Peter Melito knows what he'll be doing weekends for the next year or so. Melito's urban redevelopment company, Lenox Development LLC, has made its first purchase. The 27-year-old Niskayuna High School teacher expects to spend much of his free time helping renovate and manage 150 Barrett St. in Schenectady.
Melito and his partners in Lenox, all recent college graduates, are betting on and contributing to Schenectady's revitalization. Except for Anthony Capraro, 26, the partners, Michael Capraro, 25, Christopher DiStefano, 27, and Matthew DiStefano, 24, graduated from Union College.
“One of the things Union taught us is to be a catalyst for change in your community,” Melito said. “We all really liked the city of Schenectady.”
They are equal partners in Lenox and each contributed $4,000 to the $64,000 purchase price of 150 Barrett. The balance of the purchase was funded by a mortgage from the First National Bank of Scotia. Lenox plans to clean up the building's Art Deco facade and renovate the interior, which includes two first-floor storefronts and offices upstairs. One of the storefronts is currently available for lease.
The partners have not yet set a budget for the renovation, which will include cosmetic upgrades and improving the building's infrastructure. The company plans to use “green” building practices in renovating the building, adhering to standards that promote energy-efficiency and environmentally friendly building.
To help pay for the renovations, Lenox plans to seek a facade grant from the Downtown Schenectady Improvement Corp., green-building grants from the New York State Energy Research and Development Authority, and additional funds from the federal government and other sources.
Only Melito has stayed in the Capital Region, but the partners still plan to do much of the work themselves.
“We would like to put a lot of sweat equity into the buildings,” said Michael Capraro, a civil engineer living in Boston. Only Matthew DiStefano, who is living in San Diego, won't be able to spend much hands-on time.
What impresses John Tracy, an associate broker with real estate company CB Richard Ellis Albany, about the Lenox partners' plan is their long-term commitment. The partners don't plan to “flip” 150 Barrett–renovating and selling it for a quick profit. Their business plan calls for the company to build a portfolio of property in the city.
They are “patient money,” said Tracy, who gave Melito some advice on how to invest in and manage real estate.
The building is about a block away from Proctor's Theatre on State Street and in an Empire Zone, so Lenox is eligible for energy and tax savings. Lenox plans to keep rents reasonable and attract companies providing professional services that will support the city's plan to attract growing technology companies to downtown Sche-nectady.
This kind of private investment “is exactly the kind of thing that we're hoping to see as a spinoff of Metroplex's efforts,” said Ray Gillen, chair of economic development agency Schenectady Metroplex Development Authority.
Metroplex has been concentrating on building an arts and entertainment district around Proctor's. It has landed a planned movie theater, hotel, bakery, restaurants and other businesses. The agency is also focusing on technology and business development downtown.
Over time, Lenox plans to buy and renovate additional buildings, including property that can be converted into downtown housing. The partners hope eventually to be able to leave their day jobs and concentrate full-time on Lenox, but don't see that happening quickly.
“We don't expect to make any money from this for quite a while,” Melito said.