Buffalo developer James R. Swiezy’s long-simmering plan to convert the vacant but historic Bosche Building in the 900 block of Main Street into market-rate apartments got a boost Monday from the Erie County Industrial Development Agency, which approved $355,000 in tax breaks for the project.
Swiezy, who has been working on the conversion project for more than four years, plans to convert the four-story structure, which dates from 1891, into 23 market-rate apartments, with a small amount of commercial space on the ground floor.
The building at 916-918 Main St. has been vacant for 17 years and has long been an eyesore in a neighborhood across the street from the Buffalo Niagara Medical Campus.
Swiezy, president of Greenleaf & Co., said he hopes the project will tap into a growing market for housing near the expanding Medical Campus, which in the coming years will also be the site of the University at Buffalo Medical School.
“The spin-off from the Medical Campus is seen in this project,” said Karen M. Fiala, the IDA’s assistant treasurer.
Buffalo Mayor Byron W. Brown also has voiced his “strong support” for the project, noting that it will turn what now is a blight on the neighborhood into improved housing options near the Medical Campus.
While the IDA generally does not provide tax breaks for market-rate housing projects, agency officials said the Bosche project qualifies under its adaptive-reuse guidelines because it will revitalize a building that has been vacant for a long time and is within an area targeted for investment by the Buffalo Building Reuse plan.
Christopher Johnston, the IDA’s chairman, noted that the sales and mortgage tax breaks are essential to make the project financially viable. Swiezy has told IDA officials that the $5.8 million project would generate a negative return on investment of about 5 percent without any IDA incentives. The sales and mortgage tax breaks will reduce that negative return on investment to a little more than 2 percent.
“This building is upside down” without tax incentives, Johnston said.
The project can be profitable, however, if it also receives about $700,000 in property tax incentives under a program administered by the City of Buffalo. Swiezy also is seeking about $1.5 million in tax credits because of the project’s location in the Allentown Historic Preservation District.
Those incentives would allow the project to generate a 12 percent return on investment, the developers estimated.
The IDA also approved about $265,000 in sales and property tax breaks for a $2.9 million project that will allow Upstate Niagara Cooperative to add a chill tunnel to its facility in the North American Center in West Seneca.
The 8,600-square-foot addition to its plant at 3300 North America Drive will give the dairy cooperative the an expanded ability to produce increasingly popular Greek yogurt products.
Upstate Niagara officials told the IDA that, if the expansion isn’t done in West Seneca, it would be shifted to an out-of-state company – a move that could hurt employment at the West Seneca site, which now employs 175 people. The project is not expected to create any new jobs.