Defunct Land Deals’ Revival Stalled

A plan to allow a builder to amend his defunct land disposition agreement hit a roadblock and touched off a debate about whether developers who fail to live up to past promises should get second chances.

The debate took place at the most recent meeting of the board of directors of the Livable City Initaitive (LCI), New Haven government’s anti-blight neighborhoods agency.

The LCI board hit the pause button at the meeting Thursday night on moving forward a plan that would allow the Chapel Lofts II LLC to amend a 12-year-old land disposition agreement (LDA) to permit the building of nine condominiums above two retail spaces on a vacant lot at 1198 Chapel St.

LCI Executive Director Serena Neal-Sanjurjo said that it is the first of 14 LDAs — agreements that allow the city to sell its unused property to developers under conditions that they develop it or return it to the city — that the city is looking to revive. The thinking is that developers had a hard time making those old deals work during difficult economic times; now that the economy has picked up here the Harp administration would like to give them another chance, in some cases to build denser projects than originally envisioned. (Read more about the Harp administration’s plan and a recent discussion at the City Plan Commission here.)

“We have approximately 14 or so very, very old LDAs on the records that have not been moved,” Neal-Sanjurjo said. ​“An example of that would be the [John] Schnip LDA that we just [reworked] with Randy Salvatore [in the Hill]. This is another one that is one of the older ones. There are several others that are coming to fruition right now, however, our challenge is not to throw the baby out with the bathwater.”

Neal-Sanjurjo said that the LDAs are with a variety of developers, both for-profit and not-for-profit.

“We are trying to bring these folks back to the table and say, ​‘If you are interested in developing, we want you to develop,’” she added. “‘If you are not, then the city will move toward getting that LDA finished and pull back that property to the city. ​‘It’s absolutely unbelievable that 25 years would go by and folks would not develop. That just doesn’t make any sense.”

Shneur Katz, who is at the helm of the Chapel Lofts partnership, has signaled to the city that he’d still like to develop his project if it can be modified to meet new zoning regulations and the market demand for rental units. The original project was never built; he purchased it two years before the Great Recession.

His parcel at 1198 Chapel St. was initially zoned as a Business A, or BA, when it was purchased in 2005. Now it is zoned Business District‑1, or BD‑1, which allows for more mixed-use developments like the Novella, the Salvatore-built project a half-block away at Chapel and Howe.

City Economic Development Administrator Matthew Nemerson said in a previous interview with the Independent that Katz has told the city that he sees more potential in a development that has rental units above those two retail spaces instead of condos — 24 units to be exact.

LCI Board Chairman Tim Yolen was not impressed at Thursday night’s meeting by the argument that the city had found a way to get these developments back on track without costly lawsuits

“I’m offended by this as a longtime resident of New Haven that people can come in and after their LDA basically goes south, they can come in and negotiate a far more lucrative deal,” he said. ​“And at the taxpayers’ expense from where I sit. and I don’t like it.”

Yolen asked how the city benefits from allowing developers who have failed to fill their end of the bargain to develop land that should be back in the city’s possession — and to build a denser project denser. What of those people who fulfilled their LDAs, even during an economic downturn?

“I think it’s outrageous that they go from nine to 24” units, he added. ​“That’s outrageous. I’m sorry. I don’t know who’s running the show on this, but that’s offensive. I find it really troubling and if it’s coming from the top, then the top ought to come here and speak to this commission.”

Neal-Sanjurjo argued that a more dense development would bring more money to the city’s coffers. So would allowing the other 14 developers to amend their LDAs and get to work, under very specific conditions and timelines, she said.

New and amended LDAs will come with clear deliverables and strict 18-month timelines, she promised. Developers who don’t meet the requirements of revised agreements will be in default, and the city will exercise its right to take back the land, she said.

Evan Trachten, LCI’s acquisition and disposition coordinator, also pointed out that Katz has maintained the vacant parcel and paid his taxes on the property and others he owns in the city. Trachten said that Katz has kept in touch with the city over the years about the parcel and his desire to develop it.

But Yolen said he didn’t want answers from Neal-Sanjurjo and Trachten. He wanted answers from the city’s economic development office. Trachten, who was taken aback by the opposition to the plan, took responsibility for not telling anyone from that office to attend Thursday’s meeting. Yolen wasn’t having it.

“They should have appeared,” Yolen said. ​“They don’t need to be told.”

The two alders on the committee, Dolores Colon of the Hill and Newhallville’s Delphine Clyburn, also weren’t feeling the proposal.

“I have questions for this developer,” Colon said. ​“If you couldn’t build nine in 25 years, what makes you think you can build 24 now?”

Neal-Sanjurjo pointed out that the 1198 Chapel St. LDA is not 25 years old, but 12 years old. It was the Schnip LDA that took 25 years.

“Because they have more money now,” Clyburn intoned.

“It’s because they’ll make more money now,” Yolen said.

“The city will make more money,” Neal-Sanjurjo countered.

The board ultimately decided to table the proposal until there could be presentations from the developer and from the economic development office specifically on the 1198 Chapel St. project but also on the other outstanding LDAs.