A new report produced by the Buffalo Niagara Partnership makes a persuasive case that, while downtown Buffalo is on the path to stability, it’s not yet where it needs to be. To that end, it argues, incentives need to be maintained, not curtailed in the false belief that a critical mass will be self-sustaining.
No one wants to pay incentives. They shift costs from those who receive them – often developers and their clients – to the rest of the tax base, which has to fund that benefit. But they are necessary here for two reasons:
• As a general matter, New York is a higher cost state than most others. Attracting businesses or development projects requires efforts by such agencies as the Erie County Industrial Development Agency offer taxpayer-supported temptations.
• In Buffalo, specifically, construction costs are slightly higher than the national average while rents are about 14 percent lower. In addition, despite a recent uptick, the city’s population has fallen from 2010 and its residential stock includes thousands of vacant homes.
The matter is urgent because, while Buffalo has come roaring back over the past several years, its revival remains a work in progress. There is no guarantee that they won’t stall or even reverse.
That’s an important factor for the Erie County IDA to keep in mind as it considers whether to retire its adaptive reuse policy. It’s also the reason the region continues to require access to historic tax credits, which had helped to make possible projects such as the restoration of the Hotel @ The Lafayette. With those tax credits, that hotel would surely remain the bedraggled joint to which it had degenerated.
As the Partnership points out, while downtown Buffalo contains several “nodes,” it lacks a cohesive neighborhood such as exists in the Elmwood Village, Allentown or Parkside. Establishing that kind of neighborhood is a worthy goal and, while achieving it will require more than public incentive programs, they will need to play their roles.
Certainly, there is room for continued adaptive reuses. The study, for example found that 262 new downtown housing units were created in 2017, slightly less than the existing demand of 281 units. In addition, the vacancy rate for downtown apartments was 4.2 percent, 16 percent below the 5 percent rate considered to be healthy in a rental market.
“These figures indicate that economic development efforts are effective and the need in the market is being satisfied,” the report by Real Property Research Group, a consulting firm, concluded.
But in a city – and a critical neighborhood – that is still on the comeback trail, advocates dare not declare victory and lose focus. Downtown requires continuing attention as the city seeks to create the density that makes urban spaces work.
Without it, places such as the Hotel Lafayette decline; with it, they can flourish. Flourishing is better.