Amherst Hyatt Place Hotel Costs $18 mill; Identical Hamister Hotel to Cost $35 millSix story Hyatt Places show $17 million difference in cost August 18, 2015 |
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A Hyatt Place hotel nearly identical to the one that Niagara Falls Mayor Paul Dyster and Buffalo developer Mark Hamister have proposed for the city’s tourist district is slated to open on August 20 in Amherst, just off the 290 of Main Street. Both hotels are six stories, though the Amherst establishment has 137 rooms as opposed to the 128 of its proposed Niagara Falls counterpart. Both feature pools, spas and fitness centers, having been pressed out of the same cookie cutter responsible for 205 Hyatt Place hotels, mostly located adjacent to truck stops or airstrips throughout the country. The only real difference between the two is the cost to build them. The Amherst Hotel was put up by Iskalo Development at a cost of $18 million, while the Dyster-Hamister Hyatt place currently carries a projected price tag of $35 million. You read that that right. The $35 million Hamister Hyatt Place that Dyster claims is vital to the future of the city is going to cost nearly twice as much as an identical Hyatt Place opening this month in Amherst. How could that be?
Last week, the Niagara Falls Reporter learned that Hamister had not even closed on the land the hotel is supposed to be built on, a lot on Rainbow Boulevard that was appraised for $1.5 million. The parcel was given to the developer for a $100,000 in a deal that was ramrodded through the city Council with the help of Dyster, Gov. Andrew Cuomo and U.S. Sen. Charles Schumer in the autumn of 2013. The closing is now scheduled for September 20, ten days after the city’s mayoral primary. Further, the Reporter learned, an escape clause was written into an agreement with John Guido, who in recent years has operated a private parking lot on the site, that returns the property to his control should Hamister decide against closing the deal. The Niagara Falls project is receiving $3.85 million in funding from the state, and the Hamister Group also is expected to save about $4.25 million over 10 years in tax breaks approved by the Niagara County Industrial Development Agency. The city provided no direct funding to the project, but agreed to sell the $1.5 million parcel to Hamister for only $100,000, a price which Dyster has said reflects the fact that the city did not put its own cash incentive into the deal. All told then, Hamister will receive approximately $9.5 million in cash, tax breaks and property should he decide to go ahead and build his hotel. But that is not the only option available to him. He could walk away, of course or he could actually close on the property and not build the hotel. This last possibility must be tempting. One hundred thousand dollars is chump change for a guy like Hamister, and spending it on a piece of property he could get a million for the next day without having to actually do anything would be pretty sweet. Should he decide to do that, the city would have absolutely no recourse whatsoever. The $18 million, six-story Iskalo Development hotel represents the first incarnation of the Hyatt Place brand in the Buffalo Niagara market. Unlike its Niagara Falls counterpart, the project ran into stiff opposition from neighbors and local politicians, who objected to their height and scale, which they said was out of place with the surrounding buildings and homes. Amherst officials eventually gave approval to both – including tax breaks – although the fights prompted the Town Board to change some of the regulations for future projects. But residents filed three lawsuits and mounted a public relations campaign against Iskalo’s hotel. The last legal hurdle was removed in February 2014, allowing full construction to begin. In contrast, Niagara Falls politicians enlisted the aid of the mainstream media to con the populace into believing that the Hamister hotel project would be the greatest thing to happen here since Harriet Tubman once passed through on a moving train sometime prior to the beginning of the Civil War. A news release issued at the time describes a 100,000-square-foot establishment with 100 plus upscale rooms and 24 trendy permanent apartments. On the ground floor, 8,000 feet would be devoted high end boutiques for the discerning shopper. The project would create between 200 and 300 jobs during the construction phase, and catering to the needs of the moneyed patrons who would flock to the premier destination would require the services of 140 full time employees once construction was completed, Hamister promised. Dyster served as cheerleader, a role to which he is admirably suited. The hotel project would be “transformational,” a “gamechanger” that would provide a once in a lifetime opportunity that would provide the “tipping point” that would forever serve to revitalize the city’s tourist district, the mayor gushed. Since that time, Hamister has downsized his project, even as his projected costs spiral upward. In paperwork filed under pain of perjury with the county’s Industrial Development Agency, Hamister admitted that just six full time and 29 part time jobs would be created rather than the 140 high paying positions he’d promised. And sadly for lovers of trendy boutiques, there won’t be any of those at all. The 24 permanent apartments are no longer a part of the plan and, in what may be the deepest cut of all, the hotel’s affiliation has been changed from the prestigious Hilton imprimatur to the middle of the road Hyatt Place brand, one step above a Motel 6. Why would a project that has been downgraded on so many levels actually see costs rise? And why was Iskalo Development able to build a nearly identical hotel in Amherst for around half the price? We may never know. Hamister stopped talking to the press about the project weeks ago, and Dyster simply has no clue. Only in Niagara Falls, kids. Only in Niagara Falls.
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