SCHUMER ANNOUNCES: AFTER HIS URGING, THE SIBLEY BUILDING IN DOWNTOWN ROCHESTER WILL BE AWARDED OVER $40 MILLION IN FEDERAL “NEW MARKETS TAX CREDITS” TO COMPLETE MASSIVE SIBLEY CONSTRUCTION PLAN; SENATOR SAYS FUNDING WILL HELP REVITALIZE DOWNTOWN ROCHESTER, THE NEW HOME FOR PHOTONICS, HIGH-TECH BIZ INCUBATOR
Schumer Has Championed Federal New Markets Tax Credit (NMTC) Funding for Sibley, the Anchor for New Downtown Innovation Zone
Securing Federal NMTCs Was The Final Financing Piece Needed In Order For The Sibley Building Developers To Greenlight Entire Project
Schumer: Federal Investment is Final Piece of the Puzzle to Complete the Transformation To Re-Energize Downtown
Standing at the Sibley Building, U.S. Senator Charles E. Schumer today visited Rochester and announced that he has helped secure $42.5 million in federal New Markets Tax Credits (NMTC) that were needed to greenlight the multi-phase $200 million redevelopment of the Sibley Building into a vibrant downtown hub for photonics spin-offs, high tech businesses, new shops, and tenants. Schumer said securing these federal funds was the final piece of the puzzle needed in order for the Sibley Building developers, WinnDevelopment, to start construction on the first $110 million in renovations on-schedule in February 2016, and ultimately to move forward on the complete multi-phase, job-creating $200 million Sibley redevelopment plan.
“Winning this federal investment is the final piece of the puzzle needed to transform the Sibley building into the epicenter of High Tech and Photonics businesses, retail, and downtown activity in Rochester. This $42.5 million in New Markets Tax Credits will help redevelop this long-neglected building along Main Street in order to create an innovation hub and center where people want to live, shop and do business once again. We have fought long and hard to secure these funds, which will finally allow us to leverage millions in private and public investments. This redevelopment project will be a win-win-win, for residents, businesses and the historic Sibley site, as it will unlock the kind of economic potential that will reinvigorate downtown Rochester for years to come,” said Senator Schumer.
Schumer has long made it a priority to help secure the needed NMTC allocation for WinnDevelopment to get the Sibley project underway with this $200 million redevelopment plan. The redeveloped building will be an anchor of the new Downtown Innovation Zone, which is aimed at turning around Main Street and Downtown Rochester into a hub for new high tech and entrepreneurial activities. Schumer said that because the building encompasses nearly a quarter of Main Street and downtown Rochester – as it spans several city blocks – it only makes sense to begin redevelopment efforts with the Sibley building as its cornerstone. Schumer explained that, before it closed in the early 1990s, the Sibley department store’s headquarters in Rochester was once the epicenter of shopping, retail and business activities. After its closure, the building fell on hard times in the 1990s and 2000s – the vacancy rate increased, and a series of efforts to revitalize the building, largely failed. Nearly four years ago, WinnDevelopment purchased the building. From there, the company set out its ambitious $200 million redevelopment plan, with the goal of reenergizing Main Street.
Schumer said this redevelopment plan is aimed at turning Main Street around and the Sibley building back into a hub for new photonics and high tech businesses as well as a mixed-use area with places to live, shop, eat, do business and more. Local leaders from the City of Rochester, Rochester Downtown Development Corporation, and High Tech of Rochester have established a Downtown Innovation Zone, anchored by the new HTR Business Accelerator incubator that will be constructed in the Sibley building. Specifically, the Sibley building will house the new High Tech of Rochester (HTR) Downtown High Tech Business Incubator Accelerator, the new national American Institute for Manufacturing (AIM) Photonics’ workforce development center and photonic company incubator facilities. This is in addition to the development of six floors for 168 units of mixed income housing, Class A office space, over 10,000 sq. ft. of retail space, a green roof terrace, and the development of remaining unclaimed space for additional office and retail use. HTR plans to house approximately 24 high tech businesses at its new business incubator in the Sibley building to spur hundreds of jobs. Schumer said the stars are now aligning to grow the new Downtown Innovation Zone and will be bolstered by the Rochester Institute of Technology’s (RIT) Center for Urban Entrepreneurship business incubator, which is located next door to Sibley. In 2013, Schumer secured a $1.5 million federal construction for the incubator. In addition, in 2014, he secured another $1.5 million federal funding to construct new on-street parking along East Main Street.
However, Schumer has said the linchpin in making this a reality was securing the federal NMTC investment needed to leverage millions in public and private funds in order to transform this area. That is why Schumer has been pushing for years to win the needed $42.5 million NMTC allocation for the Sibley project, which is a cornerstone of the plans to revitalize downtown Rochester. Schumer previously wrote to Treasury Secretary Lew to push for a NMTC allocation for the project and, in May 2015, he hosted a meeting in his DC office with WinnDevelopment, the NMTC Coalition and the four leading Community Development Entities (CDE) that allocate federal New Markets Tax Credits. During this meeting, he urged the CDEs to award the NMTC allocations required to kick-start the multi-million dollar redevelopment of the historic Sibley Building. Over the past year Schumer also made calls to the NMTC providers RBC and wrote to officials at Urban Research Park to underscore the importance of this project. Specifically, under the plan Schumer helped create, RBC Community Development will provide a $20 million NMTC allocation, Urban Research Park will provide a $12.4 million NMTC allocation, Community Impact Capital will provide an $8.35 million NMTC allocation, and PNC Bank will provide a $1.76 million NMTC allocation.
Schumer announced today that under the deal, WinnDevelopment will formally close on the financing by next month in January, start construction on the first $110 million scope of work on-time in February 2016, and greenlight construction of the complete multiphase $200 million redevelopment of the Sibley Building. Securing this final NMTC financing will ensure WinnDevelopment’s construction timeline is not delayed and will begin in February. Schumer called this a major victory for downtown Rochester and the soon-to-be Sibley tenants, like the AIM Photonics workforce development center and HTR.
Specifically, the NMTC allocation will yield approximately $10.5 million in direct investment to construct the new high-tech, mixed-use, and office/retail space components. The NMTCs will be applied to a $110 million initial scope of work that WinnDevelopment will commence in February 2016. This $110 million includes the construction of the 6thfloor for the New High Tech of Rochester business Incubator, construction of floors 1 and 2 for mixed-use commercial and retail space for new businesses, shops, restaurant, and other improvements. While construction began this fall on the 6th floor space that will house the HTR business incubator, the overall complete $200 million multi-phase redevelopment previously could not move forward without this NMTC financing. Since many phases will be built simultaneously, Schumer argued that the NMTC financing was the final critical piece needed to bring the entire puzzle together. Now that this financing has been secured, Schumer said this revitalization can move beyond the Sibley building’s 6th floor and begin to once again make the entire center a hub for innovation and commercial activity.
Schumer was joined by WinnDevelopment President and Managing Partner Larry Curtis, WinnDevelopment Vice President Joseph Eddy, High Technology of Rochester President Jim Senall, Rochester Downtown Development Corporation President Heidi Zimmer-Meyer, University of Rochester President Joel Seligman and Rochester Institute of Technology President William Destler.
“The Sibley Building redevelopment is the largest, most complex project in Rochester and the investment of more than $200 million as part of a public-private partnership is recreating Sibley as the centerpiece of a revitalized Downtown,” said Lawrence Curtis, President, WinnDevelopment. “New Market Tax Credits are a major catalyst for economic development and are necessary in making the financing work for complex projects like The Sibley Building. Senator Schumer’s tireless support of the program and his commitment to The Sibley Building are key to its success.”
Schumer has long been a champion of the NMTC program. The program was established in 2000 with the goal of spurring economic development in low-income communities through the use of tax credits, and Schumer successfully fought to extend the New Markets Tax Credit program in the just passed Fiscal Year 2016 Omnibus appropriations bill that Congress passed last week, to help leverage private investment and jump-start construction efforts in communities like Rochester. The Community Development Financial Institutions Program (CDFI) within the U.S. Treasury Department accepts applications annually for the NMTC program. Through the NMTC, Community Development Entities (CDE) or financial institutions like banks apply to the CDFI to receive a tax credit allocation and, if awarded an allocation, then serve as intermediaries to accept and distribute tax credit allocations. In exchange for investing in qualifying projects, individual investors and corporations can receive a tax credit on their federal income tax return, creating an incentive for individuals to invest. By selling tax credits, the CDE can raise large amounts of equity for identified economic development projects such as the redevelopment of the Sibley building.