Efforts to revive the Statler Towers have been given another extension but the City of Buffalo could end up owning the historic building.
Statler City LLC, led by Mark D. Croce and James J. Eagan, were granted additional time Tuesday by a Bankruptcy Court judge to work out a deal with the city. A hearing to gauge their progress was set for Jan. 12.
Robert Knoer, an attorney for Statler City, said that under the plan, the city would take title to the 18-story landmark on Niagara Square and Statler City would be named the boarded-up property's designated developer.
"The city has not agreed to any specific terms, but this is a concept we have worked through," Knoer told Judge Carl Bucki.
John Heffron, an attorney for the city, described the arrangements as in the "preliminary stages. There is a lot of ground to cover, to say the least," he said.
The plan would have to be submitted to the Common Council for approval.
Statler City has said it needs more than $5 million in public funds to make emergency repairs to the Statler before it could launch a revitalization of the property. But the city has expressed reservations about providing funds, saying it wants to see a comprehensive plan for redeveloping the 800,000-square-foot former hotel.
Brendan R. Mehaffy, executive director of the city's Office of Strategic Planning, said city officials still need to work out numerous specifics with Statler City.
"It's a question of the plan and the details we need to be comfortable with," he said.
Garry Graber, attorney for the trustee in the bankruptcy case, Morris Horwitz, said Statler City addressed two key concerns about insurance and taxes that made Horwitz agreeable to giving Statler City more time.
Statler City said it will put in place a $7 million insurance policy safeguarding the trustee and pledged to cover any taxes that accrue on the Statler from Dec. 1 onward, to prevent the Statler bankruptcy estate from absorbing those costs.
The insurance policy "protects the trustee from any liability that might befall him stemming from problems with the building," Graber said.
Statler City had been seeking a 90-day extension of its "due diligence" period. Bucki granted a shorter extension, of about three weeks. He delayed ruling on a motion by the trustee seeking authority to abandon the Statler.