Financial difficulties are not unique to the Statler project. Numerous downtown developments have had financial bumps on their way to, or after, completion. Steel’s recently profiled City Centre is one of them.
The nine-story, circa-1926 Nemmer Building at 610-616 Main Street was acquired by the City in a tax foreclosure auction in 1978. The windowless building had been vacant for over a decade and it would take another ten years for the City to find a developer to carry out a redevelopment of the site. Several firms or partnerships took a run at the property in the early 1980’s. Tremont Corp. of Orchard Park came close to pulling off an office conversion project in 1985. Those plans fell through as well (rendering below). Demolition of the eyesore was considered inevitable.
Tremont Centre proposal, 1985.
As development proceeded on surrounding blocks, City Centre Development submitted a proposal that included luxury condominiums, office and retail space. A second phase would have seen the construction of a 1600 seat theater on an adjacent site. The Buffalo Urban Renewal Agency endorsed plans by the City Centre team consisting of William Jones, Joseph Petrella and Tino Bellanco.
Designed by architecture firm Hovey Nardini Architects, five floors were to be added to the building to provide four levels of commercial space topped by 41 condominium units. Construction was expected to start in spring 1991 and last approximately one year. Work did not get under way as scheduled. M&T Bank, the project lender, required 31 of the condominium units be pre-sold prior to releasing construction funds. Despite asking prices of $156,000 to $600,000, 25 condo units had been reserved. The Buffalo Enterprise Development Corporation stepped in to assist the project in the form of a $1.65 million guaranty, roughly equal in value to six units, meeting M&T funding requirements.
City Centre rendering showing mixed-use tower and planned theater, 1988.
Work was finally underway in March 1992. When the building was completed in mid-1993, just one additional unit had been put under contract.
Unforeseen construction costs along with a difficult real estate market forced the developer into filing for Chapter 11 bankruptcy protection in late-1994. At the time of filing, 75 percent of the commercial space was under lease, but just 18 of the pre-sold units actually closed. Many of the condominium sales fell through due to the delays in completing the building.
A financial reorganization plan was completed in 1996 with M&T Bank agreeing to provide additional funds to complete work on unfinished condominium units. The Urban Renewal Agency agreed to buy some of the 14 unsold condos if necessary. Seven were eventually purchased for a total of $1.65 million. Those units were eventually sold by the City, at a loss, beginning in 1999.
Realtor Susan Lenahan marketed the condos after the bankruptcy filing. “When the building first started, people were fearful of the location and Chippewa Street, which of course is not a problem now,” says Lenahan. “Also, people wanted garage parking and the ramp had not yet been built on the corner. It is always about location, location, location, and the developers were really pioneers at the time.”
There are fourteen different floorplans ranging in size from a one bedroom unit with 754 sq.ft. to a two-bedroom unit on the 13th floor with two terraces and 2,898 sq.ft. of living space. Units sold in the last two years have ranged in price from $175,000 to $320,000. It remains downtown’s only condominium development. The commercial condominium at the base of the building is currently going through a bankruptcy proceeding.
Developers have only recently regained the courage to propose new, large-scale condominium projects in the city. All patently upscale. As for City Centre Development, the firm has morphed into CityView Properties. They have had better luck with other risky projects including rehab of the Root Building on Chippewa Street into a mix of office, educational and retail space and converting the Larkin warehouse on Exchange Street into 600,000 sq.ft. of office space. CityView is returning downtown with plans to restore the long-vacant Genesee Block near the Theater District.
