Hartford Business Journal

14 Hartford Business Journal • October 8, 2018 • www.HartfordBusiness.com By Gregory Seay gseay@hartfordbusiness.com S ix years after its formation to restitch downtown Hart- ford's tattered inventory of aging office buildings into needed housing, the Capital Region Development Authority is at a crossroads. The successor to Gov. Dannel P. Mal- loy, a key proponent for creating the quasi-public, taxpayer funded land- and economic-development entity, will decide the fate of not only CRDA's mission, scope and funding, but prime state assets it oversees, including Hartford's aging XL Center. All of the major candidates run- ning to replace Malloy generally agree CRDA's mission is valid and that it should continue in its efforts. But there's far less consensus on how much money the state should invest in CRDA-backed projects, including maintaining and upgrad- ing Connecticut's key public sports/ entertainment venues or building new housing downtown, especially given the fiscal climate. Malloy has led the way in investing tens of millions of dollars in Hartford- related projects during his two terms in office, not including his controver- sial bailout of the city's nearly $550 million in debt. At one of his final meetings Sept. 20 as chair of the Bond Commission, the Democratic governor and his fellow commissioners greenlighted $52.7 million in funding for, among other CRDA-involved projects: a downtown Hartford grocery store; a new down- town parking garage to accommodate the planned Bushnell South develop- ment; and up to 200 new apartments in the shadow of Dunkin' Donuts Park, in the city's Downtown North quadrant. Meantime, CRDA's top leaders, includ- ing its chair, say they do not expect post-election changes to the agency, its mission or core staff, led by Executive Director Michael Freimuth, a former Stamford economic-development official. They also say they've successfully been able to move toward the goals and mission set out by the legislature in 2012, which includes erecting 3,000 new housing units downtown. According to its latest annual report, CRDA has invested close to $100 mil- lion of bonded taxpayer funds to lever- age redevelopment of 23 ex-commer- cial buildings into 1,546 housing units in Hartford with a total construction value of $413 million. Those buildings are now generating north of $1 million in new tax revenue to the city. Moreover, landlord-borrowers in some of CRDA's earliest housing- conversion deals, namely downtown's 26-unit The Grand on Ann and 190-unit Spectra apartments, have repaid most or all of their CRDA obligations, said Freimuth, whose seven-year CRDA contract runs through 2023. CRDA's most visible success, Freimuth said, has been focus- ing initially on the "dirty dozen'' of center-city and near-downtown buildings most in need of rehabilita- tion. CRDA also manages seven downtown park- ing garages, with 17,445 spaces. An intan- gible benefit from CRDA's work, he said, is how it has turned from nega- tive to positive the narrative about Hartford and the region as users and residents flock to its newest work, live and play amenities. Hartford Mayor Luke Bronin, an ex-Malloy aide who sits on CRDA's board, agreed, saying the agency has "changed both the reality and the at- titude'' about the city. "CRDA has been the single most ef- fective economic-development initia- tive in the Capital City in decades,'' Bronin said. The next step, Bronin says, is for CRDA and the city to collaborate on "in-fill'' development of its vacant, blighted and underused parcels, in- cluding Spinnaker Real Estate Part- ners' planned 108-unit market-rate apartment project at the corner of Park and Main streets. Eleven of the dirty-dozen Hartford buildings have now been converted to apartments or other uses, including the former Bank of America building at 777 Main St.; the former Capewell Horse Nail factory in the South End; the former downtown Capitol Lofts, being converted to the Teachers Corner apart- ments; and the former Hartford Times Building, home to UConn's downtown campus. The lone holdout: the vacant former YMCA high-rise on Jewell Street that Northland Investment Corp. owns. Those early deals, Freimuth says, were testbeds for creative approaches to financing developments, particularly instances where landlords needed help filling gaps not covered by borrowings or equity. State and local housing tax credits, along with CRDA support, have often filled funding breaches. Meanwhile, CRDA and landlords of some of its latest sponsored develop- ments will face a challenging 2019, he said, as the local housing market ab- sorbs 467 new apartments next year. "The market is going to be impact- ed,'' Freimuth said of space absorption. Developer role Today, CRDA is evolving, he said, into less of a "banker,'' helping identify and structure loans, equity and tax credits, and more of a property co-developer and manager. Its staff's technical expertise not only assists Hartford, but neighbor- ing communities in the region with their economic-develop- ment aspirations. The state, for instance, retained CRDA to oversee redevelopment of a pair of office towers at 450 Columbus Blvd., now housing state employees. CRDA also helped the city negotiate with owners of Hartford's new pro soccer team on a Dillon Sta- dium lease and renovation plan. In East Hartford, CRDA is work- ing closely with the town, Pratt & Whitney, Goodwin College, and others, to redevelop the Silver Lane corridor — a major boulevard linking the town to Hartford and Manchester. The agency also is assisting East Hartford, town officials confirm, in buyout talks for the 26-acre former Showcase Cinemas site fronting I-84 East, where the town once hoped to land a casino. CRDA also is expected to advise East Hartford about redevelop- ment options for the property. CRDA also is advising East Hartford in talks with Founder's Plaza's landlord about a possible parking garage to free acres of surface parking on the river- front office campus to development. "East Hartford has less than 5 per- cent of raw land left for development," Mayor Marcia Leclerc, a member of CRDA's board, said via email. "In order for the town to grow the grand list, we must work in priority areas that offer that potential and the riverfront area offers that opportunity." Important role Leclerc was one of several current CRDA board members and execu- tives who said the next governor and legislature should keep the agency, perhaps even cloning versions of it to serve other regions of Connecticut. Freimuth said a brief effort to do that died in the legislature. "CRDA has put the Greater Hartford CRDA's Hartford housing pipeline Total units completed or in process 1,546 No. of market-rate units 1,367 No. of affordable units 179 Unit configuration Studio 505 1 bedroom 832 2 bedroom 189 3 bedroom 20 Source: Capital Region Development Authority Hartford's Helper Amid its success recasting downtown, what's next for CRDA? PHOTO | HBJ FILE Michael Freimuth, a former Stamford economic-development official, is the first and only executive director of the Capital Region Development Authority. He is credited inside and outside the quasi-public agency as the consummate dealmaker.

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