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ECIDA backs incentives for Sheehan redevelopment

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The Erie County Industrial Development Agency on Monday approved more than $750,000 in incentives to support the planned redevelopment of the former Sheehan Memorial Hospital.

McGuire Development plans to revive the former hospital at 425 Michigan Ave. as Compass East, a medical, technology and workforce facility. The project is valued at $21 million; McGuire Development bought the property out of bankruptcy late last year.

McGuire is still finalizing a lease with a key tenant: Time Warner Cable, which plans to locate a call center there and occupy 47,000 square feet, filling about a third of the total space. The ECIDA said the incentives for the project are contingent on Time Warner’s signing the lease.

The IDA says Time Warner plans to create as many as 150 jobs at the site. Combined with existing jobs from around the country that will be moved to the location, the call center could have 322 jobs in five years, according to the ECIDA.

University Pediatric Dentistry will remain a tenant at the former hospital, and McGuire Group will locate a training facility at the site. The property would also include some market-rate apartments, according to the developer.

Even with all of those mixed-use plans, about half of the large site would still be vacant.

The project was approved for $756,612 in sales tax savings. McGuire Development will seek real property tax savings through the city’s 485-a exemption program.

“From my standpoint, this is an excellent project that is going to create new jobs here in Western New York and is really taking a development that is desperately in need of redevelopment,” said Christopher Johnston, the ECIDA’s vice chairman.

The ECIDA also approved $241,600 in tax breaks for Frey the Wheelman as it relocates from the City of Buffalo to 380 Dick Road in Cheektowaga. The project is valued at $1 million and is expected to add three full-time jobs to Frey’s seven-person workforce.

Frey, which is focused on automotive parts, sees the Cheektowaga location as a better fit for its business, closer to the trucking business corridor. It has been on East Tupper Street, adjacent to the Buffalo Niagara Medical Campus, for 75 years. Uniland Development plans to redevelop that location.

Frey’s customers include truck fleets and municipalities, supplying them with parts and doing some repairs, said John Brownsey, Frey’s vice president.

“We are a distribution channel more than a retail store,” he said.

In other matters, the ECIDA is turning to the Buffalo-based StraussGroup to guide its search for a new chief executive officer, after North Carolina-based Jorgenson Consulting abruptly quit last Friday. Jorgenson told ECIDA officials it had too many other projects to work on. Its departure came just as the ECIDA was about to release the “opportunity profile,” or the job description aimed at attracting candidates.

“I’m disappointed in Jorgenson,” said County Executive Mark Poloncarz, an ECIDA board member. “It’s very unprofessional, what they did.”

The ECIDA had not signed a contract with Jorgenson before the firm dropped out. StraussGroup was the runner-up when the ECIDA was choosing a search firm. Al Culliton, the agency’s chief operating officer and acting CEO, is planning to retire at the start of 2014.

Also, Paragon Advertising was selected for a “rebranding” campaign tied into the ECIDA’s upcoming move to 95 Perry St. The ECIDA will spend $23,000 on the rebranding effort.

And Savarino Construction will handle the buildout of the ECIDA’s new space at 95 Perry St. The original firm chosen, Ledge Creek Development of Clarence, dropped out.

email: mglynn@buffnews.com

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