City Buys Ex-Welfare Building

by Thomas Breen | Oct 7, 2019 4:34 pm

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Posted to: Business/ Economic Development, Newhallville

The city has closed on a $900,000 purchase of a long vacant Newhallville office building that it plans to convert into a worker-owned laundry. According to Stephen Press of Press/Cuozzo Realtors, a Hamden firm that brokered the sale, the city purchased the 46,119 square-foot vacant office building at 188-206 and 218-222 Bassett St. from the New York City-based holding company Bassett Properties Inc. for $900,000 on Wednesday. The site used to house the state Department of Social Services area welfare office, but has been long dormant ever since the state moved those services to Fair Haven in 2013. Mayor Toni Harp announced earlier this year that her administration plans to purchase and convert this large, derelict property in the heart of Newhallville into a worker-owned laundry designed to serve some of the area’s largest employers, like Yale University and Yale New Haven Hospital. The idea came from a similar operation in Cleveland, Ohio, run by the Evergreen Cooperative Initiative, which is serving as a consultant on the project. According to testimony given at an aldermanic committee earlier this year by Livable City Initiative (LCI) Executive Director Serena Neal-Sanjurjo, the laundry is projected to generate between 40 and 150 jobs that start at $15 an hour. She said at that committee hearing that the $900,000 used to purchase the property, which was last appraised as worth $2.9 million and which the previous owner had hoped to sell for at least $1.6 million, came from two different sources: $500,000 from the Community Block Development Grant Acquisition fund and $400,000 from the Economic Development Land and Building Fund. “We are very excited about the opportunity to move forward with the plan to bring the Evergreen Concept for a worker-owned facility to the site,” Neal-Sanjurjo told the Independent in a written statement on Thursday. “On a recent visit to Cleveland, we were able to meet and engage with members of the cooperative and were very impressed with what they’re doing there. It’s an opportunity for New Haven to create employment opportunities for local residents and build wealth in neighborhoods that have struggled with disinvestment.”

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posted by: alex on October 7, 2019 5:15pm Awesome! We don’t need a new Mayor!

posted by: anonymous on October 7, 2019 5:27pm Has the funding for the $10,000,000 in required renovations (according to the previous article) also been secured? I’m sure there will be concern about that and other potential delays, but hopefully people can keep in mind that projects like this can take decades to materialize. This thing closed during the DeStefano administration, so it’s probably something that at least three mayors will be able to take credit for once it eventually re-opens as a laundry, or something else.

posted by: Gary Stewart on October 7, 2019 5:53pm I hope this turns out well but, people should be aware of the health concerns this building represents. Having worked there way back when , I remember well the cancer deaths, particularly brain cancer, that Welfare Dept. employees suffered , well beyond statistical probability. Does the City have plans to look at that?

posted by: Thomas Alfred Paine on October 7, 2019 6:45pm @Alex

Fortunately, New Haven is an American city that exercises the democratic process.

The determination of whether or not New Haven has a new mayor is in the hands of a majority of the voters, not one voter!

This purchase should have been delayed until the new administration takes office and has an opportunity to examine the details and proposals for this project.

The Harp administration thought acquisition or use of the Bethel Church property was a good deal for the planned Escape youth center, but once renovations began and all of the costs were counted to make the Escape possible were considered too great, the project was essentially abandoned and the money spent was wasted.

The last thing any new administration wants is a repeat of the Escape boondoggle at the Welfare Office site. This laundry was Mayor harp’s vision. It remains to be seen if it will be Justin Elicker’s vision, or whether or not renovation of this building for the intended purpose will be fiscally viable and wise.

Count the costs. If the project is unfeasible, sell the building. No need to hold on and hold out like the Harp administration did until the aldermen cut off the funding.

There are good reasons why that building has remained vacant for so many years. One would think a developer would have jumped on it long before now. Maybe they knew sometthing that the city did not, or chose to ignore.

Remember these old sayings, “All that glitters is not gold,” “Don’t count your chickens before they hatch,” and “For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it?”

posted by: Thomas Alfred Paine on October 7, 2019 6:47pm @Alex

Fortunately, New Haven is an American city that exercises the democratic process.

The determination of whether or not New Haven has a new mayor is in the hands of a majority of the voters, not one voter!

This purchase should have been delayed until the new administration takes office and has an opportunity to examine the details and proposals for this project.

The Harp administration thought acquisition or use of the Bethel Church property was a good deal for the planned Escape youth center, but once renovations began and all of the costs were counted to make the Escape possible were considered too great, the project was essentially abandoned and the money spent was wasted.

The last thing any new administration wants is a repeat of the Escape boondoggle at the Welfare Office site. This laundry was Mayor harp’s vision. It remains to be seen if it will be Justin Elicker’s vision, or whether or not renovation of this building for the intended purpose will be fiscally viable and wise.

Count the costs. If the project is unfeasible, sell the building. No need to hold on and hold out like the Harp administration did until the aldermen cut off the funding.

There are good reasons why that building has remained vacant for so many years. One would think a developer would have jumped on it long before now. Maybe they knew something that the city did not, or chose to ignore.

Remember these old sayings, “All that glitters is not gold,” “Don’t count your chickens before they hatch,” and “For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it?”

posted by: Ryn111 on October 7, 2019 6:47pm Alex, probably time to give up… Toni already has. (also let the hashtag die #runtonirun) Call me a cynic but it will be interesting to see how LCI justifies this in 5 years when the building is still vacant and has fallen further into disrepair. Are they an economic development agency? building code enforcement? affordable housing developer? or just the largest owner of vacant property in the city? The idea sounds great in theory, but what will the total project cost? When will the project be completed? Why is the jobs estimate such a wide range? Its pathetic the alders approved the allocation of this amount of money without real timelines/budgets. From the Staking Rink in East Rock to the Q house in Dixwell to any school redevelopment project across the city the scars or poor municipal management are visible everywhere.

posted by: ctddw on October 7, 2019 6:52pm Alex…..you are so pro-Harp….really makes one wonder what is in it for you. You’re trying to hard.

posted by: CityYankee on October 7, 2019 7:52pm How will it be worker-owned of the CIty is buying and renovating it? Worker-owners have to have skin in the game or it’s just another giveaway; like so many other govt schemes to “empower” workers at taxpayer expense.

posted by: Noteworthy on October 7, 2019 7:53pm Can You Spell Boondoggle Notes: 1. Given the Harp House’s history, this is a very scary deal. 2. No, the $10 mil has not been secured nor is that necessarily even the correct number. In fact, I’d bet it will easily be twice that amount. 3. This property should have been leased with an option to buy at the very least or some other creative financing scheme. Just running out and buying it without all the details and business plan done is irresponsible but predictable. It’s what the Harp people do. 4. Past behavior is a good predictor of future actions. And it has.

posted by: Bill Saunders on October 7, 2019 8:24pm I really don’t believe this project is sustainable on it’s own merits.

posted by: NewHaven73 on October 7, 2019 8:44pm Do you mean tax-payer owned? Or are the tax payers funding a private business venture now?

posted by: alex on October 7, 2019 8:57pm All of the hate, doubt and resentment toward this landmark wealth-building initiative shows how important it is that people know: There’s still an election on November 5! Don’t lose your voice! Mayor Harp is the right choice on the bottom line. It’s quite clear that projects like this are on the chopping block if Elicker gets in. His supporters are practically excited for this project to fail or be canceled. Worker-owner means it will be a co-op, like Evergreen in Cleveland. It will be sustainable because of the large commercial contracts it is designed to fulfill — incl. eg Yale University & Yale New Haven Health — and, (2) the value and wealth of a laundry company with good contracts stems from the work that is being done at the laundry. Giving workers a stake in the company will ensure the highest quality of output while also building wealth in the community. This is a win-win-win! You have to wonder what the haters propose we do to close the racial wealth gap. We can’t let progress like this be squandered. Forward together—not one step back! Join the People’s Campaign!

posted by: Bill Saunders on October 7, 2019 9:11pm New Haven 73, It’s a speculative investment of taxpayer money—Just like the “China Trip”. Taxpayer money is not for ‘business investment’!!!! That is a ‘conflict of interest’ at the get go!!! If the City of New Haven was so good at investing, the underfunded pension fund would be looking pretty rosy right now!

posted by: NewHaven73 on October 7, 2019 9:13pm 1) The racial wealth gap is not the responsibility of the tax payer. 2) Worker owned is fine, as long as the loan is repayed at some point No haters here. Just a common sense tax payer. The country is trillions of dollars in debt.

posted by: Kevin McCarthy on October 8, 2019 8:11am Alex, as you know, I have a great deal of respect for Mayor Harp. And creating decent jobs for unemployed folks is a good thing. But this is a profoundly unwise decision. I have seen no evidence that the administration has begun to line up funding to rehabilitate the building. As you know, Gov. Lamont has placed the state on a debt diet, and there is no reason to believe that the Trump Administration is going to do the city any favors. Nor have I seen any evidence that Mayor Harp has developed options if it it proves impossible to develop a co-op laundry.

posted by: alex on October 8, 2019 8:15am Well, Kevin, what have you done to find out? It’s very easy to criticize from the sidelines. All of your expertise could be contributed to making this idea a success. Bill, you really shouldn’t talk about wasting taxpayer money… BTW where’s Elicker’s $20,000? Has he returned it yet? NewHaven73, the racial wealth gap is absolutely our responsibility. It’s also a major drag on economic growth in the United States. It’s a much bigger problem than the national debt, which this has no impact on at all.

posted by: THREEFIFTHS on October 8, 2019 8:53am We are very excited about the opportunity to move forward with the plan to bring the Evergreen Concept for a worker-owned facility to the site,” Neal-Sanjurjo told the Independent in a written statement on Thursday. Not so fast. The Untold Story of the Evergreen Cooperatives Evergreen and the Fallacy of the Anchor Institution During the initial planning stage of Evergreen, the Cleveland VA Medical Center proposed the creation of a laundry business and the Cleveland Foundation, with the Democracy Collaborative, enticed University Hospitals (UH), the Cleveland Clinic, and Case Western Reserve University to also agree to contract with said laundry business and to put up money for the Evergreen Cooperative Development Fund. This money was matched, to a degree, by the Cleveland Foundation, which went about capitalizing a laundry business and solar installation and weatherization business, in-line with what was then the relatively new American Recovery and Reinvestment Act. The second business came about because the Cleveland Clinic wanted to “go solar” but couldn’t take advantage of the associated ARRA tax credits – the solar co-op solved this problem. Thus work began on the first two Evergreen Cooperatives. https://geo.coop/story/untold-story-evergreen-cooperatives

posted by: THREEFIFTHS on October 8, 2019 9:04am Again Snake-Oil and Three Card Monte being sold.This Building will sit like this.Just ask the people of West Haven.

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West Haven residents eager for The Haven project to start WEST HAVEN—West Haven community members are speaking out after another setback involving a highly anticipated waterfront mall.Developers have been working on a project that would turn dozens of vacant properties into a waterfront luxury mall. The project has been in the works for almost 5 years.Graffiti, trash and illegal dumping are taking over the future site of the upscale shopping mall, The Haven. Jaedin Falcone told News 8, “It’s looking like a trash town on this side.” Paul Popielarczyk told News 8, “It’s really unfortunate people gotta do that.” https://www.wtnh.com/news/connecticut/new-haven/west-haven-residents-eager-for-the-haven-project-to-start/

posted by: Noteworthy on October 8, 2019 10:16am Better Idea Notes: 1. If this is such a good investment - then our city pension funds should invest their money in this. It’s a sure winner - so they’re returns should be awesome. Run this up the flagpole of our pension advisor and see what they say. lol

posted by: Honest in New Haven on October 8, 2019 10:40am This is New Haven. If this moves forward, someone local who is totally unqualified to lead this project will be named President & CEO (nonprofits don’t use “Executive Director” any longer) and that will be that. Just wait for it.

posted by: John Champion on October 8, 2019 10:53am THREEFIFTHS, Thank you for providing a link to the Evergreen Concept. While I support the idea of worker owner/management, I wonder if the necessary steps have been followed. Is there a business plan? What is the anticipated revenue vs expenses? Having a spread of between 40 and 150 jobs is not a plan. The linked article about Evergreen mentioned that modern laundry equipment is capital intense, who is financing this equipment? 40 jobs are a terrific goal. I am dubious that this is the best way to that goal. John Champion

posted by: Kevin McCarthy on October 8, 2019 11:12am Alex, I’m trying to be charitable. But the administration has not put forward even the outlines of a business plan. FWIW, my expertise, such as it is, lies elsewhere. If the project goes forward and the city wants to make the building more energy efficient, I would be happy to identify potential funding sources.

posted by: missthenighthawks on October 8, 2019 4:02pm The City has no business running a private business, unless we’re tackling socialism head on. Private company owners would have not bought this property without a full blown business plan including, more precise renovation plans, capital costs for the equipment and vehicles needed, HR costs for employees, health insurance, pension/401k costs, management personnel ready to tackle the job, and of course, COMMITTED CUSTOMERS.

Laundries are not a simple business to run. There are huge environmental and health issues involved, especially for medical-based laundries. I’m also sure the existing businesses supporting Yale’s needs aren’t going to just walk away without a fight.

posted by: 1644 on October 9, 2019 2:28pm Alex: Elicker said that he would be in “full campaign mode” so long as Harp remained on the ballot. Harp has not withdrawn, so I would not expect him to return the $20K.

posted by: Bill Saunders on October 9, 2019 11:46pm 1644, Not only has the Mayor not withdrawn, she is actively campaigning.

Facts matter, Alex!!!!!!