The developer behind the Crescendo apartment building on Niagara Street is now seeking tax breaks for a second project just across the street.
Natale Development is requesting a package of sales and mortgage recording tax breaks from the Erie County Industrial Development Agency, to support its $5.6 million conversion of the former Aldrich & Ray Manufacturing Co. building into a mixed-use facility with commercial and residential space.
Plans for the project at 1485-1491 Niagara St. call for a blend of commercial and residential space in the four-story structure, which is also known as the former S.A. Day Manufacturing Co. building.
The 33,550-square-foot complex – located on 0.77 acres across the street from Natale's fully-leased Crescendo apartments – would include 16,000 square feet of commercial space on the first and second floors, plus 14 two-story, two-bedroom apartments on the combined third and fourth floors, according to the application to the ECIDA.
Entry to the apartments would be on the third floor, where the living areas and kitchen would be located, while the bedrooms would be upstairs. Rents will be market-rate, but the developers said in their application to ECIDA that they are "considering designating at least one unit" for tenants earning 90 percent of the area median income.
Two businesses already have signed leases for the first and second floors – Horvath Chiropractic, with 3,750 square feet, and MVP Network Consulting, with 12,500 square feet, the application says. That would take up all the commercial space.
The project – which will be undertaken and owned by Angelo Natale, Frank Parisi, Robert Corrao and Carl Savarino – will also entail a full site cleanup by Benchmark Turnkey under the state Brownfield Cleanup Program.
Funding includes $1.1 million in developer equity and $4.5 million in bank loans.
The proposal has already received municipal approval, and if approved by the state Department of Environmental Conservation and state Historic Preservation Office, it also would be supported by $2.3 million in historic and brownfield cleanup tax credits.
Even so, Natale and its partners are seeking $37,500 in mortgage tax breaks and $205,625 in sales tax breaks. They are also applying separately for the city's 485-b property tax break, which is longer and more lucrative than the ECIDA's property tax incentive.
"The total cost to renovate an aging building like this one in a manner that fits the city of Buffalo and SHPO requirements is very high. In order to really do this building justice and put it back into use as an operational mixed-use building, we need to spend more money than what the market rents will be able to stabilize," the developers said in their ECIDA application.
"A project like this one is not feasible without financial assistance," the developers said.
This is the second effort to redevelop the vacant red-brick warehouse and industrial building, which was previously targeted by architect-turned-developer Karl Frizlen for a mixed-use residential and commercial project. The masonry structure sits between Potomac and Bird avenues, across from the Niagara Thruway and Niagara River, affording views of the water and Unity Island.
Frizlen's Lofts @ 1485 Niagara project called for 30 market-rate apartments and up to 5,000 square feet of commercial space. But his $2.5 million effort collapsed after the state Historic Preservation Office determined the facility would not qualify for lucrative tax credits of up to 40 percent of the development costs because the northern part of the complex had already been torn down.
Even so, Natale and his advisers, led by architect Steven Carmina of Carmina Wood Morris, believe the existing structure should still be able to qualify for historic tax credits. "We feel we have a very strong argument that the building that’s existing is the original building that was built on the site and should be listed," Carmina said.
Carmina said they already proposed extending an existing historic district on Niagara Street to cover the building, but the state rejected that argument and also said it would not approve the building individually. So the developers are instead planning to seek a more favorable ruling from the National Park Service, though the architect acknowledged that "we're fighting an uphill battle."
"It’s going to take a lot of work to get it there, but we’re being pretty obstinate about it," he said. "We do respect SHPO’s position, but we disagree, and we’re going to let NPS weigh in."
Officials hope to start work in November and finish by August 2019.