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With the growing Medical Campus and colleges nearby, Willoughby Insurance has big plans

Craig Willoughby knows all about legacies.

The 38-year-old Buffalo native has been selling auto insurance throughout Western New York for years, following in the footsteps of his father and grandfather before him. Over many decades, the five-office agency has become known as almost a last-resort option for consumers with bad driving records or bad credit: “Willoughby Will When Nobody Will.”

His third-generation business has been booming in recent years, but now he wants to guarantee a future for his own young family. And he wants to leave them a very different kind of inheritance, in case the insurance business changes.

So he plans to knock down the ramshackle one-story, red-and-white building at the southeast corner of Main and East Ferry streets in Buffalo – his agency’s longtime main office – and replace it with a 10-story mixed-use building to be called Willougby Exchange, ensuring his family’s name remains on something physical for years to come. The new building will include his agency’s main office, as well as his own future residence on the top floor.

“It’s the opportunity of a lifetime to put up a legacy building,” Willoughby said in an interview. “I want to make sure my family is taken care of.”

The $26 million project, which would include over 100 apartments and an urban market, is designed to capitalize on the new buzz around that neighborhood, and especially that intersection, where two of the four corners have seen redevelopment.

Near Medical Campus

The new Willoughby Exchange will be aimed at a blend of downtown and Medical Campus workers, plus those in the Canisius College and University at Buffalo communities, who desire urban living and easy access to their jobs and city life. And as with Nick Sinatra’s Fenton Village across Main Street and Midtown Apartments around the corner – and even Ciminelli Real Estate Corp.’s Bethune Lofts further up Main – Willoughby and his team hope it will benefit from its location on Main Street along bus routes and near a Metro Rail station.

“You’re on the outskirts of what’s happening with Medical Campus moving this way. You’re on the other side of (University at Buffalo). You’re in the center,” said Colby Smith, president of commercial real estate firm Colby Development, who will handle much of the project as Willoughby’s representative. “If you’re going to build something new and you can aggregate land, that’s the location, right there in the Masten District.”

The development team cited favorable demographics and a market study that projects demand for apartments at about 3,300 units for the next three years, with fewer than 1,500 already in existence or underway. And Buffalo Mayor Byron W. Brown is calling for 2,000 more units by 2018. “It’s the right project. It’s the right time,” said Orrin Tobbe, president of Bank Advisory Services, the team’s financial adviser. “The market demand is there.”

According to plans by Silvestri Architects that were shared with The Buffalo News, the 125,000-square-foot red-brick and glass project calls for eight stories of apartments above one floor of commercial and retail space on the ground level. The market-rate apartments include 64 one-bedroom units, of about 990 square feet each, and 37 two-bedroom units, with about 1,140 square feet in each. The apartments will rent for $1,200 and $1,500 per month, respectively, plus $75 per month for covered parking.

“There’s such a demand for housing for folks that are at the Medical Campus. They can’t wait for something like this,” Smith said.

A two-story owners suite will be accessed from the ninth floor, and includes a 10th floor for living quarters. “I plan on retiring there, moving back into the city after I raise my kids,” Willoughby said.

Grocery store

The project also features 19,000 square feet of commercial space, including the 2,230-square-foot Willoughby Insurance office; a three-story, 4,632-square-foot fitness studio with a pool at the corner of Ferry and Otis streets; 5,500 square feet of space that is still available; and 7,380 square feet of space designated for a urban store. Smith said the grocer would not be a national chain.

“Demand in that geographic region is calling for grocers,” Willoughby said. “So we’d like to fill up with a nice high-end grocer that would match the building and match the luxury apartments across the street.”

There’s also one level of underground parking beneath the building, with 72 spaces, as well as an additional 64 surface spaces outside the building – enough to accommodate both the residential and retail needs. And there’s a rooftop garden area and common space for tenants on top of the smaller building.

Green plans

Willoughby is hoping to make the complex a “net-zero” project that will use only renewable energy, generated onsite with a geothermal system for heating and air-conditioning or through a solar farm for electrical power. However, Smith acknowledged the sizable upfront costs of such investments.

Smith said the team shared project details with Common Councilmember Ulysees O. Wingo Sr., the mayor’s office and the city Planning Department, but has not filed formal documents. Both Planning Board and Zoning Board of Appeals approvals are needed before work can begin, but Smith said they hope to start by late fall and open in spring 2018. Blasdell-based R&P Oak Hill Development will manage construction.

Lending environment

The project will be financed using a combination of bank loans and investor equity, plus a city property tax break and possible state environmental incentives. Willoughby already owns the 1.16-acre parcel, which is appraised at $860,000, and “we have a high level of interest” from both local and out-of-town individual investors, Tobbe said. The group is also negotiating with two local banks on a financing package. The team may apply for a low-interest loan through a Buffalo Billion program for transit-oriented development, but no other tax credits or breaks are envisioned, Tobbe said. “It all seems to be coming together,” he said. “Right now it’s a good lending market. Local banks are being very aggressive on this.”

Vision grew

Founded in 1952 by Craig Willoughby’s grandfather, the insurance agency initially operated just out of a home on Minnesota Avenue before eventually moving to the corner of Main and Michigan Avenue – now a Family Dollar store – in the 1960s. It was forced to move again in the 1970s, when the Metro Rail was built, and Willoughby’s father later expanded the entire business to nine locations in three counties before scaling back to its present size.

Willoughby, whose current insurance office is located in the former home of Arthur Treacher’s Fish & Chips, said he had “always wanted to do something” at the site, and even had some friends draw up some architectural proposals back in 2002. But he admits he never imagined doing such a large project until Smith first approached him two years ago.

“I got super-excited and super-stoked about it, and with Buffalo in the turnover with the way everything has changed in the past five years, it became a much more realistic and feasible project,” he said. “I never in a million years saw this coming, but I can tell you I’m excited as heck about going forward with this project.”

When it came time to name it, he struggled until his brother suggested a historical reference within the family. One of Willoughby’s ancestors built the Dolan Exchange in the 1830s in downtown Buffalo to handle shipments in fruits, berries, grains and other products off Lake Erie.

“You never know what the future is going to hold, but this is a guarantee,” Willoughby said. “There’s always going to be a demand for living, for a place to put your head down at night. That’s what Willoughby Exchange is going to do, guarantee my children’s future.”

email: jepstein@buffnews.com