Communities in Connecticut and across the country are working hard to differentiate themselves as wealthy investors kick the tires on major developments made potentially more lucrative by the federal “Opportunity Zone” program.
Get Instant Access to This Article
Subscribe to Hartford Business Journal and get immediate access to all of our subscriber-only content and much more.
- Critical Hartford and Connecticut business news updated daily.
- Immediate access to all subscriber-only content on our website.
- Bi-weekly print or digital editions of our award-winning publication.
- Special bonus issues like the Hartford Book of Lists.
- Exclusive ticket prize draws for our in-person events.
Click here to purchase a paywall bypass link for this article.
Communities in Connecticut and across the country are working hard to differentiate themselves as wealthy investors kick the tires on major developments made potentially more lucrative by the federal “Opportunity Zone” program.
Nationwide, nearly 9,000 eligible zones, including 72 in Connecticut, have been approved, which means there are plenty of options for investors wanting to reduce or even eliminate their capital-gains taxes over the coming decade.
Just how many of those mostly low-income areas actually attract OZ investment remains to be seen.
However, as a handful of Greater Hartford communities continue to seek the attention of OZ funds and investors, Manchester may be an early contender.
The Silk City remains in negotiations with a development team it selected over the summer to redevelop the former Broad Street Parkade mall site, which was a long-vacant eyesore when the town acquired and demolished it in 2012. The site has sat empty since then.
Broad Street is one of two Opportunity Zones in Manchester, and the developer, Manchester Parkade I LLC, has told town officials the emergence of OZs could be a key enabler for an envisioned mixed-use project that would include office space, market-rate housing, retail and entertainment components.
The LLC is led by Milford-based developer and clean-energy financier Michael Licamele and Harry Freeman, a real estate developer and longtime municipal economic-development official in Greater Hartford. The partners were selected after Manchester parted ways with a prior developer, Montreal-based Live Work Learn Play, which pursued a Parkade project for about five years before things fell apart.
Manchester officials touted the area’s OZ status when it was searching for a new developer earlier this year.
”Obviously, I think it makes a difference,” said Gary Anderson, Manchester’s director of planning and economic development.
The developers and town, which are still trying to finalize an agreement, pushed their deadline to January, but Anderson said he remains optimistic about the talks and Manchester’s desirability to investors.
After all, it’s the closest the town has come to a viable project on the site, he said.
Optimism is probably a good quality for local officials banking on Opportunity Zones.
Besides the steep competition, there’s additional uncertainty about the program because it has rolled out more slowly than anticipated.
Some regulations aren’t yet final, and OZ funds have fallen short of projections so far, the Wall Street Journal reported in October. Citing a Novogradac analysis of 103 funds, WSJ reported that they had raised just $3 billion of their combined goal of more than $27 billion.
That may portend challenges ahead, but Anderson hopes the OZ program will be a deciding factor that leads to a Parkade redevelopment, following years of work to retool the property.
”It’s one of our major priorities and has been for the past 10 or 12 years,” he said.
Most recently, the town was able to eliminate several easements on the site that would have made finalizing a development agreement a challenge, Anderson said.
Loan program
Manchester’s other Opportunity Zone covers its Main Street central business district, which has also been a focus for the town.
This year, Manchester created a zero-interest building improvement loan program for businesses there.
Officials this fall approved the program’s first loan, a $200,000 package for Firestone Art Studio + Cafe in the former Pinewood Furniture building at 1115 Main St.
Other ongoing Main Street initiatives include a special district that aims to better market available real estate and lighting improvements.
Main and Broad streets run parallel, linked in the middle by the recently improved Center Springs Park, and Anderson said both are key pieces of Manchester’s core that will matter to its future economy, demographics and quality of life.
The town’s ultimate aims are those shared by many municipalities — population and grand list growth, more business activity, and the more intangible:
“We want to make downtown a place where people want to be,” he said. “A buzz or positive feeling is sometimes hard to measure.”
