Hostel Buffalo-Niagara's long-term prospects of remaining downtown have taken a step forward.
After soliciting proposals from developers in February, the city has decided not to sell the building at 667 Main St. where the hostel is located, Mayor Byron W. Brown said. Instead, plans call for the hostel to stay put while the Buffalo Urban Renewal Agency develops mixed-income housing in the back of the building.
"We let them know the city does have a commitment to the hostel," the mayor said. "We think it is a desirable use for downtown Buffalo, and we feel very confident we will able to work together for the long term."
Cliff Madell, the hostel's president, said he appreciated the mayor's support, and that with a four-year lease there are no immediate concerns. But he said the likelihood of paying more in rent after that remains a big concern.
"We are very appreciative of our long-term partnership with the city, and look forward to continuing that relationship," Madell said. "Our concern for the future is that we may be required to raise our prices, which would jeopardize our service as a hostel by becoming too expensive for our young population of travelers."
The hostel charges travelers $30 a night.
The 50-bed facility, located in the Theatre District since 1998, draws around 6,000 visitors annually from around the world. Although the lease with the Niagara Frontier Council of American Youth Hostels doesn't expire for four years, there were concerns the building's sale would lead to its ouster because the not-for-profit pays rent well below market rate.
The hostel responded to the city's request for proposals with a $1.7 million plan to redevelop the rest of the building into 15 affordable extended stay units and three commercial spaces. Potential tenants included theater people in town for productions, medical researchers coming to the Buffalo Niagara Medical Campus for brief periods and medical students taking up residence while on rotation.
After meeting with the city, Madell said the hostel would be willing to change its plan from extended stay units to mixed-income housing.
Developer Rocco Termini also submitted a plan, but when he learned the hostel was seeking to buy the building he asked the board of Buffalo Place, a downtown organization made up of property owners, to get behind the hostel's proposal.
The mayor said while he prefers the Buffalo Urban Renewal Agency develop the building, the city could decide at a later time to reconsider.
"While right now this is the way we are envisioning moving forward, we are going to continue to talk and not close the door to those conversations with the hostel," Brown said. "But right now we think the most viable option for the hostel, for the city and for the residents of the community is for the city to develop the Washington Street side of the building."
An ongoing internal dispute between the local hostel and the national organization has also complicated the local group's offer.
The city's decision to develop the building was surprising since it has sold three buildings on the 600 block of Main Street in recent years – the Market Arcade, the former Market Arcade cinema and the Irish Classical Theatre building. The rationale was to return the buildings into private ownership and get them back on the tax rolls.
Brown said the city also wants to help the hostel improve its business plan, including examining best practices in the hostel industry nationally and internationally.
"The city ultimately wants to make a long-term commitment to the hostel," Brown said. "We have indicated to them our desire to be supportive, and to look at how we can rework the business model and make it more viable for the long term."
Madell said he's hopeful for a positive outcome. Buffalo has the only hostel in New York State outside New York City.
"Hostels bring international travelers into Buffalo who wouldn't otherwise come here at all," Madell said. "They stay here because we're only a $2 bus a ride away from Niagara Falls, and there's more to do here than there.
"It puts Buffalo on the map for a young generation who will have been here in their 20s, and have a story to tell."