A massive string of West End apartments — along with an unusual city tax deferral plan — may soon change hands as a New York-based realty company moves to buy Clemens Place.
The potential purchase came to light during a city council meeting last week because the tax plan requires the city’s approval before the property can change hands. The buyers at J.S.S. Realty Associates were mum on the possible deal, but city housing director Bruno Mazzula said some contracts on the sale indicated a $36 million price tag and that such a sale was likely to take place in a month or two.
Clemens Place, one of Hartford’s largest private apartment complexes, is a string of 42 buildings with 583 apartments, stretching out over Farmington and Sisson avenues, and several other side streets. The current owner, Hartford-based Intown West Associates, operates under a tax abatement plan that requires a yearly payment of $200 per unit in lieu of taxes.
Under the 1980 agreement, the owner of Clemens Place must pay that amount until 2020. If there is “sufficient cash flow” generated from rent — city officials couldn’t detail that amount as of press time — an extra $320 payment per unit kicks in.
But Clemens Place hasn’t generated enough revenue to activate that part of the agreement; under its terms, the owners will be required to make all back payments when the deal is up in 2020. If Clemens Place puts off all extra payments until the deadline, it will owe the city an extra $7.5 million.
J.S.S. Realty Associates, if it goes through with the purchase, will inherit that payment burden from current owners Intown West Associates. The 1980 tax agreement also requires 20 percent of Clemens Place to be designated as low-income housing.
“Nothing changes, essentially,” Mazzula said. He added that J.S.S. Realty initially indicated that $2 million would go into improvements in the housing.
John Palmieri, Hartford Redevelopment Agency executive director, said it’s possible that J.S.S. Realty Associates senses a valuable opportunity in Clemens Place. The terms of the 1980 agreement are coming due relatively quickly, so the company must believe it can generate additional value out of those units.
Many Clemens Place apartments are located around an area that has seen economic revival in the recent past, catching the eye of developers such as David Nyberg. He bought 12 apartment buildings in nearby Asylum Hill and has said he intends to rehabilitate and upgrade the units.
Intown West Associates representatives were unavailable for comment at press time. The company has had run-ins with the Environmental Protection Agency over an alleged failure to alert Clements Place tenants to possible lead contamination. According to documents from EPA New England, Intown paid a $45,000 fine to the agency in 2004 for lead paint violations.
