It’s a tall order as billionaire looks into purchase of Buffalo’s highest building

Jonathan D. Epstein Updated Wed, Jun 08, 2016 06:47 PM EDT A New York City billionaire who built his fortune on real estate, grocery and convenience stores is the latest potential investor to explore a purchase of Buffalo’s tallest building, even as another unnamed party has made a formal offer to buy One Seneca Tower. John A. Catsimatidis – who owns Gristedes Foods in Manhattan, the Red Apple Group and the Warren, Pa.-based parent of the Kwik Fill chain – confirmed that he has “looked at the building” and has also engaged in discussions with another bidder, Phillip Ruthen of Connecticut, about a possible collaboration. However, both Catsimatidis, who toured the building on a recent visit to Buffalo, and Ruthen say they have not agreed to any deal to work together. “We talked, but we are not partners,” Catsimatidis said by email. “We have interest, but it’s a tough deal.” Meanwhile, no details were available about the newest purchase proposal for the 38-story tower or the potential buyer, except that the offer came this week from out of town. It has not yet been accepted, real estate sources say. However, those sources also said it’s not from Catsimatidis nor Ruthen, nor is it from a group of both Chinese and domestic investors represented by Hunt Real Estate Corp. CEO Peter F. Hunt. It’s also not from Harvey Kaylie, another New York City businessman, who canceled his own $27 million cash deal to purchase the 1.2-million-square-foot complex just two days before his due-diligence period expired, after struggling to line up enough partner financing to make the entire project work. That adds an entirely new individual or group to the mix of potential buyers, even as all the local developers continue to stay away from a project whose costs experts say could go as high as $200 million. “Somebody has to have the deep-enough pockets and endurance to stick this out. It’s a multiyear project. It’s not going to happen overnight,” Hunt said. “You’ll need a developer with vision who can deal with all the naysayers. Are they standing in line? No, but someone will come along.” One Seneca is currently owned by LNR Properties, the special loan servicer representing bondholders who held a $91 million mortgage on which the prior owner, Seneca One Realty, defaulted. Built in 1972 as the headquarters for Marine Midland Bank and long dominated by Marine and successor HSBC Bank USA, the tower is now 96 percent empty, after HSBC and Phillips Lytle LLC left the building almost simultaneously in late 2013, triggering the previous servicer to initiate foreclosure proceedings. LNR took possession of the tower last October, followed by the accompanying five-story parking ramp in March. LNR then put them both up for sale, but insisted on a quick, two-week due-diligence period and a fast closing, which has puzzled many in the local real estate community who see such demands as unrealistic. Kaylie, who had unsuccessfully bid on the tower at the October 2015 foreclosure auction, … Continue reading It’s a tall order as billionaire looks into purchase of Buffalo’s highest building