Ellicott seeks tax breaks for Our Lady of Lourdes project - The Buffalo News

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Ellicott seeks tax breaks for Our Lady of Lourdes project

As Ellicott Development Co. proceeds with its plans for an adaptive reuse of Our Lady of Lourdes Church, the firm owned by Carl and William Paladino is hoping for some tax breaks to support the $3.79 million project.

Ellicott, which is also constructing a six-story building just to the south, wants to renovate the 1898-era church at 1115 Main St. and convert it into a mix of retail, restaurant, office and residential space.

According to documents filed with the city, plans call for constructing two additional floors within the open cathedral nave area to generate about 14,000 square feet over three floors, or 22,453 square feet including the basement.

The ground floor will consist of retail or restaurant space, while the basement will be storage. The second floor will have 5,700 square feet of office space for tenants that have not yet been lined up. The third floor will feature three market-rate apartments of one, two and three bedrooms, ranging in size from 900 to 1,800 square feet, with rents of $1,100 to $1,950 per month.

According to the city filings, the developer plans to retain the existing Medina sandstone facade, stone base, canopy, dormer, wood stone door and wood, stone and copper trim, but will repair or replace materials as needed. The church steeples will also be kept, along with the decorative cross features on top.

Ultimately, the 32,128-square-foot building - which sits on 0.56 acres just north of the Buffalo Niagara Medical Campus - will connect to the new six-story medical office building next door through a glass-enclosed interior courtyard between the structures.

Ellicott, through St. Paul Group LLC, wants sales and mortgage tax exemptions from the Erie County Industrial Development Agency, citing the need to offset "extraordinary costs" that are inherent in redeveloping a "long-vacant and dilapidated structure," but which are not found in a complete new-build. That includes bringing it up to code.

"Like other adaptive reuse developments that we have undertaken, the viability of this project is plagued in many ways, requiring a need for every available resource to finance and yield a modest return," the firm explained in the ECIDA application.

The company noted in its application that the prior owner had "stripped the building's interior down to bare bones." So while "the overall scope of work is extensive," it said the rehabilitation costs also include extensive structural repairs and restoration of decorative plaster on the inside, replacement of all windows, installation of a new elevator and two stair towers, installation of a fire-suppression system, and the addition of bathrooms.

In fact, the developer first had to stabilize the long-vacant building, fixing parts of the roof that were in danger of caving in and erecting steel to brace the outside walls just to make it safe to enter.

At the same time, Ellicott noted, while construction costs in Buffalo may be similar or higher to those in other cities, the rental rates are significantly lower than elsewhere, and lenders may discount them further when calculating how much financing they will provide. That results in a shortfall.

"With the ECIDA's assistance, we are able to tighten the gap in project financing and breathe new life into a long-underutilized and poorly maintained structure," Ellicott said. Otherwise, "we cannot proceed with the project."

Besides the $26,495 in mortgage tax breaks and $142,146 in sales tax help, the project financing would include $2.65 million from banks and $1.14 million in equity. The developer also plans to seek a property tax break through the city.

The agency has scheduled a public hearing for Dec. 1 at 9 a.m. at its 95 Perry St. office. Comments will be accepted through Dec. 19.

Company officials hope to start work in January and finish by July.

Meanwhile, just to the south, Ellicott is planning a six-story retail and office building at 1091 Main, on the site of a parking lot. The proposed 194,000-square-foot building, designed by Smith & Associates, will include retail and office space on the first floor, with the five upper floors of medical or other office space. The 87-foot-tall building will also include a basement level for 50 vehicles, as well as a loading dock.

The $45 million project was approved by the city Planning Board and Zoning Board of Appeals in February.

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