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Buffalo to help minority- and women-owned construction firms

City officials are working to create a new business development center in Buffalo to help start and grow more minority- and women-owned construction contractors, as they seek to fill a void often cited by real estate developers who struggle to meet minority staffing requirements on construction projects.

The city has been working for about six months on a plan to develop the Beverly Gray Business Exchange Center, with help from Next Street Financial LLC, a merchant bank and consulting firm based in Roxbury, Mass., that specializes in urban business development. The exchange will be located in a city-owned building at Utica and Jefferson streets, on the East Side, that city invested money into for improvements a few years ago.

The goal is to ensure that the economic benefits of the city’s ongoing redevelopment boom and revival are being felt more broadly by residents and workers throughout the city’s neighborhoods, said Brendan Mehaffy, executive director of the city’s Office of Strategic Planning.

“The mayor still hears from a substantial population in the city of Buffalo that they don’t feel this growth is for them,” he told a developers’ forum this week.

The impetus for the new venture stems from the city’s insistence on requiring that developers and construction managers on city projects must meet specific hiring goals for women- and minority-owned contractors and workers. That was a major mandate, for example, on the Buffalo Sabres’ HarborCenter project, as well as for the Joint Schools Construction Board’s 10-year renovation project for Buffalo Public Schools, and “we’ve been very aggressive” with such requirements on others as well, Mehaffy said.

But developers complained that it’s very difficult to meet those goals, because there are not enough firms that qualify. So the Beverly Gray Center is designed to address that.

“We’re not sitting idly by and just saying, it’s your problem, go solve it by yourself,” Mehaffy said. “We’re trying to be as fair and helpful as we can to meet this common goal that we think will serve everybody and continue this growth and take it to the next level.”

Using funding from both an unidentified national foundation and local foundations, the city hired NextStreet to study the small business environment in Buffalo itself and then craft a model for the business exchange. The firm has some past experience doing similar work in New York, Chicago and other cities, and will bring that expertise to Buffalo, Mehaffy said.

Next Street, which also has an office in New York City, works with business owners, real estate developers, municipal officials and non-profits to help inner-city small businesses grow, while bringing private, public and nonprofit resources together, according to its website. More specifically, it provides financing and expertise to urban companies, with specialists in organizational development and business strategy, and it links them to more capital, while expanding their capacity to serve bigger clients and handle larger jobs. Most of its clients are in low- and moderate-income areas and nearly three-fourths are minority- or women-owned.

Next Street will interview government officials, community and industry leaders, and key institutions to understand small business needs locally, and will use that to help the Beverly Gray center determine what services and financing tools to offer, and how. The partnership will also help Next Street to develop new economic development strategies that will ensure more balanced growth across the board in Buffalo.

“Quite frankly, unless all boats are rising as part of this, we are going to run into a brick wall as far as development is concerned in this community,” Mehaffy told the developers. “So we are doing as much as we can to make sure that everybody feels that the growth that is happening in the city of Buffalo is growth that everybody can benefit from and growth that will penetrate deep into the neighborhoods.”

The new initiative comes as the city is experiencing a spurt of economic development, with likely $5 billion in new construction projects over the last five years and more coming down the pipeline every day.

“It’s extraordinary what is happening at this point in time,” Mehaffy said. “When you take a step back and look at all of these projects, it’s really extraordinary.”

“We have a window of time here, where this growth is occurring, and we want to make sure we use it for the greatest benefit for the city of Buffalo as possible.”