Waiting in Reception

On April 11, two weeks from Saturday, it will have been exactly one year since British developer Bashar Issa’s BSC Development last did any work to improve the historic Statler Towers. On March 3, the building was taken out of Issa’s hands, and Stephen Leous, a local businessman, was appointed as the receiver by State Supreme Court Justice John M. Curran.

“The background is that the owner of the Park Lane brought a lawsuit against the owners of the building, claiming that his neglect of the torn-apart lobby area was affecting his business,” said Leous’ attorney, Bruce Zeftel.

As receiver, Leous acts as the fiduciary arm of the court. He handles all the income and expenses, oversees the maintenance of the property, and maintains tenant relationships.

While the Statler Towers have not seen a responsible or capable owner in quite some time, the building remains an attractive buy, according to Leous.

“There are state and federal programs for converting buildings to make them more energy-efficient,” Leous says. “Whoever takes the building forward, I think there is a real opportunity there. The whole mechanical and electrical system in the building is very old, and so there is a lot of opportunity to improve efficiency in the building with aid from the state and feds.”

Improving the efficiency of the building is not the only way that a potential buyer could receive government assistance. The building is in an Empire Zone, making any potential owner eligible for tax incentives. Also, Issa was nearly through the process of documentation required to receive tax credits from the New York State Historic Preservation Office, meaning that a new owner would be eligible for those same tax credits should they complete that process.

Beyond a helping hand from the government, many other factors make this building a smart buy for investors, says Leous.

“It’s a landmark building located on the most prominent circle in Buffalo. Also, There is an existing tenant level here. We have 20-plus tenants currently.”

While Issa had a vision for the building, he lacked the know-how and the resources to completely restore the structure. By most estimates the complete restoration of the Statler Towers is a $100 million project. While this figure may seem daunting, it is far from impossible.

“There have been buildings just like this one in Boston and St. Louis that have redeveloped with great success,” says Leous. “What we need is a purchaser who is serious about saving this building and has the resources to make that happen.”

Should the building ever see the type of repair that it needs, it might reap the benefits of its great location. The New Era headquarters, City Hall, the Buffalo District Office of Immigration, the Federal Court House (under construction), and the new Avant Building (under construction) all lie within a few blocks, giving any business that might reside within the Statler a great shot at success.

“In terms of architecture and history, Buffalo has really great bones,” says Leous. “This is just one of the buildings that shows that.”

—justin sondel