When Samuel Savarino said he was closing his Savarino Companies and work halted at the Downtown Batavia Ellicott Station apartment complex in the summer of 2023, it seemed a given that the Buffalo-based developer was done with the project.
However, Savarino recently indicated, in responses to questions from The Batavian, that such a conclusion may have been premature. Work is being performed on the Ellicott Street property by “subcontractors of Savarino Companies LLC,” Savarino said Thursday.
Contractor vehicles could clearly be seen at the site throughout the past several days, along with crews that apparently installed exterior siding and completed other construction tasks.
The work is to both button up the property’s exterior to protect it from the wintry elements, and to further proceed with project construction, Savarino said.
He made an abrupt announcement in August 2023 that his company would be closing after a sticky financial situation involving the state Dormitory Authority and claims that not being paid for completed work created what Savarino said at the time was enough of a financial constraint, compounded by pandemic shutdowns, to keep some of his other projects afloat.
After he backed off from Ellicott Station, city, county and state officials weighed in on the situation, proffering optimism that another developer would eventually step in and continue on.
When asked if he had walked away completely from the project and if there was any possibility that he would work with another developer here, Savarino simply replied “No and Yes” to those two questions in that order. He did not wish to speak by phone and offered to answer questions by email.
Savarino said that he’s been in communication with the city, Genesee County Economic Development Center, and the state Office of Homes and Community Renewal, with no elaboration or specifics as to when. City Manager Rachael Tabelski said on Thursday that she has “not had any communication on Ellicott Station from Savarino or the state.”
Savarino declined to answer further questions about the liens filed against his company by a handful of contractors that had already invested labor and materials into the project or whether he had any plans to file any type of financial protection, namely bankruptcy.
When asked if he had any hindsight about what happened with the Ellicott project and if issues were about more than the Dormitory Authority, he did not reply.
The project at 50-56 Ellicott St. became embroiled in a wrangle with city and county officials about how an initial market rate-turned-affordable workforce housing apartment complex became an unwelcome low to very low-income housing complex.
Savarino qualified for state housing tax credits with a low-income strategy, but city and county leaders wanted to see the project accommodate higher salaried tenants to bring in more wealth and bump up the local economy and spending for what was being touted as “a pathway to prosperity.”
Much of it fell apart when GCEDC gained access to tenant demographics and discovered that Savarino was using a lottery method to select tenants and that income levels were much lower than anticipated. However, Savarino had also missed two October 2023 payment in lieu of taxes (PILOT) installments of $25,312.26 for Ellicott Station and $11,743.90 for the adjacent property that was to be a brewery/restaurant, according to documents provided to The Batavian.
By the time that letter from Harris Beach was sent to Ellicott Station LLC on Jan. 3, 2024, GCEDC was demanding immediate payment of $833,021.26 as part of “its right to capture agency benefits,” plus late payments and interest.
The recapture schedule includes $23,868.23 for a PILOT payment, $637,500 in sales tax exempt savings for 2023, and $170,209 mortgage recording tax exemption savings for 2021, for a total of $831,577.23 in October 2023 for Ellicott Station LLC, plus a PILOT of $10,964.29 for the adjacent Ellicott Street property, $212,500 in sales tax exemption savings in 2023 and $57,274.50 in mortgage recording tax exemption savings in 2021, for a total $280,738.79 in October 2023.
The Batavian asked Savarino if he is planning to pay the “clawback” request of more than $1.1 million and about his response to the GCEDC.
“Ellicott Station LLC has responded to the GCEDC. No further comment at this time,” he said.
In a letter dated Dec. 1, 2023, Savarino contested the agency’s claims of recapture as being “without merit” since Ellicott Station LLC only received notices of default in July and August, and “all of the information request in the July notice, however, was provided by July 31, 2023, as acknowledged in the August notice,” Savarino said.
He also disputed the discrepancy of income requirements since “numerous emails between you and myself or Oxford Consulting reflect your and other agency officials’ knowledge and agreement that the 55 units of housing would be limited to occupants with income below 60 percent of the area median income.”
“There is simply no basis to contend that the company in any way misled the agency, which is the only claimed cause for termination of the agreements,” he said. “We respectfully request that the agency reconsider the termination of the agreements and revoke its demand for recapture of benefits thereunder.”
A response from GCEDC to Savarino's letter was unavailable prior to publication.
Meanwhile, Steve Hyde, CEO of the economic agency, has given the community a whiff of optimism by stating that he believes the project will end up better in the end. There’s just no telling when and by whom that ending will happen.
To read all about Ellicott Station, go HERE