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Public money goes in ...

   Hmmmm. Most of the big stories in Business Today could just as easily been in Government Today.

- Report criticizes performance of state’s IDAs - Matt Glynn/The Buffalo News
   The state’s industrial development agencies award too many tax breaks for too little payoff in job growth, a new report contends.
   A reform group called the NY IDA Coalition released the report, called “No Return on Our Investment,” ESD based on 2008 data for the state’s 115 IDAs.
   “Economic development subsidies represent a substantial investment of taxpayer resources—we must target that investment wisely to get a good return,” the group said in its report, which used data from the state Office of the Comptroller. ...
   Allison Duwe, executive director of the Coalition for Economic Justice, which helped prepare the report on IDAs, said the trends in incentives and job creation hit home at a time of fiscal crisis for the state....
   Al Culliton, chief operating officer of the Erie County IDA, said he feels his agency and other IDAs are doing a good job fostering job growth. The ECIDA conducts an annual survey of the companies it works with, to keep track of their job counts, he said.
   Related:
- Tax breaks for businesses in N.J. towns hurt taxpayers, report says - Newark Star Ledger

- Dresser-Rand putting $9.6 million into Olean research, development - Matt Glynn/The Buffalo News
   Dresser-Rand will invest $9.6 million to bolster research and development at its Olean location, a project that will lead to more jobs, Empire State Development said.
   The R&D investment is expected to retain 787 jobs at the Cattaraugus County manufacturing plant and eventually add 50 jobs, the state’s economic development agency said. ...
   Empire State Development is providing a $500,000 capital grant, and Dresser-Rand will receive about $1.6 million in Empire Zone benefits. The company will also receive a $250,000 electric infrastructure grant from National Grid and Empire Zone electric rate reductions.

- Grant aids rural expansion of Web - Dino Grandoni/The Buffalo News
   The U.S. Department of Agriculture has released $855,901 to fund the expansion of broadband Internet service in southern Chautauqua County.
   The money is part of the Obama administration’s economic stimulus package, approved by Congress in February 2009.
   Windstream Corp. — the Little Rock, Ark.-based broadband and telecommunications company that was awarded the money after a competitive application process — will use it to provide up to 12 megabytes per second of Internet access to the towns of Clymer, Columbus, Ellery, French Creek, Mina and Sherman.
   Related:
- Recovery Act investments in broadband - White House National Economic Council

... Public money comes out?

   The big national story today is about how there has been a major step toward the end of the American occupation of [not only Iraq but also] Detroit:

- GM starts public stock-selling process - AP/Buffalo News
   DETROIT— General Motors Co. on Wednesday filed the first batch of paperwork required by regulators to sell stock to the public, a step that brings the automaker closer to its goal of shedding government Gmstartspublics-191211-001 ownership.
   The 700-page registration form, filed with the U.S. Securities and Exchange Commission, begins a process that will lead to an initial public offering of GM’s stock. No date was set for the sale, but experts say the IPO could come as early as October. ...
   The U.S. government owns roughly 61 percent of the company, which it got in exchange for giving GM $50 billion in survival aid last year. GM has repaid $6.7 billion, and the remaining $43.3 billion was converted to the ownership stake. Other stakeholders include a United Auto Workers health care trust and the Canadian government.
   Related:
- GM to investors: You can bet on our team - Tom Walsh/The Detroit Free Press
   The stakes are huge as GM seeks to shed the mantle of government ownership with an initial public offering that is expected to be one of the biggest stock sales in history. The stock will be listed on New York and Toronto exchanges, reflecting GM's intent to pay back U.S. and Canadian taxpayers who coughed up more than $50 billion to keep the company afloat after it ran out of cash in late 2008.
- GM IPO Is `More Political Than Practical' - Bloomberg News 
- GM's IPO: High hopes and deep fears - Alex Taylor III/Fortune/CNNMoney
- G.M.’s Risks: Management, Pay and More - DealBook/The New York Times 
- Bailout babies want to grow up - MarketWatch 
- How to Win from the GM IPO - James Altucher/The Wall Street Journal

   A little traveling music, please Ms. Franklin:

   There. If that doesn't do it, nothing will.

-- George Pyle/The Buffalo News

Senator brainstorms. Market speculates. Buyers web search.

   In Business Today, a U.S. senator brainstorms for economic growth, the stock market speculates on the future of M&T Bank and potential property buyers or renters will be offered a new way of looking over the Erie County market.

- Stumping for rejuvenation - Matt Glynn/The Buffalo News
   Sen. Kirsten Gillibrand appealed for ideas to rejuvenate the economy, and the manufacturing sector in Gillibrandtonawanda particular, during a visit with business and labor leaders on Tuesday.
   Gillibrand toured General Motors' Town of Tonawanda engine plant, then met with 16 guests from companies, unions, government and economic development agencies.
   Those participating in a round-table discussion cited access to capital, brownfields cleanup and renewable energy technology as avenues to job growth.
   The meeting's host has fared better than many manufacturers lately. The Tonawanda engine plant this year was awarded two new engine lines, projects that represent a combined investment of $825 million. ...
   But manufacturing as a whole has faced tough times. About 30 percent of the U.S. jobs lost since December 2007 were in that sector, the Democratic senator said.
   In the Buffalo Niagara region, manufacturing employment has declined from an annual average of 92,600 in 1990 to just 50,300 last year, according to the state Department of Labor. Through June this year, the average was 47,300 manufacturing jobs.
   Arthur Wheaton, an automotive expert at the Cornell University School of Industrial and Labor Relations in Buffalo, told Gillibrand that more manufacturers would be successful if they emulated the labor-management cooperation at the GM Tonawanda plant.
   "They're not just leaders in Western New York, they're leaders globally," he said.

- Report boosts stock of M&T - Jonathan D. Epstein/The Buffalo News
   M&T Bank Corp. shares soared Tuesday after reports from overseas that Spain’s Banco Santander SA and Buffalo-based M&T have restarted merger talks.
   M&T shares rose after a report in the Financial Times, attributed to anonymous sources, that the two banks had “rekindled” discussions over merging Santander’s U.S. subsidiary, Sovereign Bancorp, with M&T. Previous talks were halted over a disagreement about which bank would be in control. ...
   Under the earlier proposal, M&T would acquire Philadelphia-based Sovereign in a stock transaction that would double M&T’s size. Such a deal would create a regional powerhouse in the Northeast and Mid-Atlantic states with nearly $150 billion in assets and more than 1,500 branches from Virginia to New Hampshire.
   In exchange, Santander would gain a minority stake in M&T. Santander might also acquire the 22.5 percent position that Allied Irish Banks Plc now owns from its 2003 sale of Allfirst Financial in Baltimore to M&T. European regulators are forcing AIB to sell that as part of Ireland’s bailout of the bank. ...
   A deal would let Santander turn over the troubled Sovereign, which suffered billions of dollars in losses, to M&T.

- Database lists commercial sites - Jonathan D. Epstein/The Buffalo News
   The Buffalo Niagara Enterprise economic development organization has teamed up with the local trade group for commercial real estate brokers to launch a new electronic database listing commercial properties available for sale.
   BNE and the Western New York chapter of the New York State Commercial Association of Realtors this week unveiled their new commercial multiple-listing service for the Buffalo Niagara region at www.buffaloniagaracls.com .
   The new service, launched together with technology firm GIS Planning, combines real estate listings with community data on a new Web site that is available to both commercial real estate professionals and the public.

-- George Pyle/The Buffalo News

Should I stay or should I go?

   Change and rumors of change in Business Today:

- HSBC considers options for mortgage arm - Jonathan D. Epstein/The Buffalo News
   HSBC Bank USA may put its U.S. mortgage subsidiary in Depew up for sale, putting as many as 800 Hsbcmortgage jobs in jeopardy, the bank confirmed Monday.
   The possible change at HSBC comes as the bank itself is considering whether to stay in its downtown Buffalo tower or move to a new building in the city or suburbs. That could add stress to what is already a worrisome situation for local economic development leaders working to keep the bank firmly anchored in the region. [Despite deal, HSBC's options are still open - Buffalo News 8/7/10] 
   The bank notified employees Monday that it is reviewing its strategic options for HSBC Mortgage Corp.(USA), its prime mortgage lending and servicing businesses.
   Options for the mortgage subsidiary include "a sale, merger or other business combination," as well as the "sale and outsourcing of all or substantially all" of its operations and assets, according to a statement from the bank. They also could entail leaving those businesses, or the bank could decide not to make any changes at all.
   The bank emphasized in its statement that it would continue offering mortgages, serving existing customers and attracting new customers to the bank through the mortgage business.

- Poised for a Big farewell - Samantha Maziarz Christmann/The Buffalo News
   Cheryl Busch is saying goodbye to the Italian restaurant her father opened 43 years ago.
   Big John’s Restaurant at 546 Niagara Falls Blvd. will serve its last Italian meal Monday.
   As hard as it is to put so much history behind her, she said it’s time to try something new. Her husband, a full-time teacher, is hoping to move into administration — something that would be impossible with the time constraints and demands of running the restaurant.
   “We’re closing this chapter and moving on with great memories. It’s our opportunity to explore something new,” Busch said.

- Companies get grants to create 45 jobs - Matt Glynn/The Buffalo News
   Two area companies planning to add a total of 45 jobs were awarded grants of $100,000 each by Empire State Development Corp. to support their growth plans. [Press release here]
   Empire State Development, the state’s economic development arm, approved grants for StudentVoice LLC in Buffalo and Inscape in Falconer. The agency’s board also approved grants worth a total of $1.3 million for three other employers.

    One, two, three, four ....

-- George Pyle/The Buffalo News

Thinking globally: Taxes, booze

- IRS cracking down on foreign bank accounts - David Robinson/The Buffalo News
   The federal government’s crackdown on taxpayers with foreign bank accounts could leave unknowing Western New Yorkers facing potentially severe penalties, local tax experts warned.
   As part of the intensifying hunt for Americans who try to evade taxes by stashing money overseas, the Internal Revenue Service has been putting more of a focus on taxpayers who hold foreign bank or financial accounts that total $10,000 or more, even for a short time.
   Taxpayers who hold those accounts are required to file a Foreign Bank Account Reports disclosure form with the IRS and also pay the appropriate taxes on those holdings.
   The penalties for individuals who willfully fail to file the form are especially severe. Under the terms of the Patriot Act, which aims to stop the financing of terrorists, the maximum fine for a violation is $100,000 or half of the amount in the account, per year. Even nonwillful violations can carry a penalty of up to $10,000 per year.
   “The penalties are fairly draconian,” said David Barrett, a tax partner at the Buffalo accounting firm of Freed Maxick & Battaglia.

- Double Cross Vodka to debut on area vendors' top shelves - Dino Grandoni/The Buffalo News
   Double Cross Vodka, a two-year-old Slovak spirit, is having a soft launch in Buffalo this month, hitting Doublecross the shelves of many local restaurants, bars and liquor stores for the first time.
   But while the vodka is relatively new to this market, several of the people in the company and investing in it have longtime ties to Western New York. ...
   Founders Malcolm Lloyd and John Gellner saw that there were few, if any, luxury goods from Slovakia in the U.S., and few brands in the price range set for Double Cross, though there are many vodkas in the market. They put four years of research and development into their liquor, touring distilleries throughout Eastern Europe to find Jan Krak, a master distiller in Slovakia near the Polish border.

-- George Pyle/The Buffalo News

Acting locally: Beer and sports

   Is is just me, or are stories about beer getting to be a pattern here? And, of course, what goes with beer [apart from more beer]? Sports!

- Brothers to convert Cold Storage building into Wilson brewery -  Teresa Sharp/The Buffalo News
   WILSON — Good news is brewing in the village, with the planned conversion of the long-vacant, century-old Cold Storage building on Lake Street into the community’s first microbrewery.
   The property at 638 Lake St. recently was purchased by a local family, and sights have been set on opening the Woodcock Brothers Brewing Co. by next summer.
   Mark Woodcock and his wife, Andrea, of Youngstown, and brother, Tim, and his wife, Debbie, of the Village of Wilson, are behind the estimated $1.3 million project.
   They also envision the addition of a small restaurant and plenty of rental retail space in the nearly 50,000-square-foot complex.
   The brewery would use about 24,000 to 30,000 square feet in the stone building portion of the site, Mark Woodcock said.
   “We will leave about 12,000 square feet across three levels in the stone building open, which we feel would be perfect for a winery to join us,” he said. “We feel this could really enhance this as a destination.”

- Businessmen to tap 'fandemonium' - Dino Grandoni/The Buffalo News|
   Athletes who have played in Buffalo have said over and over that sports fans here are among the most devoted in the country. In the words of legendary sportscaster Van Miller, it's "fandemonium" at Buffalo sporting events.
   Which is why a pair of businessmen are trying to create a local sports museum that will be the first of its kind in Buffalo, one that they want to call -- yes -- Fandemoneum.
    The museum, named after the term coined by Miller, the longtime Bills play-by-play man, is the brainchild of two native Buffalonians: Gregory D. Tranter, who lives in Massachusetts, and Michael R. Weekes, who recently moved back to the area. ...
   What Fandemoneum (ending in "eum" like "museum") [like Newseum] will look like isn't the biggest question mark. Where to put it and how to finance it are. ...
   Tranter and Weekes met at the "Buffalo Bills 50th Season" exhibit at the Buffalo & Erie County Historical Society, where Tranter took guests on tours through the memorabilia, most of which was from his sizable collection of over 100,000 Bills items. ... They did some research and saw existing sports museums for the New England Patriots and Pittsburgh's sports franchises.

   OK. All together now:

-- George Pyle/The Buffalo News

Beer. Smoothies. Urology practice expands.

   The last time I mentioned beer in the headline to a blog post, traffic shot up. Let's see what happens today.
   In
Business Today:

- Brewery expands holdings - Dino Grandoni/The Buffalo News
   Rochester-based North American Breweries [first time I've ever been carded at my own computer] is buying another brewing company, Independent Brewers United, in a deal finalized at noon Wednesday.
   North American will take over operations at the Vermont-based company’s three breweries in Portland, Ore.; Berkeley, Calif.; and Burlington, Vt., along with its five alehouses and one retail store. Three craft beers — Magic HatPyramid and MacTarnahan’s  [must be 21 to click], — will be added to North American’s brand portfolio, which includes Genesee, Dundee and Seagram’s and most notably, Labatt, whose U.S. headquarters is in Buffalo. [In where else but Fountain Plaza.]
   The terms were not disclosed. “For our whole portfolio, the one area where we’re not strong is craft beers,” North American Breweries CEO Rich Lozyniak said. “This is one company we’ve been keeping our eye on.”

- Rich Products ends manufacturing at last local plant - Matt Glynn/The Buffalo News
   Rich Products has ended manufacturing at its plant at Niagara and West Ferry streets, and is Richproducts considering how to reuse the site.
   The company wrapped up production of a fruit-based concentrate, primarily used in smoothies and fruit shakes, at the end of July as planned. Rich Products opted to have a different company, Island Aseptics in Ohio, make the product on its behalf under a manufacturing agreement.
   Rich Products plans to keep the 172,000-square-foot plant rather than put the facility up for sale, said Dwight Gram, a company spokesman. The site is across Niagara Street from the company's world headquarters campus.

- Urology group plans Cambria site - Thomas J. Prohaska/The Buffalo News
   To meet what it believes will be a growing demand for its services and a declining pool of providers in Niagara County, Western New York Urology Associates announced Wednesday it plans to construct a new $11.3 million location in Cambria.
   Officials of the company went before the board of the Niagara County Industrial Development Agency to request a 15-year property tax break on the planned 37,000-square-foot, two-story building.
   Richard Terhaar, administrator of the company, said it built a major facility on Harlem Road in Cheektowaga in 2008, and 20 percent of the patients come from Niagara County....
   That location is on farmland at 3832 Saunders Settlement Road, which is Route 31. It’s about two miles east of Niagara County Community College and almost in the geographical center of Niagara County.

   Well, that all seems to flow together nicely.

-- George Pyle/The Buffalo News

Robbing Peter to rent to Paul

   Harbor development, and its ripple effect on nearby cities, is not only an issue in Buffalo.

- HSBC Center tenants seek better deals - Jonathan D. Epstein/The Buffalo News
   Five years ago, three New York City investors bought Buffalo's tallest building for $85 million. Hsbcneighborhood
   At the time, many people in Western New York thought the sum -- the highest ever paid in Buffalo -- was extravagant and excessive. But in the heyday of the credit boom, the new owners had no trouble getting $83 million in loans for their purchase of One HSBC Center.
   But since March, those owners, known as Seneca One Realty LLC, have faced significantly higher monthly payments, plus a $73 million balloon payment due in five years.
   And the higher rents they might need to charge are causing their premier tenants -- HSBC Bank USA and the law firm Phillips Lytle LP -- to look elsewhere for better deals.

   The question then becomes: If much of the HSBC tower is vacated, will current or future owners be forced to lower rents, appeal to other downtown businesses, which will move up and leave a big hole in the occupancy rate of other downtown buildings?
   Like this:
-
Pierce Atwood landlord cries foul - Portland [Maine] Press Herald
   The owners of One Monument Square say they are angry that the city has lured away their tower's anchor tenant, Pierce Atwood, to new offices on the waterfront.
   The city, which in June gave Maine's largest law firm a tax break for the project, sealed the deal Monday with a lease agreement that moves a bait company away from the new headquarters and protects views of the Fore River from the building.
   If One Monument Square's owners cannot find new tenants for the space, they will seek an abatement to lower their property tax bill, which now amounts to more than $300,000 a year, said Bill Finard, whose family has owned the 10-story tower since it was built in 1970. ...
   The law firm now has 175 employees in the top six floors of One Monument Square.
   City officials said Tuesday that they still believe they made the right decision to give Waterfront Maine a $2.8 million tax break to convert the Cumberland Cold Storage warehouse on Commercial Street into office space for Pierce Atwood.

   Also:
- IKEA not interested in Canal Side - The Buffalo News 
- Brown asks for public input on waterfront - The Buffalo News 
- Port Angeles seeks funds for waterfront development - Peninsula [Wash.] Daily News
- Prime Naples waterfront tract with 50 docks goes to auction Wednesday - Naples [Fla.] News
- Beacon's plan must include waterfront - Poughkeepsie Journal
- New plan for Century Plaza hotel adds two 46-story towers - Los Angeles Times
   After backing down from a contentious proposal to demolish the Hyatt Regency Century Plaza hotel, the owner has unveiled plans to construct a high-rise real estate development next to the Space Age landmark that would transform the tenor of Century City's streets and dramatically alter the skyline.
  
   That last isn't exactly waterfront development. But it's a big deal, one that will probably also set off a domino effect in that city.

-- George Pyle/The Buffalo News

Beer will flow. Rates will freeze. Scans will link.

   From Business Today:

- Beer will flow at Blue Monk - Denise Jewell Gee/The Buffalo News
   A new "gastropub" with a long list of beers and an emphasis on high-end bar food is nearing completion Bluemonk in the former Merlin's building on Elmwood Avenue in Buffalo.
   Mike Shatzel [right], co-owner of Cole's on Elmwood Avenue, said Tuesday he hopes to open Blue Monk in time for the Elmwood Festival of the Arts later this month.
   Renovation of the building is "98 percent complete," and the bistro is awaiting its liquor license -- a step he hopes to complete within two weeks.

- NYPA puts freeze on rates until year’s end - David Robinson/The Buffalo News
   The New York Power Authority is extending its rate freeze through the end of this year in a move that will save businesses and municipal utilities more than $7 million.
   Richard M. Kessel, the Power Authority’s president and chief executive officer, said Tuesday the state’s economy is still too weak to try to impose higher electric rates on the companies and municipal utilities that benefit from the agency’s low-cost power.
   “Any increase, in my view, would negatively impact the businesses and customers of the New York Power Authority,” Kessel said during a news conference outside the Niagara Power Project. “The economy is not doing well, and it’s slipping back.”

- Windsong Radiology has joined data link - George Pyle/The Buffalo News
   HEALTHeLINK has added Windsong Radiology Group as a member of the Western New York electronic medical records exchange. It is the first independent radiology practice to join the group, and managers estimate it will make some 300,000 images a year available electronically to participating doctors, clinics and hospitals.
   “Radiology reports are a critical diagnostic tool, and having them available to physicians electronically will help improve the quality of patient care and reduce duplicative testing resulting in less radiation exposure to patients,” Daniel E. Porreca, executive director of HEALTHeLINK, said in a statement Tuesday.

-- George Pyle/The Buffalo News

Checking in on our hotels

   Lotta Buffalo News about Buffalo hotels:

- Investor from L.A. may bid on Statler - Matt Glynn/The Buffalo News
   Competition to buy the Statler Towers is heating up.
   My Dynasty Real Estate Investments LLC, a Los Angeles-based investor, is preparing to submit a bid for the Niagara Square property in downtown Buffalo, said Richard J. Sterben, a Williamsville real estate broker.
    That would mean a second suitor for the Statler, which was mothballed in January. Monday, U.S. Bankruptcy Court Judge Carl L. Bucki scheduled the Statler sale for Aug. 30.
   Local businessmen Mark D. Croce and James J. Eagan already have submitted an offer totaling $700,000 -- $200,000 for the property, plus the assumption of an estimated $500,000 in outstanding taxes.
   Sterben said his client, whom he declined to identify, will bid $250,000 and assume the unpaid taxes, bringing the total value to about $750,000.
   Sterben said his client is negotiating with John Ferchill, a Cleveland-based developer, to serve as preferred developer on the Statler project.
   Ferchill guided the revival of a long-dormant, Statler-like property in Detroit called Westin-Book Cadillac. The investor represented by Sterben proposes a mixed-use redevelopment for the Statler, consisting of apartments, hotel rooms and office space. The project probably would cost $85 million to $100 million, he said.

Adam’s Mark gets sales tax breaks - David Robinson/The Buffalo News 
  The owners of Adam’s Mark Hotel [map] in Buffalo are getting $470,000 in sales tax breaks through the Adamsmark Erie County Industrial Development Agency for the second stage of its upgrade project for the downtown hotel.
   WNY Lodging, which acquired Adam’s Mark last year, plans to spend $5.6 million to replace the carpeting, wallpaper and furniture in all of the hotel’s 486 guest rooms and corridors, as well as install new light fixtures. ...
   The improvements are part of a series of changes that were required for WNY Lodging to obtain a Crowne Plaza franchise for the hotel. ...
   The IDA also approved $816,000 in tax breaks for Anderson Equipment Co., which is moving its construction equipment distribution business from Great Arrow Drive in Buffalo to the former Syracuse Supply building in the Town of Tonawanda.

- Lodging demand is high near cities, low in rural areas - Bloomberg News/The Buffalo News
   ... The Buffalo hotel market has enjoyed occupancy rates above the national average, though far short of those found in major cities, according to Smith Travel Report statistics provided by the Buffalo Niagara Convention and Visitors Bureau.  

    Just as long as it doesn't look like this:

-- George Pyle/The Buffalo News

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