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New Deal Planned For Brewery Square

by Thomas MacMillan | Jun 23, 2014 7:02 am

(22) Comments | Commenting has been closed | E-mail the Author

Posted to: City Hall, Housing, Fair Haven

Three decades after an old Fair Haven brewery was turned into apartments, the city is helping mend the owner’s troubled finances, and collecting $300,000 and a piece of riverfront property in the process.

The brewery, now Brewery Square Apartments, sits at the corner of Ferry and River streets, at a bend in the Quinnipiac River.

The building features detailed brickwork and arches laid in the 1880s. After years as a functioning brewery and years lying fallow, it was converted into apartments in the 1980s with the city’s help.

The city’s help came as part of a land disposition agreement (LDA) with the developer, Brewery Square Limited Partnership.

Since then, the developer has not been able to complete all the work it agreed to do, and has taken on debt that it’s now looking to refinance. The deal now being proposed by the city would help Brewery Square settle unpaid debts and be in a position to pay for improvements to the building.

Brewery Square doesn’t owe the city back taxes, said Erik Johnson, head of the Livable City Initiative. As part of the deal, Brewery Square would pay deferred taxes early. Instead of paying $500,000 in 2025, Brewery Square would pay $300,000 now, and quit-claim to the city a parcel of riverfront land where planned townhouses were never built, Johnson said. That looming tax bill has held up the owner’s ability to obtain financing.

The proposed deal has been submitted to the Board of Alders, which is expected to hold a committee hearing on the matter. In the meantime, the City Plan Commission weighed in on the topic on Wednesday night.

The commission recommended approval of the deal, with some conditions.

The commission also gave the nod to a long-delayed repair of the seawall at Brewery Square, which means a crumbling, fenced-off section of sidewalk (pictured) overlooking the Quinnipiac may soon reopen to riverside strollers.

Terms

Karyn Gilvarg, head of the City Plan Department, summarized the deal for the commission Wednesday evening.

 

After the brewery shut down, the building became vacant in the 1940s or ‘50s. The city acquired the land and sold it to Brewery Square Limited Partnership in the early ‘80s.

“The complex was developed with substantial government assistance,” Gilvarg wrote in an advisory report to the commission. The city sold the property at a discounted price and helped put federal dollars into the project. The city also agreed to a tax deferral plan, and Brewery Square agreed to annual payment in lieu of taxes (PILOT).

Brewery Square wasn’t able to make as much money as it expected to from the property and ended up with expenses larger than income.

The proposed deal “wipes the slate clean” and allows Brewery Square to get a new mortgage, Gilvarg said.

LCI head Johnson said the tax deferral plan included a “balloon payment” to the city that would come due in about 2025, worth about $525,000.

The proposed deal would allow Brewery Square to pay off that debt now, before the rest of the ballooning due to interest, Johnson said.

“Instead of getting $500,000 tomorrow, I’m going to get $300,000 today,” he said. “Instead of having payment be deferred until 2025, it basically gets prepaid today, which will then allow them to go get new financing.”

“They are not getting a tax deal. They’re just paying off an obligation early,” Johnson said.

Brewery Square would also quit-claim an undeveloped parcel (pictured) back to the city, land that was intended for townhouse construction before money ran out. Johnson said he doesn’t know yet what the city will do with the property.

Conditions

The City Plan Commission voted to recommend approval of the proposed deal with four recommended conditions, that Brewery Square:

• “Demonstrate financial capacity to undertake needed capital improvements.”
• Agree to keep a certain portion of apartments as publicly subsidized units.
• Set a date to quit-claim the unbuilt parcel to the city.
• Submit a renovation plan for the corner building, known as the “Gatehouse” (at left in photo above).

That last condition may be impossible to meet, according to Bob Leahy, who works for the management company that handles Brewery Square.

The Gatehouse is owned by a separate partnership, he said. The building was originally intended as commercial space. It’s totally unfinished inside; there are no plans to develop it, Leany said. “It would take quite a bit of money.”

Leahy said the proposed deal would allow Brewery Square to refinance its debt and improve the building. The structure needs work of several kinds, including roof repair, Leahy said.

“It’s been a challenge all these years at that location,” Leahy said. “We’ve been there for 30 years. The rest of the neighborhood hasn’t come up to the same level as we had hoped.”

Seawall

The City Plan Commission also approved reconstruction of a seawall (pictured) just south of Brewery Square, damaged for at least 10 years.

The repair would fix about 300 feet of steel and concrete retaining wall. Sidewalks behind the wall have collapsed and are now fenced off.

“This has been the project that’s always pushed aside,” said Larry Smith, acting city engineer. “We’re anxious to get this going.”

“I’m glad to see it moving forward. The sidewalks are a mess,” said City Plan Commissioner Kevin Diadamo.

Smith said the project will go out to bid this summer.

The City Plan Commission also approved applying for and excepting federal money set aside through the Department of Housing and Urban Development for post-Hurricane Sandy planning and infrastructure repair.

The city is applying for a total of $4.273,297. The funding requires a 25 percent match from the city.

Of the $4.2 million, $940,047 would go toward the Brewery Square seawall repair. Money would also go to Mill River district analysis, Hill/Union Ave. drainage improvements, River Street bulkhead design, East Shore erosion control, and Long Wharf flood mitigation.

 

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posted by: Threefifths on June 23, 2014  7:38am

“Instead of getting $500,000 tomorrow, I’m going to get $300,000 today,” he said. “Instead of having payment be deferred until 2025, it basically gets prepaid today, which will then allow them to go get new financing.”

This sounds like a shake down.People wake up.Gentrification is done in steps.Keep jumping for joy. A lot of you will be gone when the rents go up.


High rents have Bronx locals packing up
Gentrification starts to hit Highbridge, Grand Concourse.


http://www.crainsnewyork.com/article/20140331/REAL_ESTATE/303309991/high-rents-have-bronx-locals-packing-up#

posted by: Anderson Scooper on June 23, 2014  7:40am

Unfortunately T-Mac’s article is unclear as to whose sea wall is about to get the million dollar repair.

Does it belong to the Brewery Square folks, or is it the City’s?  (Or does it become our liability only after the land is quit-claimed to us?)

The taxes now instead of 2025 are not a problem to me….

posted by: robn on June 23, 2014  7:42am

I would support this if the city put on paper the intention to sell the parcel to another developer and if BSLP agreed to maintain the undeveloped parcel until it was developed.

posted by: LookOut on June 23, 2014  8:46am

Sounds great.  Replace an empty building and vacant lot with development, people, tax revenue.  Glad to see that New Haven is deciding not to listen to those who would like things to stand still.  If this could bring some middle class folks to the city (filling a major hole), that would be awesome

posted by: RhyminTyman on June 23, 2014  8:59am

Can’t collect taxes if the company is bankrupt in the next ten years. This is smart assuming they city can sell that land to a developer and hopefully recoup the cost of the sea wall and the 200,000 in lost future tax dollars. If this allows Brewery Square to fix itself up and the city makes some change on this deal, this truly a win-win.

posted by: Stylo on June 23, 2014  9:11am

Incorporating an actual brewery there would be nice. Makes for a nice draw to the area. But apartments aren’t a bad thing.

posted by: Threefifths on June 23, 2014  9:14am

posted by: LookOut on June 23, 2014 9:46am

Sounds great.  Replace an empty building and vacant lot with development, people, tax revenue.  Glad to see that New Haven is deciding not to listen to those who would like things to stand still.  If this could bring some middle class folks to the city (filling a major hole), that would be awesome


What MiddleClass.

If 80% of us are in or near poverty than THERE IS NO MIDDLE CLASS.


http://www.dailykos.com/story/2013/09/16/1228186/-If-80-of-us-are-in-or-near-poverty-than-THERE-IS-NO-MIDDLE-CLASS#

What Happened to Middle Class America.

Economist Paul Krugman


http://youtu.be/yc-rF7V7RnU

posted by: LookOut on June 23, 2014  10:15am

3/5ths:  To quote a great 20th century politician, “There you go again…”

By definition, the middle class cannot vanish.  Find the upper and lower and look in between.  I"m going to assume that you mis-spoke there. 

As far as the poverty line issue, that line is developed by finding the cost to ‘get by’ and here is we have a huge problem.  The big government mindset of the past 45 years has led to rapid increases in costs for items such as housing, energy, education, healthcare….etc.  This results in more fixed costs for everyone and fewer opportunities for the middle and lower classes to advance.  If one reviews the poverty table since the LBJ administration;

https://www.census.gov/hhes/www/poverty/data/historical/people.html

you will see that these costs have risen by an average of 5% a year while inflation and income have averaged about 2.5%.  This is great if you are a gov’t insider but it is a disaster for society int he long term.

posted by: HewNaven on June 23, 2014  10:21am

If this could bring some middle class folks to the city (filling a major hole), that would be awesome

That would also be exceptional. River-front townhouses are usually not bought by middle-class suburban dwellers looking to move into the city.  These would more likely be occupied by yuppies and upper middle class retirees and professionals. There’s nothing wrong with that, lets just keep each other honest about projections and assumptions about developments and who’s going to be moving in.

posted by: RhyminTyman on June 23, 2014  11:22am

Lookout: 3/5 is using an article that is ranting about another article that states 80% of Americans will at somepoint take aid from the government. The largest drive in that number is unemployment benefits. It is just lies and more destortions and less solution.

posted by: RhyminTyman on June 23, 2014  11:25am

HewNaven across the river they are building workforce(ie middle class) homes. So it is not unrealistic for a project pushed by the city in this general area to be somewhere between affordable and market rate.

posted by: Anderson Scooper on June 23, 2014  11:31am

WHOSE SEA WALL IS IT NOW?

From the aerial view of the property, via Google maps, it would appear that the City is about to be deeded green space in exchange for a million dollar repair bill. (My guess is the land is undevelopable to the current owners, as the open space was likely part of the original deal.)

@RhyminTyman—The City will always be able to collect the property taxes due, even in the event of a bankruptcy. Taxes always come first, and would have to be paid as part of the inevitable foreclosure sale.

posted by: Don in New Haven on June 23, 2014  12:41pm

Today I viewed this building and its grounds from the river side. There is no doubt that this would make an excellent school building.

Apartments? I don’t see any way to make this into an apartment building. The present owner has clearly proved this to be true.

Fiddling with debt merely is one way to cost taxpayers more money.

The property should be taken over by the City and converted into a magnificent school for Fair Haven

The sidewalk by the river was not properly constructed and the City should check the records to find the contractor who did the work then offer an opportunity to repair the damage or be removed from the City list of eligible contractors..

posted by: anonymous on June 23, 2014  12:53pm

“80% of Americans will at somepoint take aid from the government.”

The biggest form of “aid” is a federal subsidy known as the mortgage interest tax deduction, which mostly benefits families making $100,000 or more. 

This program represents the lion’s share of all federal money spent on housing.

“The mortgage interest deduction helps millions of middle-class homeowners. But it helps wealthy families much more. Households with incomes between $40,000 and $75,000 receive, on average, $523 from the mortgage interest deduction. Households with incomes above $250,000 receive $5,459, or more than 10 times as much.”

http://americanprogress.org/issues/open-government/news/2011/01/26/8866/tax-expenditure-of-the-week-the-mortgage-interest-deduction/

posted by: RhyminTyman on June 23, 2014  1:23pm

Anonymous: is this a problem? Are you suggesting that we end the subsidy to prevent the rich of getting aid? Sounds a bit like citing off your nose to spite your face.

posted by: cedarhillresident! on June 23, 2014  1:48pm

A.S.

If you go to Vision apprasal it (at least to me appares the city already owns it…..

Click on the map… ( have to use front street to pull it up for some reason)  and then click on the parcels…and map with data…unless I am reading it wrong

http://goo.gl/DMC51u

posted by: Jonathan Hopkins on June 23, 2014  2:28pm

Don,

Brewery Square was converted into an apartment building in the 1980s, people have been living there for 30 years…

http://newhaven.craigslist.org/search/hhh?query=brewery+square&sale_date=-

Many of New Haven’s schools are underpopulated. How would building another school help that? Where would the money come from to do it?

posted by: RhyminTyman on June 23, 2014  2:40pm

JH is right we really don’t made more class rooms. So some mega school that would displace the current residents would be a little silly.

posted by: Threefifths on June 23, 2014  3:20pm

posted by: LookOut on June 23, 2014 11:15am

3/5ths:  To quote a great 20th century politician, “There you go again…”

By definition, the middle class cannot vanish.  Find the upper and lower and look in between.  I"m going to assume that you mis-spoke there.

Explain this.Take from Not left wing.But Right wing Fobes.

America’s Vanishing Middle Class.

Any analysis of wages earned in prior decades and wages earned today needs to take into account the fact that a lot of non-white-males have entered the workforce. Still, these are troubling numbers

  Median earnings for full-time, year-round male workers: 2010—$47,715; 1972—$47,550. That not a typo. In thirty-eight years, the annual earnings of the typical male worker, adjusted to 2010 dollars, have risen by $165, or $3.17 a week.

  If you do the comparison with 1973 it is even worse. The figure for median earnings of full-time male workers in that year (when O. J. rushed two thousand yards and Tony Orlando had a chart-topper with “Tie a Yellow Ribbon Round the Old Oak Tree”) was $49,065.


http://www.forbes.com/sites/erikkain/2011/09/15/americas-vanishing-middle-class/


Poverty and Income in America: The Four Lost Decades
Posted by John Cassidy


The latest poverty and income figures came out this week, and boy are they disturbing. It’s not so much the headline figures, which have been well covered in the Times and elsewhere: 46 million Americans living under the poverty line in 2010, the highest number since the Commerce Department started collecting the figures back in 1959.

Notice 46 million Americans living under the poverty line in 46 million Americans living under the poverty line 2010.What year are we in 2014.You want to bet there are more the 46 million Americans living under the poverty linein 2014.

http://www.newyorker.com/online/blogs/johncassidy/2011/09/poverty-figures.html#ixzz1Y2vKmOxv

Part One.

posted by: Threefifths on June 23, 2014  3:39pm

Part two.@LookOut

Take frome CBS.
A vanishing middle-class—the new normal?

Almost half of middle-class households today live paycheck-to-paycheck, according to a recent survey by financial services firm NestWise. Some 45 percent of households earning between $50,000 and $150,000 per year spend all or more of their monthly earnings each month. Most of those households also have insufficient savings to deal with the loss of a job or other financial emergency.

http://www.cbsnews.com/news/a-vanishing-middle-class-the-new-normal/


How the bubble destroyed the middle class

http://www.marketwatch.com/story/how-the-bubble-destroyed-the-middle-class-2011-07-08

And for Blacks it is worst.

30 Years Of US Black Middle Class Economic Gains Have Been Wiped Out

http://www.businessinsider.com/us-black-middle-class-is-suffering-2012-10

Keep drinking the Kool-Aid.

My Bad I forgot the middle class is now call the working class.

posted by: wendy1 on June 24, 2014  6:02pm

If there are any vacancies, could you fit some homeless people in there??especially since the city and fed govt.s are paying.

posted by: Don in New Haven on June 24, 2014  8:33pm

wendy1,

That’s an excellent idea!!!

Let’s hope the City agrees with us.

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