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The state has reached a $2.5 million deal to acquire the 88 acres of city-owned land in South Buffalo that will become the home for the RiverBend clean energy and technology hub.

The formal agreement to acquire the former Republic Steel property on South Park Avenue comes a little more than three months after New York State agreed to the basic terms of the land acquisition and clears a key hurdle in the Buffalo Billion initiative to jump-start the long-sagging Buffalo Niagara economy with fast-growing, technology-based businesses.

“The RiverBend project is one of the most dramatic economic development undertakings in Western New York’s history, and today marks a critical milestone for this initiative,” Gov. Andrew M. Cuomo said in a statement. “It is also a project that will tie the high-tech and clean energy industries to Western New York for years to come.”

State officials plan to base the RiverBend project on the same model that was used in Albany to create a thriving semiconductor industry, with the state providing state-of-the-art facilities and equipment that can be used by the companies that agree to become part of the development.

Under the deal, the state’s Fort Schuyler Management Corp. will pay the Buffalo Urban Development Corp. $2.5 million to buy the sprawling property along a curve in the Buffalo River. The urban development agency is holding a special meeting at 9 a.m. today to consider the sale agreement.

The state already has reached an agreement with two California-based companies – solar panel manufacturer Silevo and LED lighting maker Soraa – to become the first two tenants in the RiverBend complex. A third company, Solar Frontier, one of the world’s largest solar panel manufacturers, last month signed an agreement with state officials to study the feasibility of setting up a solar panel production facility in Buffalo, without identifying a particular site.

Buffalo-based LPCiminelli was selected earlier this year as the developer of the RiverBend project. The initial 280,000-square-foot building in the project will house both Soraa and Silevo. Silevo will use the bulk of the space – 232,000 square feet – for its first North American factory to produce solar panels. Soraa will use the remaining 17 percent of the building’s space to expand its manufacturing capacity and also carry out corporate research and development work.

The land purchase agreement also includes hiring goals for minority and women workers and businesses. The agreement requires that woman- and minority-owned businesses account for 20 percent of the work at the project, with 25 percent of the workforce targeted for minorities and a goal of having 5 percent of the construction workers be women.

The agreement also includes a commitment from the state to work with local education organizations in Buffalo to set up workforce and training programs aimed at increasing the employment opportunities for city residents, especially women and minorities.

It also would permit Buffalo Niagara Riverkeeper to access the site for a shoreline-restoration project.

Fort Schuyler is a nonprofit entity created to manage property transactions on behalf of the State University of New York Research Foundation, which will own the facilities and equipment on the complex that the companies will use.

The RiverBend project is the biggest single piece of the governor’s Buffalo Billion initiative, with the state pledging to invest $225 million to establish a six-building clean energy and technology hub. The first phase of the project, involving Silevo and Soraa, is expected to create 850 permanent jobs and more than 500 construction jobs.

The state investment will be used to acquire the site, install the infrastructure – such as water, sewer, utility and roads – and construct the buildings at the RiverBend complex. The state also will buy and own the equipment for the companies, which will not get direct state funding.

California-based Silevo’s factory in RiverBend will have the annual capacity to make 200 megawatts of solar panels – more than six times the capacity of its current production facility in China., creating 475 jobs in the process.

Soraa, which like Silevo is based in Fremont, Calif., has pledged to create 375 jobs locally as it establishes manufacturing for its LED lighting, which the company claims can produce a more natural range of light than conventional LED technology.

email: drobinson@buffnews.com