A Condemned Holiday Inn in Gates Is Coming Down — And an $18.7 Million Building Materials Warehouse Is Going Up

The condemned hotel at 911 Brooks Avenue in the Town of Gates has been an eyesore for years — a 180-room Holiday Inn built in 1975, shuttered since 2020 when a lender foreclosed after the operator defaulted on nearly $7.8 million in debt. Fenced off and deteriorating, the 10.8-acre property at the intersection of Brooks Avenue and Interstate 390 has sat as a visible reminder of the hospitality sector's pandemic-era losses.

That is about to change. As reported by the Rochester Business Journal on June 3, 2026, Erie Materials — a Syracuse-based, family-owned distributor of exterior building materials founded in 1973 — plans to demolish the hotel, conduct asbestos abatement, and construct a 49,000-square-foot warehouse and a 13,000-square-foot showroom and office facility on the site. The $18.7 million project would mark Erie Materials' entry into the Rochester market, adding to its nine-location network across upstate New York and Pennsylvania.

The Property's History

The 180-room hotel at 911 Brooks was built in 1975 as a Holiday Inn. Access Point Financial foreclosed after operator F.M. Butt Hotels Corp. defaulted on nearly $7.8 million in debt, and the lender submitted the only bid at a January 2020 foreclosure auction. At least one redevelopment plan was subsequently proposed to the Town of Gates — a hotel, restaurant, and mixed-use concept in 2023 — but it was eventually scrapped. Erie Materials acquired the site and is now pursuing an industrial redevelopment path.

Demolition and asbestos abatement costs for the existing structure are estimated at $6 million to $7 million — a substantial remediation investment that reflects both the hotel's age and the complexity of removing a large commercial structure with asbestos-containing materials.

The New Development

Erie Materials distributes residential and commercial roofing supplies, windows, doors, siding, decking, and seamless gutters. The proposed new facilities at 911 Brooks Avenue are sized for that operational profile: a 49,000-square-foot warehouse serving as the distribution hub for the Rochester market, and a 13,000-square-foot showroom and office building providing customer-facing space for contractors, builders, and homeowners reviewing product options. Together the two structures add approximately 62,000 square feet of new commercial construction on a site that currently holds a condemned structure.

The Gates Planning Board has already given final approval on the project plans. The remaining critical step is COMIDA review — the County of Monroe Industrial Development Agency is scheduled to vote on the proposal at its June 16, 2026 meeting, following a public hearing set for June 11 at Gates Town Hall.

Tax Incentives and Public Funding

Erie Materials is seeking $1.7 million in COMIDA tax incentives to assist with property acquisition, asbestos abatement, and demolition costs:

A $768,000 sales tax exemption on construction materials and equipment. A $97,500 mortgage recording tax exemption. A 10-year PILOT agreement worth an estimated $842,764 in property tax abatement. The Town of Gates will also apply a previously awarded $2 million Restore New York Communities Initiative grant to the property to offset project costs.

The combination of private capital, COMIDA incentives, and the existing state grant creates a workable financial framework for a project that carries unusually high front-end costs due to demolition and abatement. The Restore NY grant had been sitting against this property without a viable development project to apply it to — Erie Materials' proposal provides exactly that vehicle.

Construction Sequencing and Abatement Complexity

The $6 million to $7 million demolition and asbestos abatement estimate for the former Holiday Inn is a significant front-end cost that will define the early construction schedule. Hotels built in 1975 typically contain asbestos in floor tile adhesives, ceiling tiles, pipe insulation, roofing felts, and spray-applied fireproofing — all categories requiring licensed abatement contractors operating under NYSDOL and EPA regulations before the general demolition contractor can proceed with structural removal. A 180-room, multi-story hotel also generates a substantial volume of concrete and steel debris that requires on-site staging and regulated disposal, particularly if any materials are classified as contaminated.

The abatement phase will likely require a standalone contract with an environmental remediation contractor, followed by a general demolition contract, before the site is cleared for new construction. That two-phase pre-construction sequence — abatement, then demolition — is standard on commercial sites of this vintage but adds several months to the timeline before vertical construction of the new warehouse and showroom can begin. Given that COMIDA approval is expected by June 16, 2026, a realistic construction commencement window is late summer or fall 2026, with completion of the new facilities likely in 2027.

Erie Materials' decision to co-locate a 49,000-square-foot warehouse with a 13,000-square-foot showroom and office on the same parcel reflects an operational model common among building products distributors: contractor-facing distribution infrastructure and customer-facing display space on a single campus reduces travel for contractors who want to view product samples before placing large orders. Designing the site to accommodate tractor-trailer access for warehouse deliveries alongside customer vehicle parking for showroom visitors requires careful site planning — particularly on a 10.8-acre parcel that previously held a hotel surface parking field that will need reconfiguration for industrial use.

Erie Materials and the Rochester Market

Erie Materials operates more than 400 employees across locations in Syracuse, Albany, Auburn, Binghamton, Elmira, Poughkeepsie, Utica, and Watertown in New York, as well as Scranton and Williamsport in Pennsylvania. Rochester represents a logical market extension — it is the largest upstate New York market without an Erie Materials location. The building products distribution sector has seen sustained demand as residential remodeling and commercial construction remain elevated, and establishing a local warehouse cuts transportation costs and lead times for Rochester-area contractors who would otherwise source from the Syracuse or Buffalo locations.

What Comes Next

With Gates Planning Board approval already secured, the June 16 COMIDA vote is the primary remaining approval gate. If the agency approves the incentive package, Erie Materials can proceed to finalize construction contracts and begin demolition of the existing hotel.

Given the $6-7 million remediation cost, abatement and demolition will likely constitute the first major construction phase — a months-long process before any new vertical construction begins. The project demonstrates a pattern common in Monroe County's industrial corridor: former hospitality and commercial assets that cannot be revived in their original use are being repositioned for the building products, logistics, and light industrial sectors that have sustained demand and a viable financial case on sites with highway access and ample acreage.