REAL ESTATE
Wilson, now under investigation, had tried to buy Buffalo buildings
The 22-year-old Cleveland investor who plunked down $6.3 million for two Hamburg mansions last year, and is now under federal investigation for possible fraud, also tried to buy at least one prominent downtown Buffalo office building, real estate sources said Wednesday.
Michael Wilson, who stunned Western New York real estate brokers with the record-setting home purchases last October, was close to a deal to buy the Tishman Building on Lafayette Square in April, according to a source familiar with the negotiations.
He submitted a bid during the sealed bid auction process and came close to agreeing on a price, but no contract was signed and “nothing was ever consummated,” the source said.
Jeff LiPuma, managing partner at brokerage CB Richard Ellis, which represents the building’s owner, declined to comment, citing a confidentiality agreement.
FBI agents converged on Wilson’s Hamburg homes July 1, executing search warrants and seizing computers, documents, three vehicles and three guns, as part of an investigation into alleged investment fraud by a pair of companies at which he is a top executive.
Investigators aren’t confirming details, but a Texas businessman earlier told The Buffalo News that he and other investors believe Wilson’s companies cheated investors out of at least $30 million. FBI officials said Wednesday that the investigation is continuing.
Wilson also faces possible foreclosure on his two homes by the former owner, John A. Russo, who holds mortgages on them. Wilson originally paid $2 million in cash for the mansions and agreed to pay another $1 million every six months, but defaulted on his May 1 payment.
But his interest in commercial property downtown, and especially a visible building like Tishman, represents a new wrinkle, and shows his intention of a bigger presence here.
The nearly vacant, 20-story, 198,000-square-foot former headquarters of National Fuel Gas Co. is owned by Lillian Goldman Family LLC, a New York City investment firm. The glass tower’s anchor tenant is still a National Fuel customer service center on the ground floor. The building remains for sale, with negotiations ongoing but no contracts signed.
It also wasn’t the only building Wilson looked at. “He was definitely pursuing a number of things, and that was one he had interest in,” the source said.
Wilson, through a team of representatives, also toured the 40,000 square-foot office building at 392 Pearl Street, owned by developer Anthony Trusso in March. Its tenants include Read to Succeed and Northwinds Capital.
“There was a group of guys that came through,” said Trusso, who added that he doesn’t recall ever hearing Wilson’s name. “I only met them for about half an hour.”
Trusso said the group originally came looking for space to rent an office downtown, but then became interested in buying a building outright. Although he communicated with them “a couple of times” through brokers at Coldwell Banker Commercial Meridian, Trusso said the group didn’t follow up with an offer on the Pearl Street building. But he knew Wilson’s group was also looking at Tishman and had made an offer there.
“He did have a group of his guys out looking,” said Eric Tudor, managing member of Coldwell Banker Commercial. “Where he’s at now, I don’t know. We haven’t heard hide nor hair from his guys.”
Wilson was also rumored to have looked at the Rand Building, Main Place Mall and the AM&A department store building. But the owners of those buildings said they never heard of him until they read of the FBI search.
“I’ve never heard of him, spoken to him, and no broker has approached me any time in the last two years. Nor has anyone approached me on behalf of someone else,” said Patrick Hotung, general manager of Main Place Liberty Group, which owns Main Place Mall, the Main Place Tower and the Liberty Building.
“I’ve never heard him mentioned in connection with any of our buildings,” said David Sweet, president of Main Seneca Corp., which owns the Rand Building at 237 Main St. “And we’ve not had any serious negotiations with anybody about selling our buildings.”
He said he recalled one person who “came around and professed an interest in buying some of our buildings,” but he was from outside the country and wasn’t initially interested in Rand. “It . . . never amounted to anything,” he said.
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