It's a tale of two families, millions of dollars and some of the most exclusive and expensive real estate in the country.
Vanity Fair's July issue spills the saga of the White family, who have lived and farmed in Sagaponack, N.Y., since the 17th century, and their decade-long fight with Houston's Anthony Petrello, once a friend and now a rival who may end up with the valuable family land in the tony Hamptons.
Petrello and his wife Cynthia are East Coasters, and Vanity Fair describes Tony's rise from the lower-middle-class grandson of Italian immigrants in Newark to Yale, Harvard Law, managing partner at a white shoe law firm and eventually Chief Operating Officer at Nabors Industries, "the biggest land-based drilling company in the world," which brought on a move to Houston.
Petrello first came upon John White and his family in 1992 when he rented one of the humble cottages on the edge of the family land, by the beach, joining a low-key community of renters and locals.
By 1995, Petrello agreed to buy a corner parcel of land — 11 acres for $2 million — with the right of first refusal on sale of the rest of the property outside of the family, with the deal to take effect after the official land subdivision (paid for by Petrello) was complete.
But what happened during the process of completing the sale has created a division in the community — and according to VF, it's Petrello versus everybody else.
First, there is the argument over whether the Petrellos promised to build a modest house on the land, as the Whites claim — patriarch John White hates the mansions that had taken over the neighborhood. Without the pledge in writing, the Petrellos submitted plans for a 5,000-square-foot guest house and their lawyer, David Berg, told VF they have plans for an 18,000-square-foot home.
In the years for the subdivision to be completed and filed, the land prices in the Hamptons and Sagaponack skyrocketed, and the farm, which was worth $6 million in 1995, jumped to an estimated $32 million. White asked for more money — but still significantly less than market value — for the pre-existing lot. In 2000 when the Whites declined to close on the deal as it stood, Petrello sued.
Ten years later, Petrello won his deal on the land: 9.56 acres for $2.1 million. But he's still filing claims against the Whites for the cost of landscaping 10 years ago, the increased costs of building now, the lost rental income over the past decade, nearly $5 million in legal fees and other costs.
The Whites sold the development rights to their beachfront land to the Town of Southampton for $14 million, significantly less than commercial developers would have paid. Most of that money, they say, was spent defending Petrello's lawsuit. More importantly, the Whites have put the rest of their land in established trusts, partly to protect their interest from Petrello's right of first refusal in case one of the family died.
Petrello has seized the trusts and the implication that future non-family members could eventually be included, as grounds that he can act on his right of first refusal now and snap up the additional tracts for a fraction of the market value.
It's interesting that Vanity Fair, which would normally be covering the tony parties at the Hamptons mansions that John White dislikes so much, has come out swinging so strongly in favor of the Whites, the last of the unassuming local farmers that New York society names have crowded out.
One pull quote, courtesy of a Houston builder who had a legal dispute with the Petrellos about their historic mansion in Shadyside, describes Petrello as "a modern-day Satan." The photo of a dapper Tony and Cynthia on the grounds of their Houston estate is captioned "Texas Crude." (Ouch!) One wonders whether Petrello is vilified not because he aggressively got a good deal on land but because he was the last millionaire to do so — and with Texas money to boot.
A call to Berg for comment from his client and him was not immediately returned.
Is Petrello a grasping Texas interloper or just a success story looking for his slice of paradise?
Anthony and Cynthia Petrello
