Four months after completing its repurchase of the former Auction Direct USA dealership property on Transit Road, West Herr Automotive Group is evaluating opportunities for future development of the site, but has not yet made any decisions.
West Herr, the region’s largest dealership group, bought the used-car lot at 5485 Transit Road, near Roll Road, from Rochester-based Auction Direct, paying $3.5 million. The property, which is located right next to West Herr’s Used Car Outlet store, had previously been owned and used by West Herr, but was sold to Auction Direct in 2010 for $4.14 million, enabling the five-year-old company to enter the Buffalo market. Prior to West Herr’s ownership, the site was Saturn of Clarence.
Auction Direct invested more than $1 million in upgrading the property, where it operated a showroom and dealership for its online and auction-based “no-haggle” model that had already proven successful in Rochester, Florida and North Carolina after its initial launch in 2005. The company had hoped to sell 50 to 60 cars a month on average from the Clarence location, which may have been unrealistic, said Robert P. Strell, the real estate broker who originally worked with Auction Direct five years ago.
But Buffalo proved a harder market in which to compete because of established used-car dealers like West Herr itself. So Auction Direct closed the site in 2014 and consolidated its Western New York sales back to Rochester, just three years after opening the location. It then negotiated a resale back to West Herr.
“We were offered the opportunity to buy [it] back at a very fair purchase price, considering the improvements that were made to the building,” said Scott Bieler, West Herr president.
For its part, West Herr didn’t see Auction Direct as competition several years ago, and didn’t have immediate plans for the property in 2010. Now, though, the Internet has become more important for all car dealers, and West Herr needs more land for its own growing car sales business, especially for parking its large inventory.
“It’s harder to find a property that you can use for automotive sales use now,” Strell said, citing the difficulty of rezoning land. “There’s just not a lot of property around, and it’s being developed to other, more intense retail purposes. This will give West Herr a lot more room.”