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| A westside view of the $500 million, mixed-use Fenway Center development. |
In a last-ditch effort to save one of the city’s largest
construction projects, developer John Rosenthal is asking Boston Mayor Martin
J. Walsh’s administration for a $7.8 million tax break to help build a massive
complex of buildings near Fenway Park.
Though his request was rebuffed by former mayor Thomas M.
Menino, Rosenthal submitted a new application to Walsh, and so far his pitch is
getting a warmer reception.
“John’s a good man and I know he’s been working on this
project for a long time,” Walsh said in a recent interview with The Boston
Globe. “We’re going to look at [his proposal] and do what’s best for the city.”
Rosenthal has sought tax relief for nearly a year. He said a
commitment from the city would allow him to start construction later this year.
Otherwise, he risks losing financing for the $500 million project.
“It’s probably do or die at this point,” he said. “And it’s
also do or die for 1,800 construction jobs and the 750 permanent jobs for a
shovel ready project.”
Fenway Center is one of the biggest and most complicated
developments in Boston. It would create a towering complex of buildings with
about 500 apartments, stores, and offices covering the ugly scar of the Massachusetts
Turnpike near Kenmore Square.
Though approved by the Boston Redevelopment Authority in
2009, the project has suffered repeated delays due to a legal and permitting
challenges. Its costs have risen by tens of millions of dollars.
Rosenthal is asking for $7.8 million in tax breaks over 13
years.
His tax payments to the city would steadily increase during
that time, eventually reaching a total of $5.5 million a year when the project
is completed. Currently, the undeveloped 4.5-acre parcel generates only
$152,000 for city coffers.
Walsh has said he is open to granting tax credits for major
real estate projects. But he has also vowed to overhaul the process for
considering them. The mayor is reviewing the request in consultation with BRA
officials.
On Wednesday, BRA spokesman Susan Elsbree said the agency
has met with Rosenthal to discuss his proposal.
“We remain interested in continuing the dialogue with him,
but we believe it is too early in the process to look at a specific course of
action,” she said.
Fenway Center is particularly expensive and difficult to
build because part of the 1.3 million-square-foot complex would straddle the
turnpike. A platform to support its main parking garage and a 27-story building
with 130 apartments, offices, and retail stores would cost about $35 million.
Three additional apartment buildings would be constructed on
scrubby parking lots between Beacon Street and Brookline Avenue, and the state
recently completed construction of a solar-powered commuter rail station off
Yawkey Way.
Fenway Center is also planned to include a community center,
farmers market, bike-sharing station, pedestrian and bike paths, and several
stores and restaurants.
The project has won the support of neighbors and many public
officials because of its potential to transform a gritty pocket of the city
near Fenway Park.
But Rosenthal has struggled to lock down financing for the
project. He said his building costs have risen $48 million in the last few
years, throwing off the expected returns for investors. Bentall Kennedy, an
international pension fund investor, has expressed interest in supporting the
project.
Rosenthal said he has been able to reduce costs by $40
million through engineering efficiencies and negotiations with builders, but
that he needs tax help from the city to close the remaining gap.
“At some point you can’t find more savings,” he said. “There
are a lot of infrastructure costs that are unique to this development. We’ve
looked everywhere, and we still have a gap.”
Bentall Kennedy did not respond to a request for comment Wednesday.
If the city grants the requested tax relief, Rosenthal said
he would aim to start construction by next fall.
Source: Boston
Globe
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