Oheka Castle bought by Gold Coast Property & Estate Management for $72 million

The new owners of Huntington's iconic Oheka Castle are a pair of developers who "love the castle" and are ready to usher the Gold Coast mansion to "its next chapter," their lawyer said Tuesday.

The winning bid of $72 million came from Gold Coast Property & Estate Management LLC, a newly formed business run by principals Ronald Browning and Paul Alflen, said attorney Brian Gardner, counsel for the group.

The company outbid six other entities Tuesday during an auction at a Manhattan hotel.

“They’re excited for the opportunity to conserve the castle and take over its stewardship,” Gardner said in an interview. Browning and Alflen will maintain Oheka's current operations “as well as oversee its next chapter, which will include development on portions of the property that will not interfere with the castle or its ground.”

The pending owners intend to move forward with development “consistent with prior approvals,” Gardner said.

The winning bidder is entitled to development rights for up to 95 condominium units on the property.

Gardner noted that Alflen is from Long Island and has been to the castle “hundreds of times.”

“Both love the castle,” Gardner said.

Reached by phone, Alflen confirmed he was part of the winning bid and referred questions to Gardner. He said his background was in “hospitality and development.”

The landmark mansion in Huntington Town sold Tuesday morning at an auction conducted by Concierge Auctions. The winning bid is expected to be confirmed during a hearing Thursday in federal bankruptcy court.

Seven unidentified entities had registered to take part in the private auction.

Oheka owner Kahn Property Owner LLC filed for federal Chapter 11 bankruptcy protection last year to hold off a foreclosure sale. Power broker and developer Gary Melius, a Oheka co-owner who lives at the castle, said at the time the castle had been in foreclosure for a decade.

Court documents show Melius, 82, owes about $60 million to a secured creditor, and between $8 million and $10 million to unsecured creditors and for professional fees.

Melius: 'It will just get better'

Melius told Newsday he was relieved by the sale and that it was sufficient to clear his debts.

Without naming the potential new owners, he described them as “very, very nice people." He said Oheka will continue operating as usual under the new ownership, which includes continuing to host holiday events like the annual Easter egg hunt for neighborhood children.

“Nothing — no change. It will just get better,” Melius said. “I am happy, my neighbors will be happy … and we'll all go ahead together.”

Melius said he also will continue living at Oheka and managing operations there, even after it changes hands. There was no immediate confirmation of the developers' plans or whether Melius could continue living at Oheka.

The auction, at The Dominick Hotel on Spring Street in Manhattan, began promptly at 10 a.m. and lasted about 90 minutes, Concierge Auctions CEO Chad Roffers said. It was not open to the public.

"When we went into this process, three to five bidders was a realistic target, so to have seven qualified engaged bidders was a real positive," Roffers told Newsday.

In the neighborhood: Tempered optimism

The terms of the deal alleviated some concerns held by castle neighbors such as Gayle Snyder, a longtime skeptic of the Oheka sale who leads the Cold Spring Hills Civic Association.

Snyder told Newsday she was “absolutely thrilled” that Melius would remain involved with Oheka, saying his policy of making the castle accessible to the neighborhood for things like children’s holiday events would continue.

“Gary always felt strongly that the castle should be shared," she said. “We were very concerned about who would buy it, [because they] might lock it up.”

Snyder added that “hopefully, whoever the buyer is keeps their word — we shall see.”

The civic leader said neighborhood concerns persisted about the new housing units planned for the Oheka property. She explained that nearby residents would prefer no housing be built there, but the condo development rights already exist on that plot of land.

A rare 'trophy' property

An appraisal prepared last year as part of bankruptcy proceedings fixed the castle's value at $137 million, including the condominium development rights.

On its website, Concierge Auctions marketed Oheka as "one of the rarest trophy properties in the country."

For the past four decades, it has been a luxury hotel-catering emporium — a popular spot for celebrity weddings, proms and parties of all sorts, as well as lavish political fundraisers and poker games attracting top elected officials and law enforcement figures.

In earlier years, it was a World War II radio operators training school, a retreat for New York City sanitation workers and a military academy.

The castle was built between 1914 and 1919 — a 127-room estate on 443 acres. The current configuration features a restaurant, catering hall and hotel with 34 guest rooms and suites, all on 21 acres, just north of Jericho Turnpike and next to Cold Spring Country Club.

Oheka's imposing spires, drenched in shadows and accompanied by foreboding music, set the tone in the opening scenes of the 1941 Orson Welles classic "Citizen Kane."

It was constructed as a summer home for investment banker Otto H. Kahn, who named it using a play on his initials. 

Melius bought the property in 1984 and transformed it into an opulent catering venue. He was shot and wounded there in broad daylight in 2014 in a case that remains unsolved.