Tag Archives: statler

Next up – Basil Fawlty?

23 Apr

Mr. Issa should have concentrated on his Statler renovation rather than tooling around Lake Erie on a 45′ Sea Ray with dual 500 HP diesel engines. A boat that costs probably in the neighborhood of $300,000, if not more.

I’ll bet Issa’s creditors would love to find it.

Bashar Issa’s Latest W.T.F.

14 Mar

The Statler has been in receivership for 10 days now. A judge determined that Issa was:

“indifferent and unconcerned” in his operation of the Statler

Yet on March 9th, after the receiver had been appointed, Issa executed a lease with some London-based investment firm to occupy 11 floors of the Statler, some of which are already occupied. Issa had no authority to do that, and the court is demanding he appear to determine whether he should be held in contempt of court. The lease is for a whopping $1 per year.

The deal with AAMS Investments Limited, which has an initial lease term of 49 years and options going out another 949 years, would divert a $1 million commission to Issa’s father, Mohmoud al Issa.

By funneling the $1 million to his father, Bashar is blatantly violating the court’s order that Statler revenue be used for its operations and upkeep. The elder Issa holds a mortgage on the property, the validity of which is being scrutinized.

Even by the generous standards of Buffalo failure, Issa’s is epic indeed.

Bashar Issa and The Statler: A Lesson For Buffalo

28 Feb

issa

“Cherish the past, adorn the future, construct for the future” – Bashar Al-Issa

When Bashar Issa exploded on the scene in June of 2006, we were all pretty excited that one of the most beautiful buildings in Downtown Buffalo was to be renovated by an out-of-town developer with money and vision.

statlerhotelbuffalo

Issa was exciting.  2006 was the peak of the “hopeful years” when it seemed Buffalo was ready to slough off it’s usual skepticism and embrace a project.  We were trying new things, we lost a few pounds and we were looking for Mr. Right.  Issa’s decision to buy the Statler and and invest $80MM to make it a world class hotel and condo project seemed a validation of the things we all knew about Buffalo.  Someone finally came along and told us we were pretty.  At first, even a cynic like me was taken with the guy.

By January of 2007, I started to have my doubts about Issa.  He hadn’t announced much of a plan for the Statler, and was immediately invested in drumming up national support for the project with his interest in buying the Central Terminal, his master plan for the City of Buffalo, his 48 Story City Tower and his Statler on The Sea.  He was trying really hard to look successful without accomplishing much.  I grew suspicious as the hero worship grew to a fever pitch with weekly updates from another local website as to the proclivities of Mr. Issa.  I thought we were investing too much in his mere presence.  We were like a girl who didn’t want to think that her boyfriend could possibly be a douchebag, even though she was starting to see his real self.  My comments from January of 2007:

When the Statler is completed and I see cranes in the air around the site for the Buffalo City Tower, I’ll thank Mr. Issa for his efforts. Until then I’ll applaud Rocco Termini, Sam Savarino, Carl Paladino, Ben Obletz, Paul Ciminelli, and Carl Montante for completing projects that make Buffalo a better place to live, work, and play.

I hope that issuing a simple “Welcome to Buffalo, Mr. Issa” will suffice…

I think we know that from this point, it was pretty much all downhill.  There were project delays, incremental progress and the completion of new elevator doors and discussion of new windows at the hotel seemed to be enough to throw New Buffalo into a near orgasmic fit.  “He loves me, he really loves me!!!”

While a Jake Halpern article in the Wall Street Journal seemed to upset many locals, Halpern turned out to be quite prophetic, the friend who finally sits you down and tells you your boyfriend is sleeping with six of your sorority sisters:

The danger is that Buffalo’s optimism regarding Mr. Issa will become a kind of clinging, desperate hope. This hard-luck city is always looking for redemption: redemption from poverty, from four straight Super Bowl losses, from the loss of the steel mills, from the bad stereotypes about the weather, and from the opportunists who, like myself, move away from the city in its hour of need.

This need makes someone like Mr. Issa more appealing because it casts him as a hero in the classic American storyline. He’s the sheriff sauntering into town who, in John-Wayne-like fashion, will restore justice, dignity and prosperity.

The problem is that waiting for a John Wayne figure can create complacency and obscure the reality that redemption will not come easily or at once in the form of deus ex machina.

Progress slowed to a crawl and whispers began that Issa was in way over his head.  By January of 2008, the bloom was off the rose as the progress had ground to a halt and Mr. Issa’s workers walked off the job site due to low pay and unsafe working conditions.  News began to leak from his properties in England that he was having cash flow problems and that someone had died on one of his job sites.  Allegations of poor working conditions existed there as well.  By the fall of 2008, Issa announced his intention to sell the hotel and sold the plot of land for his invisible skyscraper.

invisible_skyscraper

After all of that, Issa had a deal worked out with a Canadian firm to buy The Statler, but he fucked that up, too.

Now, here we are in February of 2009 and The Statler Hotel will probably be put into receivership.  The catering and event planning company which occupies The Statler has outstanding claims, is losing business and the building is bleeding money.  In fact, the lights might be turned off next month if some sort of resolution can’t be arranged.

Day-to-day control of Buffalo’s floundering Statler Towers could be in the hands of a court-appointed receiver as early as Tuesday.

Longtime Statler manager John Gingher testified the Statler is running at a deficit of as much as $75,000 a month, with just $19,000 in cash on hand. He told the court there is a strong probability the 18-story Niagara Square landmark could “go dark” within 30 days due to a pile of more than $1 million in bills, including some $400,000 owed to utilities.

Quite the sordid tale, eh?

Did Issa set out to fail?  Of course not.  I’m sure he saw an opportunity to get a great building on the cheap that he could renovate and flip for cash.  He would create artificial demand by announcing big plans to an uncritical local press.  He would build public support working his PR through that uncritical press and either pump and dump the property for a short term gain or eventually finish it and hopefully break even by operating a hotel and selling a few condos.  I tend to think it was more a function of the former than the latter, but that’s just me. In retrospect, why did we think that a privately financed $80MM project could provide the necessary return in a downtrodden market?  Were we high?

Alan, Marc and I are usually mocked for being negative when new projects are announced.  While others tend to focus on the design of new projects and lend a critical eye in that manner, we openly wonder if the project is feasible.  Does the project have the right funding?  Does the market support the project?  In this case, we didn’t do it soon enough.  Would it have made a difference if we did?  I don’t know, but I think we overinflate our value if we assume we would have.

So, when projects are announced and pretty diagrams drawn in Google Sketchup are unveiled, forgive me if I am skeptical.  I think we all need to be skeptical.  We need to be supportive of new ideas, yet critical.  As a community we should not be cheerleaders because someone validates us.  We should hold people accountable, measure progress and demand results.  We shouldn’t play the patsy for a snake oil salesman who is looking to make a buck with his Daddy’s money.

Issa’s Visas

10 Jan

Bashar Issa has used this excuse before – to avoid dealing with legal proceedings relating to his all-but-dead US operations, he claims to have “visa issues”.

Issa is a British citizen. The UK is part of the visa waiver program:

The Visa Waiver Program (VWP) enables nationals of certain countries to travel to the United States for tourism or business for stays of 90 days or less without obtaining a visa

Why does he need a visa, and why is he having difficulty?

(Photo HT)

Statler Sold

17 Sep

Issa, in the end, made $300,000 on the sale. Maybe now he can finish his second project in his native Manchester. It appears that the new buyers know what they’re doing, which is nice.

Unlike Issa, who attempted to thwart unionized worker participation in renovating the 85-year-old landmark, the Greystone Group plans to hire only union workers to carry out it’s overhaul. In return, the new owners will seek backing from Building Trades Council pension funds as part of their project financing.

The Greystone Group’s vision for the faded 18-story building is similar to Issa’s $100 million blueprint. The Manchester, England-based developer had proposed a top-to-bottom restoration of the 800,000-square-foot building which began its life as Ellsworth Statler’s flagship hotel property.

Issa, 30, bounded onto the Buffalo development scene in mid-2006, purchasing the faded Statler for $3.5 million in cash, and later proposed to build a 40-story, mixed-use tower – which would have been the city’s tallest structure – on South Elmwood Avenue.

The British developer, who boasted more than $1 billion worth of ongoing projects in Great Britain, made little forward progress on the Statler’s rebirth before halting work in April citing cash-flow problems.

Just another name to add to the list of people who promise big and deliver nothing.

UPDATE: This ditty, by BRO commenter “heathersmiles” is funny:

Bashar Issa came to town, with his daddy’s money, blowing sunshine up your ass you believed him and that’s funny!

And what became, pray, of the “Statler on the Sea“? Inquiring minds want to know.

An Insider Describes Statler Stagnation

20 Aug

This is a fascinating account of the boundless hope and sudden disappointment that one Bashar al-Issa has engendered in Buffalonians over the past couple of years.

I guess if I had the scratch to attempt a big renovation such as the Statler, I’d hire people who knew what the hell they were doing and had loads of experience doing it, and I’d listen to them, to boot. Instead,

The problem with the Statler project, as far as I can see, is not conceptual. The problem has been in the operations. Issa’s managerial style is to look for new, more efficient ways of doing things and bypassing standard, proven methods. This approach has seldom worked in practice, and has in fact wound up costing the company money.

You don’t renovate an aging behemoth of a building on hope and enthusiasm alone.

Photo via Rayman @ Flickr.com

One More Issa Point

17 Jul

This has been stuck in my mind for the past couple of weeks:

In his letter, Issa also confirmed he is having difficulties obtaining a visa to travel to the United States.

“At the present time I am awaiting my travel documents to be returned by the [U. S.] Embassy,” Issa wrote.

Issa is a British citizen. The UK is part of the visa waiver program:

The Visa Waiver Program (VWP) enables nationals of certain countries to travel to the United States for tourism or business for stays of 90 days or less without obtaining a visa

Why does he need a visa, and why is he having difficulty?

BTEC 2008: TODAY AT THE STATLER

27 Jun

Is Buffalo still a blue collar town in America’s Rust Belt?

The stereotype of Buffalo is that it is a town filled with blue collar lunch bucket factory workers with a love of chicken wings and Canadian Beer. Well, the wings and beer thing is true, but Buffalo is home to a growing and thriving community of new economy.

Purpose: To showcase 20 of the region’s most progressive new economy companies to demonstrate that we are rapidly building a burgeoning entrepreneurial sector in Western New York.

This will be a networking event at which larger companies can show the way to success, mid-level companies can reach out to new customers, find talent, locate real estate, and smaller companies that are just starting out can find some investors or just share their plans.

The event will be interactive with questions from the online community via text and Twitter, live attendees, and the whole event will be streamed online via BuffaloHomecoming.com, wnymedia.net, and ustream.tv.

It’s about building a community of entrepreneurs and young professionals who are looking to generate local wealth which can be used to put people to work, and build the foundation of our community. Instead of looking to traditional power structures and politicians, these are driven companies which seek to build upon Buffalo’s legacy of entrepreneurialism. Let’s look forward, work together and build the city in our own vision.

When we’re done, we’ll upload each presentation to dozens of viral video sites to spread the word about Buffalo’s business future.

Presenters: WNY’s 20 most innovative technology, design, social network, creative and media companies. Click here for more details on our presenters.

Audience: Local, regional, and national venture capitalists and angel investors, members of Buffalo Niagara Enterprise and the Buffalo Niagara Partnership, InfoTech Niagara, local entrepreneurs, general public, online participation. Attendance is 100% free and registration is NOT required. We just ask you to join us in person or virtually!

When: June 27th, 2008 9AM-2PM

Where: Statler Golden Ballroom, Statler Hotel, Buffalo, NY

THE EVENT IS FREE AND REGISTRATION IS NOT REQUIRED

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Statler on Hold

30 Mar

The Buffalo News’ Sharon Linstedt reports that Bashar Issa has put his Statler renovation on “hold”.

In reviewing my British – American English dictionary, I find that “on hold” translates as “over”.

An employee of Issa’s BSC Development Buffalo LLC, who spoke on the condition of anonymity, said that, although redevelopment is being halted, Issa “is not going to walk away” from the building.

“He made the point he is not selling the building and is not walking away,” the employee said. “He had a loan deal that didn’t pan out, and he will look at Plan B and Plan C. It’s not a dead project.”

The BSC Development staff member also said current vendor contracts will be honored and the halt in renovations will not affect tenants or the Park Lane Catering’s event schedule in the Statler’s Golden Ballroom, and Terrace and Rendezvous rooms.

I think it’s safe to say that Issa was and is in over his head. It’s one thing to build a project or two in your hometown (each of which was overbudget and late), but it’s a whole different thing to do a massive renovation of a local icon in a shrinking Great Lakes city across the ocean. Progress has been slow, Issa got himself embroiled in a nasty labor dispute, and it became increasingly clear that expectations were probably too high indeed.

In any event, I hope Issa can execute plans B – Zed, and we should bear in mind that what little progress he’s been able to accomplish in the Statler is greater than any progress the prior owner had been able to accomplish. But the notion that this young man from Manchester was going to single-handedly show Buffalo a thing or two seems to have been quite overblown indeed.

Bashar & the Laborers

14 Jan

statler.JPG

When I make a mistake or make some material correction in a post, I will highlight the fact that it has been changed.

Evidently, some of the people working on Bashar Issa’s Statler Tower renovation have voted to join the Laborers’ Union Local 210. That’s no big surprise here in Buffalo, especially on a project of that size. Here’s what Newell at Buffalo Rising wrote about it:

Would you pay $50 per hour to an employee who pushes a broom? What if you were made to do so? That is the labor issue that BSC Group’s Bashar Issa is facing at this moment. Months ago I spoke with Bashar who told me that he was worried that his workers would unionize. This past Saturday he told me that Local 210 had finally succeeded in luring his unskilled workers to vote union. And if you think about it, who wouldn’t vote union if promised a ridiculous amount of money to conduct menial work routines? But what these unionized workers may not know is that unions like 210 can be very effective when it comes to running a developer out of town. Yup… no developer means no work in the future for the workers.

Is Bashar leaving town? No. He’s going to finish the Statler Hotel (at a price that would likely cost that he anticipated), and when asked about the Buffalo City Tower?

You can read the rest here. And when you do, notice the bit that I’ve highlighted. It doesn’t read that way anymore. Now, it reads:

Would you pay $30 to $40 or more to an employee who pushes a broom or dumps bricks into a dumpster?

Yet there’s nothing there to indicate that an edit has been made. Of course, I could be making it all up, but that wouldn’t then explain comments such as these:

Flyguy – do you really think a broom pusher deserves $50 an hour? Really?????

Unions and politicians- a bad mix that have crippled this town for too long. $50/hour? For reals?

$50 to push a broom is outrageous!

…using the $50 to push a broom is the extreme…

The whole thing is one-sided hearsay from Issa’s camp, with no trace of any comment from the Laborers’ Union to find out what, exactly, might be the deal here. Instead, it’s entitled, “A Union Win is a Buffalo Loss”. I think that’s an oversimplistic conclusion to be drawn.

I’m not quite sure anyone gets $50 for pushing a broom – members of the Laborers’ Union do a lot more than that. Hell, ask yourself if you’d like to lift and dispose of building materials from a construction site for $13/hour and no benefits, or $25/hour with health care, a pension plan, and other benefits. Now add in asbestos and lead paint removal. Now ask yourself just how likely is it that a developer from the UK – which has strong unions of its own – wouldn’t have anticipated the likelihood that his workers in Buffalo, NY would join a union if offered a chance. Of course, had they been paid a comparable wage with benefits, it might have been a moot point. We’ll never know.

It’s easy to dismiss that sort of stuff as pushing a broom for $50/hour, and it’s probably why Buffalo Rising amended its post, and attempted to do so sub rosa.

In any event, I have a call in to Local 210 to find out what their side of the story is, and to determine exactly what kind of work its people will be doing in the Statler, and what the difference is in terms of wages and fringe.

It’s a $130 million project. It was announced in its final form in May 2007 with a target of Spring 2008 to open phase one. It’s now January 2008, and you tell me whether it looks like it’s 3 months from opening. I suspect there’s much, much more to the story than some blue collar workers asking for a raise and some benefits.