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The federal Small Business Administration's Area 1 disaster office will relocate from Niagara Falls to Buffalo next summer, bringing 300 new workers to downtown.

The agency will lease 32,000 square feet in the new Niagara Center office complex at 130 S. Elmwood Ave., the U.S. General Services Administration announced Tuesday.

"I look forward to welcoming the new tenants and new customers to our new downtown," said Mayor Anthony M. Masiello. "They will be getting a state-of-the-art building in an exciting neighborhood."

A spokesman for Gov. George E. Pataki's office said late Tuesday, "We applaud SBA's decision to remain in Western New York. The governor had urged them to keep their offices in Western New York and we're pleased they will continue to have a strong presence in the region."

The GSA, which is in charge of real estate decisions for federal agencies, said the annual rent for the new Buffalo center will be $571,875 and the first nine months of the lease will be rent free.

"We are pleased that GSA was successful in finding a new home for the Small Business Administration and ensuring that this important operation, one that delivers services to the entire Northeastern United States, as well as Puerto Rico and the U.S. Virgin Islands, remains in Western New York," said Eileen Long-Chelales, GSA regional administrator.

There had been talk in recent years about relocating the disaster office to an entirely new site, which raised the ire of local, state and federal lawmakers who vowed to keep it in the Buffalo area. In November 2003, SBA officials promised the office would remain in Niagara Falls for the short term, but would seek a new permanent site "within the commuting area."

The $40 million, 290,000-square-foot office building, which will be the agency's new home, is located in the shadow of Buffalo City Hall, just north of Niagara Square. The five-story structure is in the final stages of construction and will welcome its first tenant, the local offices of the Internal Revenue Service, in January.

The building is becoming downtown Buffalo's new federal building by virtue of its tenant roster, which will include the IRS, the Department of Veteran Affairs, and now the SBA. To date, some 190,000 square feet of the building have been leased to those three federal agencies.

Tom Widzinski, a spokesman for Amherst's Uniland Development, which is partnering with Acquest Holdings on the office complex, said the owners are delighted the SBA has chosen downtown Buffalo and their building.

"The popularity of the new building has proven it to be an excellent complement to the government presence already flourishing in the city," Widzinski said.

There are currently more than 350 construction workers at the site on a daily basis in an effort to bring it to completion.

The GSA has worked over the past year to find space for more than a dozen federal offices which will vacate the government-owned Dulski Federal Office Building on Huron Street in downtown Buffalo by the end of 2005. In addition to the Niagara Center, it also has found a new home for the Social Security Administration in the former Barrister Global Services Network building at 186 Exchange St.

The GSA is expected to announce what quarters it has chosen for U.S. Customs offices before the end of the year. Several real estate sources said that large lease will likely go to the freshly redeveloped Larkin building, also on Exchange Street.


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