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Revamping old sites exposes opportunities, adaptability

Rochester Business Journal
March 15, 2013

Laurence Glazer, CEO of Buckingham Properties LLC, has one word to describe how the Midtown Tower will look when it is completely renovated: spectacular.
 
The Rochester developer, in partnership with Robert Morgan of Morgan Management LLC in Perinton, has agreed to buy and redevelop Midtown Tower. The cost is projected to be at least $55 million.
 
The high-rise tower section of Midtown Plaza has been stripped to its skeleton to prepare for the conversion to a mixed-use residential and commercial building. Work on the 17-story structure is expected to be complete at the end of 2014.
 
From a developer's perspective, the 357,000-square-foot Midtown Tower redevelopment is a good project to pursue, Glazer says. It is a sound structure, and the shape lends itself to many adaptable uses.
 
Builders and real estate developers alike see benefits in rehabbing structures that might seem outdated today. Still, these buildings need to meet certain criteria to get a modern look.
 
Glazer is no stranger to revamping old buildings. His projects range from developing trendy lofts in renovated Rochester factories to transforming the former Genesee Hospital site for mixed use, including housing, retail and offices.
 
When Glazer studies a building, he looks at features such as ceiling height, condition of the windows and accessibility.
 
"Most can be worked through," he says.
 
In his view, comparing new construction with renovation, the latter may be more challenging but often is better for the developer financially. Incentives play a part as well.
 
"The deal is always in the buy," Glazer says.
 
Still, each building needs to be reviewed independently, he says.
 
"Some are just unfit, and the cost is so much, you are just better off tearing them down," he says.
 
It also is important to keep a level head when assessing a building. It can be easy to be attracted to a building and blinded by the grand ideas associated with renovating. While it is wise not to romanticize the potential of an older building, it happens, Glazer admits.
 
"It's easy to fall in love," he says.
 
The Pike Co. Inc. also is renovating a downtown building. It is upgrading the Seneca Building for Arkansas-based Windstream Corp., which acquired telecommunications firm Paetec Holding Corp. in 2011.
 
Windstream plans to house 335 or more employees on the Seneca Building's first two floors, and occupancy is expected July 1. The additional office space is available for lease.
 
The Seneca Building property was the site of a Universalist Church beginning in 1847. In the early 1900s, the land was sold to the Hotel Seneca Corp. and used for a 300-room hotel. By the 1920s, the hotel had more than 500 rooms, making it Rochester's largest. In 1968, that building was razed to make way for Midtown Plaza and the structure now being renovated.
 
Peter Cornell, president of Pike Development and executive vice president of the Pike Co., also considers various factors when determining if an older building can be rehabilitated. These include column spacing, ceiling height and the exterior of the structure, particularly the placement of windows.
 
When Cornell is examining a site, the first two items on his list are wide columns and high ceilings that allow for drop ceilings to be installed, disguising utility wires behind them.
 
The Seneca Building was taken down to its steel frame, which allowed Pike to make the changes necessary to rehab the building into a modern office structure.
 
"There wasn't a lot more we could have done if it were a brand-new building," Cornell says.
 
A building that has been around for several years is adaptable to many uses if reconstruction is possible with a new exterior and flexible window placements. Without those two characteristics, however, it is harder to reuse.
 
Still, if the job is done right, there is no difference between a renovated older structure and new Class A office space, Cornell says.
 
"You need to know who the user will be and how adaptable the space will be to that user's needs," he says.
 
Pike has completed a number of projects on older local buildings. Those projects include renovations of the 28-story Xerox Tower and the 363,000-square-foot Monroe County Hall of Justice. While Pike does have a successful track record, it is not afraid to decline a dubious project.
 
"Every day we turn things down; (we) aren't going to take chances on properties that do not fit our profile or have the best chance of being leased," Cornell says.
 
The company also uses other businesses as a resource. One such firm is the Cabot Group, which recently signed on with Pike to manage all 100,000 square feet of office space in the Seneca Building.
 
The Pittsford-based Cabot Group now has the job of attracting local businesses such as law, marketing, engineering and accounting firms to lease the space on the third floor.
 
Daniel Saperstone, the Cabot Group's vice president, says renovation projects for older buildings can be more desirable than new construction because tax credits and other incentives may be available.
 
"If there are incentives, there can be some value from existing structures," Saperstone says. "There may be times when you can't build something that would be competitive without those incentives."
 
Such public-private partnerships make reuses viable.
 
"It gives these buildings new life," Saperstone says.
 
Glazer says that for every 10 older buildings downtown, eight are salvageable. He points to other downtown properties with potential for rehabilitation, among them the Sibley Centre. Boston-based WinnDevelopment LLC plans to spend more than $100 million over 10 years to modernize its 1 million square feet.
 
The present Sibley structure on 3.5 acres at the northwest corner of East Main and Franklin streets had its beginnings 107 years ago, following a fire in 1904 that destroyed the original Sibley, Lindsay & Curr Co. department store. A 391,444-square-foot, five-story section along East Main was built in 1905, according to the online Department Store Museum. A 585,372-square-foot, 12-story section was added in 1926.
 
Glazer says the building's current windows will need to be replaced to avoid bigger problems later.
 
The Gannett Building on Exchange Boulevard is another site that can be reconfigured for further use, he observes. The Democrat and Chronicle Media Group said in January that the downtown building is for sale, and the media business wants to move into a new downtown location by mid-2014.
 
Michael Kane, president and publisher of the Democrat and Chronicle and president of Gannett's U.S. Community Publishing East Group, said the building no longer fits the company's size and the needs of its staff. The property is assessed at $4.27 million.
 
Gannett has owned the building on Exchange Boulevard since 1928. The building originally housed the now-defunct Times-Union, which was published as an afternoon counterpart to the Democrat and Chronicle. The structure also was headquarters of Gannett Co. Inc. until 1976, when the corporate staff moved to the Lincoln First Tower on East Main Street. The corporate headquarters moved to the Virginia suburbs of Washington, D.C., 10 years later.
 
Glazer has not recently been through the Gannett Building but believes it has good bones. He describes it as a grand old building that probably will not be torn down.
 
"It's a keeper," he says.


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