Bad memories haunt Sibley deal

| September 07, 2012

The extended limbo in which the City of Rochester has found itself over the Sibley building -- unable to collect on a huge outstanding debt, unwilling to foreclose on a massive, underused building -- has made City Council members gun-shy. They say they want to make sure the city doesn't fall into the same trap twice.

Mayor Tom Richards, who sees the Sibley building as a lynchpin to the redevelopment of downtown, this week announced an agreement to sell the Sibley building for $5 million to a company created by the Boston-based Winn Development. Winn plans to overhaul the building for retail, offices, and housing in the Sibley tower.

But at a meeting on Thursday, Council members -- who must sign off on the deal -- said the proposal is overly complex and seems to give too much discretion to the mayor. The deal would allow the mayor to adjust the interest rate and "other terms and conditions" of an outstanding $3.1-million loan that Winn has agreed to take responsibility for.

"I need a roadmap," Council member Carolee Conklin said. "This is very convoluted."

Conklin said she won't support the deal unless the wording is changed. She also asked for a clearer explanation of the financing.

The agreement also includes a 20-year tax-abatement agreement, pending approval by COMIDA.

That the building would be sold to a company formed by Winn -- and not Winn itself -- raised warning signs for some Council members. The building is currently owned by Rochwil Associates, a limited liability corporation formed by Wilmorite. Rochwil owes the city more than $20 million, but has no resources to pay that debt, Mayor Richards says.

That explanation doesn't sit well with many members of the public, who cite Wilmorite's deep pockets. But the debt belongs to Rochwil and not Wilmorite, which seems to have little interest in the building or the debt. Richards and previous mayors have also resisted calls to foreclose on Sibley, saying the city doesn't want responsibility for the massive building.

Yesterday, Council members said they want to make sure the city isn't walking into a similar situation if the Winn company can't make a go of the building.

"I absolutely support the preservation and maintenance of the Sibley building, but we're the safeguard," Council member Conklin said. "We need to be fiscally responsible on this."


Comments (3)

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The deal with Winn sounds almost identical to the deal with RochWil, and if this didn't work out for RochWil, why would anyone think it will work out differently for Winn?

Nobody from the city should be signing off on this deal until the city can figure out just what happened to the millions of dollars per year in rent money the city has paid RochWil for MCC downtown all of these years. Where did that money go? It sure didn't go toward paying property taxes, loans and more.

The most likely outcome is that taxpayers will again be subsidizing this dinosaur of a building to the tune of millions of dollars a year. The only realistic long-term solution to this is to foreclose on the building, and then implode it.

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Posted by Animule on 09/08/2012 at 12:18 PM

Seems like there are two solutions, at least to me. First, do not do the deal without guarantees from Winn, since, it is obvious that they do not want to do this deal within their portfolio, which, I think means that the Mayor has given them some deal that bullet proofs them! So, here we go again, Emperor Richardson doing a deal with his crony types and hanging us out, while telling us it is good for us!
Second, either a grandjury or lawfirm needs to look at the Rochwil deal and all the money paid to Tom Wilmot and where it went. This has a bad feel to me and all others that pay taxes in Rochester! have the ball and balls on this one,,,go for it!

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Posted by clint on 09/08/2012 at 7:53 PM

Sounds way too similar to the RochWil deal (i.e. taxpayers be damned). What is so difficult about the city foreclosing and temporarily maintaining the building? Taxpayers are already subsidizing it... not sure what it is exactly that "RochWil" does (other than sit back and let the taxpayer funded rent roll in of course!).

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Posted by J on 09/10/2012 at 10:25 AM
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