Tag Archives: Mark Croce

Paladino Hates Subsidies to _Other_ Developers

22 Sep

Carl's Insult Billboardatorium

Consider the irony – the better word, really is “chutzpah” of poor, downtrodden Carl Paladino complaining mightily about the $5 million the city of Buffalo will be granting its favored developer, Mark Croce, to rehabilitate the Statler.

The irony stems, of course, from the fact that Paladino’s real estate empire would crumble if he suddenly lost all of his government leases, and wouldn’t have grown to where it is today without upwards of $12 million in tax subsidies.  It’s not every company that has the political clout to receive $1.4 million in tax subsidies in order to invest only $1.1 million into a few Buffalo properties and creating exactly one job – $3 million from the Empire Zone program altogether, with a gain of only 25 jobs.  He bought access to those programs with his generousness to politicians and candidates, yet he’s on the outs with the Brown Administration, so now he’s going to disingenuously try and prevent a competing developer from getting public money to rehabilitate an historic downtown building.

Carl was Masiello’s favorite. How many questionable last-minute-on-Friday demos did Carl get under Tony’s watch? Now, others have taken his place and Carl is having none of it. Carl’s access to the Buffalo News used to be as wide as an airport hangar. Now he’s engaged in a blood feud with publisher Stan Lipsey, who permitted his reporters to actually investigate Carl’s business and political dealings.  Had it been up to Paladino, the Webb Building would have been razed instead of rehabilitated by Rocco Termini with historic tax credits.

Paladino’s understanding of “private sector initiative” is which politician is in whose corner.

The irony is delightful.

Paladino threatened to seek an injunction against the city’s Statler subsidy to Croce.

Croce dismissed the threat. “Good luck with that. I’ll see you in court, Carl,” he said during a separate interview. “Anybody can sue in this great country if they want. I’ve seen Carl waste a lot of money on frivolous lawsuits.”

Of course, in Niagara Falls, Paladino’s Giacomo is one of the few downtown “jewels”.  Paladino bought the United Office Building for $1.00 and reportedly rents space in it to Empire State Development for $15/SF. The going rate in downtown Niagara Falls is more like 1/3 of that amount.

$5MM in Poverty-Reduction Funds to Statler?

24 Mar

Poverty Reducer

Local restaurateur, developer, parking lot owner, and friend-of-Byron’s Mark Croce famously announced that he would commence an incremental rehabilitation of the Statler Towers. For the time being, only the first two floors will be rehabbed to re-enable the ballrooms to be used for events. The upper floors will be rehabbed as the market demands. The deal amazingly closed for only $700,000; in order to make the Statler commercially viable, he will have to repair of the exterior details, many of which have decided to plummet to the ground in recent years.

In order to do that, Croce has applied for a $5.3 million grant from the City of Buffalo, which would likely come from its Community Development Block Grant funding. That money, however, arises out of a HUD program to provide affordable housing and jobs for poverty prevention. Its purpose is to directly benefit low and middle-income people and reduce neighborhood blight. What that has to do with rehabilitating a millionaire’s $700,000 hotel rehab is beyond me.

Add to that the fact that it was announced just yesterday that a Croce LLC just closed on a $1.2 million Orchard Park mansion. I’m sure congress had in mind that CDBG money would go to help develop a crumbling downtown hotel owned by someone who can afford to plunk down $1.2 MM for a nice 12,800 SF house in a tony suburb. Right?

The New Statler Twilight Zone

10 Nov

The key is to avoid looking around. If you follow the path laid out for visitors – in the Delaware entrance, up the stairs, to the right, into the ballroom – the Statler Hotel doesn’t look half bad. You are helped in this endeavor by friendly docents who block your way into any other section of the building, ensuring you stay on the prescribed, most restored, route. Still, there are signs. Bits of plaster on a freshly cleaned rug. Dusty stairs and marble. Move off, out of the crowd, and peer into some of the upper galleries, and the scope of the problem becomes obvious – the peeling glamour becomes wholesale decay.

About a year ago, I asked if Canalside would end up like the Statler (massive failure) or the Buffalo Airport (quiet success story)? That question hasn’t been answered yet, but let me turn it on its head. Will the Statler end up like Canalside (unrealized massive public expenditure) or the Buffalo Airport (completed and positive massive public expenditure)? At the Preservation Buffalo Niagara sponsored event late Wednesday morning, in the unheated Terrace Room of the Statler itself, I heard a plan that sounded more like the Elephant House restoration at the Buffalo Zoo.

First, the meeting details. Developer Mark Croce and lawyer/partner Robert Knoer provided a few more tantalizing specifics on their Statler renovation plan. In this effort they were bookended by Preservation Buffalo Niagara Executive Director Henry McCartney and Chair Catherine Schweitzer, who gave glowing reviews and full endorsement of the plan. More on them in a moment.

Robert Knoer started with the massive scope of the problem. At 800K square feet, the Statler is roughly the size of the Boulevard Mall in Amherst. It’s lower roofs are leaking, the HVAC system is antiquated, $5 million is owed in mortgage and tax liens, and chunks of the terra cotta “ribbon” are falling on people’s heads. Oh, and by the way, its hard to demolish. In a thinly veiled swipe at Donn Esmonde and the rest of the commentariat, he indicated no one knows how much demolition would be, and any number, from $10 million to $20 million, is speculation. What he does know is that the Statler is full of asbestos, and it’s hard to implode a building right next to a shiny new glass skinned federal court house.

So what to do. The Croce/Knoer plan has three phases: 1) Spend $5.3 million to do emergency stabilization work on the roofs, terra cotta, and HVAC system, 2) Fix up the first floor to provide usable retail space that can generate income, and 3) Save the upper floors for organic growth (drywall ready, not shovel ready) of no pre-specified variety. Observant readers will note that under this plan, nearly ten million dollars is required just to make the Statler the “going concern” is was two years ago. Once stabilized and open for minimal business, the first floor should generate $500K a year in income, enough to help fund whatever adaptive reuse (hotel? call center? apartments? condos? backoffice?) is in store for the upper floors.

The unanticipated portion of Phase 3 was the proposed linkage between the Statler and Convention Center. This is not a sky bridge. It’s is a 50k square foot behemoth over Franklin Street to expand the Convention Center and marry it up with hotel rooms and meeting space inside the Statler. Robert Knoer called it payback on the public’s investment.

The public’s investment? Wait a second, they haven’t asked for any money yet. You are right, and they never did. They asked for “support,” and got it from Preservation Buffalo Niagara. Said Henry McCartney:

“The principals of Statler City LLC have done their homework, carefully studied the building and come up with a feasible plan. It is now time to show them our support and move forward with this effort to save the Statler.”

Which is where this event turns bizarre. Beneath the polished presentation, smiling politicians, and unified front, what was unsaid and implied was far more interesting than any specific plan. Lest anyone be confused, the leading WNY preservation group just endorsed altering the facade of our most celebrated historic landmark to connect it to the most egregious example of terrible urban planning in Buffalo. Rather than pushing for the Warsaw Pact convention center to be removed, so the coveted original street grid could be restored, Preservation Buffalo Niagara is ensuring its perpetual existence with a permanent link to the Statler.

And why? The video-promoted National Trust Convention in 2011. On more than one occasion, Robert Knoer noted that Buffalo could not stand for preservation-minded convention goers leaving their daily events to see a Statler, right out their front door, barricaded and boarded up. The egg on the face of the convention organizer, Preservation Buffalo Niagara, would be considerable. PBN needs a Statler solution, and the Croce plan is the only one. They sold their soul for a week long glorified business meeting. 

The train wreck continued. A who’s who of current (Collins, Hoyt, Higgins, Kearns) and former (Masiello, Pitts) Buffalo politicians made the event, but not Byron Brown, who’s office is across the street. Rumor is that Brown was peeved that Croce mentioned the November 15th closing deadline in the newspaper. That closing is coming fast, and one source in the room speculated that, at the end of the day, this was all just elaborate stagecraft to convince bankruptcy trustee Morris Horwitz to look favorably on the Croce offer.

The final bizarre item may be the most glaring: the funding. Croce and Knoer did not ask for public dollars directly, but implied they were seeking “community support.” PBN references “blended funding” several times in their press release, and hinted more information would be forth coming when the deal closes. My guess – stand by for good old fashioned fund raising. PBN is not a foundation, and has no scratch of their own, but they are a charity, and can solicit tax deductible donations as a pass through. Are you ready to buy your $10 Save the Statler red wrist band?