Uniland Development Co. surprised the downtown development community when the firm purchased the shuttered Dulski Federal Building on Delaware Avenue and announced plans to convert the 15-story structure into a mix of office, hotel and high-end condominium units. Though Uniland is the region’s largest real estate developer, the company had limited experience in residential and hotel development. The skeptics have been proven wrong and the Avant has set a new standard for development not only in Buffalo, but arguably in upstate New York.
While buildings with multiple uses are commonplace in many cities, the Avant is the first in Buffalo to contain three uses: office, hotel and residential. According to Uniland officials, it may be the only building west of New York City with that distinction.
When work was finished last year, the project cost totaled $83 million. Uniland Vice President Michael Montante says the Dulski Building was “aesthetically challenged” but was in a prime location and included two-levels of underground parking. “To duplicate that would have cost millions of dollars,” he says.
A mix of uses was what the project planners envisioned when the 460,000 sq.ft. property was purchased at a General Services Administration auction in 2006. “With that amount of space, we couldn’t flood the market with that amount of office space,” stated Montante. “It would wreak havoc in the downtown market.
“We knew it had to be a mixed-use,” says Montante. “The trick is finding uses that are compatible.”
The revamped building includes a 153-room Embassy Suites hotel on the first seven floors, 128,000 sq.ft. of office space on floors 8 through 12, and 30 luxury residential units on the top three floors.
Bringing together users who will access facilities at different times of the day or days of the week increases the 24/7 vitality of the building and surrounding blocks. The neighborhood around the Avant, bordering the Historic West Village, one block from Chippewa and near courthouses, office buildings, restaurants and other hotels, is arguably downtown’s only area that has around the clock activity. Uniland is confident that the project is a catalyst for further development in the neighborhood.
Each use in the building has separate entrances and elevators, but share many of the Embassy Suites features and services.
The award winning building received the Building Owner’s and Management Association Building of the Year in 2009 and is this year’s Business First Golden Brick award winner for Building of the Year. Hilton Worldwide also recognized Embassy Suites Buffalo at Avant as its Best Conversion this year.
Uniland has also had success selling Buffalo’s most expensive condominiums which are 70 percent sold 1.5 years into sales despite a difficult real estate and financial market.
The building’s five floors of office space are half-leased. Law firm Damon Morey’s 177 employees occupy the eleventh and twelfth floors. The firm relocated from less efficient space on Main Street and signed-on as the building’s anchor office tenant shortly after construction started. Two additional tenants have taken space on the tenth floor.
“We had a good response to 285 Delaware Avenue,” says Montante. “We knew what we wanted to do with the office space here. There’s demand for Class-A offices.”
Montante expresses optimism that the remaining office space will be leased soon. Potential tenants have expressed interest in space ranging in size from 1200 sq.ft. to as large as 35,000 sq.ft. The synergy and appeal of a quality mixed use development has special appeal to companies and commands a premium.
“It’s a unique building,” says Montante. “Despite a soft real estate market, we are confident the space will fill.”
Uniland traditionally keeps an inventory of available commercial space for lease for companies needing office or light industrial space immediately instead of waiting 18 to 30 months for a building to be constructed. The firm has been the biggest builder of spec space in the region, or as Montante prefers calling it, “venture buildings.” But the down economy has brought new multi-tenant construction to a virtual halt.
“We will do spec space, but it will be market-driven,” he says. “Until we get a bump in employment, the commercial real estate market will remain soft.”
Bullish on Delaware/Elmwood Corridor
Montante expects the Delaware and Elmwood corridor to continue its recent spate of development that includes the Federal Courthouse, its own 285 Delaware office building, the Niagara Center, Babeville, Hampton Inn, and plans for redevelopment of the 100 S. Elmwood building, a boutique hotel at Huron and Franklin, and a parking ramp and office building at Mohawk and S. Elmwood. He is also optimistic on the future of the Statler. “The Statler is a building that needs to be saved” he says and suggests it is a project worthy of public assistance to make it happen.
“Developers have a herd-like mentality, there’s a synergy and momentum in this part of the business district,” explains Montante. “Delaware and Elmwood avenues from City Hall to Tupper Street have seen a significant amount of development and investment.” In fact, over the last five years there has been $295 million invested within one block of Avant.
“We want to continue the momentum building in the area,” says Montante. According to media reports, the company is attempting to secure law firm Phillips Lytle for an office building it is proposing at 155 South Elmwood, just south of the Avant.
City vs Suburbs
Uniland may have cut its teeth with light industrial and office properties in Amherst, Tonawanda and other suburbs, but the perception that the company is suburban-focused is wrong. In fact the company has a long history of Buffalo projects including renovations to 298 Main Street, office space along the Elm-Oak corridor, redevelopment of the former Sears store at Main and Delevan for Blue Cross (now owned by Canisius College), Delevan Station, Niagara Center and the 285 Delaware office building to name a few.
“We consider ourselves to be a Buffalo developer,” says Montante. “We’re not a city or suburban developer. Both are important. There are no borders. Since the mid-1980’s, we have been active in the city. We may be the largest developer of new space in the city over that period.”
Uniland has developed 12 million sq.ft. of office, warehouse and residential space in Western New York since being founded by Carl Montante and Nancy Dobson 36 years ago. Today, the firm owns six million sq.ft. of space, manages 131 buildings, employs 211, and counts 480 companies as tenants.
“We’re in the customer service business,” explains Montante. “If you don’t service your customers the right way, it [your properties] won’t be filled. That’s how Uniland separates itself from the others.”
Montante says the average Uniland tenant occupies 2,200 sq.ft., many smaller, others significantly larger. “It takes six to eight months of courting them and then we service that relationship for 5, 7, 10 and even 20 years over the term of the lease.”
“We have a lot of customers to manage and we do a good job,” says Montante.
Unialnd surveys its tenants twice a year and according to the most recent survey results, Ninety-nine percent of current tenants would recommend Uniland to a friend or colleague.
Gates Circle Tower Still Alive
Uniland remains committed to building the 23-story luxury condominium project proposed for Gates Circle. The luxury high-rise was first proposed in 2007 but was delayed by lawsuits and is now delayed by the economic climate.
“It is certainly on our radar screen,” says Montante. “It is not a shelved project.”
“Until the market improves, not so much the residential market, but the financial market, that is when you’ll see activity on Gates Circle,” says Montante. “It’s a great site, great design and great project. We’re just waiting for the right time.”
“We have not soured on the luxury condo market. If anything, the Avant has reaffirmed our belief that there is demand for high-end, luxury units in Buffalo.”
Get Connected: Uniland Development Co., 716.834.5000
Watch for Parts II and III- The Embassy Suites and Luxury Living Avant Style