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If we build it, will they come?


What will it take to breathe life into the center of downtown Rochester?

                  The corporate crusaders of Wilmorite Inc. thought they had an answer. When the mall magnates secured a $4 million federal loan and began transforming the Sibley Building into retail and office space in the early 1990s, there was hope that they would spur a renaissance of commercial activity on Main Street.

                  But a decade later, the building is only 67 percent occupied, according to leasing and property manager David Lang. And in terms of development, the surrounding area is still stuck in the Middle Ages, with hundreds of thousands of square feet of empty commercial space.

                  Given Sibley Centre's high vacancy rate, Rochwil Associates --- the Wilmorite affiliate in charge of the redevelopment effort --- was unable to make a $4 million loan payment this summer. Rochwil and city officials recently agreed to refinance the loan, saving the city from having to cover the payment itself.

                  Rochwil's struggle to attract tenants may cast a shadow over another project hyped as downtown's saving grace: Rochester Central Station. The Rochester-Genesee Regional Transportation Authority plans to build a bus terminal just west of the Sibley complex. Central Station is also to have 70,000 square feet of retail space and 300,000 square feet of Class A (read: "classy") office space, according to the project's new Web site (

                  RGRTA Chair William Nojay has said he's counting on revenue generated by the commercial space and a 1,000-car parking garage to help cover the facility's yearly operating costs. He has also suggested that the city should chip in, because many city residents ride the buses.

                  In 1998, Nojay estimated that yearly operating costs would be in the neighborhood of $750,000. But that was early in an as-yet-unfinished site-planning process.

                  Asked how he thought Central Station could attract tenants where the Sibley Centre had failed, Sibley leasing manager Lang says, "That's a good a question."

                  Nojay, the project's loudest cheerleader, wasn't willing to answer that question last week when it was posed by this newspaper, which has expressed skepticism of the project. "As long as people like the whole crowd... at City believe everything about Rochester is negative, negative, negative, nothing good will happen in Rochester," he told this reporter before abruptly hanging up.

                  Donald Riley, CEO of RGRTA, could not be reached for comment.

                  Nevertheless, it's safe to say Riley and Nojay remain optimistic about the project's chances of securing enough tenants to keep it, as Nojay once said, "revenue neutral."

                  "I'm an optimist," says Andrée Mastrosimone, president of Calm & Sense Communications. "I tend to think, 'If you build it, they will come.'" Mastrosimone's corporate and marketing-communications firm spent a year, beginning in February of 2000, trying to attract retail and office tenants to the Sibley Centre.

                  But considering Main Street's prospects for revitalization these days, she says: "I was more optimistic a couple of years ago than I am now."

                  The negative feedback Mastrosimone got from prospective Sibley tenants included concerns about the area's vitality and safety. "There wasn't a lot of business-type traffic during the day," she says. "There wasn't a feeling of being among a community of your peers. Now the area's become less and less occupied. In terms of retail, you can't do a lot of quick shopping. Restaurants are limited. It really is like a ghost town on Main Street."

                  Ironically, downtown's stagnant state seems to be perpetuated in part by the possibility Rochester Central Station will be built there. The city block bordered by North Clinton Avenue and East Main, St. Paul and Mortimer streets is a shell of vacant space. Property owner Edwin Cohen could not be reached for comment. But last year, he told the Rochester Business Journal he'd received several calls from people interested in opening restaurants and shops in the area. At the time, plans for the transit center included the demolition of his buildings. Understandably, prospective tenants were wary of signing a lease.

                  "I could fill [my properties] very easily if they decide to put the transit center in there or not," Cohen told the RBJ.

                  Mastrosimone also says business owners she tried to lure to the area felt "trepidation being downtown in an environment that still seemed to them somewhat unsafe."

                  Lang, the person currently in charge of marketing the building, has heard similar concerns. "It's a negative perception," says Lang, who considers safety "a non-issue." While some people may feel the area is unsafe, he says, "in terms of problems, they're almost nonexistent."

                  Lang considers vacancy more of a problem in the area than safety. Of Sibley Centre's 1.1 million square feet of space, roughly 80 percent is being marketed as office space, most on the upper floors. Lang characterizes the redeveloped office space as "a high-end Class B." In office space marketed as Class A, the type RGRTA is planning, "the amenities and finishes tend to be of higher quality, and there are more of them," Lang says.

                  Of course, the cost of Class A space is commensurately higher, too: as much as $23 per square foot, compared to $9 to $13 per square foot for B-grade digs, according to Lang.

                  "Currently, the downtown market's flooded with A and B space," Lang says. Tenants aren't asking for Class A space in particular, so much as they're "looking for a good value," he says. "That's the overriding issue."

                  "There's a limit on how much you'd be able to charge in rent to businesses that go into that facility," City Councilmember Brian Curran says of Central Station. "There's a lot of vacant space downtown to compete with them. There's a market, but it's not an unlimited market."

                  "When you take a look at Class A in the region, everything is softer now," says Heidi Zimmer-Meyer, executive vice president of Rochester Downtown Development Corp., an economic development organization and not-for-profit business association. Zimmer-Meyer hasn't seen RGRTA's plans for the project. ("I don't know what's holding it up at this point," she says. "They've been very close to the vest on this.") But she is aware that RGRTA is hoping revenue from its commercial space will pay the project's bills.

                  "That's their goal," she says, "but if you've got rising vacancy downtown, that's a tricky business."

                  "You don't want it to be a spec project," Zimmer-Meyer says, referring to office construction undertaken based on speculation it will be bought or rented. "At the same time, there's evidence that if you plan a project appropriately, if you pre-lease it, you may be able to pull it off."

                  Furthermore, she says, "if a confluence of things in the marketplace hits at the right time, it could be a very good thing." For example, the economy could be on the upswing when the space goes on the market. She also cites the proposed downtown performing arts center and fast ferry as projects that could help Grand Central Station be a success.

                  But even if those projects don't come to fruition, Rochester Central Station "can be a stand-alone project," she says. "It may be easier to make this thing work than it sounds."

                  Zimmer-Meyer believes the terminal and its attendant businesses can have a profound effect on the public's perception of downtown Rochester. "Thinking globally, in some ways these mega-projects have a huge impact on space and how we think about what we do on our off time," she says, tossing out ideas like lunch spots and jazz clubs in the area.

                  "In the case of a bus terminal, there are different people coming through at different times," she says. "You have suburban park-and-ride combined with the people who use city buses. Some times of year, there are students. It's a whole mixed bag of different kinds of players."

                  But from Mastrosimone's marketing perspective, there may be too many players for the comfort of the corporate types RGRTA hopes to lure there. When you're trying to attract office tenants, "you have to make sure that the retail responds to whatever demographic it is you're looking to have in that environment," she says. "If it is upscale business types, you need to have retail to support that."

                  The terminal proponents' talk of revitalizing downtown sounds familiar to Mastrosimone. "I think we were searching for anything we could [use]" to market the Sibley space, she says.

                  "The least expensive thing to do is generate excitement," says Mastrosimone. But, she says, "you can only spin something so much."