The Amherst Industrial Development Agency on Friday approved nearly $2 million in tax breaks for Iskalo Development Co.’s renovation of the Lord Amherst Hotel and Sonoma Grille restaurant, despite vocal opposition from Snyder residents who object to plans for a larger Hyatt Place on the same property.
A crowd of nearly two dozen people attended the morning meeting, with six people speaking against Iskalo’s plans for a six-story nationally branded hotel with 137 rooms.
That separate project, which would be built behind the aging Lord Amherst and facing the Youngmann Expressway interchange with Main Street, has raised the ire of residents of the neighborhood whose backyards abut the property.
Although Iskalo owns the entire 6.5-acre property at 5000-5010 Main St. where the current Lord Amherst and Sonoma sit and where the Hyatt would be built, Amherst IDA and company officials said the two projects are distinct. The company plans to subdivide the property into separate parcels.
They said the matter under consideration on Friday dealt only with renovations to bring the Lord Amherst and Sonoma to an “as new” condition. While Iskalo officials have submitted plans for the Hyatt to the Amherst Town Board, the project is awaiting environmental reviews and other approvals before it can come to the IDA.
That didn’t stop outraged neighbors from speaking out during the public hearing portion of the meeting.
“While the upgrading of the Lord Amherst is long overdue and generally welcome, there is widespread and substantial neighborhood and community opposition to the planned new hotel,” said Michele Marconi, who lives on Livingston Parkway in Snyder, which runs behind the proposed hotel site.
“I am opposed to any and all assistance which may be considered or provided to allow for this project to move forward ... I ask for your vote to disapprove,” she said.
“I’ve always understood IDAs as intended to develop and help communities where they are,” said David Kernan, also of Livingston Parkway. “In this case, for the IDA to approve this application would be to oppress people in this neighborhood in order to further the ambitions of a developer.”
But David Chiazza, executive vice president for Iskalo, denied there are any “budgeted items for site work that would be related to the proposed Hyatt Place.”
“The abatement that would come for the Lord Amherst, which has been in continuous operation for 50 years, and is really the only hotel that can claim that in Western New York, is to take a hotel that has 35 percent occupancy and really should be closed and try to see if we could keep it in Snyder,” he said.
“It’s challenging. It needs everything. It hasn’t been touched materially in 50 years ... That’s the basis for our need for your assistance, and it is limited to just the Lord Amherst.”
Opponents said it’s not that simple. “To say that this meeting is separate from the Hyatt Hotel under consideration is very disingenuous,” said Kernan. “Obviously the viability of the redevelopment of the Lord Amherst is dependent on some further development of the property, and that further development of the property is the Hyatt hotel, so the two projects are economically interconnected.”
According to IDA documents, Iskalo’s application calls for revamping and equipping the 56,000-square-foot Lord Amherst and Sonoma and adding a 1,700-square-foot expansion to the restaurant. Iskalo bought the property in October 2011 from the longtime owners, and received IDA sales tax breaks at that time for “initial property improvements and equipment purchases” that would precede a further renovation, the documents said.
The hotel and restaurant have recently received initial approval from the National Park Service to be designated one of the “Historic Hotels of America,” which will help with marketing the independent and unbranded hotel, the IDA summary said.
Work would include completing deferred maintenance, making the buildings handicapped accessible with an elevator, removing asbestos, upgrading mechanical systems to be energy efficient and renovating guest rooms, corridors, lobby, reception areas and amenities.
The costs would approach what it would take to just tear down and replace them with a new limited-service, mid-scale hotel, Iskalo said, and the lack of a national brand means it’s harder to attract a lot of business and it can’t charge as much as franchised hotels.
IDA benefits “will aid in overcoming this and give the historic hotel the best chance to succeed,” the IDA summary said.
The agency’s board, with only Amherst Town Supervisor Dr. Barry Weinstein voting “no,” authorized $1.07 million in tax savings on the $9.89 million renovation. That includes $615,374 in property tax savings, $359,407 in sales tax breaks and $98,858 in mortgage tax relief.
In exchange, under the agency’s 10-year exemption and gradually increasing payment-in-lieu-of-taxes (PILOT), Iskalo will pay a total of $1.92 million in property taxes over the period. That breaks down to $1.24 million to the Amherst Central School District, $374,779 to the Town of Amherst and $307,563 to Erie County.
By comparison, the property would pay $1.1 million in property taxes over 10 years under its current level, so the PILOT calls for $834,076 in added taxes.
Officials said municipalities have already benefited from Iskalo’s purchase of the property, which had been assessed at about $600,000 when it was acquired but is now assessed at $3.5 million.
According to the application, the project will keep 43 full-time positions and create 26 more, with both hourly and salaried positions that range from minimum wage to $65,000 a year.