The developer planning to turn a former National Guard armory into an apartment complex for Syracuse University students received support Tuesday from the Syracuse Industrial Development Agency.

The agency’s members voted 4-0 to exempt Norm Swanson’s project from sales taxes on construction materials and from the state mortgage recording tax, said Ben Walsh, executive director of SIDA. Swanson is expected to save approximately $325,000 from the exemptions, Walsh said.

In March, Swanson, owner of the Genesee Grande Hotel, Parkview Hotel and Hotel Skyler, proposed to convert the former armory located at 1055 E. Genesee St. into 133 apartments for SU students. Construction for the apartment complex, estimated to cost approximately $18 million, is anticipated to begin in June and end in August 2012.

‘This is a longtime vacant structure — a historic structure — in an area that is experiencing pretty significant economic remodelization,’ Walsh said.

On Tuesday, SIDA also scheduled a public hearing for June 21 at 8:30 a.m. on Cameron Group LLC’s request for a property tax exemption for a building it plans to build at 601 University Ave., which would house a new SU bookstore and fitness center complex.

‘The whole purpose of a public hearing is to hear from both the developer and anyone from the public who either supports or opposes the project,’ Walsh said. ‘The board will listen to the presentation and anyone who feels inclined to speak and ultimately make a decision on the merits of the project.’

The university is planning to move the bookstore in the Schine Student Center to the new building on University Avenue, according to an article published in The Daily Orange on March 7. The complex would also include retail stores and cost $20 million to construct, according to the article.

Cameron Group submitted an application for property tax exemption within the past month, and the first step in the process is to authorize a public hearing, Walsh said.

If approved, the Cameron Group would receive a property tax exemption in the form of a payment in lieu of tax agreement, or PILOT, and would be eligible for mortgage recording tax and sales tax exemptions, he said.

A representative from the Cameron Group could not be reached for comment.

When Swanson makes the improvements to the currently vacant armory, the value of the property is going to increase along with the tax assessment, which ends up helping the city of Syracuse, Walsh said.

‘Some people think, ‘Why are we giving these big tax breaks to these wealthy developers,” he said. ‘Well, this isn’t a matter of providing unnecessary benefits; this is what’s required to make these projects financially feasible.’

The currently vacant armory would hold 49 apartments, most of which are planned to be two-bedroom units. Another 84 apartments would be built in a new four-story building to be constructed on a lot north of the armory facing East Fayette Street. A garage, which was once used to repair tanks and is currently missing its roof, would be torn down to make room for the new building.

The complex, which Swanson plans to name Copper Beech Commons, would be 180,000 square feet and would include a 3,000-square-foot health and fitness center for tenants.

Swanson’s project will not receive a PILOT agreement from SIDA because it qualifies for the New York state 485-A property tax exemption program adopted late last year by the Syracuse Common Council, Walsh said. The program provides exemptions to properties that are converted from nonresidential buildings into residential developments or a building used for both residential and commercial purposes, he said.

‘There’s really two ways to get property tax exemption, either you get it through an exemption that’s currently on the books and you get it by right, which they are in this case,’ Walsh said. ‘Or through a payment in lieu of tax agreement — PILOT agreement — which SIDA can provide but didn’t have to in this case.’

Copper Beech Commons will get a 100 percent exemption for eight years from any increase in its tax assessment attributed to the construction, with a partial exemption for another four years.

jdharr04@syr.edu

Published on May 18, 2011 at 12:00 pm

Contact Jon: jdharr04@syr.edu