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BizTalk: LeChase Construction's Panza sees more growth for Buffalo

It's been a busy few years for Jeffrey Panza, but he's not complaining.

The burst of construction and development activity in recent years has drawn attention to Buffalo not only from investors, businesses, tourists and residents, but also from out-of-town contractors. That includes Panza's employer, LeChase Construction Services.

Founded in 1944, the Rochester-based general contractor specializes in the higher education, healthcare, commercial, manufacturing, industrial, and multi-family housing markets. It has offices across the state, from the lower Hudson Valley to Western New York, as well as in North Carolina, and generates nearly $100 million in annual revenues.

The firm has been operating in Buffalo for over 25 years, mostly by taking a drive down the Thruway from its headquarters in Rochester. But it opened its own office in Buffalo four years ago, now led by Panza.

That move enabled the company to capture a handful of larger projects that have come up in recent years, including the Bak USA headquarters at Compass East, the technology innovation hub at Fountain Plaza that is anchored by IBM Corp., the new Buffalo Niagara Medical Campus parking ramp, Roswell Park Comprehensive Cancer Center's Scott Bieler Clinical Sciences Center, Ellicott Development's 500 Pearl and the core-and-shell construction of the new Explore & More Children's Museum at Canalside.

It's also benefited from the collapse of the area's dominant general construction company, LPCiminelli, in the wake of the conviction of Louis P. Ciminelli in the bid-rigging case involving the SolarCity project at Riverbend.

The company recently moved and expanded its local office a year ago by leasing 2,500 square feet on Main Street in Amherst, with more than 25 employees. And Panza is looking ahead to further growth.

Buffalo News: Tell me about your company's business in Buffalo.

Jeff Panza: We've been doing work in the Buffalo market for 25 years, more as a Thruway contractor, going after specific projects. Four years ago, we made a decision to open an office here in Buffalo and it's really been very good.

We've been doing work on the Medical Campus. We've been doing work at University at Buffalo with the field house. We've got some developer work with Ellicott Development, and we've worked with McGuire Development on the IBM IT commercialization innovation hub at KeyTower.

We're doing some work in Niagara County with the Lockport YMCA. We're doing Niagara County Community College's Learning Commons, and the North Tonawanda City School District.

So we're pretty diversified, and I think that's how we sustain, because we don't pinhole ourselves into one market. We make sure that we're broad enough that when one market gets a little bit slower, we can pick it up somewhere else.

Q: What do you see happening in the local marketplace for construction?

A: The market's been really good, and I think it's going to sustain. We saw a flip toward the good with the SolarCity project, and so I think the bubble's going to flatten out a little bit, but I think it's sustainable with the developer work going on. I think there's a lot of work in higher education. There's work at SUNY Buffalo State and University at Buffalo, and you see some of the private colleges wanting to spend money as well.

What I think is really great is you're starting to see some of the industry investing in the area as well. In Niagara Falls, there's talk of Niacet wanting to do some expansion, and Norampac. We see obviously Athenex down in Dunkirk. Even some of the startups like Bak, who have invested in the area and come to this area.

So that's some real strong indicators of the strength of the economy and where it's going.

Q: Do you see any hiccups or concerns?

A: Certainly the historic tax credits are out there. That can be a concern for some of the developers, because so much of what goes on in Buffalo is the restoration of some of these historic buildings. So that will play out as time goes on.

Q: What other potential headwinds do you see for Buffalo?

A: The indicator of industry is the medical campus, which is huge with the UB medical school moving downtown, Roswell Park continuing to invest, Kaleida's investing in Buffalo General. So I think the draw of the medical campus is huge, and that's going to drive development downtown.

It seems that the millennials, they want to work, and play, and live all in the same place. They don't want to commute 15 miles or 20 miles from the burbs. So right now, with the attitude of millennials and the medical campus, that's huge for downtown Buffalo.

Q: With the mega-projects ending here, is there a point when the activity hits a wall?

A: No, not really. Buffalo is a little unique right now, because we do have those mega projects. But if you look at the other regions, the average sized job is about $3 million.

Buffalo is a little unique right now, because I've probably got fewer projects that are larger projects, versus the other regions. Rochester may have a couple of hundred projects in that $1 million to $2 million range.

Q: So you're optimistic?

A: I'm very optimistic, extremely. And we have the support of our board of directors out of Rochester. They are fully on board with Buffalo and they see this as a future, for sure.

Q: How long have you been in this market yourself?

A: Essentially 36 years. The first half of my career as a consulting engineer, and the last 18 years I've been working for LeChase and I've grown with LeChase. They're a great, great company, and I think we're going to be here in Buffalo for a long, long time.

Q: Knowing Buffalo, would you have expected to see the kind of activity that we're seeing here?

A: I think that 10 years ago, we would have been much more skeptical about coming to Buffalo and seeing the kind of growth we've seen the last few years, so, yeah, I think we're a little bit surprised.

A: How do Buffalo and Rochester compare?

Q: We're across New York state. We have seven offices through New York state.

So comparatively, Buffalo is still on growth. There was a blip, but it seems to be on a steady, controlled growth right now.

I would say Rochester has gone through a time where a lot of their industry — the Kodaks, Xeroxes, and Bausch & Lombs — have gone away for the most part. So I think Rochester is a bit more flat than Buffalo is.

Q: And the other upstate cities?

A: It's a little different. I don't see the same energy that is in Buffalo in the other regions. Everybody is sustaining the growth that they've had, but the competition is a little tougher, as the market gets a little flatter.

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