A consultant with a real estate company said there is "high degree of confidence" of moving forward with the redevelopment of the long-vacant Court Square Hotel building. MGM Springfield is investing in the $55 million project to satisfy its obligation to develop market-rate housing within a half-mile of the downtown casino.Credit WAMCEdit | Remove
MGM plans to increase the amount of money it intends to invest in a major urban renewal project just a block from its downtown gambling resort in Springfield, Massachusetts.
MGM will spend more than the $11 million the company initially pledged to help redevelop the derelict former Court Square Hotel building, according to a consultant for one of the companies planning the project and city officials. They would not reveal the additional amount. An MGM official declined comment.
In late March, MGM told the Massachusetts Gaming Commission that it planned to invest in the $55 million project in order to satisfy its licensing requirement to develop housing within a half-mile of the downtown casino.
Even with the additional money from MGM, all the financial pieces for the project are not yet in place, according to Michael Crowley, a consultant for Opal Real Estate of Springfield, which is co-developing the project with Boston-based WinnCompanies.
"I wish I had the ability to announce to you today that we had all those funding sources in line, but I can not say that with 100 percent certainty, but I believe we are very close," said Crowley.
At a hearing of the Springfield City Council Casino Oversight Committee Monday night, Crowley said there is a “high degree of confidence” the project will move forward.
"If you recall, the last time we were here ( one month ago) we told you we had an approximately $5 million shortfall on a $55 million project. We know believe we are on about the 1-yard line with that," said Crowley.
City Solicitor Ed Pikula told the committee that MGM and the city are preparing an amendment to the Springfield Host Community Agreement for the council to vote on in the near future. The current agreement calls for MGM to develop at least 54 units of market rate housing by March 2020.
The Court Square project envisions 60 market-rate apartments and 15 units that would rent at reduced prices for people with incomes at 80 percent of the region’s median income. There will also be retail space on the first floor of the six-story building.
"This would be a major major outside the (casino) footprint step that would spin off more development, " said Pikula. Noting that a consultant 15 years ago had identifed the redevelopment of Court Square as a key to downtown revitilization, Pikula said "finally this is coming to fruition."
MGM plans to return to the city the former school department administration building on State Street that the company purchased in 2014. Pikula said another developer will be sought to build market-rate housing at that location.
City Councilor Mike Fenton, who chairs the council’s casino committee, said he is very pleased with MGM’s decision to help finance the Court Square project.
"MGM has committed to invest more than $11 million in market rate housing at Court Square and my estimation is that pound for pound that is a much better investment for Springfield taxpayers than ( MGM) building 54 units in another location," said Fenton.
In addition to developing housing, the host community agreement obligates MGM to put on entertainment events at the civic center, City Stage, and Symphony Hall. City Stage has closed and negotiations are ongoing to have MGM take over the management of Symphony Hall.
Pikula said the amended host community agreement will address those changes.