High density housing has a train to catch
By christina p. o’neill
A $9-million renovation project in downtown Fitchburg will bring 31 mixed-income apartments to the city’s Main Street. Farther down at 524 Main St., another renovation, this one of the former Johnsonia building that’s been converted from apartments to condos, will establish another 46 housing units. Both are within blocks of an MBTA station hosting commuter service to Boston. Ten of the Johnsonia condos – selling for $139,000 and up for a single-bedroom, $170,000 and up for a two-bedroom – had been sold by the time father and son developers Clark and Matthew Straight unveiled the remake to the public on June 28.
Not too many years ago, such projects would have been a tough sell, says Clark Straight. Downtown Fitchburg was practically empty after the closure of a GE plant and the loss of 800 jobs, and the decommissioning of nearby Fort Devens costing 3,600 jobs. The city essentially lost its middle class, he says. But today, it’s coming back. When people call or visit the Straights’ website www.johnsonia.com, they always ask about how close the train station is. A new 400-car garage, built near the station to service commuters, is only half full now but, Straight says, within a year it will be heavily used. "Main Street is exploding, in an extremely positive way," he says.The apartment project, at 470 Main Street, now houses a branch of TD Banknorth – which owns the property – on its first floor. The bank plans to sell it to the Fitchburg-based Twin Cities CDC, which will then convert the second to top floors into housing. Expected cost of renovation: $8 million to $9 million.
TD Banknorth inherited the building from Safety Fund National Bank, which it acquired in the 1990s. But as TD Banknorth gradually reduced its backroom operations, it had less need for the upper floors, which are now mostly empty. So when the city changed its zoning to allow residential units in downtown on the second floor and up, TD Banknorth officials approached the Twin Cities CDC to see if there might be a way to more fully utilize the building.
The bank’s proposal: A sale/leaseback in which the bank would occupy most of the first floor as an anchor tenant, with the housing units located upstairs.
But assembling the financing for such a project is so complex and labor-intensive that it wouldn’t have made sense for a for-profit developer, according to Twin Cities’ Executive Director Marc Dohan. While the Straights rehabilitated their building, the Johnsonia, completely from private funding, the 470 Main St. project has a patchwork of funders. Dohan expects Twin Cities CDC will barely cover its costs because of the work involved. It will, however, get a new office out of the deal, becoming TD Banknorth’s neighbor on the first floor.
Such a project wouldn’t be bankable without a strong demand for housing. Mass transit is also a factor, Dohan concurs. The CDC expects to take a year to assemble the financing and another year to complete the construction and renovation. Retaining TD Banknorth, a secure tenant, was another deal-maker, he indicates. The apartments are expected to rent for $800-$900 a month. TD Banknorth President and CEO Christopher Bramley still has a desk on the second floor of 470 Main St., which he still uses.
Clark Straight looks back on 24 years of managing the Johnsonia as an apartment building, and says that other downtown project managers have followed its conversion – and his lead – with keen interest. "Everybody’s been watching me," he says. "All up and down Main Street, I see things happening. This was planned. This was not an accident."
Christina P. O’Neill can be reached at coneill@wbjournal.com
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