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Former nursing home to be auctioned off Residential use of site seems likely outcome

The bankrupt former Grace Manor Nursing Home near Kleinhans Music Hall will be auctioned off Oct. 31 by Cash Cunningham in a proceeding that is already garnering interest, even from out of town.

The auction of the 81,200-square-foot building at 10 Symphony Circle will take place on site at 10 a.m. The vacant building will be sold along with the connected gated parking lot, while a related carriage house on Arlington Street and the equipment that is still inside the former nursing home will be sold separately, piece by piece.

No minimum bid has been set by the bankruptcy court or the secured creditors, the largest of whom is the State Dormitory Authority. Terms of the sale call for a $50,000 deposit in cash or certified funds on the day of the sale, with the balance to 10 percent due within five business days and closing within 30 days, according to Cunningham's company, Cash Realty & Auctions.

"They're not giving me any opening bid," Cunningham said. "They just want it to go away."

The building, which is on 2.14 acres of prime property, was assessed at $5.66 million when it was operating as a nursing home, but Cunningham said he doesn't expect it to sell for that much.

"We wouldn't expect it to generate anywhere near that. We would love it, but it's very unlikely," he said.

The building has about 80 rooms and housed 167 beds when it was functioning, but Cunningham said it "probably will not be used as a nursing home again," since the state would have to be willing to relicense beds at the site. It is zoned for "apartment/hotel district."

"It's likely it'll be converted to some other use, possibly assisted living or student housing, and I think there's a need for that," he said, noting that it's "very close" to D'Youville College as well as to Buffalo State College and Canisius College.

Still, he hopes it will generate interest and bidding. The first signs proclaiming the auction went up Thursday night, and Cunningham said he received calls Friday, including from one interested person from out of town who happened to be visiting Buffalo at the time.

"Because someone would have to convert the use, one would think it would take somebody with some bit of knowledge in terms of development and someone with the resources or access to resources to make that happen," Cunningham said. "But you never worry. At an auction, it only takes two."

He noted that its location -- on Symphony Circle, with two acres and its own parking lot -- makes it attractive, and the building is also in "pristine" condition. It underwent $7 million in renovations in 1997, before opening as a nursing home, so many of the mechanical systems have been redone, and are "good and sound," Cunningham said.

The building has two passenger elevators, one freight elevator, two gas-fired boilers, a new sprinkler system, a loading dock, a diesel emergency generator, two stairwells, dining room and lounges on every floor, sun porches and bay windows. There's also a connected three-story administration building.

"We think it's just a great piece of property. If someone wanted to do something of a residential nature, I think it would be terrific for that."

The sale caps a story that began with the dream of the late Rev. Houston Williams, former pastor of Grace Tabernacle Church of God, who decided in 1979 that Buffalo needed a quality nursing home owned by an African-American. He spent the next 10 years raising funds and soliciting donations but died in 1990, eight years before Grace Manor opened.

It lost money for the first five years before making a profit but then suffered like many nursing homes from what industry officials say are inadequate Medicaid reimbursement rates. In early 2008, in a bid to stay open without interruption, it voluntarily went into receivership, with Kaleida Health named as the operator for as long as 18 months under an arrangement with the state Health Department.

But officials could not work out its problems, and the facility closed in May, although a union representing former employees claims in a federal lawsuit that residents were relocated and the staff was laid off by April 1, so that workers were not given proper notice of the shutdown following the March 5 announcement.

e-mail: jepstein@buffnews.com

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