GARDINER — Luck, strategy and persistence are starting to pay off in Gardiner’s bid to turn a blighted property into a state-of-the-art medical arts building. Three votes by Gardiner city councilors last week were aimed at assembling the needed land parcels to develop the project and clearing them of the contaminants that are the legacy of 200 years of industrial activity on the banks of the Cobbosseecontee Stream.
Although there are more tasks to complete before the project can be considered a done deal, it’s closer to complete than it’s ever been.
“It’s just going to change the entire welcome to the city,” Gardiner Mayor Thom Harnett said, “and it will give us a new, modern medical building close to downtown and a major thoroughfare.”
REDRAWING THE LINES
“It’s been a chicken and egg and chicken and egg kind of thing,” Gardiner City Manager Scott Morelli said last week.
By the time a forced bankruptcy tied up three of the four T.W. Dick properties at the end of 2014, it was clear that the parcels could come under city control, one way or another.
“Before the properties even got to that point, we knew we would be in that situation,” Morelli said. The prior owner had tried selling the property, but he had given up.
The city had already acquired 1 Summer St., part of the old fabricating facility on the corner of Summer Street and Highland Avenue.
In a deal struck with the creditors, they agreed to let the bankruptcy drop and allow the city to take ownership of the properties in exchange for the chance to see some money after the city cleaned up the lots and sold them.
“When we walked into that meeting (with the creditors) with a phone book of all the contaminants, they knew no one was going to buy in, and they didn’t want to end up with it,” Morelli said.
Even before Developers Collaborative was identified as the developer for this project, company principals had looked at the site on Summer Street and concluded that to make a medical building of the type considered work, the project would need to include 2 Highland Ave., a boarded up two-story house next door, said Kevin Bunker, principal at Developers Collaborative.
The property, situated just to the north of 1 Summer St., was in foreclosure.
Introducing the proposals to the city councilors, Morelli said, “You can see the domino effect here.”
The first was approval for the city to buy 2 Highland Ave. from the Gardiner Board of Trade for a payment of $1 now and $29,999 when it’s sold for the project.
The board of trade, established to be a bridge between city government and the business community, had bought the building at a foreclosure sale.
The second was for the city to sell 1 and 31 Summer St. and 2 Highland Ave. to Developers Collaborative for $144,900 — $30,000 for 2 Highland Ave.; $85,000, which is the current assessed value of 1 Summer St.; and $29,900 for 31 Summer St.
The third was the formal acceptance of the $305,000 grant from the state Department of Environmental Protection and Department of Community and Economic Development.
City councilors had questions about the chain of transactions, particularly the Board of Trade’s role in acquiring and selling the Highland Avenue property and who would be responsible if the costs of demolishing the building exceeded what the Board of Trade members expect to pay.
But Bunker, who was on hand at the meeting, said, “It’s an amazing thing the Board of Trade has done,” he said. That transaction, he said, transformed the property from a site that didn’t work to a site that did.
“This doesn’t make the project $30,000 better; it makes it feasible. My option says I get the property for $30,000. Barring any negotiation or agreement I am able to do, I am paying for it,” he said. “I’m very comfortable with the deal, and I’m really happy the Board of Trade was entrepreneurial enough to help out and pull it together. That’s my two cents.”
“It may be a little more than two cents,” Harnett said.
“Hopefully not,” Bunker said.
In recapping the proposals, Morelli said considering the city’s direct costs in the project — $30,000 to the Board of Trade, $80,000 for the match for the brownfields grants and $20,000 in back taxes owed on the properties — the city will come out $14,900 ahead.
“We do have to return a portion of the profit from the sale of 31 Summer St., because that’s the agreement we made with the creditors,” Morelli said. “Overall, it’s a financial positive for the city, not to mention everything that’s going to happen there because of Developers Collaborative.”
THE LYNCH PIN
The piece that will push this project forward is a signed lease by MaineGeneral officials. That’s the piece needed for Developers Collaborative to secure financing and push ahead with its plans.
When Gardiner officials released the request for qualifications in October, it included a letter from MaineGeneral Medical Center Chief Operating Officer Paul Stein expressing MaineGeneral’s desire to collaborate with the city on the project.
Even beyond this project, Bunker has said his company is interested in developing affordable senior housing in Gardiner possibly at 24 Summer St., another former T.W. Dick parcel that is along the stream.
“There are a lot of misconceptions about affordable senior housing,” he said.
The target demographic is people 55 and older who earn from $20,000 to $30,000 a year. Tenants would have to pass credit and background checks.
“Generally, who we get is a bunch of nice old ladies living there. They are single women, mostly widows,” he said.
The women have chosen to give up their homes and the chores that go along with them to live in a building with an elevator and security, he said.
Creating a competitive financing package requires planning board approval, grant applications and perhaps seeking a TIF, tax increment financing.
“The time to start talking about this is now,” he said.
The other piece of the project is a new use for MaineGeneral’s existing building on Dresden Avenue.
“I’m going to need a lot of guidance from you (the city council) and the neighbors, because I am not going to fight the neighborhood to put up something that everyone hates,” Bunker said.
Jessica Lowell — 621-5632
Twitter: @JLowellKJ
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