$20M sought to make DoNo apts. 'affordable'

February 20, 2015

Deal Watch Today

The developer building a downtown Hartford ballpark says it needs $20 million in public funding to include affordable apartments in its next development phase that also envisions a supermarket and parking garage.

Officials with developer DoNo LLC appeared at Thursday night's regular meeting of the Capital Region Development Authority and outlined its plan for the proposed $105 million project directly across Main Street from the ballpark now under construction.

The yet-unnamed project would include 328 one- and two-bedroom apartments situated atop street-level retail space that would include a 62,430-square-foot supermarket, plus another 33,000 square feet of extra retail space, and a 705-space parking garage. Twenty percent, or about 65 units, would be earmarked "affordable'' and offer below-market rents; the rest would be priced to the market.

Yves-Georges Joseph II, vice president of development for Centerplan Development LLC, a partner in DoNo LLC, told CRDA board members that preliminary talks have been held between DoNo LLC and staff of the qausi-public agency about what form their financial partnership might take.

Originally, the mixed-use project was conceived to be built with private financing, Joseph said. However, feedback the developer got about the entire DoNo development project from city officials, residents and other "stakeholders'' insisted that some of the apartments have rents tied to the median income of city residents, he said.

To do that, DoNo LLC calculated that injecting an affordability feature into the apartment project would create a private "funding gap'' of $20 million that CRDA could fill, Joseph said. DoNo assumes a monthly affordable rent of about $650 a month for the units, based on city residents' median income of $35,000 annually. The gap reflects the "funding hurdle,'' Joseph said, that the developer would have to cross to sway investors skeptical about the lengthened recovery period for their investment from having some apartments rent for less than others

The CRDA made no specific commitment to DoNo LLC's proposal that the two partner in financing the mixed-use development but both sides indicated their discussions will continue.

However, Joseph reminded the panel that DoNo LLC's develpment contract with the city requires ground for the mixed-use project be broken by November, which means financing must be completed by Sept. 30 to meet that timetable.

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$20M sought to make DoNo apts. 'affordable'