PROJECT BENEFITED FUNDRAISER
Political fundraiser made 900% profit on land deal
A Union Montreal fundraiser, who raised money for Mayor Michael Applebaum and former city councillor Marcel Tremblay, benefited from the efforts of elected officials and civil servants in NotreDame-de-Grâce to secure subsidies and approvals for a housing development on Upper Lachine Rd. Linda Gyulai and Marian Scott report.
A Union Montreal fundraiser benefitted from the efforts of the Côtedes-Neiges–Notre-Dame-de-Grâce borough to obtain approval and a large subsidy for developer Antonio Magi to build a housing project on Upper Lachine Rd.
Businessman Lee Lalli made a 900 per cent profit when he sold the site of the future housing project to Magi in January 2005.
Lalli, who organized fundraisers for Montreal Mayor Michael Applebaum while he was mayor of the west-end borough and a member of Union Montreal, as well as for former city councillor Marcel Tremblay, paid $350,000 for an industrial site at 5757 Upper Lachine through a numbered company in 1999, real estate records show.
Five years later, Lalli’s company sold the property for $3.2 million to Magi’s Construction F.T.M. Inc. Magi’s brother, Ricardo Magi, represented the company in the transaction.
A month later, the city’s housing department granted Construction F.T.M.’s project for the site almost that exact value in subsidies — $3.14 million.
As The Gazette reported on Friday, documents obtained by the newspaper contradict statements by Applebaum, who was borough mayor from 2002 until November, that elected officials in the borough were not involved in the controversial housing project and that the project was presented to the borough by the city’s housing department as a fait accompli.
Lalli contradicted Applebaum’s claim that no elected officials in the borough were involved in the project’s approval. Lalli told The Gazette on Friday that it was Applebaum who suggested he cede the property to allow a housing project.
Lalli said his construction com- pany, which operated machinery at 5757 Upper Lachine at the time, generated noise complaints from residents.
“I was asked by the mayor if I would consider moving and they would do a housing project because neighbours didn’t like what I was doing there,” Lalli said. “And I tried to comply.”
The documents obtained by The Gazette show Construction F.T.M. asked the borough for a zoning change for its housing project and requested subsidies from the city’s housing department before September 2004, while Lalli’s company still owned the site.
Later in the interview, Lalli backtracked about who had suggested he cede the land for the housing development. Lalli then said he couldn’t remember if it was Applebaum, Marcel Tremblay, who was a Côte-des-Neiges–Notre-Dame-deGrâce councillor for the district that includes Upper Lachine at the time, or someone else.
“It could have been either Michael Applebaum, it could have been (Marcel) Tremblay, it could have been anybody, but I knew that people were complaining to the city.”
The documents obtained by The Gazette this week show Marcel Tremblay, the brother of former mayor Gérald Tremblay, met with an official from the electrical commission in April 2004 to inquire whether the city, Hydro-Québec and the provincial government would cover the cost of burying electrical lines along Upper Lachine between Clifton and Girouard Aves. He also asked about the procedure for burying lines.
It’s “extremely rare” for a politician to approach the commission alone without a civil servant, commission chairman Serge Boileau said. The commission usually deals directly with civil servants.
The commission responded with the information in writing in May. The borough did not pursue a plan to bury electrical lines on Upper Lachine.
Applebaum’s spokesman, Jonathan Abecassis, said Thursday the mayor was not aware Marcel Tremblay had contacted the commission.
Applebaum acknowledged through a spokesperson that he agreed with the residents that Lalli’s business should go, but denied he suggested a housing project.
“He never told Lee (Lalli) to build housing there,” Abecassis said.
And while Construction F.T.M. paid Lalli’s company $3.2 million for the property in 2005, real estate records show Construction F.T.M. sold the property during the construction phase to a numbered company, 9119-3557 Quebec Inc., operating under the name Habitation Vally, for $1.56 million in November 2006.
Lalli said he had “no idea” why he was able to sell the property for $3.2 million after buying it for $350,000. “Why does land go up everywhere?” he asked, adding that he spent over $1 million in renovations on the building at 5757 Upper Lachine that has now been demolished.
Lalli, who worked on Marcel Tremblay’s 2001 election campaign, organized a $1,000-a-head fundraiser for Applebaum and Tremblay in August 2003 at La Cantina restaurant on St-Laurent Blvd. He told The Gazette he organized a second fundraiser for Applebaum’s 2009 reelection campaign at La Cantina.
Lalli said he relocated the 2009 event when the restaurant’s owner, Federico Del Peschio, was shot and killed in the parking lot behind the restaurant less than a week before the fundraiser.
Lalli said he moved the event to a boardroom in his office building on St-Jacques St. W.
Applebaum’s ties to Lalli made headlines in March over a RadioCanada report that Lalli profited from rezoning by the borough of a site he owned and then sold at Côte St-Luc Rd. and Décarie Blvd.
Lalli, who has insisted he has no ties to the Mafia, acknowledged he met with Mafia boss Vito Rizzuto in 2003 at La Cantina restaurant to discuss the Décarie Blvd. land deal. Rizzuto called the meeting to try to persuade Lalli to partner with Antonio Magi on the deal, Lalli said.
Lalli said Magi had also been in- terested in buying the site and had made an offer on it before Lalli.
Rizzuto accepted his refusal to let Magi in on the deal, Lalli said.
Six years later, Lalli was savagely beaten by two thugs.
At a city council meeting Friday, Applebaum maintained his position that the project was presented to the borough as fait accompli. But he acknowledged for the first time the borough intervened with the housing department to help secure subsidies for the project. “We had a say for allowing affordable housing. ... This is why this dossier was accepted so we could have affordable housing,” Applebaum said.
The documents obtained by The Gazette show the director of the borough’s urban planning department, Diane Martin, wrote to the civil servant in charge of subsidies at the city’s housing department in December 2004 to say her department “welcomes the project,” promising to initiate procedures to change the zoning “immediately.”
A month later, Lalli’s company sold the property to Construction F.T.M. A month after that, in February 2005, the civil servant in charge of subsidies in the housing department wrote to Construction F.T.M. confirming the subsidies.
The documents also show the borough’s manager pressured the city’s electrical commission to change its recommendation to bury the project’s new power lines — a move that saved Construction F.T.M. about $1 million by allowing the company to install aerial lines instead.
Despite an access-to-information request filed by The Gazette and repeated follow-up requests for information about the project, the borough withheld documents showing exchanges between the borough officials and the electrical commission.
The housing project made headlines in December 2009, when Nick Rizzuto Jr., the son of reputed Mafia boss Vito Rizzuto, was gunned down outside the complex. Rizzuto had been seen frequently at the Upper Lachine building for three years and was said to be developing two housing projects with Magi.