Montante acquires another Gates Circle-area site - The Buffalo News

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Montante acquires another Gates Circle-area site

TM Montante Development has acquired a Delaware Avenue office building near Gates Circlein a $1.95 million deal that would expand the geographic reach of its already-mammoth project to reuse the former Millard Fillmore hospital site nearby.

TM Montante spokesman Byron DeLuke said Friday that the firm's "initial concept" for its new purchase involves an adaptive reuse of the mostly vacant office building, with residential apartments on the upper floors and commercial or retail space on the ground floor.

"We're not ready to discuss details as we have yet to fully engage the community on the project," he said. "And we're committed to a robust and collaborative community discussion as we bring each and every project forward at the site."

The development firm owned by Thomas Montante — brother of Uniland Development Co.'s Carl Montante — paid $1.95 million this week to buy the medical and professional office building at 1275 Delaware. The seller was E.C. Mortgage Co.  of West Seneca, registered to accounting firm Travers & Co.

Built in 1957, the 47,712-square-foot, five-story structure with a penthouse includes a 66-space parking lot, and is valued by the city at $1.176 million. It's located adjacent to the 10-acre former hospital site, on which Montante and partner Robert Morgan of Rochester are planning a multi-year, $110 million redevelopment of a new residential community.

The mixed-use concept fits into the developers' plans for the larger Gates Circle project, known as Lancaster Square, which calls for up to 500 condominiums, market-rate apartments and townhomes, spread over the site in multiple buildings to be constructed over several years. There would also be retail space for a grocery store, fitness club and ground-floor retail storefronts, and possibly some office space. Montante officials have already had discussions with potential tenants like Tops Markets, Dash's and the YMCA, but no commitments yet.

TM Montante starts talks on next Gates Circle project

Montante announced earlier this year that he was teaming up with Morgan, whose fast-growing Morgan Communities owns 36,000 apartments in 14 states, as well as mobile-home parks, self-storage facilities and commercial buildings. Morgan, who initially began his real estate empire by acquiring and upgrading existing properties, has become much more active in new construction and development in cities like Rochester, Pittsburgh, and now Buffalo.

The Buffalo News reported in September that the FBI and U.S. Attorney's Office in Buffalo are investigating how Morgan's companies finance their acquisitions and developments, focusing particularly on the rent rolls and other financial information they provide to lenders to justify loans. The probe extends beyond his properties in Buffalo, including those in other cities as well.

There is no indication that the investigation is affecting the Gates Circle project, where Morgan's experience and financial connections will come into play, and Montante officials did not respond to inquiries on the subject.

In the meantime, the hospital buildings have already been taken down and cleared, and the site cleaned in preparation for reuse. And the partners received city approval for the first phase, a six-story, 60,000-square foot mixed-use building at 1299 Delaware - right next to the office building Montante just acquired. This new facility would include three first-floor retail spaces and 60 market-rate apartments on the upper floors.

The developers have also started preliminary discussions with neighbors about a second major building on the site that could host the proposed grocery store and up to 150 more apartments. And Montante has agreed to buy the city-owned parking ramp at 1277 Delaware for $1.7 million, pending approval by the Common Council.

In other parts of the former hospital site, Episcopal Church Home & Affiliates opened its new $41 million, six-story urban Canterbury Woods facility with 53 independent-living and five assisted-living units at 3 Gates Circle, while People Inc. is working to erect a three-story senior housing building at 637 Linwood, with 37 units and parking.

Separately, the Montante family sold another Delaware Avenue building — housing a compounding pharmacy in Kenmore — to the owner and operator of four other such facilities in the region. DeLuke said the family had initially acquired the building at 2814-2818 Delaware in 1975, with the intention of operating an auto service center under the Broad Elm Tire brand, which the family owned. It was later converted into a fine-dining restaurant 14 years ago, and became a pharmacy several years ago, he said. The sale to 2818 Delaware Ave LLC was for $465,000.

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