlet to bring together farmers and community members to teach and learn about food. Pacific East would have been ideal for the purpose, but Ms. Desmond was uncomfortable with the sale, which she called “a complete farce.”

    There is some question as to whether the building’s use, as a pre-existing restaurant in a residential zone, was viable at the time of the sale to the fire district. If a new commercial establishment could open there today, it would make the parcel far more valuable than if it were used for a residence, the more so in view of its location, at 415 Main Street between the firehouse and the Long Island Rail Road tracks. The East Hampton Town Code says that if there has been no commercial use for 18 months, the property is considered abandoned and its commercial classification expires.

    Ms. Desmond said that the town’s senior building inspector, Tom Preiato, told her in August that the commercial use would lapse on Sept. 9. On Sept. 14, Mr. Preiato said that the 18-month clause in the code was last satisfied in March of 2010, and would not lapse until sometime in October. He did not say how it was satisfied or by whom in response to several requests for this information.

    However, in her 2008 decision dissolving the partnership, Judge Emerson wrote that Pacific East had “ceased operation in September 2007 and, according to various representations by the parties . . . is in a complete state of disrepair.” In response to an inquiry, the Suffolk County Health Department said that the restaurant was last inspected on May 25, 2006.

    At an informational meeting held one week before the vote, both Mr. Emptage and Mr. Han told the audience that the restaurant use had not expired, based on Mr. Preiato’s representation and that of Lee Minetree, a real estate broker representing Hormoz Sabet.

    There was no absentee balloting at the Oct. 4 vote, a fact that occasioned some grumbling afterward. On the whole, though, a random poll taken at the Amagansett Post Office this week showed (30 to 6) that residents are pleased with the purchase. Many mentioned the “dedication” of the ambulance personnel and firefighters, all of whom are volunteers.

    One of the few people who was not happy, Andrew Sabin of Bluff Road, said he voted in favor anyway, “because if you’re dying, you don’t want to be the schmuck who was against it.”

    Fire district officials have estimated that a house assessed at $7,950 a year, the median for the hamlet, will pay $87.92 more in annual taxes to cover the cost of the $2.8 million purchase. The district will assume a 30-year obligation but hopes to discharge it in half that time. Mr. Emptage said the tax figures were based on a projected 15-year payoff.