MGM plans to redevelop a more than century-old building into market-rate apartments just a few blocks from where the Las Vegas-based company is constructing a casino in downtown Springfield.
A landmark three-story building made of large blocks of limestone located on State Street in Springfield’s metro-center that had been vacant for five years will have new life after an earlier redevelopment plan fell through.
MGM’s recent acquisition of the building settles a lawsuit between the city and a developer who had purchased the building for $1 in 2011 with plans to convert the former commercial building to apartments. Springfield’s chief development officer Kevin Kennedy said when those plans failed to materialize, the city sued developer David Nyberg.
"He was not able to perform and meet the standards we had in the contract with him, so we exercised our right to take the property back from him," said Kennedy.
MGM paid $600,000 for the property which covers all outstanding debts, including property taxes, a mortgage, and liens. Under an agreement with the city, MGM now has 18 months to redevelop the building into market-rate housing.
" We believe MGM will do a very high quality job," said Kennedy.
Housing was part of the original 2013 casino development agreement between MGM and the city of Springfield. The housing had to be moved off-site to accommodate a redesign of the casino that replaced a 25-story hotel tower with a six-story hotel.
MGM Resorts International President Bill Hornbuckle announced plans last October to buy the State Street building.
The building at 195 State Street is on the National Register of Historic Places. Built in 1905, it was originally the headquarters of the Springfield Fire and Marine Insurance Company. It was most recently the central administration building for the Springfield Public Schools. The school department moved out in 2010.
Springfield Mayor Domenic Sarno has long encouraged the development of market-rate housing in downtown Springfield, believing it will attract young people and retirees with disposable income.
" We are open for business and we will work with ( developers) to do a fair deal that benefits the development company and the city of Springfield, " said Sarno.
A New York City-based developer spent $15 million in 2014 to buy and renovate a 280-unit apartment complex in downtown Springfield with plans to charge market-rate rents.
Earlier this year, city officials promoted a developer’s plan to convert vacant commercial lofts above retail stores along a block on Main Street into apartments.
