Syracuse, N.Y. -- A lawsuit filed earlier this year that threatened to block the first new construction project in Armory Square in 10 years has been dropped.
But development of the six-story apartment building at 401 S. Clinton St. is now delayed by what developer John Funiciello called a "funding gap."
Funiciello, president of JF Real Estate, said he is still working to put together a financing plan for what was first announced as an $18 million development that would replace the crumbling Clinton Street Garage.
He said he has no new timetable for the project. It had been scheduled to start construction this fall with an opening set for 2026 or 2027.
As originally proposed, the building would have 88 mostly market-rate apartments on the five upper floors and 3,000 square feet of ground level commercial space. Twelve of the 88 apartments were to be reserved for income-qualified people at below-market rates.
Funiciello could not say whether the funding delay will change any of the project details.
The project won city planning approval in January. But in February, the Landmark Theatre, whose back entrance is just down the street, filed a lawsuit challenging that approval.
The Landmark's lawsuit, filed in State Supreme Court, accused both the city's Planning Commission and its Landmark Preservation Board of failing to comply with the law in giving the project a green light to proceed.
It stemmed from a long-running dispute involving the Landmark's need for space to allow large tractor-trailers to park near the theater's back entrance. That entrance is less than 50 feet away from the existing garage.
The new building would have an underground parking garage whose entrance would be located within the space needed for truck parking, the theater's lawsuit said.
Big trucks use the space for loading and unloading shows, such as the upcoming touring production of "Hamilton."
The Landmark's lawsuit argued, among other things, that the city Planning Commission failed to take its concerns into account.
The lawsuit ended earlier this month when both the theater and the city agreed to discontinue it. The developer was not a party to the suit.
Both the developer and the theater indicated they are willing to try to resolve any issues going forward.
"We will work with Landmark to make it work for everybody," Funiciello told syracuse.com.
"The Landmark is happy to work with the developers and the City of Syracuse regarding any plans for future development of the property," theater director Mike Intaglietta said.