The Albany Business Review | June 19, 2009

A deteriorating railroad car diner in downtown Schenectady is once again for sale after a local construction company withdrew from the project.

Ed Zemeck, president of Prize Construction in Niskayuna, said he couldn’t pursue renovations of the Silver Diner on Erie Boulevard because his hands were tied by the city.

“Basically the city and Metroplex [Development Authority] didn’t fulfill some of the things they said they would do,” Zemeck said.

Photo by Ron Dylewski

Metroplex Development Authority Chairman Ray Gillen said he didn’t want to get into a “tit for tat” with Zemeck over the project. He said the city and Metroplex needed to see progress on the structural repairs because the building probably can’t survive another winter.

“I think it was a bunch of different issues that came together,” Gillen said. “We made a lot of concessions to him along the way.”

City officials a year ago announced a deal with Prize Construction in which the company would purchase the old rail car for $1, maintain its art-deco styling and restore the interior as its new office.

The long-term plan was to eventually open a diner, recalling the days when General Electric Co. workers from the nearby factories would line the counter and fill the booths.

Those days are long gone, but historic preservationists have pushed for years to spare the diner from the wrecking ball. The city took possession of the property several years ago through a tax foreclosure.

Under the deal with Prize Construction, the Metroplex was going to loan $40,000 and the Downtown Schenectady Improvement Corp. would have provided up $50,000 from its matching-grant facade improvement program.

Prize Construction would have spent at least $90,000.

In order for the work to proceed, Zemeck said the city was supposed to transfer ownership of adjacent land to the Metroplex and test the soil for contamination. The parcel where the diner sits would have then been enlarged to allow for future expansion and parking, Zemeck said.

“When the city sat on everything and Metroplex didn’t acquire anything, we came to a standstill,” Zemeck said.

The two sides tried to negotiate another rescue plan for the diner, but couldn’t reach an agreement, he said. In the end, no money changed hands and the city still owns the property.

“We’re greatly disappointed,” Zemeck said.

The Metroplex is listing the diner for sale today on Craigslist and other web sites.

If the diner can’t be sold, officials have talked to a group that would salvage key parts of the diner for a museum being developed in Duanesburg.

Originally published online here: http://www.bizjournals.com/albany/stories/2009/06/15/daily45.html