Construction on Woolson Block expected to start in the fall

The Woolson Block building renovation has come with hurdles, including revenue shortfalls and added construction costs, but despite challenges developers say they expect construction to begin this fall and finish in about a year.


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Construction on Woolson Block expected to start in the fall BY PATRICK ADRIAN, The Shopper May 1, 2018 SPRINGFIELD, Vt. – The Woolson Block building renovation has come with hurdles, including revenue shortfalls and added construction costs, but despite challenges developers say they expect construction to begin this fall and finish in about a year. “This is a pretty difficult project,” Springfield Housing Authority Executive Director Bob Morelock told the Springfield Select Board on Monday, April 23. “It started off at about $5 million [in estimated cost]. We’re up to about $8.1 million.” Morelock’s update came during the board’s discussion of a loan amendment request by the new Woolson building owners, the Woolson Block Limited Partnership, which would give more flexibility to the owners during repayment. Woolson Block The Select Board voted to amend loan repayment for the construction on the Woolson Block project. Photo provided. The town loaned $200,000 to developers to transform the Woolson Block building into an affordable housing and commercial complex, with original plans for 15 affordable apartments, four transitional housing units for homeless youth, and commercial spaces at the street level. Project partners include the Springfield Housing Authority, Springfield Regional Development Corporation, Springfield on the Move, and several social services organizations. The amendment, which the Select Board unanimously approved, changes the original loan terms from repayment over 20 years with a one percent interest rate to 25 years with zero interest. More importantly, the amendment allows the owners to repay from its surplus cash, rather than in fixed installments. To illustrate the difference, under a traditional loan the owners would typically repay a fixed amount of $8,000 each year, for 25 years, for a total of $200,000. Under the surplus cash provision, should the owners not have $8,000 in funds from its cash surplus, the owners may pay a lesser amount that year without penalization. The owners still have to pay the remaining loan, Morelock explained in a phone interview. This provision just gives them more flexibility with its repayment schedule. Based on projected revenue data for Woolson Block, Morelock said he believes the owners will generate sufficient surplus cash to cover its annual payments. The intent is only to give the owners as much flexibility and support as possible. “This is a complicated project,” Morelock told the Select Board. “We’ve been lucky to get partners in this particular project. If it wasn’t for [them] we wouldn’t be doing this project. Nobody would be doing this project.” Needed architectural revisions have resulted in $200,000 additional spending for youth housing accommodations, and having to take down the northwest and southwest corners of the building, where additions were constructed on faulty foundations. Though removing these corners opens outdoor space for a potential riverside walkway, it also results in one less apartment unit. The project also has received less grant funds than solicited. Developers requested $750,000 from the state’s Community Development Block Grant program but only received $400,000, and a grant request for $500,000 from the Federal Home Loan Bank was denied completely. Morelock told the board, however, that he expects most of that $850,000 shortfall to be made up in another grants. Also, most of the project’s costs are funded through housing and downtown tax credits, which the developers have attained. Developers plan to begin the contract bidding and have construction underway by September or October.