Canalside Project Faces BIG FINES Due to Delays

One of the most obvious changes at Canalside is stuck in the mud and not making any progress.

The $40 million Heritage Point complex started taking shape in 2021, but little progress has been made on the two buildings set to take shape there. Now the developer, Sinatra & Company, is facing fines from the state for lack of failure to complete the project in a timely manner.

The company will be required to pay $100 per day for 60 days, followed by a fine of $500 per day, until the work is “substantially” complete, local outlets have reported. The fines were put in place at the request of the Erie Canal Harbor Development Corporation.

A letter sent to Sinatra & Company on August 1 says the developer is in “default of the Sale, Purchase, and Development Agreement entered into as of December 20, 2019” for “failure to meet the Substantial Completion date as defined in the agreement.” If the work is not done in six months’ time, the Erie Canal Harbor Development Corporation believes it has the authority to cancel the agreement and retake ownership of the project and property.

Nick Sinatra, the company’s founder and CEO, puts the blame on economic shifts, including increases in the cost of labor and construction materials, especially after the pandemic.

“In Buffalo, it has caused the project cost for Heritage Point to nearly double from the time it was awarded by the state, pre-Covid,” he says. “Despite adhering to all New York State guidelines, these rising costs have created financial challenges that require additional support from all partners.”

Sinatra & Company has already invested $12 million in equity into the project, with an additional $18.8 million spent on the site. But now he’s asking for another $4 million in state loans to get back to work on the two buildings, which are set to house restaurants, retail, office space, and 61 apartments.

To make matters worse, Sinatra & Company is facing $2.8 million in liens from what contractors say are unpaid bills pertaining to the same project. He says he needs the $4 million to help “fill a $10 million gap to get the project done.”

Work on Heritage Point stopped earlier this year when funding ran out; most of the project’s steel framing work has been completed and can be seen at Canalside, rising up out of the ground near the waterfront and the Explore & More Children’s Museum.

In all, there are eight contractors who say Sinatra & Company owes them money, causing them to file mechanics’ liens on the project and demanding payment, including Pike Construction Services and Community Steel Corp. A representative from Community Steel Corp. says his company has not received any payment since last November. Prior to that, the company had received $1.5 million for work already completed but is owed $1.2 million more.

Buffalo Council Member Mitch Nowkawski has asked Sinatra & Company for an update to be provided during the city’s Community Development Committee meeting on September 10 at 2 p.m.