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Rich Products is investing $18.5 million to expand and upgrade its customer innovation center at its Niagara Street headquarters.

The investment, announced Monday, will lead to the creation of 17 new jobs and help retain 651 existing positions at the Niagara Street headquarters of the Buffalo-based food products company, which is one of the region's biggest private companies in terms of sales.

Rich will be receiving an extensive incentive package, including $4.9 million in grants and tax credits from the state, and the company is expected to seek sales tax incentives through the Erie County Industrial Development Agency.

The City of Buffalo and the Niagara Frontier Transportation Authority also are pledging to make $10 million in infrastructure improvements along Niagara Street from Niagara Square to Tonawanda Street.

The company also is expected to seek low-cost electricity through the Recharge NY program.

"What this investment does is it ensures a long-term commitment," said Lt. Gov. Robert Duffy during a news conference at the Rich Atrium. "It has such an impact on the whole west side of this community."

William Gisel, Rich Products' chief executive officer, said the company plans to revamp its facilities on the north side of the Rich Atrium, and also will renovate the Atrium property, which will continue to host weddings and other events, although the iconic biplane that hangs from the ceiling may be removed.

Work on the project is expected to begin within a month and be completed by March 2014, Gisel said.

"This place will have a very different look about it," he said.

The expanded customer innovation center "will become the focal point for customer interaction from around the world" and will include state-of-the-art technology and product development facilities, which the company uses to develop new products in conjunction with its customers, Gisel said.

Local development officials said the announcement is important for the Western New York economy because it cements Rich Products' commitment to the region, while also making the local headquarters the center for its research and innovation capabilities, which could lead to additional growth down the road.

"This is a global company that could make this investment anywhere in the world," said Buffalo Mayor Byron W. Brown.

Rich, which has about 1,300 employees across Western New York, uses the customer innovation center to develop new products with its customers. That often involves bringing in teams of workers from the restaurant chains or food companies that Rich works with to collaborate with Rich officials from sales and marketing people to product development experts on new products that meet its customers' needs.

More than 10,000 customers have visited Rich's headquarters complex over the last 23 years, Gisel said.

While Rich Products no longer does any manufacturing in the Buffalo Niagara region, the company has invested about $70 million locally in research and development, along with information technology initiatives over the last five years, Gisel said.

Rich Products will receive a $2 million grant from Empire State Development, along with $2.9 million in tax credits through the Excelsior Jobs Program.

The company also is expected to receive sales tax savings worth nearly $491,000 through the Erie County IDA, possibly as early as its December meeting, said John Cappellino, the agency's executive vice president.

The Niagara Street infrastructure improvements involve programs from the City of Buffalo, as well as the NFTA. On the city's end, $5.6 million is from a four-phase program to upgrade Niagara Street between Tonawanda Street and Niagara Square by the end of 2014.

The NFTA also is planning a $4.5 million project to create a comprehensive urban transit corridor that will improve Metro Bus service and improve "livability standards" along the corridor.

In addition, the city and Erie County are planning improvements at Black Rock Canal Park and Broderick Park.

"It says a lot about what we can do when we work together," said Erie County Executive Mark C. Poloncarz.

Brown said the investment in the Niagara Street corridor will complement the Rich Products investment and give an immediate boost to the city's West Side.

"Hopefully, in the future, we'll see a larger campus-like setting, where the manufacturing blends in with the neighborhood," said Assemblyman Sean Ryan, D-Buffalo.?

email: ?drobinson@buffnews.com