NewHavenBIZ

32 n e w h a v e n B I Z | J a n u a r y 2 0 2 0 | n e w h a v e n b i z . c o m Super-strict environmental restrictions have made many old industrial buildings unsellable. But change may be in the offing F O C U S : R E A L E S T A T E & C O N S T R U C T I O N By Michelle Tuccitto Sullo New Life for Poisoned Properties? O n Whalley Avenue in New Haven, a 25,000-square-foot brick building has sat idle for years, and it is now covered with graffiti, including initials, symbols and messages like "RIP Big Mark." Not far away, a former dry cleaners also lies fallow, awaiting a new use. e former Ansonia Copper & Brass site in Ansonia has been vacant for years on a nearly 50-acre parcel close to downtown which, if redeveloped, has the potential to invigorate an entire community. But like hundreds of sites across the region and state, these proper- ties fall under Connecticut's Trans- fer Act, as they have environmental issues that must be remediated before they can be redeveloped. Selling or redeveloping a proper- ty with a history of environmental contamination can be challenging. Buyers oen balk at remediation costs or delays. "ere have been numerous deals in the New Haven area I have passed on because they were subject to the Transfer Act," says Christopher Nicotra of Apollo Investment Properties of Fairfield. "You have to protect yourself," Nicotra adds. "You could get stuck in limbo with the state, and end up spending significant amounts of money." e Transfer Act was enacted in 1985 to place restrictions on the sale of properties with environ- mental pollution so they could not simply be transferred unremediated from one owner to the next. According to many in the real estate industry, the law has had the unintended consequence of leaving properties — some with only minor or even just potential contamina- tion — ending up as idle eyesores. Since its inception, the state Department of Energy and Envi- ronmental Protection has received roughly 7,200 Transfer Act filings. Some sites have been sold multiple times, and DEEP officials estimate there are about 4,200 sites around the state. About 1,000 have been completely cleaned up, according to Jan Michael Czeczotka, DEEP's Division Director, Bureau of Water Protection and Land Use. It isn't always hulking old facto- ries impacted by the Transfer Act. Realtors and developers have had it impact deals involving properties where chemicals from dry-cleaning businesses and automotive shops have become an issue, for example. Cleanup costs, time and uncer- tainty are among the factors killing deals, Realtors say. In New Haven alone, DEEP has dealt with about 234 filings, with many properties having prior manufacturing, automotive and dry-cleaning uses. Larger cities have more commercial properties, hence more filings — Bridgeport has had 259; Waterbury, 265; and Stamford, 397. With properties languishing, it means lost revenue — and not solely in the private sector: Com- panies involved in filings would have generated an estimated $178 million in tax revenue for state and local governments in 2019, accord- ing to the Connecticut Economic Resource Center. Connecticut and New Jersey are the only two states that have a Transfer Act. While the legislature revised it in 2019, many in the real estate and economic development communi- ties are calling for more sweeping changes, which they say are key to finally bringing these properties back to life. e legislature's recent revisions to the law, "An Act Concerning the Transfer of Hazardous Waste Establishments," went into effect Oct. 1. e changes include requir- ing DEEP to make an "audit or no audit" decision within one year. If an audit is mandated, it must take place within three years. 781 Whalley Avenue in New Haven

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