Wexford Asks for $32M for 195 Project, Tenant Says Might Not Work in Providence
Tuesday, December 13, 2016
On Monday, Wexford announced to the 195 Commission at the Rhode Island Commerce Corporation that it has signed letters of intent to lease space to Brown University’s School of Professional Studies as well as the Cambridge Innovation Center, whose CEO and Founder Tim Rowe was on hand to talk about their successful track record as a start-up incubator.
“You can’t have surety this is going to work,” said Rowe during his presentation, who estimated that 40,000 jobs have been created by CIC’s Cambridge facilities.
Citing what he said is the “need for innovation infrastructure,” Rowe said he thinks there is a possibility for a “design innovation center” at the Wexford facility in Providence, among other opportunities.
Supporters of the project, meanwhile, are confident in its potential.
“This is the best thing since sliced bread - this has been worth the wait,” said Sharon Steele, who is the Vice-President of the Jewelry District Association, and recently spoke out in opposition to New York developer Jason Fane’s tower proposal on an adjacent 195 lot.
“It’s important for people to understand that this is the time to spend the money that needs to be spent, to button up and tie down our future,” said Steele, who spoke to who she saw as helping with the start-up potential at the CIC. “I see URI has being huge, with food, and blue-tech, marine, every silo that's been identified by Brookings.”
“When Rowe said in St. Louis the difference CIC made [there] was ‘seismic’ — that's what Wexford is doing,” said Steele.
195 Commission Chair Joe Azrack spoke Monday to the incentives being offered to Wexford - by the 195 Commission.
“From the redevelopment fund, it's a total $18.5 million for the innovation center's development and up to $1M for renovation of One Ship Street for interim space for future tenants,” said Azrack. “The land is being contributed to the partnership in return for profits interest -- we'll get the land value back depending on the performance of the project.”
Azrack said that the land under the innovation center is valued “at about $2.9 million.”
Commerce Secretary Stefan Pryor spoke following Monday’s 195 Commission meeting about what to expect from Wexford and the Commerce Corporation now, above and beyond the 195 Commission's incentives.
“The likely Rebuild RI tax credit amount is in the neighborhood of $12.5 million,” said Pryor. “There will likely be two forms of forgone revenue as part of the total deal structure also authorized. Forgone revenue is revenue that’s generated by the project but would not exist but for that project. So sales tax on construction materials -- there may be a request for exemption for that, and also a repledging of a portion of the hotel tax, that wouldn't have been generated otherwise back to the project.”
On Monday, Wexford President Jim Berens told GoLocal that while he knows the rents that Wexford will be getting from Brown and CIC, that he was not going to divulge them.
“They’re not public information,” said Berens.
SLIDES: Reactions to Fane"s 195 "One Tower" Proposal
Related Slideshow: Reactions to Fane’s “One Tower” Proposal on 195 - December 9, 2016
Former Mayor of Providence
"If the developer thinks the market is there, and the state doesn't have to subsidize it - if someone wants to come in and spend hundreds of millions of their own money, we should try and make it easier, not more difficult. Yes, they’d be getting a tax stabilization but remember that property isn't paying taxes now -- highways have never paid property taxes.
As for people opposed to it, as my dad used to tell me, that's why Howard Johnson has 28 flavors -- everyone has their opinion on what's attractive or not attractive, what’s an addition to the skyline, or a detraction. But again, if someone wants to spend hundreds of millions and employ people and create housing and add an attractive element to the city, we should be embracing it."
Project Manager, Public Policy at United Way of Rhode Island, founding member of the Millennial Professional Group of Rhode Island
“I’ve heard from young professionals who have left the state, citing our lack of development and opportunity as reasons why. If we want to tackle our brain-drain, young professionals and recent graduates need more opportunities to work and thrive.
While it's encouraging to see out-of-state developers wanting to invest in our state, any proposal should be given thoughtful review to truly understand how it can help our business community."
Executive Director, The Providence Foundation
"We certainly welcome outside investor and capital interest in downtown and growing the downtown residential community is one of our goals because of the many benefits that it brings.
However, this proposal is quite a departure from the plans that many have been developed for this area and thus requires analysis, study and discussion. At this point, the Providence Foundation does not have sufficient information nor has had the time to discuss the project."
Jewelry District Association Vice-President
“We need ‘live, work, and play’ - in scale. We have 95 Chestnut with 60 plus units, Plot 30 with same developer with 90 units, so together that’s 150 units. Then we’ll have the two seven story towers, ‘River House', after South Street landing is completed, next to Davol Square. Then we’ll have 44 Hospital Street.
These are all the right scale, appropriate to the district, all ready to go — what we need is business, lab space, bio tech, start-ups - so that we have people who then need to live there.”
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