The Olean Common Council unanimously declared Savarino Companies of Buffalo a qualified and eligible sponsor to redevelop 101 N. Union St., the former Manufacturers Hanover building.
The designation allows the owner, the city Urban Renewal Agency, to negotiate a developer agreement, set a sale price and move ahead with the project after a quarter-century vacancy.
Courtney Cox, real estate development manager for Savarino, said that construction is still some time away.
Developers are applying for competitive tax credits from the state Office of Housing and Community Renewal, with the application due in December.
“We’re anticipating an award in May 2020,” he said, adding it will take another six months or so to iron out the rest of the details before construction can begin.
Savarino officials plan a $13 million redevelopment in the 104-year-old building using $2 million from the 2017 state Downtown Revitalization Initiative award, various development tax breaks and other sources.
The property is owned by the city Urban Renewal Agency, which has searched since 2010 for a developer for the seven-story structure. Under state law, the city must approve the developer for the project, as the city assisted in purchasing the structure.
Under the proposal, Savarino will develop a first-floor restaurant, bar and banquet space, as well as 25 apartments on the upper floors, according to the public hearing announcement. The apartments will remain rental for at least five years and consist of affordable housing under state guidelines, as well as market rate apartments.
“We’re going to have a good mix of income-restrictive and nonrestrictive apartments,” Cox said, with rents between $600 to $900 a month for the studio, 1- and 2-bedroom apartments.
The market rate in Olean is roughly that of the upper level of affordable housing in the state.
Jeff Belt, who co-chaired the local planning committee that helped select the project for the DRI award, and who also owns the former Marra buildings to the west, said during the public hearing that he is in full support of the project, but wants to make sure the project reaches both the high and low ends of the market as first proposed.
Originally, a boutique hotel was planned for several floors, as well as a focus on high-end apartments on the top floor.
Since the LPC met in 2017-18, “if anything, the community has risen up,” and there is more of a need for high-end housing than when first proposed, Belt said.
Belt noted that no project in Olean in the last two decades has received the credits Savarino is seeking, and few have applied for them, but this year the project is one of two seeking the aid in the city.
But even if the project is entirely affordable housing, with income limits, “it’s still a win,” Belt said.
“At least the building is saved, there is heat on,” he said, but noted “this isn’t what the LPC directed $2 million to.”
Belt was the only resident to speak at the hearing.
Another important step remains, aldermen said.
“Can you rename the building?” asked Alderman Paul Gonzalez, D-Ward 3, noting the failures to redevelop the structure under that name since the namesake merged with Chemical Bank and shut down local operations. “We should have a burying ceremony for that name.”
Echoing his colleague’s sentiment, “although we can appreciate our past, we need to move ahead,” said council President John Crawford, D-Ward 5.
Cox said a new name is under discussion.
The building opened for business as First National Bank on April 1, 1915. Passing through several owners via bank mergers, the final tenant moved out by 1994, with the building sitting vacant for more than two decades. Following several ownership changes, the property was purchased by the URA in 2010. Shortly thereafter a firm attempted to develop the site, but pulled out. It took four requests for proposal between 2011 and 2017 before Savarino stepped forward.