NEWINGTON - The town has paved the way for a new senior community and a hefty grand list addition.
Town councilors unanimously approved a tax agreement to help bring a long-awaited development to the vacant site at the intersection of Route 175 and Russell Road. The Villas at Cedar Mountain will have 89 independent-living apartments for seniors and 122 assisted-living and memory-care units.
Economic Development Director Andy Brecher called the $60 million project “the biggest investment anyone has ever made in Newington.”
Developer HDC One bought the property in 2007. After years of failed attempts to secure funding for the project, principal Michael Frisbie stepped forward to ask the town for a tax break this spring.
“I wanted to be transparent, open and honest about our need for tax relief,” he told the council.
Under the agreement, the company will be afforded a property tax abatement of 50 percent for a period of 10 years. With an anticipated yield of $1.2 million in annual property taxes, the town would receive $613,000 annually and then payments in full after the ten-year period.
Tax assessment fixing is guided by Connecticut General Statutes, making it feasible for the community to become operational before reaching financial stabilization and profitability. This also serves as the stimulus to securing the construction loan.
“Unlike a lot of businesses where property taxes are a small part of the overall expense, they represent 10 percent of the revenue for this sort of enterprise,” Brecher explained. “Anyone considering investing or lending to the project needs to feel confident they are going to get a return commensurate with their risk.”
“The town has provided all of the land use approvals necessary for the project to proceed,” he continued. “We are confident with approval of the 50 percent tax abatement for the next 10 years they will be able to finalize their financing and begin construction.”
Shovels are expected to be in the ground by year’s end. Construction will take about 18 months, with occupancy anticipated in mid-2020.
Councilors agreed the town’s need for senior housing is critical, as around one-third of residents are expected to be of retirement age by 2020.
“There are no options close by that fit that need and this fits that need,” Councilor Beth DelBuono said.
Mayor Roy Zartarian said his mother could have benefited from this type of community when she was alive.
“There just wasn’t anything available until it was too late.”
The property will consist of one- to two-bedroom units with one to two bathrooms, balconies, covered parking areas and community amenities.
“This will allow couples to live together while receiving the services they need in a supportive environment,” Frisbie said, adding that the demand for senior housing in the area is double the amount of apartments he plans to build.
The company has agreed to pay the town in full for building permit fees, about $297,000, as well as personal property taxes, estimated to start at $58,800 annually. At full occupancy, the facility will consist of two buildings and will employ 97 people.
Erica Drzewiecki can be reached at 860-801-5097 or email@example.com.