Student housing developer receives third extension on I-195 project

THE INTERSTATE 195 REDEVELOPMENT DISTRICT COMMISSION has granted a third extension to the developer looking to build student housing on the former I-195 land in order to reach an agreement with Providence on a tax stabilization agreement. / COURTESY PHOENIX PROPERTY CO.
THE INTERSTATE 195 REDEVELOPMENT DISTRICT COMMISSION has granted a third extension to the developer looking to build student housing on the former I-195 land in order to reach an agreement with Providence on a tax stabilization agreement. / COURTESY PHOENIX PROPERTY CO.

PROVIDENCE — For the third time, the Interstate 195 Redevelopment District Commission has extended a deadline to allow a developer to try to reach an agreement on a tax stabilization plan with the city.

The Dallas-based developer, a combined effort of the Phoenix Property Co. and Lincoln Property Co., wants to build a six-story building with 500 beds, arranged in a suite fashion. The property is known as Parcel 28, located on the block defined by Clifford, Friendship, Chestnut and Richmond streets. The developer also wants to purchase a small property in the block on city land to complete the development.

Phoenix-Lincoln has requested a tax stabilization agreement that would allow the city’s property taxes on the improved site to be collected on a deferred basis.?

The lack of visible momentum on a tax agreement for the $50 million project prompted Chairman Joseph Azrack to state that the process for securing TSAs needs to be re-examined.

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While the process requires effort by the developer, it also requires cooperation from the mayor’s office and the City Council, Azrack said.

“It’s now about three months beyond what was originally the deadline for a tax stabilization agreement,” he said. “We have to find a better way to get these TSAs [completed]. The way it’s working now it’s not acceptable. It does a disservice to the city.”

According to Azrack, the developer has already invested more than $500,000 in the project.

The new deadline, as requested by Phoenix-Lincoln properties, is July 1.

The discussions between the developer and the city administration are ongoing, said Providence Planning Director Bonnie Nickerson, an ex-officio member of the I-195 commission.

The original purchase and sale agreement between Phoenix-Lincoln and the I-195 commission allowed the developer until March 1 to reach an agreement with the city on financial incentives. After that, it could exit the agreement.

Following the meeting, Azrack said a market-based tax treaty is needed. The city and state do not exist in a vacuum, he said. Development companies are trying to find ways to bridge the financial gap between the cost of construction and the income that can be generated by development. “It is clear that without a tax stabilization agreement, they are not comparable. They are substantially in excess.”

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