The man behind the redevelopment of Seneca One tower has another major project on his hands: the overhaul of the Boulevard Mall.
And he’s going it alone.
Developer Douglas Jemal told The Buffalo News he has completed his $30 million purchase of the 64-acre property in Amherst. He said developer Nick Sinatra, who placed the winning bid for the mall at an April auction, and Cleveland-based RMS Investment Corp. are no longer involved in the project.
The Washington, D.C.-based Jemal said Monday that he closed on the purchase of the mall and the adjacent Wegmans store on Alberta Drive on June 27. A statement from the broker that marketed the property said Jemal paid the auction price of $24.05 million for the mall and $6 million for the Wegmans.
The deeds that document the sales had not been recorded with the Erie County Clerk’s Office as of Monday. Jemal said he doesn’t know why that was, and commercial broker JLL did not immediately provide an answer Monday.
Jemal said he now will hire architects to design the future look of the mall property, which has anchor tenants such as Macy’s and Dick’s Sporting Goods but is subject to the same forces that have battered indoor shopping centers nationwide. He said he wants to create a sense of place in the mall.
“We all know the demise of the mall, the malls, are here. They’re gone,” Jemal said. “It’s a great piece of property in a great location that needs to be de-malled, like every other mall is being done throughout the United States.”
He said construction on the site should begin in the spring. He said he has no idea how much the redevelopment will cost but that the new-look mall site will be rebranded as Boulevard Place.
While the Boulevard Mall property is included in a federal opportunity zone that provides tax benefits to qualified investments, Jemal said his purchase wasn’t structured in a way that allows him to take advantage of that program.
HFF, a commercial real-estate broker now owned by JLL, marketed the mall property with Ten-X on behalf of the special servicer, LNR Partners, which was selling most of the land and buildings on the east side of Niagara Falls Boulevard between Maple Road and Almeda Avenue.
Town officials had worked hard to interest prospective buyers in the mall property in advance of the online auction, including pushing for the site’s inclusion in an opportunity zone.
Sinatra was the only developer who revealed his intention to bid before the auction, which concluded April 3 in a flurry of activity that pushed the final price to just over $24 million.
Sinatra confirmed he was the winning bidder shortly after the conclusion of the auction. The next morning, he told The News that he and his partners planned to “turn the mall inside out” in their overhaul of the property.
[RELATED: Much of Boulevard Mall likely to remain intact as Sinatra & Co. reshapes site]
But Sinatra in the weeks and months after the auction declined to comment further, saying he couldn’t elaborate until the sale closed. Jemal in May revealed he was part of the development team, along with RMS.
“Jemal was always the money behind this thing,” said a source familiar with the mall project who spoke on condition of anonymity.
It’s likely Sinatra acted as a local point person for Jemal before and after the auction process and Jemal presumably paid Sinatra a finder’s fee after assuming full control, the source said.
Jemal said Sinatra left the partnership to concentrate on his other real-estate interests in the area. Sinatra & Co. is working on its Elmwood Crossing reuse of the former Women & Children’s Hospital complex and the development of the South Aud Block at Canalside.
Sinatra said in a text message that he and his partners “decided not to move forward with the Boulevard Mall acquisition.” He said they transferred their interests to Jemal but he couldn’t disclose the terms of that arrangement.
“Doug Jemal is a great guy and we wish him tremendous success with the project. Our community is blessed to have him involved,” Sinatra wrote, declining further comment.
Amherst Supervisor Brian J. Kulpa has had several discussions with Jemal in recent months. The town has a keen interest in seeing the mall revived and has applied for a $10 million state grant to pay for the construction of sewers and roads on, under and around the mall property.
Jemal is taking on more risk with the project as the sole developer, Kulpa said, but he’s established a track record with his other local developments.
“I’m not shocked,” Kulpa said of the Sinatra departure. “I met Doug a couple times. It seems he’s pretty hands on, and I’m sure he doesn’t want a struggle about who’s going to do what and what goes where.”
Benderson Development Co. owns several parcels within the Boulevard Mall footprint, including the former Macy’s Mens store and LA Fitness gym.
“We’ve spoken with Doug and are excited to work with him to make it a more viable mall site,” said Eric L. Recoon, Benderson’s vice president of development and leasing.
The Wegmans at 675 Alberta Drive wasn’t initially included in the mall sale. An unknown party during the auction placed a high bid of $7.45 million, a figure that didn’t meet the reserve price.
Jemal agreed to pay $6 million for the property. Wegmans has a long-term lease with options to renew, said spokeswoman Michele Mehaffy, “so nothing changes except that we have a new landlord.”
Jemal said the Wegmans property was attractive because of the the company’s strong reputation in the market.
“I needed a good sandwich,” he quipped, before praising the sushi and soup bars.
The mall is only the latest project Jemal has taken on in the Buffalo area, including the Seneca One tower that now will host an M&T Bank tech hub.
Jemal bought the tower in 2016 for $12.6 million and has started on the first stages of a $120 million redevelopment of the vacant 1.2-million-square-foot complex.
He also bought the former Buffalo Police headquarters at 74 Franklin St., which he plans to convert into the Police Apartments in a $30 million project. And he bought a house on Nottingham Terrace.
A.J. Baynes, president and CEO of the Amherst Chamber of Commerce, said Jemal is “tripling down” on the Buffalo area with the three large projects.
“We’ve got some great developers locally that have tackled some great projects over the years,” Baynes said. “And to see that their hard work is also now attracting – whether it’s a WS Development (at the Northtown Plaza) or Doug Jemal – big players from the national market, it shows the renaissance of Buffalo is real.”
Published in The Buffalo News July 15, 2019
