Hartford Business Journal

20 Hartford Business Journal • September 3, 2018 • www.HartfordBusiness.com Opinion & Commentary EDITOR'S TAKE NIMBYism on display in Newington "N o." It's a common refrain you hear from town or city residents whenever a new development is proposed. Whether it's fear of change or concerns about environmental, social, tax or other impacts, Connecticut is well-known for its "Not in my backyard," or NIMBY attitude, which is a major turn off to developers and businesses. The mindset adds to the state's anti-business climate and must change if Con- necticut is going to grow its way out of its economic malaise. While not all developments are right for a particular community, Connecticut must be more willing to work with developers or businesses looking to invest capital. The most recent high-profile NIMBY example is in New- ington, where Massachusett-based developer Dakota Part- ners Inc. is eyeing a multimillion dollar affordable housing development on a long-vacant lot on Cedar Street. The plan, which includes erecting three buildings that will house 108 units with rents ranging from $410 to $1,046 for one bedroom and $486 to $1,240 for two-bedroom units, has been aired at several well-attended town meetings where residents, according to a town official and media reports, have over- whelmingly opposed the project. Concerns about traffic, tax impact, and the addition of affordable rental units in town were all voiced, painting the development in a negative light before developers could even think about putting a shovel near the ground. First, let me say there are legitimate concerns the developer must address with this project, but the initial overwhelming negative reaction was overblown. The site Dakota Partners wants to redevelop has been vacant for nearly two decades and is contaminated with petroleum left by former occupant Crest Mo- tors. The opportunity to clean up the site and put a private property on the tax rolls should be something town residents are willing to work with. Craig Minor, Newington's town planner, said the town has been trying to redevelop the property at 550 Cedar St. for years and has considered everything from an indoor training soccer facility to an elderly housing project, but nothing has panned out. Personally, he thinks retail or office space would be a better use of the land, but he won't dismiss Dakota Partners' affordable housing project. Several concerns, however, must be addressed, he said. The site must be remediated before construction could begin and pedestrian access between the development site and the CTfastrak Cedar Street station, which sits nearby, should be improved so residents can safely walk to the bus line. Minor said the apartment project will add to traffic on Cedar Street, which admittedly is already log-jammed during rush hour, but not enough to call the project completely out of bounds. (Dakota Partners did submit a traffic study with its proposal that said the project would add 60 or so cars during peak traffic hours.) "That is some additional traffic," Minor said. "Will it make it slightly worse, yes." Overall, however, Minor takes a reasonable approach to the project, not dis- missing it out of hand but wanting to ensure basic public safety concerns are addressed before he throws his weight behind it. It's the type of common-sense approach more residents ought to take when dealing with new developments. Few Connecticut towns or cities are in a posi- tion to thumb their noses at economic development opportunities. There's an added reason Newington may have to approve the project. Only about 8 percent of its housing stock is considered affordable, less than the 10 percent mandated by state law. That will make it harder for the town's planning and zoning commission to reject the project, which aims to provide shelter for lower-income residents including EMTs and young teachers. Dakota Partners, which has successfully developed an office-to-apartment project in Hartford and has several other Connecticut projects in the pipeline, deserves a chance to address local concerns. If it does, its project ought to get a fair shake. ANATOMY OF AN EXIT The trials and tribulations of selling a business By Ed Pratesi W hether described as a tsunami of sellers, the coming "Baby Boomer bust" or other names, many private company owners are in sell mode, whether they know it or not. However, many don't know it, while others are too involved with the "here and now," fearful of addressing the notion of exiting their business. Finally some owners are resigned to ride their business into the sunset. The goal for this column is to provide a forum of ideas and strategies to assist in the exit process. To that end, we will interview busi- ness owners who have exited their businesses, professionals who advise business owners on sale or transition issues, and others to provide an over- view of the exit process from a finan- cial, family and emotional perspective. By way of introduction, I have been a practicing CPA for over 30 years, and my partner, John Salemi, and I, after considering the competitive environment for CPA firms in 2014, decided to put ourselves "in play." Fast-forward two years and we suc- cessfully negotiated a sale to UHY Ad- visors N.E. LLC, a national CPA firm. Our journey was not by any means a fast transition and probably not much different than what is experi- enced by many business owners who are exiting their business. Here are some of the questions we had during the process and the issues we encountered: Fear of the unknown, what if … ? Our first concerns were: What if our team members find out we are trying to sell the business? Will they leave? What if our customers find out? Will they leave? What type of firm should we look for? Should we seek a firm smaller in size, our size or a larger firm? What do we have to sell? Potential loss of freedom Except in a scenario where we would be acquiring a smaller firm, what would our firm look like after a trans- action? What would our roles be? How can we be sure that "cultures" match? It took longer than expected Our initial foray into the market revealed a clear preference for us — a larger firm would offer a better platform upon which to grow, increase capabilities and provide a means of succession. The initial interview and get-to-know-you process went smooth- ly. In fact, in hindsight, too smooth. As we delved into the negotiations, we realized that we missed commu- nicating in a meaningful way with two very important constituents in the process — our wives. Yes, they were supportive, but we realized very quickly that if this process was to be successful we needed "buy-in." The entire process took two years to complete. We learned that it takes time to consummate a deal and many roadblocks will appear whether anticipated or not. While we thought we were ready, we really did not have our "ducks in a row" Once the letter of intent was signed we found ourselves in a position where we needed to get information to the buyer as quickly as possible as part of the due-diligence process. We quickly realized we needed to get the buyer data and information in the form they wanted, not what we used as metrics. No succession in place We had been very successful in attracting a team of professionals that worked together harmoniously, but based on their career paths and personal needs we felt we did not have any likely successor(s). We had no idea what our business was worth This may sound heretical for a CPA firm not to know their worth or value. But the important point is you do not know your value unless you begin the process of marketing your business to buyers. While we could have an edu- cated guess at the value, it was only by going through the sales process that we found our true market value. The above recounts our experi- ence in the exit process. We welcome business owners, advisors and others to share their experiences with us and HBJ's readers as we embark on a journey of discovery. Ed Pratesi is the managing director of UHY Advisors N.E. LLC, a national tax and business consulting firm. Greg Bordonaro Editor Ed Pratesi

• Cover