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New owners of AM&A’s building envision a hotel at the long-vacant site

For 16 years, the former Adam Meldrum & Anderson Co. department store has sat vacant in the heart of downtown, an unwelcome reminder of the-once bustling shopping district’s long decline.

But this week – in the clearest sign yet that the yellow-brick building appears on its way back – workers set up Jersey barriers and erected fencing on Main, Washington and Eagle streets in advance of a $5 million, four-month-long asbestos removal project scheduled to begin next month.

When the project is complete, the new owners hope to create a New York City-Buffalo-Niagara Falls pipeline that would take Chinese tourists by bus from the Big Apple to stay in one of up to 300 hotel rooms envisioned for the former AM&A’s. The travelers would visit local attractions during their stay before continuing on to Niagara Falls.

“These people are very well financed, they have large projects around, and I wouldn’t be concerned in a minute about being able to finish a project of this scope. They aren’t run-of-the-mill investors,” said John Schenne, a local engineer working on the project.

Landco H&L – a group of New York City investors, including some believed to be from China – bought the 12-story, 375,000-square-foot property at 377 Main St. in November for $2.7 million. It also owns a travel agency and a fleet of tour buses, Shenne said.

“They want to bring in new people that wouldn’t be here if it weren’t for them,” Shenne said. “You bring 300 people to town, put them in up in a nice hotel and they are going to spend money that otherwise wouldn’t be here. The building is going back on the tax rolls, and it’s good for everybody.”

Developer Hormoz Mansouri, who briefly worked for the owner, confirmed the New York City-Buffalo-Niagara Falls plan. He said the colossal building, once built for merchandising, had numerous obstacles and needs major investment to succeed. He questioned whether such an expensive undertaking could pay off.

Still, Mansouri said of Buffalo tapping into Niagara Falls tourism, “It’s a great idea. Niagara Falls has been a great idea for 30, 40 years.”

Much more is also in store for the AM&A’s building. The plans include a large, upscale Chinese restaurant, a medical diagnostic center, a spa and fitness center and a small number of apartments.

Last week, Mayor Byron W. Brown and others in his administration met with Li Li of Flushing, Queens, listed as the investors’ leader, according to the deed filed with the Erie County Clerk’s Office. The mayor in October pressed Attorney General Eric T. Schneiderman to initiate legal action against the building’s former owner in an attempt to force action on the building that has languished, vacant, over the past decade.

“The mayor has prioritized the former AM&A’s building because of its strategic location in the heart of downtown, next to one of our largest employers, M&T Bank, and near many residential developments that have been very successful,” said Brendan Mehaffy, who heads the Office of Strategic Planning and attended the meeting. “The redevelopment of that building would really build more critical mass in that area, which then brings greater demand for other services, like restaurants and retail, that are starting to come downtown.”

He added that the administration was encouraged to see international investors seeking to bring international tourism to the city.

Attempts by The News to reach Li were unsuccessful.

Some people close to the situation said they were frustrated by a lack of transparency, which they also said could be explained, in part, by cultural differences.

Schenne’s involvement stems from working with developer Rocco Termini on many of his projects, including the AM&A Lofts and Hotel @ the Lafayette, where the engineer has his office. He became familiar with AM&A’s when Termini sought to redevelop the site into a hotel, apartments and offices before pulling out in 2012 after failing to raise the state cap on historic tax credits he needed to help finance the project. Schenne did structural inspections and other preliminary work.

“I think I know more about that building than anybody in town,” he said.

Schenne, who is currently working on design drawings, said that’s why Landco sought him out.

Landco plans to seek state historic tax credits. Schenne said he will work with the state Office of Parks, Recreation and Historic Preservation to restore the facade on the Washington Street side and match the existing architecture by removing ceramic tiles where old shop windows once were. Three other interconnecting structures also would be restored.

A revitalized AM&A’s would dramatically alter downtown, said Ed Healy, spokesman for Visit Buffalo Niagara.

“It has felt that despite all the progress that is everywhere around us, AM&A’s was kind of an Achilles’ heel that was left in the middle of downtown. You would take people on Metro Rail and almost want to create a distraction so they wouldn’t see it,” Healy said.

“If this is cleaned up and restored and put to such high use, it’s like a final piece of the puzzle,” he said.

Dottie Gallagher-Cohen, president and CEO of the Buffalo Niagara Partnership, also said it would be a huge boost for downtown.

“That building is one of the most challenging for redevelopment in Buffalo. A lot of people have looked at it and walked away. To the point where we have active work and remediation of the problems in the building, that is magnificent,” she said.

It’s too early to establish a timeline for the project and an opening date, Schenne said.

“We have kicked around 18 months to two years,” he said. “Nobody does a project of this size overnight.”

The building will soon be sealed for the asbestos abatement that is slated to be completed in the spring.

“After that, then we’ll go crazy. By then nice weather will be here, and you’ll see a lot of progress,” Schenne said.