The city is giving HSBC Bank an extra three months to decide whether it will build a new office complex on the downtown waterfront.
Without debate, the Common Council on Tuesday unanimously agreed to give the banking giant until June 30 to decide whether it will exercise its option to occupy waterfront parcels known as the Webster Block. The extension was formally requested by Buffalo Strategic Planning Director Brendan R. Mehaffy, who later acknowledged that the bank asked for additional time.
This is the second extension that the city has granted to HSBC. The Council voted in December to give the bank until March 30 to decide whether it will move forward with the land-disposition agreement.
HSBC Bank USA spokesman Neil Brazil confirmed that the bank requested the 90-day extension "as we continue to review options." Besides several alternatives for the Webster Block, HSBC also is considering staying in the One HSBC Center tower in its existing space or a reconfigured space, or building on the parking lot behind its HSBC Atrium office building.
"HSBC is still looking at a range of options, one of which is to maintain the status quo. This takes time," he said. "We do appreciate the interest of various stakeholders."
He said the bank will make an announcement "as soon as it is practicable to do so."
Lawmakers only learned about the proposed extension Tuesday, hours before the meeting.
"This Council is moving at the speed of business," said Council Majority Leader Richard A. Fontana of the Lovejoy District. City leaders want to try to protect thousands of banking jobs in downtown Buffalo.
Ideally, Fontana said, the bank would stay in its current quarters in HSBC Center near the foot of Main Street. Some observers fear that a move could devastate the downtown commercial real estate market. HSBC is one of the largest downtown tenants, and many observers warn that the market would be unable to absorb hundreds of thousands of square feet of empty space if the bank leaves HSBC Center.
But city officials repeatedly have said they would rather see HSBC build a new complex on the Webster Block if the alternative involves the loss of thousands of jobs in the downtown district.
"Everyone agrees that we don't want to see these employees leave the city," said University Council Member Bonnie E. Russell.
Mehaffy was asked if he thinks the bank's request for a second extension foreshadows any future decision.
"It shows that HSBC is examining all options. So for those who still hold out hope for the tower [option], this is actually a positive sign, because if it was a forgone conclusion that it was the Webster Block, then all they needed to do was announce it," Mehaffy said.
Fontana underscored the importance of moving quickly on the extension. Without it, HSBC would have had to make a decision by the end of the month.
"We're turning around the item lightning-quick," he said.
The Webster Block is near the inner harbor and across the street from the HSBC Atrium building that HSBC owns. The block is bordered by Main, Washington, Perry and Scott streets.
Last summer, the Council agreed to transfer the 1.9-acre parcel to Erie Canal Harbor Development Corp. for development by HSBC. But it was agreed that the deed would not be turned over until HSBC informs the city that it has selected the site for development. The city would retain ownership of the property if the bank does not build on the land.
Meanwhile, the Phillips Lytle law firm, which also is considering a move out of the HSBC tower, has delayed a decision-making vote by its partners that had been planned for this month. Managing partner David J. McNamara said, "It's difficult to say when we will be in a position to conduct the vote."
"Our team continues to make progress in its efforts to negotiate specific terms for our partners' future consideration," McNamara said by e-mail, "and we will schedule a vote when that process is concluded."
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