In Manchester, mayor, alderman say no city bonds for proposed Pearl Street twin towers
MANCHESTER - Both the mayor and the ward alderman say they won't back a developer's proposal asking for about $46 million in city-backed bonds to build two towers for student housing on the site of the city-owned Pearl Street parking lot.
"This is going to be privately done or it's not going to be done," Ward 3 Alderman Pat Long said Friday. "I don't know anyone on the board saying, 'Sure, let's invest in this guy.'"
Manchester Mayor Ted Gatsas said he also opposes the proposal, to be discussed before aldermen Tuesday, because it leaves the city vulnerable to financial losses if the project proceeds and then suffers a financial downturn.
"The problem is they want us to float the bonds and ... we're going to be responsible for the bonds," Gatsas said.
Vitas Management & Development Companies, the lone company to submit a request for proposal for the parking lot north of Bridge Street, said it would build the project if the city issued bonds covering 70 percent of the project's cost.
According to the developer's 34-page proposal, the projected price tag is around $66 million, meaning about $46 million would need to be bonded. The $66 million would provide about 240 units housing 756 beds, according to the plans.
In August, a majority of aldermen, including Long, voted to enter into an agreement to sell the property directly to VMD Companies and its principal, James Vitas. But after the mayor vetoed the measure, aldermen voted to issue a request for proposals for the parking lot, which several developers had expressed an interest in buying as a site to build student housing. The deadline for submissions was Oct. 31.
VMD said it would buy the city parking lot for $1 million, lease 300 spaces to the city for public use at a negotiated price and create a special taxing district to help pay for a proposed 900-spot parking garage. The current Pearl Street lot contains 328 spaces.
The proposed towers would rise nine stories or 115 feet.
"We believe the project to be aesthetically appealing and compatible with the existing character of the downtown area," Vitas wrote in the proposal.
Vitas didn't return numerous phone messages or emails late last week.
The VMD proposal said a parking garage could open about 30 months after the parties signed a purchase-and-sales agreement with the towers, taking up to 36 months.