Boston Herald: BRA Weighs Time-Limit for Projects

Scott Van Voorhis of the Boston Herald wrote on Friday, August 22 that the Boston Redevelopment Authority is considering a time-limit for developers to build after receiving approvals. As this is still being reviewed, the Chinatown Blogger wouldn’t put too much weigh on this until the rule is actually adopted because this may just all be posturing. Why is the City suddenly talking about this? There was a report last week that the developer for the Filene’s building in Downtown Boston may have financing problems after construction has already started.

One of the most egregious projects that could have used a time-limit? Kensington Properties. The developers received approvals in late 2003, 2 years before the housing market tanked in 2006, and now the lot is jokingly called by some as the “Thomas Menino Greenway” because grass has grown on the site. The Chinatown Blogger had spoken with a BRA staff in 2007 about the financing problem. As the staff person explained: Developers provide a feasibility report to the BRA, however, this feasibility report does not mean the developer have actually obtained all the financing.

In a real estate transaction, if the seller/buyer agrees on the price of the house and the buyer can’t get a mortgage loan afterwards, the seller needs to move on and find another buyer. In this case, a developer shouldn’t be allowed to start construction unless they can get the financing, and if the developer is not able to obtain financing after a certain period of time, the City needs to move on and find another developer.

Below is the complete text of the Herald article. The Herald archives their articles after 1 week.
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The Boston Redevelopment Authority weighs time-limit for starting OK’d projects
By Scott Van Voorhis, Friday, August 22, 2008

Developers who win approval to build major projects would have 18 months to get started or face having to return to City Hall to explain the delay, Boston’s top development regulator said yesterday.

The Boston Redevelopment Authority, which oversees plans for major projects in the city, is reviewing new rules that would require developers to demonstrate a viable financing plan before their projects are given a green light, said BRA director John Palmieri.

City officials are weighing plans to scrutinize the finances of developers after concerns that some projects may become stalled after winning approval and digging big foundation holes.

One concern has been the high-profile redevelopment of the Filene’s complex. While the project’s developers have begun demolition, they are still pushing to wrap up financing for a planned tower.

“We understand the economy is tough right now, but we also want to make sure developers don’t proceed to clear sites and then decide they are unable to continue,” Palmieri said.

The BRA often seeks such information, and sometimes has requested formal financing plans.

However, developers are not currently required under city regulations to show evidence of financial backing before they are granted permits to begin work, Palmieri noted.

sbvanvoorhis@bostonherald.com

This entry was posted on August 25, 2008 at 1:29 pm and is filed under WORD ON THE STREET. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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