Patience, planning and diversification are key to navigating a rocky economy that has made real estate development more difficult, according to Paul Ciminelli, president and CEO of Ciminelli Real Estate. “It’s real challenging times,” he said. “You’re looking at the overall economy, and there’s a lot of headwinds.” Development opportunities are fewer and further between right now as interest rates rise and banks pull back on lending. But Ciminelli Real Estate is more than just a developer or investor. The company has long diversified its offerings, which provides a measure of protection when times are tough. The same economic factors that are slowing down development are driving new customers to the company’s other initiatives, Ciminelli said.
The company’s property management arm is doing brisk business as property owners face tough questions about what to do with their spaces. The company’s brokerage and consulting services, operated in partnership with national real estate firm Newmark, is thriving for similar reasons. Newmark Ciminelli represents anyone looking to buy, sell or lease. The tumult in the office market means there’s plenty of tenants looking for new space, and plenty of property owners looking for new tenants. “Our Newmark arm has gotten a lot of business because of this,” Ciminelli said. Meanwhile, on the development side, Ciminelli Real Estate is biding its time. “In general, we’re always looking for opportunities, whether the market is on an upswing or a downswing,” Ciminelli said. Ciminelli Real Estate is the third-largest commercial real estate developer in Western New York, with about 11.5 million square feet in its local portfolio. The company has about 230 employees, and several offices in Florida in addition to its Buffalo headquarters.
The company is wrapping up several large Western New York projects — the 716 Health building and Roswell Park Scott Bieler Amherst Center, both in Amherst, and the Lafayette Court building on Main Street in Buffalo. It doesn’t have any other major local projects in the immediate future, which means it can keep its powder dry. Now is the time to invest in pre-development work, getting projects lined up while waiting for economic conditions to improve. “You want to get ready to go, and then figure out the proper time to pull the trigger,” Ciminelli said. Buffalo’s real estate market remains relatively healthy for a secondary market, he said. “In spite of what’s going on with the economy and remote work, the region is doing OK,” he said.