New York State has committed $20 million to demolish the Terrence Building, the vacant former Rochester Psychiatric Center tower on Elmwood Avenue, a step officials describe as the precondition for a mixed-use redevelopment that would add roughly 500 homes on the site. The money was included in the FY 2027 Enacted Budget and announced during Governor Kathy Hochul's June 9, 2026 visit to Rochester, alongside a broader package of regional investments (New York State Homes and Community Renewal).

What happened

The state announced $20 million to advance demolition of the Terrence Building, which it describes as the long-vacant former home of the Rochester Psychiatric Center, and said the resulting multi-phased, mixed-use redevelopment will include more than 500 housing units (HCR). The announcement was made at Monroe Community College's downtown campus, where the Governor delivered budget remarks (WXXI News).

The demolition allocation sits inside a much larger regional commitment. The same budget earmarks $300 million for the Rochester-Monroe Transformation Initiative, split between $75 million for construction of High Falls State Park on 40 acres of Genesee River brownfield and $225 million for economic development and revitalization projects in Rochester and the surrounding region (HCR).

The building and the site

The tower has been empty since 1995. WXXI describes it as a vacant, asbestos-laden 17-story tower on Elmwood Avenue at the border of the City of Rochester and the Town of Brighton (WXXI News). Local television coverage describes the same structure as riddled with asbestos and repeatedly targeted by vandals since its 1995 closure (13WHAM).

One detail is reported inconsistently and is worth flagging for anyone sizing the work. WXXI calls the tower 17 stories, while a separate report on the site's redevelopment applications describes a 16-story former psychiatric hospital built in 1959 (RochesterFirst). Neither the state release nor 13WHAM states a height. Estimators should treat the story count, and any gross square footage derived from it, as unverified until abatement and demolition documents are issued.

Cost history and what the $20 million buys

The demolition has been priced before. WXXI reports an earlier estimate in the range of $15 million to $20 million, with a roughly two-year timeline (WXXI News). The state allocation therefore lands at the top of that earlier band, which is a reasonable posture for a high-rise asbestos abatement and structural demolition on a constrained suburban-edge parcel, but it leaves little contingency if regulated-material quantities exceed the survey.

No demolition contractor, engineer or lead agency for the takedown has been identified in the coverage reviewed here, and no start or completion date has been published (WXXI News). Rochester Mayor Malik Evans said the timeline will depend on when "the dollars come in" (WXXI News).

What is proposed for the cleared land

Redevelopment concepts have circulated for years without reaching construction. WXXI reports that the most recent proposal, submitted in 2023-24 by Whitestone Development Partners, contemplated 522 housing units in a mix of one-story duplex rentals and three apartment buildings ranging from 80 to 320 units, plus two commercial buildings, a community building with an outdoor pool, and a three-story hotel led by developer Bob Morgan (WXXI News).

A separate hotel application has moved into municipal review. Plans submitted to the City of Rochester propose a 134-room Hyatt House extended-stay hotel with 132 on-site parking spaces, replacement of existing lots and roads with a private internal road network, two future commercial spaces, a pedestrian connection to the Elmwood sidewalk and three signs. The applicant is listed as Bob Morgan, with Taylor The Builders identified as the construction firm and Bergmann Associates as plan preparer (RochesterFirst). The state release does not tie any specific developer to the $20 million demolition award.

Why it matters to construction professionals

This is a sequencing story more than a funding story. Mayor Evans framed it plainly: "If the building didn't come down, any of the plans don't mean anything. This was the key component. The sequencing had to be right, and what the governor did in putting this in the budget allows it now to move from paper to reality" (13WHAM). Governor Hochul said of the demolition, "I want this to happen. This is critically important" (WXXI News).

Large vertical demolitions in the Rochester market are infrequent, and a 16-to-17-story asbestos-laden tower is a specialty scope. It typically draws a short list of regional abatement and demolition contractors, with a long tail of subcontracted work in regulated-material handling, scaffolding and containment, crushing and recycling, hauling, environmental monitoring and site restoration. The stated objective is a shovel-ready site, which usually implies foundation removal, backfill, grading and utility stub-out rather than simply dropping the structure.

Implications for owners, developers, contractors and subcontractors

• Developers: Public money is funding the single most expensive and least financeable phase of the project. That materially improves the residual land value for whichever team ultimately controls the site, and it is why the mayor described multiple interested developers.
• Demolition and abatement contractors: Watch for the procuring entity to be named. Because the funding flows through the state budget rather than a city capital line, the bid vehicle, prevailing wage treatment and insurance requirements are not yet public.
• Housing builders: A site plan with roughly 500 units would be one of the larger residential land pipelines in Monroe County. If it advances in phases, expect a multi-year sequence rather than a single mobilization.
• Subcontractors: Site utilities, roadway and stormwater packages are likely to precede vertical work by a full season or more, given the private internal road network described in the hotel application.

What to watch next

• Identification of the lead public agency and the release of an abatement and demolition bid package, including the regulated-materials survey that will govern pricing.
• Whether the hotel application under city review is approved and how it interacts with the larger residential concept.
• Whether the $20 million proves sufficient, given the earlier $15 million to $20 million estimate predates the current cost environment.
• How the demolition is sequenced against other Rochester-Monroe Transformation Initiative spending, particularly High Falls State Park, which is competing for the same regional labor pool.

Bottom line

The state has funded the removal of the physical obstacle that stalled this site for three decades. Nothing about the redevelopment is contracted yet: no demolition contractor, no schedule, no confirmed developer and no final unit count. For contractors, the near-term opportunity is the demolition and site-preparation package itself. For developers and housing builders, the more useful signal is that a large, centrally located Rochester parcel is being publicly prepared for delivery rather than waiting for a private party to absorb the abatement risk.

Sources

• New York State Homes and Community Renewal, "Governor Hochul Announces Major Rochester Investments and Highlights Affordability Agenda" (June 9, 2026) — https://hcr.ny.gov/news/governor-hochul-announces-major-rochester-investments-and-highlights-affordability-agenda
• WXXI News, "Gov. Hochul announces $20M for Terrence Building demolition" (June 9, 2026) — https://www.wxxinews.org/local-news/2026-06-09/gov-hochul-announces-20m-for-terrence-building-demolition
• 13WHAM, "State budget includes $20 million for demolition of former Rochester Psychiatric Center" (June 9, 2026) — https://13wham.com/news/local/new-york-state-budget-includes-20-million-for-demolition-of-former-rochester-psychiatric-center-terrence-building-elmwood-avenue-psych-brighton-new-york-ny-governor-kathy-hochul-mayor-malik-evans-affordable-housing-funding
• RochesterFirst, "Redevelopment of abandoned psych center, plans for hotel under review" — https://www.rochesterfirst.com/news/redevelopment-of-abandoned-psych-center-in-works-plans-under-review/