After more than two years of delays, Krog Corp. has completed its purchase of the mammoth Trico Products Corp. building on Washington Street, enabling the firm to begin its $80 million redevelopment of the former factory into apartments, a hotel and commercial space.
Orchard Park-based Krog on Wednesday morning paid $35,000 to acquire the seven-story complex from the Buffalo Brownfield Restoration Corp., an arm of the city's Buffalo Urban Development Corp. that has owned the 617,000-square-foot facility at 791 Washington St. for more than a decade.
"I am very proud to say that the city and its economic development agency no longer owns this building," said Buffalo Mayor Byron W. Brown.
The closing was expected but repeatedly put off over the last 24 months as Peter Krog and his team lined up local, state and federal approvals, along with a complicated stream of financing. The project's funding includes historic and brownfield tax credits from the state and federal governments, as well as tax breaks through the Erie County Industrial Development Agency.
The developer has been working in the building for six months on a state-supervised asbestos remediation under the state's Brownfield Cleanup Program, and still has to clean up mold and other environmental issues from years of decay and water damage. Plans call for completion and occupancy by late 2018.
Wednesday's purchase marks a significant milestone in the city's effort to preserve the building's history and bring it back to life. Originally home to the windshield wiper manufacturer founded by John R. Oishei, the complex was built in five stages between 1880 and 1954. It occupies almost an entire city block between Washington and Ellicott streets, north of Goodell Street, on the edge of the Buffalo Niagara Medical Campus.
"We have inherited many legacy buildings in the City of Buffalo and to preserve and redevelop those legacy buildings is no easy task," Brown said. "Ten years of providing stewardship over the Trico Building was a long time, but a necessary time to get to the point where today we are able to transfer it to a developer."
The city bought the building in 2007 in anticipation of redevelopment and reuse by Buffalo Niagara Medical Campus Inc. The BNMC plan never moved forward, and its designated-developer agreement expired in December 2013. Two months later, Krog agreed to buy it.
"It's been a long hard struggle. It's not an easy project. If it was an easy project, a lot of other people would have taken it on a long time ago," said Krog, a developer and engineer. "Fortunately, we've had the fortitude to be able to stay with it and see it to fruition, and now it's a big milestone for us to be closing on the property today and now definitely we'll be moving ahead full speed."
Krog, which has partnered with Buffalo-based Hart Hotels Inc. on the project, plans to carve an atrium into the building for more daylight. Crews will demolish about 120,000 square feet of the building along Ellicott Street as part of the redevelopment, reducing the total building size to just under 500,000 square feet. They will rebuild three top floors to link both sides and create a dramatic entry for car traffic into an interior courtyard.
"When we get through with it, it'll look like a brand-new building," Krog said.
The project will feature a 120-room extended-stay hotel operated by Hart. There's also as many as 185 studio, one-bedroom and two-bedroom loft-style, market-rate apartments, ranging in size from 500 to 1,200 square feet.
The plans also call for 35,000 square feet of Class A office space for a high-tech anchor tenant, 86,000 square feet of additional commercial space and 12,000 square feet of retail or food and beverage space. Tenants have not yet been identified, Krog said. The building will also include 230 interior parking spaces, with another 100 spaces available through an agreement with the Medical Campus.
The Buffalo Public Schools had planned to put a second campus of its successful Emerson School of Hospitality into the Trico complex, in 85,000 square feet, but pulled out late last year because of the delays. Krog increased the number of apartments and added 30,000 square feet of office space to fill out the plan.
"If anybody could pull off a project at this location, it's Peter Krog," Brown said.
Despite the challenges, Krog said he doesn't regret taking on the building. "This has been probably one of the most difficult projects that we've worked on," Krog said. "It's a challenge, to prove that I can do it."