Chapel Developer Lashes Out

Peter Chapman came out swinging.

He said the city ​“stonewalled” and ​“obstructed” his planned factory conversion — and now seeks to ​“extract” $350,000 before he can proceed.

City officials swung back, accusing Chapman of leaving his property derelict for years, then of negotiating in public after reneging on a sweetheart deal.

That dispute took place during the regular monthly Finance Committee meeting in the Aldermanic Chambers on the second floor of City Hall.

The subject of Monday night’s heated 40-minute public hearing was a letter that Chapman sent to the alders in December 2018 accusing city officials of ​“reprehensible” and ​“irrational conduct.”

“The unstructured procedure that governs New Haven property, and property development, is nearly impossible to navigate, or is being made so for the purposes of thwarting my efforts to develop or sell my property.”

That property is a six-story, 30,500 square-foot former warehouse that Chapman owns at 433 Chapel St. That building sits at the corner of Wallace Street in between Wooster Square and the Mill River, and formerly housed the M. Armstrong & Co. carriage manufacturing company.

Click here to download Chapman’s original communication to the board.

Chapman first bought the building from the city in 2002 with the intention of converting it into 18 apartments and a street-level commercial space. The city agreed to sell him the property for $152,000 — just $5 per square foot — and gave him 18 months to make the mixed-use project a reality.

After years of development delays and political troubles that stymied his first attempts to rehab and sell the building to a new developer, Chapman told the alders Monday that the building remains empty and unconverted to this day — because of city inaction, not his.

“It’s become clear to me that I’m being stonewalled or obstructed, in most cases due to no communication, and also having roadblocks and constant changes ad hoc to the procedure, whatever that is,” he said.

He laid out a year-long timeline running between mid-2017, when he first pitched the Downtown-Wooster Square Community Management Team on an updated development with 25 apartments instead of 18, and late 2018, when he sent the frustrated letter to the alders.

In between, he said, he had been in inconsistent email communication with Livable City Initiative (LCI) Executive Director Serena Neal-Sanjurjo, whom he said had promised to help him update his time-lapsed Development and Land Disposition Agreement (DLDA).

“Repeated requests for updates were unanswered,” he said. In February, he received approval from the Board of Zoning Appeals (BZA) for a variance allowing him to build 25 residential units at the property.

What exactly is the hold up now? asked Fair Haven Alder Ernie Santiago. Did Chapman need another variance or administrative approval of some kind.

“The hold up is I’m being asked for $350,000 for the project to be able to move forward,” Chapman said.

He said the city is trying to ​“extract” that amount of money from him because the value of the property has increased in the year’s since he bought it. That analysis doesn’t take into question the fact that he held onto the property through the Great Recession, he said, and has been paying property taxes on a fallow property for nearly two decades.

And why were you not able to complete the project within the original timeline laid out in the DLDA? asked East Rock Alder Anna Festa.

Chapman said he was stuck with two commercial tenants whom he had to evict back when he took control of the property. That took at least six months, he said. ​“The evictions ate into the timeline.”

Land Banker Or Stymied Developer?

Hill Alder Dolores Colon recalled that Chapman came before the Board of Alders in 2014 — over a decade after his initial DLDA stipulated he had to have the project done.

During that Community Development Committee hearing, she said, Chapman and his attorney and a former Wooster Square alder proposed paying the city $69,000 in exchange for allowing him to break his DLDA and sell the building to another private developer for $900,000.

“It seems you had been sort of land banking,” Colon said. ​“You got a good price for the land. And you came before the board. I think that you were planning on getting a partner and you were going to sell and make a substantial amount of money in this transaction. We felt you had not invested in the parcel of land you had been given. We thought you were being opportunistic at that time.”

Chapman said he took issue with Colon’s accusation of ​“land banking”: ​“It suggests that I’m engaged in some sort of wrongdoing.”

He had tried to sell the property, he agreed, but the Community Development Committee ultimately tabled the item. ​“It died on the vine. It was left there, to no one’s benefit.”

He also took umbrage with Colon’s accusation that he was trying to unduly profit from the previously nixed deal. ​“I come from modest beginnings,” he said, and he and his parents have spent much of their lives donating time to community service in the New Haven area. His parents were pioneers of the some of the city’s first bike lanes, he said.

What exactly do you want from the city? asked Finance Committee Chair and Edgewood Alder Evette Hamilton. What do you want from the alders? What’s the point of all of this brouhaha?

“For one, there seems to be this false narrative that I have somehow benefited financially greatly from this project due to the conceptual idea, yet undefined, of land banking,” Chapman replied. ​“What I need is for the city to stop trying to extract money from me in exchange for building.”

“It Has Been Very Contentious”

City Acting Economic Development Administrator Michael Piscitelli, LCI Executive Director Serena Neal-Sanjurjo, and LCI Deputy Director Frank D’Amore then had their chance to address the alders and rebut Chapman’s claims.

“The allegations made by Mr. Chapman are both personally hurtful and inaccurate,” Piscitelli said. The city has always operated in good faith in dealings and negotiations with Chapman, he said.

Furthermore, ​“significant time has passed and this property has been largely dormant.” In its ongoing negotiations with Chapman, the current state of the property and the fact that ​“the property was conveyed at a very low price years ago” have been important factors.

“The city has changed considerably” since when Chapman got the building for $152,000, Piscitelli said. Wooster Square is such a hot real estate market that the city is now looking to sell a sliver lot for $200,000.

“Money is a very significant part of this negotiation, as is affordable housing.”

He declined to go into too much more detail, noting that the city is still trying to come to terms with Chapman and doesn’t want to bring this stage of negotiations into the public view. Any proposed deal between the city and Chapman would go through the LCI Property Acquisition and Disposition Committee, the LCI Board of Directors, and the Board of Alders, he said. There is a firm and established structure in place for public vetting once the deal reaches that stage.

“It has been very contentious,” he concluded. ​“We do not have a deal.”