News Column

Conventus Building on Buffalo Medical Campus gets tax breaks

July 16, 2014

By David Robinson, The Buffalo News, N.Y.



July 16--The developer of the Conventus Building on the Buffalo Niagara Medical Campus is getting $472,000 in additional tax breaks from the Erie County Industrial Development Agency for the portion of the building that will be occupied by Albany Molecular Research.

AMRI, an Albany-based drug development firm that plans to bring about 250 research jobs to the area as part of the Buffalo Billion economic development initiative, will occupy the seventh floor of the Conventus Building.

The developer, Ciminelli Real Estate, added the seventh floor to what was originally planned as a six-story building after the IDA already had approved $4.2 million in tax breaks for the project in March 2013.

The additional tax breaks will apply to a portion of the construction costs associated with the addition of the 60,000 square feet of space on the seventh floor that will be occupied by AMRI. The drug research and development company is expected to begin moving into its Conventus space early next year, said Dennis Penman, Ciminelli's executive vice president.

Ciminelli is treating this floor as a "condo" within the larger facility, with the state's Fort Schuyler Management Corp. owning the space on the top floor and Ciminelli owning the rest of the building.

While the state is responsible for building out the space on the seventh floor and plans to spend $30 million to $40 million to equip it, Ciminelli is paying for the cost of expanding the core and the shell of the building.

The tax breaks will cover a portion of the sales taxes and mortgage taxes associated with adding a seventh floor. Because Ciminelli already has spent about $726,000 on steel associated with the seventh floor, the company is not receiving sales tax breaks on that purchase.

"They will not be receiving any benefits from the improvements that already have been installed," said John Cappellino, the IDA's executive vice president.

The Conventus Building is about 40 percent complete and is expected to be finished in the first half of next year. Penman has said Ciminelli fast-tracked the expansion of the seventh floor and needed to complete agreements with state officials on the additional floor before turning to the IDA for incentives involving that part of the project.

Fort Schuyler is a state development entity that has been closely involved with the SUNY College of Nanoscale Science and Engineering in Albany and is involved with other Buffalo Billion development projects, including the RiverBend clean energy hub in South Buffalo.

Because the state already has clawback arrangements in place with AMRI to recover incentives if it does not create 250 jobs by 2020 and maintain employment at that level through 2025, IDA officials said they were not imposing clawback provisions of their own on the company. The IDA's clawbacks cover the 125 construction jobs that are involved in the Conventus project.

email: drobinson@buffnews.com

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(c)2014 The Buffalo News (Buffalo, N.Y.)

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Source: Buffalo News (NY)


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