The $50 million that Gov. Andrew Cuomo announced last week for the East Side did more than just provide a promise of money.
It projected confidence and a commitment to the East Side that has developers talking.
"If you look at the other areas, there is really nothing left except for the East Side," said Rhonda Ricks, whose R+A+R Development is working on a project to bring housing to the former Buffalo Forge site. "All the other areas have been done."
Ricks and other developers said they believe the Buffalo Billion II investment lays the groundwork for big changes ahead.
"Overnight, it puts the East Side on the map," said Rocco Termini, who has developed nearly a dozen properties in downtown Buffalo and Black Rock.
"You will see projects coming out of the woodwork that people wanted to produce but couldn't because they couldn't get the numbers to work," he said.
The East Side Corridor Economic Development Fund, which the state money will be funneled through, calls for infrastructure investments and other improvements in nine areas located along the north-south corridors of Bailey, Fillmore, Jefferson and Michigan avenues.
The money will support historic assets, boost projects that have demonstrated momentum, aid new businesses and entrepreneurs and promote walkable areas.
"This is a good plan because it will bring other resources from private developers, and gives us an opportunity to have a mixture of housing, programming and services that haven't been there for a long time," Ricks said.
Empire State Development developed the plan in partnership with the City of Buffalo and University at Buffalo Regional Institute.
Last year, the state approved a $10 million housing initiative designed to increase homeownership, prevent foreclosure and target zombie properties. Also, the non-profit entity for the Central Terminal received $5 million to implement a plan developed by the Urban Land Institute.
Since 2011, New York State has invested $237 million on the East Side, including $90 million for the largest project, the Northland Workforce Training Center, as well as programs such as Buffalo Center for Arts & Technology, Burgard High School Advanced Manufacturing Program and Bellamy Commons.
Termini said that if done right, the $50 million can be leveraged to $200 million worth of development on the East Side through the use of tax credits and other economic development funding available for urban projects.
Waiting its turn
Some 42 percent of Buffalo's residents live on the East Side. Nearly four out of five are people of color. As state funds from the first Buffalo Billion began pouring into the region, many residents felt the state shortchanged the East Side.
That view has been changing in the past few years as more resources have gone there and privately funded developments have increased.
"I'm extremely happy," said Council Member Rasheed Wyatt, who represents the University District. "There are so many things we're trying to accomplish in the Kensington-Bailey district as far as rebuilding our business strip, and also making it more appealing to attract additional investment and new residences."
Kensington-Bailey is one of the investment target areas in the plan. The Varsity Theatre, considered a linchpin in that commercial district, is getting funds for interior lighting and other renovations, facade improvements and a vertical sign.
The theater is one of 10 properties or developments now underway receiving grants, including Nash Lofts, Torn Space Theater, Buffalo Brewing Company's relocation to the former Schreiber Brewery and the Beverly Gray Business Exchange Center.
Funds are also being spent to boost the Michigan Street African American Heritage Corridor, reinvigorate the Broadway Market while creating a visual link to the Central Terminal, and restoring the Buffalo Museum of Science's northern entrance, among other projects.
There are funds to assist Main Street shop owners with interior and exterior upgrades. A Building Preservation Fund will help stabilize at-risk historic buildings and aid interested parties seeking to restore a historic property.
A community-based real estate development training program has the goal of training East Side residents and business owners to pursue development or infill projects on their own properties. The program includes capital grants to building owners who complete the training for the renovation of their properties.
"I think a lot of prior investments were growing our roots under the ground," said John Maggiore, a senior policy adviser to the governor. "Individually, you could see stirrings, but the sense they were all connected might have been missing.
"What we announced is the connective tissue," Maggiore said. "It's not going to be the last investment on the East Side, but what I think will result from this is a greater sense of a narrative, a visual narrative that the cream is turning into the butter."
Maggiore expects developers to take advantage of historic and other tax credits.
"Developers in Buffalo and Western New York have done it better than anyone else in the state," he said.
Nick Sinatra and Dr. Fadi Daghe are both involved with developments on the East Side, and both said the governor's action will only add to the momentum that's begun.
"This is great news for the area. This is what we need," said Daghe, whose company bought the former Sattler's department store and the former Eckhardt Building, both on Broadway.
"I really do think it was a huge announcement," Sinatra said. "The timing is perfect. When I talk to investors and say what we want to do and say the governor just put in $50 million, it's exciting and tells a positive story."
Sinatra also praised Mayor Byron W. Brown for being "bullish" on Jefferson Avenue.
The developer is building a mixed-use project near Johnnie B. Wiley Amateur Athletic Pavilion, and also opened a Northwest Bank branch in a new building he constructed with fellow developer David Pawlik.
"This investment will significantly improve every neighborhood it touches,” Brown said of the $50 million initiative.
Brown said he and his economic development staff worked closely with the governor and his staff on the allocation.
“These funds will support the economic resurgence of Buffalo's East Side for its residents," the mayor said. "This strategic development will bring success similar to what we’ve seen at the Northland Workforce Training Center and the growth in that area of the city."
A recent change year in the federal tax law has added a new incentive to develop on the East Side.
Distressed areas classified as "opportunity zones," which most of the East Side qualifies as, allows investors to invest capital gains and receive favorable tax treatment.
"This is going to make private capital more interested in the East Side," Sinatra said. "The governor's timing couldn't be any more perfect as it relates to that."
Developer Jake Schneider, who recently redeveloped the former Shea's Seneca Theatre in South Buffalo, hasn't worked on the East Side yet.
But he is eyeing a project he hopes can move forward.
"We are looking at opportunities on the East Side and we are finding them, and that's really encouraging," Schneider said. "There has been more progress in the last five years than in the previous 25."
The vast amount of vacant property on the East Side due to the demolitions of derelict buildings is something Schneider thinks will pay dividends for the East Side.
"Development is driven by economics," Schneider said. "You have to have projects that pencil out. It's not surprising to me that the more economically challenged neighborhoods are the last ones to get developers' attention. "I think the mere fact that developers, myself included, are now looking to that area for opportunities is a major paradigm shift."