The designer for planned redevelopment of the former AM&A’s department store building said the mysterious new owners of the complex are backed by the fifth-largest real estate development group in China, which would lend significant financial weight to their ambitious plans to convert the mammoth building into a destination for Asian tourists.
Local engineer John A. Schenne, of East Aurora, said the out-of-town buyers, led by Lily Li of Flushing, Queens, are part of a much larger investor group from China that owns significant chunks of real estate both in that country and also in New York City. Schenne said he did not know the name of the private Chinese company or any other details about it, except that “they own a bunch of buildings in China.”
The group will be spending its own money on the project, now estimated to cost $60 million to $70 million, and will not use any bank financing, he said, during a presentation Wednesday to directors of the downtown property owners group Buffalo Place. He said they are also seeking state and federal historic tax credits. “They’ve got all the funding in place,” he said. “They’ve got an ambitious plan to get this done in 18 months.”
The group is moving forward quickly with its redevelopment plans. Fencing is up around the 375,000-square-foot building, and the developers are now negotiating prices and terms with five different contractors to remove asbestos and any other environmental issues in the complex.
Schenne said the group, known as Landco H&L, will likely choose two or three contractors for the cleanup, which he said will take about 70,000 to 90,000 man-hours to complete. Work can begin as soon as insurance certificates are filed with the city.
The Buffalo Planning Board has scheduled a public hearing on the project for 9 a.m. April 7. Schenne said the investors want the project completed and ready by December 2016. “That’s an aggressive schedule,” he said. “I’m not too sure we’ll make it, but that’s what we’re shooting for.”
The credentials and legitimacy of the new owners have been the subject of local speculation ever since the group suddenly showed up last fall to purchase the vacant building at 377 Main St. from its longtime owner, Apollon Group LLC, for $2.775 million.
The Long Island-based firm had bought the 10-story building in 2006 for $2.05 million with the intent of spending $60 million to develop it into apartments and retail space, but those plans never materialized, and the building sat empty and neglected for years. City and state officials began pressuring Apollon last year to do something with it or sell it. Since Landco’s purchase, repeated efforts to contact Li or other representatives of Landco have been unsuccessful, although city officials and members of the Hunt family, which owns the Brisbane Building next door to AM&A’s, say they have met Li. Schenne said she and her partners are “private people.”
The release of details on the reuse plans for the department store building, as well as movement toward the start of actual work, provide further indication that the structure might see new life 16 years after the last tenant vacated in 1999. Bon-Ton Department Stores bought the former AM&A’s in 1994 and closed it a year later. A women’s fashion store, Taylor’s occupied the first floor for eight months but closed in 1999.
“This is a project we’ve been waiting for for 20 years,” said Buffalo Place Chairman Keith M. Belanger. “It’s very exciting.”
Schenne has said the group also owns a travel agency in Queens, with more than 110 tour buses that handle large tour groups traveling from China to New York City and up to Niagara Falls. The developers want to use the AM&A’s building as part of that business, housing tourists in a 300-room hotel on the upper floors for two to three days while they visit Niagara Falls and Buffalo. And Schenne said the investors believe “they can fill a hotel to 90 percent occupancy every day, 365 days a year.”
Two restaurants would occupy the first floor, an American-style eatery and what Schenne called “the best Chinese restaurant in the U.S.” There would also be 6,000 to 8,000 square feet of retail space, although specifics haven’t been set. The building would also include a large pool room and spa area in the 40,000-square-foot basement level, with four to five pools and a 20-foot-tall waterfall dumping into one of them, he said.
Perhaps most interestingly, the second floor would be focused on health, enabling tourists to obtain a level of care they may not normally get. It would feature an environmental medicine clinic offering MRI and CT scans, complete bloodwork testing and other services, as well as a dental clinic. Discussions are also continuing about a small pharmacy, a traditional Chinese medical practitioner and an acupuncturist, “so everything’s right there under one roof,” Schenne said.
Schenne said the company also will cut a 10-story atrium into the middle of the solid block building, providing some windows and daylight for hotel guests in interior rooms. The atrium could be capped on the roof by a glass-enclosed rooftop bar and sun room, although Schenne said that hasn’t been finalized yet.
In all, the project would likely employ about 150 people, Schenne said, with those on the “front lines” likely fluent in Mandarin Chinese as well as English so they can interact with the travelers. Parking could be arranged for employees in leased space away from downtown, but “this is going to be filled up mostly with tourists that don’t have cars,” so it won’t create more pressure downtown.