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How to Clear the First Hurdle in Site Redevelopment
- 1. Workshop: How toClear the First Hurdle in Site Redevelopment Planning – Remediation Optimization – Financing A Collective Assessment for Project Success When: Wednesday , October 23, 2019 Where: Foundry 66, Conference Room 66 Franklin St., Norwich, CT Time: 8:00 am – 9:30 am
- 2. Introductions of EventSupporters Sponsored Support: Local Support: Foundry 66 is a CoWork space that allows small businesses to rent workspace. Foundry 66 is more defined by its members than its management. Norwich Community Development Corporation, Inc Norwich Redevelopment Agency (RDA) – can accept grants from the federal government … to carry out urban renewal projects to promote and preserve the region’s attractiveness, to encourage new businesses, and to assist and to nurture existing and expanding local enterprises GNACC's Mission takes a leadership role to support, promote, enhance businesses
- 3. How to Clearthe First Hurdle In Site Redevelopment GNACC Sponsored Event October 23, 2019
- 4. Eastern Connecticut /Major Businesses
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- 6. Rural Uplands -Thames River Corridor
- 7. Rural Uplands -Thames River Corridor The Day - The Thames and its Rivers The Quinebaug, left, joins the Shetucket on its way to the Thames.
- 8. Workshop Agenda Presentation byTeaming Partners: 1. Site Planning/Regional Factors - by Crosskey Architects 2. Site Specifics-1: The Buildings (hazardous building materials; disturb or not) – by Fuss & O’Neill 3. Site Specifics-2: The Land (soil contamination, remediation, ELURs, etc.) – by Fuss & O’Neill (LEP) 4. Leveraging Funding (applicable programs) - by Camoin Associates 5. Proposed Eastern Connecticut Land Bank – opportunities/functions 6. Summing up the ‘Teaming Approach’ to Clear the First Hurdle in Site Redevelopment Questions from the Audience
- 9. 1. Site Planning/Regional Needs Name: Ponemah Mill Commercial Block, Taftville, CT Type: Historic Preservation/Mixed-use Total Square Feet: 20,489 SF Units: 12 Cost: $4,000,000.00 Name: Ponemah Mill South Building, Taftville, CT Type: Historic Preservation/Multi-family Total Square Feet: 143,253 SF Units: 126 Cost: TBD
- 10. Survey the Building Name:Montgomery Mill, Windsor Locks, CT Type: Historic Preservation/Multi-family Total Square Feet: 221,758 SF Units: 160 Cost: $46,000,000.00
- 11. Develop the Program Name:NEHCEU, Hartford, CT Type: Health Care Total Square Feet: 25,422 SF Units: N/A Cost: N/A
- 12. Review Zoning Regulationsand Context Name: Pawcatuck Thread Mill, Stonington, CT Type: Historic Preservation/Multi-family Total Square Feet: 124,568 SF Units: 58 Cost: $23,240,884.00
- 13. Schematic Design -1 Name: Read’s Artspace, Bridgeport, CT Type: Historic Preservation/Mixed-use Total Square Feet: 115,840 SF Units: 61 Cost: $12,000,000.00
- 14. Schematic Design -2 Name: 17 Brewer Street, New London, CT Type: Historic Preservation/Mixed-use Total Square Feet: 115,840 SF Units: 61 Cost: $12,000,000.00
- 15. Schematic Design -3 Name: Southington Cutlery Factory, Southington, CT Type: Historic Preservation/Mixed-use Total Square Feet: 237,747 SF Units: 17 Cost: $10,000,000.00
- 16. Schematic Design -4 Name: Talcott Mill, Vernon, CT Type: Historic Preservation/Multi-family Total Square Feet: 96,526 SF Units: 83 Cost: $25,400,000.00
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- 18. Potential Funding Federal HistoricPreservation Certification Application • 20% of the qualifying expenses of your rehabilitation. • available to properties that will be used for a business or other income–producing purpose, and a "substantial" amount must be spent rehabilitating the historic building. CT Historic Rehabilitation TaxCredit • 25% tax credit on the QREs (hard costs associated with the rehabilitation; site improvements and non-construction costs are excluded.) • 31.7 million in tax credit reservations available each fiscal year. • The per-project cap is up to $4.5 million in tax credits. • The structure must have a post-rehabilitation use of one of the following: o residential use of five units or more; o mixed residential and nonresidential use; or o nonresidential. Name: Hotel America (Spectra Plaza), Hartford, CT Type: Historic Preservation/Mixed-use Total Square Feet: 189,778 SF Units: 193 Cost: $30,266,458.00
- 19. Successfully Completed Project Name:Cheney Mill – Dye House Manchester, CT Type: Historic Preservation/ Multi-family Total Square Feet: 89,805 SF Units: 57 Cost: $14,409,464.00
- 20. Successfully Completed Project Name:Capitol Lofts, Hartford,CT Type: Historic Preservation/ Multi-family Total Square Feet: 146,858 SF Units: 112 Cost: $36,500,000.00
- 21. Two Scenarios forEvaluation Site #1 - Open Land w/ Building Shell Shipping Street Area, Norwich (including Terminal Way) Site #2 - Old Mill Buildings & Stacks Baltic Mill Buildings, Sprague, CT (27 Bushnell Hollow Road)
- 22.
- 23. Site Redevelopment References Site#1 - Open Land w/ Building Shell Shipping Street Area, Norwich (including Terminal Way) Site #2 - Old Mill Buildings & Stacks Baltic Mill buildings, Sprague, CT (27 Bushnell Hollow Road)
- 24. Site #1 -Shipping Street Area, Norwich, CT
- 25. Site #1 -Shipping Street Area, Norwich, CT Floodway Zone AE: • Occupied space • Water/wastewater/gas/electric/ MEP services need to be above the AE flood elevation plus 2 ft of sea level rise
- 26. Site #1 -Shipping Street Area, Norwich, CT “A Waterfront Vision” by the Norwich Harbor Management Commission
- 27. Site #2 -Baltic Mill Buildings, Sprague, CT Building has been removed. 29 Bushnell Hollow Road
- 28. Site #2 -Baltic Mill Buildings, Sprague, CT 29 Bushnell Hollow Road, Baltic, CT, The entire site and surrounding village and mill housing is listed on the National Register of Historic Places. “Sprague getting $2 million for Baltic Mill revitalization” … Done.
- 29. Site #2 -Baltic Mill Buildings, Sprague, CT • The purpose of an ELUR is to minimize the risk of human exposure to pollutants and hazards to the environment by preventing specific uses or activities at a property or a portion of a property. • An ELUR is a tool that permits the remedial goals for a property to be dependent on the exposure risk associated with its use. Environmental Land Use Restriction (ELUR) to be established. Building has been removed.
- 30. 2. Site Specifics- Buildings/Structures Hazardous Building Materials Services may include: • Asbestos • Lead Based Paint • PCBs In Building Materials • Mold/Water Infiltration • PCB Ballasts/Mercury Equipment
- 31. 2. Site Specifics- Buildings/Structures • Asbestos Require to test prior to disturbance Remove what will be impacted. Can manage in place • Lead OSHA, EPA RRP, CTDPH What could look like just OSHA, may lead to RRP/CTDPH – Commercial/industrial conversion to apartments • PCBs in Building Materials No requirement to test, but Owner to understand waste generated Test, don’t test, presume? Scope, historical building considerations • Mold/Water Infiltration Want to fix a condition that could cause same issue after renovation. Ex. Barrier material at exterior walls absent – open wall cavity causing moisture build up. Poor site drainage etc. Fire damage/smoke odor
- 32. 2. Site Specifics- Buildings/Structures • Feasibility stage – testing tier options – visual, limited, comprehensive • Ultimate site goal – what do you want at the end of the day? • Structurally Unsound – Structural Engineer or Building Department Support • AWP with CTDPH • PCBs – Owner’s Discussion – Historical Buildings, Presume/Test/Don’t Test • Other Environmental Materials (OEM) – Phase I nor Hazmat – “The other stuff” – Boiler Ash, Garbage, Paints etc. • Waste oversight and segregation management – clean material versus hazmat disposal • Identify all types of material management to avoid project change orders
- 33. 3. Site Specifics– The Land 1. Environmental Assessment • Develop Existing Conditions Plan • Perform investigation and prepare Assessment Report(s) 2. Engineering Assessment • Identify & evaluate wetlands and flood zones • Perform geotechnical evaluation • Assess existing site utilities and storm water • Evaluate site grading • Analyze traffic patterns and develop infrastructure improvements • Develop list of potential permits 3. Remedial Action Plan • Evaluate remedial options for multiple development scenarios • Prepare detailed cost estimates for remedial options
- 34. 3. Site Specifics– The Land Existing Condition Assessment Typical Deliverable Environmental Site Assessment Phase I, Phase II, & Phase III ESA Assessment Report Wastewater & Water Supply Assessment Engineering Assessment Report Opportunities and Constraints Preliminary Reuse Evaluation
- 35. 3. Site Specifics– The Land Environmental Site Assessment Sampling Locations & Release Areas
- 36. 3. Site Specifics– The Land Engineering Evaluation
- 37. 3. Site Specifics– The Land Reuse Planning• Restaurant & Office
- 38. 3. Site Specifics– The Land Remedial Planning Integration of Remediation Into Site Design • Coordination and Communication are critical components • Flexible to allow options for Different Development Scenarios − Concept Plan • Cost Estimates based on findings & experience − historic preservation process − site development − proper sequencing of solutions (abatement, demolition, structural)
- 39. 3. Site Specifics– The Land Accurate Cost Estimates
- 40. 3. Site Specifics– The Land Remedial Action and Abatement Plans Minimize Costs Carefully Integrate • Building Reuse • Site Redevelopment • Green Remedial Solutions • Regulatory Alternative Options to • Achieve Compliance Well defined Plans and Specs. save construction cost and minimize extras
- 41. • Integrate Site Developmentwith Remediation: • Building Placement • Using Sub-Slab venting Systems to Control VOCs • Incorporate Sustainable Site Design for LEED Credits • Perform Earthwork Analysis to Minimize Soil Disposal • Design Lower Cost Engineering Controls − The development infrastructure is the solution 3. Site Specifics – The Land Integrate Site Development with Remediation
- 42. 4. Leveraging Funding JimDamicis Senior Vice President • Immediate Past President, Northeastern Economic Developers Association (NEDA) • IEDC, Economic Development Research Program, International Economic Development Council & Course Instructor • Collaborator – Communities of the Future • 25+ Years Experience in Economic and Community Development Jim Damicis Senior Vice President • Immediate Past President, Northeastern Economic Developers Association (NEDA) • IEDC, Economic Development Research Program, International Economic Development Council & Course Instructor • Collaborator – Communities of the Future • 25+ Years Experience in Economic and Community Development Email: jim@camoinassociates.com Website: www.camoinassociates.com Twitter: @jdamicis Linkedin: www.linkedin.com/in/jdamicis Blog: www.camoinassociates.com/navigator Tom Dworetsky, AICP Director of Research • Real estate market analysis • Financial feasibility analysis • Economic and fiscal impact analysis Website: www.camoinassociates.com Phone: 617-682-9975 Linkedin: www.linkedin.com/in/jdamicis Twitter: @jdamicis Phone: 617-682-9975 Email: jim@camoinassociates.com Email: tom@camoinassociates.com
- 43. Market Feasibility Financial Feasibility Citizen/Political Feasibility Technical Feasibility Ingredients for a SuccessfulProject Organizational Capacity
- 44. Understanding the supplyand demand in the market for economic uses: • Residential • Commercial • Industrial • Mixed Use • Specialty Local and regional supply and demand with consideration to national and global trends Market Analysis
- 45. Understanding the financialconditions investment • Costs and benefits • Opportunities and constraints • Likelihood for a return on investment For economic development include both public (fiscal impact analysis) and private (pro-forma) financial feasibility Important to note: a project can be feasible in the market (there is demand in excess of supply) and not be financially feasible (the financial conditions don’t warrant the risk/investment) Financial Feasibility Analysis
- 46. How to Makea Project A Success Understand what’s driving the pro forma • High construction costs • Low rents • High taxes • Slow absorption How can these factors be mitigated? • Can costs be reduced by building a more modest product? • How far can rents be pushed in the market? Look for alternative sources of capital to close the funding gap • Tax credits – historic, housing, new market, etc. • Abatement programs • TIF • Grant programs
- 47. Funding & IncentiveExamples Cheney Mill Dye House Manchester, CT Capitol Lofts Hartford, CT $9.6 M | American Recovery and Reinvestment Act Exchange Funding $3.4 M | DECD HOME Funds $3.0 M | Federal Historic Tax Credits $2.2 M | Connecticut Historic Tax Credits $1.5 M | CT Housing Finance Authority Low Interest Mortgage $570K | Developer Equity $5.3 M | Permanent Loan $5.3 M | CRDA Loan $5.0 M | CHAMP $3.3 M | City of Hartford $5.3 M | Brownfield Grant $2.1 M | Federal LIHTC $6.0 M | Federal Historic Tax Credit $5.7 M | State Historic Tax Credit $740 K | Developer Equity $6 M | DOH Funds $4 M | OPM $10 M | Federal Historic Tax Credit $12 M | State Historic Tax Credit $4 M | DECD Brownfield Loan $1.5 M | Deferred Developer Fee $7.8 M | Permanent Loan TIF supported site and surrounding district Montgomery Mill Windsor Locks, CT
- 48. Historic Tax Credits FederalHistoric Tax Credits • 20% Income Tax Credit • Must be certified CT Historic Rehabilitation Tax Credit • 25% Income Tax Credit • 30% if in Opportunity Zone or includes affordable housing Historic Preservation Incentives
- 49. What is TaxIncrement Financing (TIF)? • A financing method used to catalyze economic development. • It allows future property tax revenues from development project to be dedicated and utilized to support the project and related economic development. • Property tax benefits from project used to help finance infrastructure enhancements related to / required for project development and/or project costs. • TIF can be utilized to support public and private development costs.
- 50. Tax Cuts andJobs Act of 2017 Opportunity Zones Program provides tax benefits to encourage private investment in low income communities 50 OZs in Eastern CT Opportunity Zones Program
- 51. Tax Benefits 51 1. DeferExisting Gain 3. Eliminate Future Gain 2. Reduce Existing Gain
- 52. 5. Eastern ConnecticutLand Bank In the early stages of development – still many tasks to complete! Mission Statement: To partner with municipalities in the Eastern Connecticut region to support the return of distressed, underutilized, blighted, brownfield and historic properties to productive uses consistent with local Plans of Conservation and Development. Vision Statement: The Eastern Connecticut Land Bank will be a robust and sustainable force for the revitalization of the towns and cities of Eastern Connecticut, making possible new uses for distressed properties, preservation of historic buildings, increased tax bases and employment, decreased environmental, ecological and health risks, and stable, vibrant, healthy communities.
- 53. Eastern Connecticut LandBank Enabled by CT Public Act 17-214 - CT DECD certifies CT Brownfield Land Banks • Formed as a non-governmental, non-stock, non- profit corp., governed by Board of Directors • Has same advantages of government entities – e.g., eligible for state and federal grants and loans, liability relief – but avoids the need for municipal ownership of these problem sites • Municipalities enter into agreements with Land Bank – Terms of that Land Bank Agreement tailored to each community’s needs The Eastern CT Land Bank target area is east of CT River
- 54. Opportunities: What WillThe Eastern Connecticut Land Bank Do? Primary goal - clean up brownfield sites and convey them back to private sector, enhancing economic development, increasing municipal tax base – also: protect human health and the environment, historic preservation, open space preservation, etc. Some Specific Functions/Activities of the Land Bank: • Acquire title to derelict, tax-delinquent, contaminated properties – foreclosure of tax liens, accept transfers from municipalities • Clean them up • Clear title • Secure transferable liability protection • Position the properties for resale • The Land Bank may also accomplish these goals in partnership with…. 1. community organizations 2. property development organizations 3. private developers Important: Municipality maintains control of remediation and redevelopment process through Land Banking Agreement
- 55. Potential Sources of EasternConnecticut Land Bank Funding Grants (Federal, State, Foundation) Local Government Investment Borrowing Bond Financing Philanthropic Gifts (non-profit status is attractive to donors) Payment of Rent Property Sales Fees for Services Tax Abatement/Exemption/Foregiveness Property Tax Recapture
- 56. 6. Teaming Approach Summingup the ‘Teaming Approach’ to Clear the First Hurdle In Site Redevelopment Presentation by Teaming Partners: • Crosskey Architects: William Crosskey • Fuss & O’Neill: Kathleen Pane / Dan Jahne / Deb Denfeld • Camoin Associates: Jim Damicis / Tom Dworetsky • Eastern Connecticut Land Bank: Wayne Bugden Goal: To make developers aware of teaming partners (architect/consultant/economic forecaster) capabilities to strive for maximum project success. Teaming Approach Advantages: to collectively and comprehensively evaluate the best approach in property redevelopment; especially for sites with historic soil contamination, hazardous building material conditions, and/or infrastructure challenges.
- 57. Teaming Approach A teaming approachhelps clear the hurdles Site Re-development Success from 3 Perspectives: Specialist Crosskey Architects Fuss & O’Neill Engineers - Scientists - Planners Camoin Associates Function Architect / Planner Environmental / Site Engineering Economic Forecaster Scope Market Study Scoping the Pre Build- out Effort Leveraging Funding Success On-Target with Market Demands Smart mitigation of parcel/building restrictions ROI can be achieved Results An inclusive Pro-Forma / Preliminary Site Development / Remediation Plan defining project goals, budgets and timelines. Next Steps: Vision / Commitment / Funding
- 58. Questions from theAudience Presentation by Teaming Partners: 1. Site Planning / Regional Factors - by Crosskey Architects 2. Site Specifics – Buildings / Structures (hazardous building materials; disturb or not? – by Fuss & O’Neill 3. Site Specifics - The Land (soil contamination, remediation, ELURs, etc.) – by Fuss & O’Neill (LEP) 4. Leveraging Funding (applicable programs) - by Camoin Associates 5. Proposed ‘Eastern Connecticut Land Bank’ - opportunities / functions 6. Summing up the ‘Teaming Approach’ to Clear the First Hurdle in Site Redevelopment