Ideanomics’ “Fintech Village” project in West Hartford has faced various delays over the past two years, but now the company has added a new level of uncertainty to the purported $400-million development.
Ideanomics told investors on Monday that it has identified the Fintech Village at the former West Hartford UConn campus as a “non-core asset” and is “evaluating its strategies for divesting of this asset.”
Slipped into its annual earnings filing with the U.S. Securities & Exchange Commission, the disclosure came as Ideanomics reported a $98.5-million loss in 2019, up from $27.4 million in 2018. The company’s shares were trading at all-time lows of around 37 cents on Tuesday morning, down from $1.77 a year ago.
“Fintech Village, we’re taking a long, hard look at that,” CEO Alf Poor said on an earnings call Monday. “It’s been a much longer, slower grind through the approvals process.”
“We’re looking at the moment to bring some partners in to help reinvigorate some life in there, while we put more of our time and attention into” its core business segment, Mobile Energy Group, which provides financing and management services for conversions of commercial electric vehicle fleets, he added.
The company did not elaborate during the call. However, in a statement Tuesday, Poor said Ideanomics is “committed to find the best way forward to bring Fintech Village to its full potential and bring tech jobs to West Hartford.”
“What began as a light remediation project has turned into a major undertaking,” he said. “As such, we are shifting from a go-it-alone approach and are currently looking for partners to co-invest in the development of Fintech Village.”
The Department of Economic and Community Development (DECD) has pledged up to $10 million in assistance for the project, but that funding is contingent on job creation targets. To date, Ideanomics has not drawn on any of the money, DECD confirmed Tuesday.
Ideanomics bought the 58-acre campus in Oct. 2018 for $5.2 million. Contamination, including asbestos and polychlorinated biphenyls, was soon discovered to be higher than expected, requiring demolition of four of the five buildings on the property.
Demolition and environmental remediation work began last summer but was halted about 30 days ago, Mark McGovern, West Hartford’s community services director, said Tuesday.
McGovern said the company needed to work through approvals with state and federal environmental regulators before work could resume.
Only one of the four buildings on the property has been demolished as of Tuesday.
The company’s most recent update, issued late last year, was that the work would be finished in the second half of 2020.
“If we elect to sell, transfer or change the use of the facility, additional environmental testing may be required,” Ideanomics said in an SEC filing. “We cannot assure that we will not discover further environmental contamination, that any planned timeline for remediation will not be delayed, that we would not be required by [state or federal environmental agencies] to incur significant expenditures for environmental remediation in the future.”
If the clean-up of the property is not completed, the state could keep some or all of an $8 million surety bond Ideanomics posted in connection with the property purchase, $3.6 million of which was cash collateral.
“The surety bond will either serve as collateral to the state if we do not complete the environmental remediation to state and federal requirements or be returned to us in full if remediation efforts are successful and completed,” Ideanomics said in the recent filing.
While Ideanomics unveiled a virtual fly-through of Fintech Village last summer, revealing an expansive development with numerous buildings and public spaces, the layout was only preliminary.
Once remediation work is finished, Ideanomics would still need to apply to the town for a zoning change to accommodate a specific design.
