The partners behind the planned redevelopment of the former Shea's Seneca Theatre into apartments and commercial space are counting on more than $450,000 in tax breaks to help with the $9 million project.
Jake Schneider's Schneider Development, along with partners Andrew and Matthew Dorn, have asked the Erie County Industrial Development Agency for sales and mortgage recording tax breaks as part of their proposal to convert the 48,000-square-foot commercial building at 2178 Seneca St. to new use. The project – which entails a complete gutting, rehabilitation and historic repair of the building interior – garnered support last week from the city Planning Board and received variances from the Zoning Board of Appeals.
Plans call for 25 apartments on the second floor and rear of the first floor, along with bike storage, a fitness center, a lobby area and a dog-wash station. There's also 19,000 square feet of commercial space, including a 130-seat "black-box" theater, lobby and ticket booth, dressing rooms, classrooms and storage for the nonprofit Second Generation Theatre Company, which will relocate back to Buffalo from Lancaster, and will work with other local arts groups.
The project also features an 11,012-square-foot banquet facility for Shea's Seneca Banquet & Events – owned by William and Molly Koessler – in the ornate former theatre lobby, plus 3,000 square feet of undetermined retail space for local vendors or other businesses. A rooftop deck for residential tenants and an outdoor courtyard for the commercial tenants on a current parking lot are also planned.
"Filling the commercial space was one of the largest concerns we had to address," the partners said in their ECIDA application. "The residential component was also a large question mark for us. This area of town has been relatively untested for commercial multi-family redevelopment."
Costs include $7.08 million for renovation, $1.36 million in professional and other costs and $540,000 for the acquisition. It will be funded by $2.6 million in equity, $4 million in bank loans and $2.4 million in historic tax credits and grants from National Fuel Gas Co., National Grid and the state.
According to the partners' ECIDA application, they "are committed to the project and the neighborhood" regardless of whether they receive the tax breaks and must still follow through on their plans now that they own the building. "We have to move forward, even it's not an economically logical endeavor," they wrote.
But without the ECIDA's help under the agency's adaptive-reuse policy, the project "will have a difficult time attracting lenders" and tax credit investors because it would offer only "ignominious returns."
"As a company, we refuse to sit on the property, letting it slowly deteriorate to the detriment of the surrounding neighborhood," they wrote in the application. "However, if we cannot provide modest returns ... it will dramatically impact our ability to locate capital to structure future projects."
The partners cited the benefits to the city, county and region, noting higher new property and sales tax revenues in the future, as well as the chance to act as a catalyst for further development in South Buffalo. But in the meantime, "in order to fit within the context of the neighborhood and succeed, the project must provide lower residential and commercial rents than other areas of the city."
"The revival of this historic building holds tremendous potential to unlocking the economic revitalization of an established but economically depressed commercial corridor," according to the partners' ECIDA application. "The value to restoring these large historic structures is critically important to our regional identity and the long-term economic vitality of the neighborhood in which they are located ... At the end of the day, it's about stabilizing a neighborhood, which has incalculable benefits to the county."
A public hearing on the application has been scheduled for March 27, with comments accepted through April 25. Schneider hopes to start work by April and finish a year later.