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Psst! Wanna buy a skyscraper? - Blather. Rants. Repeat.
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captainsblog
Psst! Wanna buy a skyscraper?

38 Fls Riv Vu, as they say in the biz:

One Seneca Tower, Buffalo’s tallest building, is up for sale. It has been valued at $12 million to $20.3 million.

Marine Midland was my first-ever bank when I got to Ithaca in 1977.  There were branches of others closer to campus, and a credit union on campus which I later joined when they allowed student employees in (I still belong), but I picked the Marine because it had two shiny things that the other locals didn't: a statewide network of branches; and MoneyMatic, a primordial ATM where I could get cash in the middle of the night.  In time, I opened new ones at Marine branches in Buffalo, then Rochester.  My student loans were with them; my car loans were with them.  At some point, I switched to the S&L which anchored my then-firm's building, but soon after we moved back here, that bank was taken over by.... who else?, and I was back in the fold- because, of course, Everyone Loves Marineland.

By 2000, the bank's owner, HSBC, had rebranded all of its holdings with those initials and the big red bowtie logo. On our last trip to England, I discovered that they'd integrated things enough for us to get fee-free pound sterling cash out of their former Midland Bank subsidiary's ATMs all over London. ("Please wait while we deal with your request,...." and "Thank you for your custom.")  Over the next decade, they got heavy into subprime lending, and when things crashed in 2008, the Bowtie was one of the Bigger Bailouts.

Even so, the bank maintained that major statewide presence here, with downtown skylines from lower Manhattan to Binghamton to Rochester all including a recognizable Brutalist behemoth renamed from One Marine This to One HSBC That- but the biggest, and the only one with a huge bowtie on all four sides of the structure above the top floor, was the bank's US headquarters at One HSBC Center in our own humble downtown.  It  remains our tallest building- and the tallest private skyscraper in all of upstate- and for years also hosted the bank's primary law firm, the Canadian consulate, and tons of smaller entrants mostly in the legal and finance communities.

Yet just like that, within a few years, it was virtually all gone.  The bank first re-headquartered, then shed its entire upstate retail banking network; our own accounts were traded once more, this time to a former small S&L, which is about to trade us again for draft picks.  The big law firm moved into a former state office building that was refurbished on our tax dollars for them.  Even the Canadians left. A friend was working for a brokerage that was one of the tiniest number of tenants in this sprawling tower; even she's gone now.

The building, meanwhile, lost its bowtie and soon after any trace of the bank's current or former name. It's One Seneca Tower now, hastily named after the street it abuts.  Its assessment was reduced to $20 million US, and with close to five times that borrowed against it, the owners let it slide into foreclosure, where its major lender took it back last year.

And now, it apparently can be yours, for about what a third party bidder was willing to buy it for back at the foreclosure auction:

The building’s owner has issued a “first call for offers” to gauge interest in the office tower, which last sold at auction for $28 million, but has been valued as low as $12 million.

Bids are due back within a week, with a formal deadline of Feb. 22, although there is a little flexibility in that date, said broker Richard Schecter of Pyramid Brokerage Co., which is marketing the building.

“They want to sell it,” he said. “They’re willing to listen to all offers at this point.”

* * *

Local developers and businesspeople have shied away from taking on the building in the past, citing the tower’s enormous size and the difficulty of either re-leasing it or redeveloping it. Experts including the Urban Land Institute have recommended a mixed-use redevelopment, with some combination of residential, office, hospitality and retail uses, and observers expect that would cost from $75 million to $100 million. And that doesn’t count the regular upkeep or infrastructure improvements that would be needed in the meantime.

* * *

Special servicer LNR Partners represents the legal trust GSMS 2005-GG4 Seneca One Realty LLC, which holds the deed for investors, after outbidding out-of-town investor Harvey Kaylie, a New York City businessman who surprised the local real estate community when he offered $27 million for the tower at the auction. He has previously reiterated his interest in the building, and is expected to bid again.


If he winds up buying in that price range, he will be making some people very happy. One is our county executive: had they let the guy buy it at the foreclosure auction, there would have been one (very large) transfer tax based, not on the bid price, but on the much larger amount of the foreclosed debt.  Now that tax will be assessed again, and in this county it would be millions of extra revenue.  Plus those brokers they mentioned? They work on a percentage- of the sale price, and of the rentals arranged.   They could have avoided all of those millions of expense if they just let the guy bid it.

Ideally, a new owner will do something than just open the front door and rain cheap rent down on the entire downtown.  That would just start another game of tax-subsidized musical chairs.  On the other hand, the building is probably too big to turn into all-residential, and it's too old and Brutalist to turn much of the interior into something other than the pile of empty cubicles it now is.

One thing it has never had is anything taking advantage of its top-floor views, whether a restaurant or an observation deck.  On a clear day, you can supposedly see Toronto from the top.

HSBC still has a few worker bees in some adjacent buildings, so those initials aren't completely removed from the local lexicon. But if that longtime monument to its onetime empire takes on a new owner, and look, and purpose? It'll still be sort of sad- and you can tell THAT to the Marine;)

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