Brewery Sq. Tax Break Advances

A Fair Haven brewery-turned-apartment complex on the Quinnipiac River is on the brink of getting a new owner, a new tax break, and a new boost in affordable rentals. 

That’s the latest with the 104-unit ​“Brewery Square” complex at 19 River St.

The Romanesque Revival-style brick building dates back to the 1880s. It used to be home to the Quinnipiac Brewery Company, later renamed the Yale Brewing Company. After spending several decades vacant in the mid-20th century, the building was redeveloped into apartments in the early 1980s, and has been owned ever since by a company affiliated with the Massachusetts-based Cambridge Development Corp.

A partnership between two affordable housing developers, Community Preservation Partners (CPP) and Beacon Communities, is now looking to purchase and undertake a major renovation of the Brewery Square Apartments. 

CPP, which is based out of California, already owns and has finished a multi-million-dollar rehab of the Fairbank senior apartment complex nearby on Ferry Street. Beacon, based out of Massachusetts, has spent decades owning, managing, and developing affordable housing in New Haven, most recently at the Residences at Ninth Square and at an under-construction new 76-unit project at State and Chapel streets downtown.

“We are excited to partner with CPP on the Brewery Square preservation and thrilled to continue to make an impact in New Haven,” Beacon CEO and New Haven native Dara Kovel told the Independent. ​“A natural fit for Beacon, this reinvestment will expand affordable housing in New Haven and restore the historic integrity of these buildings. From Ninth Square and The Atwater to Monterey Place, bringing quality housing and unrivaled property management to residents is our mission. When complete, the Brewery Square renovation will increase affordability in Fair Haven by 46 units, improving affordable housing resources in the City for decades to come.”

That increase in the property’s share of below-market-rent apartments was discussed in detail Tuesday night during a Board of Alders Tax Abatement / Community Development Committee meeting in the Aldermanic Chamber on the second floor of City Hall.

CPP consultant Barry Cunningham, Beacon Executive Vice President for Finance and Capital Markets Diana DiPreta, and city Housing & Development Administration manager Mark Wilson presented to the alders a proposed 17-year tax break deal designed to allow the CPP-Beacon partnership to undertake an expected $24 million renovation of the Brewery Square property after they purchase it.

As Cunningham described the proposal on Tuesday, the soon-to-be new owners of Brewery Square would like to pay the city the tax-equivalent of $1,500 per unit per year, with a 3 percent annual increase, over the course of 17 years for this complex. That $1,500-per-year Payment in Lieu of Taxes (PILOT) amount would apply only to the 84 below-market-rent apartments.

He said that the prospective new owner’s renovations will be ​“pretty extensive,” totaling around $100,000 per unit and including ​“all new appliances, stainless steel,” quartz or granite countertops, and refinished floors, as well as a new playground, landscaping, cobblestones, and indoor area for bike storage.

The property-wide rehabilitation will also expand the number of affordable units at this 104-apartment complex from 38 to 84. Those 84 affordable units will be rented out to tenants making between 30 percent and 80 percent of the area median income (AMI), which currently translates to between around $27,900 and $74,350 for a family of two.

The affordable rentals will be subsidized through a mix of existing Housing Assistance Payment (HAP) Section 8 project-based vouchers, as well as new Low Income Housing Tax Credit (LIHTC) funding.

“The plan is to try to mitigate the number of displacements of tenants in the project,” Cunninham said; meaning that tenants will ideally be kept in their units or moved into the seven currently vacant units at the complex during the renovations. Cunningham said the developers have set aside $100,000 for tenant relocation costs, if necessary.

Cunningham said that the new partnership will be owned 60 percent by CPP and 40 percent by Beacon. Beacon will be the property manager once the ownership transition takes place. ​“The plan [is] to close this as soon as possible,” Cunningham said about the proposed sale of Brewery Square. ​“This [tax abatement deal] is the last piece of the whole puzzle.”

A signed purchase and sale agreement included in the Brewery Square tax break application lists the intended sale price for this complex as $15 million.

The committee alders spoke in support of the 17-year tax break deal before unanimously endorsing the proposal and sending it to the full Board of Alders for review and a final vote.

Hill/Ninth Square Alder Carmen Rodriguez praised Beacon for how they ​“handle properties and care for residents” at their existing buildings, including the Residences at the Ninth Square. ​“This is a great opportunity for this come to Ward 14. They have been a staple for this community for many years.”

Fair Haven Alder José Crespo praised CPP and Beacon for volunteering $1,500 per unit, plus a 3 percent annual increase, as part of this tax break deal. That’s much higher than the $500-per-unit sometimes seen and approved for other affordable housing tax break deals granted by the city.

Fellow Fair Haven Alder Sarah Miller, who said she used to live in the Brewery Square apartment complex, described the building as ​“an example of what a high-quality, mixed-income building with character and amenities” can look like. ​“It’s very well maintained,” and ​“truly has residents from all income levels.”

“All indications are that the new team will maintain the level if not exceed the level” of care put into this property already.