Niagara Gazette

July 24, 2013

Despite council action, former balloon site parcel stays in state's hands for two years

By Justin Sondel Justin.sondel@niagara-gazette.com
Niagara Gazette

Niagara Gazette — USA Niagara Development Corp., the state’s development arm in Niagara Falls, will retain exclusive development rights to the downtown site of a proposed $25 million hotel project for at least two years regardless of the outcome of tonight’s expected vote by the Niagara Falls City Council on the deal. 

A provision in the development agreement between USA Niagara, Niagara County Community College and the city that outlines the terms of development for the Niagara Falls Culinary Institute gives the state agency “exclusive” development rights for three years after the permanent certificate of occupancy has been issued.

The permanent certificate of occupancy at the culinary institute was issued on Sept. 26, 2012, according to records from the city’s Department of Inspections.

As a result, the state agency will retain development rights on the parcel through September 2015, meaning the city would have to wait at least that long before it would be able to sell the land at 310 Rainbow Blvd. to another interested buyer. 

On July 8, the council majority, including Chairman Glenn Choolokian and his colleagues Sam Fruscione and Robert Anderson, Jr., voted to table a proposed development agreement that would have allowed the city to transfer the land to the Buffalo-based Hamister Group for $100,000. The deal is part of Hamister’s proposal to build a $25 million hotel and mixed-use building on the site. 

Majority members have consistently argued that the asking price for the property is too low, suggesting, based on an estimate provided by City Assessor James Bird, that the land could fetch as much as $2 million. 

When asked about the exclusive rights clause tied to the land, Choolokian said that while he recognizes those rights, he was not on the council when the original culinary center agreement was approved. Because of that contract, Choolokian said, he can now only vote to hold out for more money for the city.

“If they want to do the project, I hope they come back with a good price,” he said.