Buyer backs out of $2.5M Guilford Mills deal

PHOTOGRAPHER: Ned Campbell

The long-empty Guilford Mills complex sits across from the Cobleskill village offices at the intersection of South Grand Street and Mineral Springs Road in this 2014 photo.

The $2.5 million purchase of Cobleskill’s former Guilford Mills facility, a major part of the START-UP NY complex planned for the site, fell through last week as the buyer came up short on funding.

Green Recycling Solutions International, the New Jersey-based company that bought the facility in December, informed the county last week that “we can no longer hold out any hope that we can see this project to fruition,” according to a letter sent to Schoharie County Treasurer Bill Cherry.

The company bought the facility from Schoharie County promising to invest the roughly $4 million to $5 million in necessary renovations before a handful of START-UP companies could move in. In all, the plan promised to create about 900 jobs.

“They just simply did not have the money,” Cherry said Wednesday. “Certainly I’m disappointed that it didn’t work out the way that we hoped it would, but there’s really no downside to the county. We didn’t lose anything other than some time on this.”

With the sale collapsed, the property reverts back to county ownership, Cherry said.

GRSI, which was not a START-UP company, had planned to renovate the facility, a designated START-UP location, then lease space to a few approved START-UP companies, including Sakat Consulting, USA Intimates, Echelon Materials and Eco Convergence.

In the letter to Cherry, GRSI Chief Financial Officer Barbara Acuff cited problems with lease deposits from the tenant companies as the reason for GRSI backing out. Acuff did not respond to a request for comment for this story Wednesday.

“This has been absolutely devastating to all of us at GRSI,” she wrote to Cherry. “We wanted nothing more than to create jobs and opportunities for the folks in Schoharie County.”

Cherry said the company had set a deadline of Aug. 21 for securing funding and getting insurance on the building, a deadline that came and passed with no action.

“During March, April, May, June of this year, there was a progression of excuses by GRSI, why they hadn’t begun the renovations,” he said. “All of us [at the county] kept our end of the bargain and did everything we could to make that project a success.”

This is the third time a deal has fallen through for the purchase of the Guilford Mills facility since the county took it for back taxes in 2009, with the first two failures following roughly the same pattern: promises, delays, then collapse.

The 468,000-square-foot former textile mill has been vacant since 2001.

Jason Evans, associate professor of agricultural business management at SUNY Cobleskill and the campus representative for START-UP NY, said the companies approved under START-UP NY, which establishes tax-free zones near universities for new or expanding businesses, will not lose their approval.

“START-UP NY as it applies at Cobleskill really did not change as a result of GRSI pulling out of that deal,” he said Wednesday. “So what we’re doing right now is working with those individual companies, with which we’re START-UP NY partners, to figure out how to still bring them to Cobleskill despite this contract falling through.”

He said there are a few options on the table, including finding new locations or working out a different configuration for the Guilford Mills site, which will retain its START-UP NY designation. Cherry said county officials are considering selling the building at a public auction, pursuing grants for the county to renovate it, or subdividing it and selling it in smaller pieces.

“There are still companies that are approved under START-UP NY that want to come to Cobleskill, but they need the heat on and the lights turned on, and they need the building brought up to code,” he said.