It really does feel different as we head into 2014.
Usually, as I look back on the past year to pick out some of the winners and losers in the Buffalo Niagara business community, the losers tend to be far more apparent than the winners.
Not this year. With a building boom underway downtown, money flowing to the region by the wagon-full from Albany and a coordinated development plan in place, the mood seems much more upbeat than it has in years.
That’s not to say we’re not without our struggles. The economy still is growing slower than the nation. Our job growth still is sluggish, and isn’t keeping pace with the rest of the country. Our wages, which rose by 1.6 percent during the spring, are growing almost 25 percent slower than they are across the nation.
So there’s still work to be done. But at least there’s something we can be optimistic about.
Frank Curci – Not too many people can say they own a supermarket chain. Curci and five of his high-ranking colleagues can after buying Tops Markets from its Wall Street owners this fall.
For Curci, it capped a stunning comeback for a supermarket executive who left Tops under a cloud a decade earlier amid accounting scandals at the Dutch grocery company that had been mismanaging the business for years. He returned in 2007 when he helped organize the Wall Street buyout and guided Tops on an acquisition binge that more than doubled the chain’s size. When those Wall Street firms wanted to cash out, he was able to put together a bid that kept the company in local hands.
Now, it’s Curci’s challenge to squeeze more profits out of a company that paid for its growth spurt by borrowing so much money that its yearly interest payments top $70 million a year.
NRG Energy – The New Jersey energy company pulled off a major coup when it convinced state officials to let it proceed with its scaled-down project to convert the coal-fired power plant in Dunkirk to natural gas. It galvanized local politicians and residents behind its controversial cause, which NRG said would lower electricity costs for consumers and keep jobs and tax money flowing to Dunkirk. National Grid begged to differ, saying it would cost less to upgrade power lines and warning that the NRG project would drive up power costs.
But NRG was able to declare victory earlier this month, when Gov. Andrew Cuomo stepped into announce that the Dunkirk plant would be converted to natural gas. That’s good for NRG and good for Dunkirk. How much the project ends up costing ratepayers will determine whether it’s a good deal for the rest of us.
Howard Zemsky – No one in the Buffalo Niagara region has more power over economic development decisions than this soft-spoken Buffalo developer. As the point man for Gov. Cuomo’s massive public-assistance plan to revive the Buffalo Niagara economy, Zemsky clearly has the governor’s ear on all things economic, and that’s really important, since Cuomo is the man who controls the money that will pay for much of the high-profile development initiatives now in the works.
Whether it works won’t be clear for a few more years. But for now, the plan that Zemsky and his colleagues on the Western New York Regional Economic Development Council have crafted is a refreshing change from the never-ending hunt for silver-bullet projects that led us down the road to stagnation for more than 30 years. And that’s encouraging.
Liazon Corp. – Six years ago, Ashok Subramanian, Tim Godzich and Alan Cohen took a chance and started a business that ran an online benefits exchange for companies. It was an idea that was ahead of its time, and Liazon quickly gained a foothold. By late 2010, the business was worth around $38 million.
Then Obamacare happened, and benefits exchanges became all the rage. Liazon roughly doubled its staff over the past year, and even more important it caught the eye of executives at global consultant Towers Watson, which bought the Buffalo business in November for $215 million – six times more than the business was worth just three years earlier. Now that’s a winner.
Delaware North Cos. and Uniland Development Co. – The concessions giant and the developer are winners because they squeezed $10.8 million in tax breaks out of the Erie County Industrial Development Agency for their office and hotel complex.
But they’re losers because of the beating they took in the process.
Their main mistake was asking for the sun and the moon in tax breaks, including a request to have taxpayers pay the mortgage on a parking ramp that was part of a project that will bring only marginal economic growth and make the glut of downtown office space worse. Eventually, they backed off and walked away with a less outrageous, but still better-than-average, package of tax breaks.
They also walked away with big black eyes in the eyes of taxpayers.
John Koelmel – The former chief executive officer at First Niagara Bank did a great job turning a sleepy Lockport bank into a regional powerhouse, stretching across upstate New York and into Pittsburgh and Philadelphia. But he forgot one thing: the bank’s shareholders.
When Koelmel’s growth-at-any-price strategy didn’t lead to a higher share price for the bank’s stock, tensions that might be overlooked when investors are making good money instead began to fester. The bank’s directors rebelled, and Koelmel was uncerimoniously sacked, a stunning downfall for an executive who had positioned himself as the public face of the company.
But in a year when even losers can be winners, even Koelmel’s downfall has a happy ending: He landed a nice new gig overseeing construction of the HarborCenter hotel and ice rink complex.
Synacor – What goes way up, sometimes goes way down. The Buffalo Internet content provider got off to a hot start last year when its stock soared following its intial public offering. Only much of the gains were from the shady actions of stock promoters, and when they moved on, the stock moved way down.
Then Windows 8 came out, and pushed the start pages Synacor runs for its clients to the background, costing it gobs of money from advertising and search queries. And now, the stock is down about 50 percent for the year, and trades for roughly half of its IPO price.
Niagara Ceramics – Things seemed to be looking up in May for the company that rose from the ashes of Buffalo China when it landed a job to make pottery for basket maker Longaberger.
But behind the scenes, it was a different story. The company was running out of money. A hoped-for deal to sell the company fell through. And even a $500,000 cash infusion it received in the spring wasn’t enough to keep the dinnerware manufacturer from closing its doors for good in September.