James Neiss/staff photographer Niagara Falls, NY - Frank Parlato Jr., managing partner of One Niagara LLC., hopes to open a viewing area on the 9th floor and roof top for tourists by next season. Parlato said, there are other plans to improve and expand the One Niagara Center.
Lillian Boncore and her husband have been talking about starting a business in the city for years.
They checked out numerous sites but couldn’t find the right fit, until they walked into One Niagara and spoke with co-owner Frank Parlato Jr. Soon afterward, “Burger Palace” opened for business on the first floor of the former Occidental Building, joining a mix of eateries, souvenir shops and other small business ventures.
James Neiss/staff photographer Niagara Falls, NY - Tourists enter the One Niagara Center where they can get information, book tours, buy souvenirs and have a bite to eat. Niagara Center continues to expand its operations, said Frank Parlato Jr., managing partner of One Niagara LLC.
“It was just a great opportunity for us,” said Boncore, who started the business this past summer. “It’s been very busy and it’s such a great atmosphere here. I think it’s a great asset to local business owners.”
Burger Palace isn’t the only success story coming out of One Niagara these days. Despite past failures at the site, most notably the AquaFalls project, vendors appear to be pleased with their location and say business is booming. Most of them are quick to credit their success to Parlato’s efforts in improving the building and changing it from an abandoned eyesore into something thousands of tourists visit daily during the summer months.
“Frank has put so much time into the building,” said Ricky Gibas, who moved his souvenir business from the old Prime Outlets Mall to One Niagara. “He’s been very supportive of us.”
James Neiss/staff photographer Niagara Falls, NY - Tourists Cheryl Joseph and her son Ethan Gonsalves, 3, both of Providence, RI, look for the perfect souvenir shirt at the Blooming Onion Gifts & Souvenir? inside the One Niagara Center.
James Neiss/staff photographer Niagara Falls, NY - Jim Gorvan proudly displays a German Chocolate cake, one of the hot sellers at the Old Falls Pastry shop, one of several restaurants in One Niagara Center.
But not everyone has been singing Parlato’s praises lately.
Co-owner David Ho, who lives in Hong Kong, has recently taken steps to have Parlato removed from managing the building. The dispute quickly became ugly, and has included accusations of tax evasion and embezzlement against Parlato.
In response, Parlato is preparing to hand over all operation records associated with One Niagara for review, but in the meantime is attempting to clear his name by proving Ho’s accusations are baseless and an attempt to “pull a money grab” now that the building is beginning to show signs of success.
“I fought too hard here to make this place work to let people with Mr. Ho’s track record disturb this place,” Parlato said. “Anyone can make accusations and allegations. Why don’t they bring forward some evidence. I’m tired of being called names that are untrue.”
Parlato’s company took over 50 percent ownership of the building on Dec. 9, 2004. In the operating agreement with Ho, Parlato is identified as the manager of the property with exclusive and permanent control.
The alliance erupted in August when Ho’s attorney, Steven Cohen, sent a letter to Parlato informing him of an annual meeting of One Niagara LLC to “elect managers, review accountings from December 2004 to the present, and review current business and legal matters.” Believing Ho was trying to go against the operating agreement, Parlato sent his attorney, Paul Grenga, to the meeting and object to its legality.
“I didn’t consent to any meeting,” said Parlato, adding the operating agreement gives him the power to make those type of decisions. “He can’t come in here and start bossing me around.”
Despite the objections, the meeting on behalf of Ho continued and the matter boiled over into State Supreme Court, where Justice Frank Caruso ruled earlier this month Parlato’s operating agreement specifies he has “irrevocable rights” to serve as manager or to choose someone on his behalf.
The two sides returned to Caruso’s courtroom a week later as the justice considered numerous requests made by Cohen to have Parlato hand over control of revenues and expenses for the building and countless documents relating to finances.
Caruso denied nearly all of the motions, but did reaffirm an agreement made that Parlato must hand over One Niagara’s books and records to Ho by Oct. 15 so an audit can be performed.
Cohen has said Ho did not intend to remove Parlato as manager, but became concerned with possible illegal activities at the site after hearing Parlato was more than $600,000 behind on the building’s property taxes.
The court documents filed on behalf of Ho allege Parlato is collecting thousands of dollars in revenue through a parking lot at the site that is not being reported.
A private investigator was hired by Cohen to gather video surveillance outside the building to determine the amount of money collected from the parking lot, according to the legal documents. During the month of August, the investigator testified he observed at least $130,000 in cash change hands from “parking lot and interior operations.”
“... It is my belief that Frank Parlato is intentionally withholding books and accounting documents so that he can enjoy an inflow of cash that is not reflected on any bank statements or ledger sheets,” Cohen wrote in his court affidavit.
Cohen continued by stating, “In light of the observations of our investigators, it appears at least possible that Frank Parlato wishes to engage in embezzlement and tax evasion undisturbed.”
On Friday, Cohen didn’t back off those accusations, but declined to comment further, only reiterating that Ho is happy the books are being turned over for review.
However, Parlato responded to the accusations, saying he’s kept meticulous records since taking over three years ago. During a recent interview with the Niagara Gazette, he produced a copy of a $50,422 check he sent to the state to cover sale taxes in 2006 accumulated from the parking lot and operations inside One Niagara.
“There’s living proof right there that I’m paying sales tax and everything is being reported,” Parlato said.
James Neiss/staff photographer Niagara Falls, NY - Frank Parlato Jr., managing partner of One Niagara LLC., hopes to open a viewing area on the 9th floor and roof top for tourists by next season. Parlato said, there are other plans to improve and expand the One Niagara Center.
In addition, Parlato said he’s put close to $2 million into fixing up the property, including filling the 60-foot AquaFalls hole left there under Ho’s management. He claims Ho hasn’t provided him with any financial backing, which is his right under the operating agreement. Instead, the money came from investments, loans or his own funds, Parlato said.
“Ho’s in Hong Kong, he doesn’t give one ounce of energy to this,” Parlato said. “He claims to be a partner, but he’s not. A partner has a say. He has no say. That’s the deal they made and they can’t change it once the thing is starting to make some money.”
Actually, Parlato claims the expenses of bringing One Niagara up to code, combined with the monthly gas and electricity bills, exceeds the revenue he collects in vendor leases and parking.
“I’m still in the red on this project,” he said.
Parlato referred to Ho’s accusations in the court documents as “a stack of innuendoes” meant to shake him up so he’ll send Ho some money.
“I fill holes and solve problems, he creates holes and causes problems, that’s the difference between us,” Parlato said.
Contact reporter Rick Forgione at 282-2311, ext. 2257.
