by Carla Occaso
MONTPELIER — City council members have learned that the lead developer on the 1 Taylor Street multi-modal transit system project has expressed concerns about a recent uptick in construction costs. These cost hikes could make the long anticipated transportation hub/housing project unprofitable for Redstone Development, a company that was going to build apartments atop a transit center in downtown Montpelier.
During their March 22 meeting, City Manager William Fraser told council members that, while Redstone Development has not backed out, “they are indicating the real estate process doesn’t pencil for them in terms of costs vs. revenue … it is looking much more difficult to make it work.”
Mayor John Hollar agreed, saying, “Construction costs have gone up and they are facing a gap that makes them think the project won’t be viable.”
Fraser said the company will stay in as long as possible, but “they, along with us, are looking for alternatives.”
What would alternatives look like? Perhaps DEW Construction could take over, it was said. The company was already serving as the construction manager for the project and have participated in the proposal process. “We did reach out to them (DEW) and they are very positive. They are thinking within the month they will be able to tell us if they can do it,” Fraser said. Other organizations may be approached as well, regarding subsidized housing or condominiums. One selling point to a private developer would be not having to deal with acquisition costs, Fraser pointed out.
Perhaps construction could be done in phases — for example, build the transit hub, bike path and bridge first, then build housing, Fraser suggested. Fraser sounded optimistic about being able to do enough work on the project’s public portion of the project to keep it afloat while they figure out the housing aspect.
Mayor John Hollar questioned that suggestion, saying, “Is that really feasible?”
This turn of events brought out a strong reaction from some on the Council.
“I am very disappointed,” said council member Jean Olson. “This is our transformational project. This is the ‘Montpelier’s open for business.” She also said housing is a problem in town and pointed to the new development corporation director, who is having trouble finding housing for his family. “We have our first major project in a long time and I’m hearing it is at risk.”
Another risk factor is the federal grant money. An end-of-year 2017 deadline is approaching and a significant amount of work has to start or the dollars could disappear.
But for now, permitting is underway and a river wall has been reconstructed. Rights of way are still in an entanglement, however. Fraser said he is waiting for appraisals from the State of Vermont before he can finalize an agreement with Mowatt Trust (M&M Beverage).
A brief description of the project from the city’s website, Montpelier-vt.org, is as follows:
“1 Taylor Street is the site formerly known as the ‘Carr Lot’ property. It is located on the east side of Taylor Street in the city of Montpelier at the confluence of the North Branch and Winooski Rivers. It is approximately one acre in size. It was purchased by the city of Montpelier in January 2014 and is currently leased by the State of Vermont for state employee parking. It is centrally located in the downtown business district and adjacent to the State’s Capitol Complex. The City of Montpelier hopes to transform what was once a scrap yard and train depot into a state-of-the-art transportation and commercial center and public park. This project is funded through the Federal Highway Administration, the Federal Transit Administration and the City of Montpelier.”
Most of the information for this story was obtained by watching the ORCA video recording of the March 22 Montpelier City Council meeting, and from the City of Montpelier website.
