Report: Little value in high-rises

Estimate of Crystal Ave. site falls short of expectations, although numbers could change

New London — While it may be a prized parcel of land because of its potential to host a major city taxpayer, the future sale of the 9 acres off Crystal Avenue that is now home to Thames River Apartments is not expected to fill the coffers of the city’s Housing Authority.

The draft of a new real estate appraisal report commissioned by the authority puts the “as is” value of the land at $110,000 — a figure that factors in the estimated $973,875 demolition costs for the 124-unit federally subsidized apartment complex now on the property.

The estimate has fallen short of expectations, though Housing Authority Executive Director Roy Boling downplayed the figure and said some of the estimates contained in the report, such as demolition costs, could change.

The report was prepared by Fairfield-based Kerin & Fazio LLC and was required as part of the Housing Authority’s demolition disposition application to the Department of Housing and Urban Development. The application is expected to be submitted within the month and, if approved, would lead to the abandonment of the high-rises and issuance of Section 8 vouchers for residents.

Housing Authority board of commissioners Chairwoman Betsy Gibson agreed that the appraised value is somewhat less than expected but not altogether surprising, considering the extensive demolition work needed to bring the site to a condition that would be attractive to buyers.

While the Housing Authority could use the money, Gibson said the property is expected to be in the hands of the city at some point and no longer the source of troubles and hardship for residents that it has been through the years.

For now, she said, the focus is on

the safety and security of the Crystal Avenue residents and working through the process that will get them into new homes. The Housing Authority has enlisted Elm City Communities and the Glendower Group to provide relocation assistance for residents. That process starts this month.

Residents for years have complained about substandard conditions at Thames River Apartments and a class-action lawsuit spearheaded by local attorney Robert Reardon eventually led to a court-stipulated judgment in 2014 and the promise of new housing.

The appraisal report also indicates what the Housing Authority already has surmised — that renovation of the Crystal Avenue site for “multi-family use is not financially feasible due to the location and current condition.”

A 2011 physical viability needs study determined there was $4.6 million in immediate repairs and renovations needed at Thames River Apartments and an additional $2.27 million needed within the next five years. While the Housing Authority has made some improvements, they have not been anywhere near the scale needed.

The appraisal report concludes that the Crystal Avenue land is valued at $180,000 per usable acre and therefore worth $1,080,000 for the six usable acres minus the $973,875 for demolition costs. Three acres of the property are located in a flood plain.

It is expected that after residents move out, the city and its development arm, the Renaissance City Development Association, would take on the task of marketing the property with an eye toward economic development in an area surrounded by an industrial zone and close to State Pier, one of only three commercial ports in the state.

The city, RCDA and Housing Authority signed a memorandum of understanding in 2016 that alludes to a future role for the RCDA.

Mayor Michael Passero said the Housing Authority still has many regulatory hurdles to clear before it can sell the property. But he said the RCDA and city are well positioned with the expertise to pursue things like Brownfields grants for property cleanup. He said he expects the property title eventually will be transferred to the RCDA, which has a “model on how to get it done.”

Passero said the vision for the future of the property will become clearer once people are moved out and safely situated in new homes.