By James Fink, originally published in Buffalo Business First on Sep 24, 2020, 10:00am EDT.
Pandemic aside, signs of development recovery are there
Adam Walters, Phillips Lytle LLP partner, and Richard Nardini, architect with LaBella Associates P.C., have seen a number of development cycles in their careers. Both went into 2020 feeling confident that a strong local economy would support multiple development projects.
Then Covid-19 hit.
“We were going along on a steady, good clip and then in March, everything went on hold as everyone tried to figure out what would happen next,” Walters said. “It became a really challenging, interesting time.”
By mid-summer, the construction pace began to pick up. “Everything that paused in March and April is back,” Nardini said.
Walters and Nardini were among eight real estate and construction leaders brought together as part of Business First’s Brick by Brick awards to discuss the region’s development landscape.
The participants included: Vince Cutrona, Evans Bank vice president; Douglas Elia, TM Montante Construction president; Bill Horbett Sr., Big L Windows & Doors president; David Pawlik, Creative Structures Services president; John Smith, Abraxas Construction president; and Robert Stelianou, Trautman Associates partner.
Pawlik said two firm’s clients, Dollar General and Family Dollar, sidelined store projects for about a month but then resumed the search for local sites. Burger King has put local expansion plans on hold, he said, but True Bethel Baptist Church in Niagara Falls is investing $11 million in an affordable housing project there.
Smith said his company, which focuses on exterior renovations, has had little to no slowdown. In fact, during the spring, his firm was busy working on five affordable housing developments.
“But if it had been a building with $800,000 condos, it probably would have stopped,” Smith said.
He started his Grand Island business in the early 1980s, shortly before the closure of the Bethlehem Steel plant in Lackawanna and National Gypsum’s operations in Clarence. And he’s grown ever since.
So has Pawlik, whose 15-year-old development company, was started during a regional economic lull.
“We are all, for the most, risk takers,” Pawlik said.
Cutrona, a commercial development loan specialist, said Evans Bank is about 130% ahead of projections for commercial development loans.
“Besides hospitality, it’s a full go,” Cutrona said, adding that the bank and underwriters are diligent about details when reviewing loans, Cutrona added.
“There are harder questions,” he said.
Horbett said business for Big L has never been better with much work coming from people looking to improve homes. Residential work accounts for 65% of Big L’s customer base. Business is so strong that Big L is expanding its Cheektowaga headquarters.
Trautman Associates relies on a mix of public and private clients, Stelianou said. He credits Washington developer Douglas Jemal for sparking a lot of regional confidence.
“There’s enough people out there who see opportunity,” Stelianou said.
As for 2021, there will be a rebound for development. The exceptions are hospitality and retail.
“Buffalo is a proud town,” Elia said. “We always roll up our sleeves and figure things out.”