Superman Building Has Zero Value, Appraisal Shows

The Superman Building in Providence has "no value," according to an appraisal conducted earlier this year by Providence-based appraiser Scotti and Associates.

Moreover, the findings show that the Industrial National Bank Building at 111 Westminster Street would cost between $60 million and $100 million to rehabilitate.

See Appraisal HERE

"It's my opinion for the highest and best use is to shutter the building until which point the market conditions improve to the point that rehabilitation is an option. We estimate that as of December 31, 2012, the building has zero value," wrote Scotti in February 2014, referring to the 2012 date when the building's last tenant, Bank of America, moved out.

Following a year which saw owner High Rock Development fail in its effort to secure $70 to $75 million in local, state, and federal funding to turn the building into apartments, the city is back to the drawing board as to how to deal with the city's empty anchor.

High Rock spokesperson Bill Fischer noted that the appraisal was part of an effort to move the process along to find a viable tenant -- or tenants -- to the city's landmark building

"The Scotti appraisal is part of a tax appeal process that was proactively filed with the city by Highrock Development. We are not surprised by the findings of the report," said Fischer. "The question now becomes what can the value of the building be in the future and how can its revitalization contribute to the economic development climate in Rhode Island."

Candidates Address "Valueless" Building

"He's probably right," said former Mayor of Providence -- and Mayoral candidate -- Vincent "Buddy" Cianci, of Scotti's appraisal of the Superman Building at $0.

"I think we have to encourage private ownership," continued Cianci. "There's been talk about hospitals or biotech to take it over. Look, the city back then knew there was a ten year lease [with Bank of America], they should have planned, or not had a cut off date that they knew was a clock ticking, sand in bottle."

"This reminds me of the Shepard Building years ago," continued Cianci, of the once vacant location downtown under his prior leadership. "I used to end my press conferences by being asked, "Anything new with the Shepard Building?" Look, we were able to get the state, the city -- and URI -- to locate there. Scotti's one of the best appraisers, and I'm sure the owners will be asking for a tax reduction, naturally. People around them are doing to ask for a reduction, and it tears down the value of the whole area."

Cianci, along with the other Mayoral candidates, had recently answered questionnaires from the Providence Foundation about their input on the fate of the building. "I believe that realistic...incentives are a necessary ingredient to secure the future revitalization of the building in combination with an aggressive marketing campaign to secure an anchor tenant," said Cianci.

Republican candidate for Mayor Dr. Daniel Harrop, who has been an outspoken advocate for receivership to turn the city around, offered his opinion on the fate of the building.

"I'm actually afraid we will be stuck with an abandoned building at some point, as it is abandoned by its owners. I do not want the city to own this building. From what I can gather from my contacts (and I know little to nothing about the building trade), it will almost be more expensive to rehab the building than to build a new one after demolition," said Harrop.

"I would prefer this be business space to residential space; it would then help to stimulate the business community downtown," said Harrop. "I remain opposed to city tax credits. I would consider taking a "piece" of the ownership of the building, in lieu of taxes, so that at some future date the city can recover its investment. This would relieve the owners of tax burdens now."

Elorza broached his perspective in his response to the Foundation; he did not return request for further comment on Thursday.

"As with all other development projects, it's up to the market to determine what should occur with the Superman Building," wrote Elorza in a statement for the Providence Foundation.

Options on the Table

Providence City Councilman -- and contender to replace City Council President Michael Solomon - Luis Aponte said he thought that a number of options are on the table, including eminent domain.

"For me, you can't have it both ways," said Aponte. "It can't be a private enterprise, who then says to the city and state, "I need $50 million, and it's the only project I'll do." If it's truly a partnership, there needs to be some concessions, and not just demands.

"I don't think large subsidies for a completely residential usage is something that's feasible," Aponte continued. "The owners need a reality check that someone's not coming to save them with a big check.

When asked if eminent domain could be an option, if the value is in fact negligible, Aponte said anything "could be possible."

"If it becomes apparent that [the building] has no value, for me the importance of that property to Providence is sufficient to say I think that all things are on the table," said Aponte.

With recent attempts by High Rock to obtain public support -- and court public opinion -- have come up short, former Director of Administration and Director of the Hassenfield Center for Public Leadership at Bryant University Gary Sasse outlined what he saw as a path moving forward.

"Before a public subsidy or preferential tax treatment is granted to the owners of the Superman Building the project must be proven to be marketable or it is bound to fail. This has not been done," said Sasse. "The developers of the Superman Building renewal have a great deal of homework to do to convince weary taxpayers that a public investment is this real estate deal would be a prudent investment of public resources."

One academic and business expert said that such a study would be forthcoming in the near future.

URI Distinguished Professor of Business Edward Mazze reused himself from responding to questions about the property assessment on Thursday, due to his work on comprehensive assessment.

"I did a study that was paid for privately, an economic impact study for due diligence, that's proprietary," said Mazze. "It was done several months ago, and I do suspect that study will be made public in short order."

"We remain hopeful with new leadership coming to both city hall and the governor’s office that collectively we can forge a plan that turns 111 Westminster into a job creator and economic development engine for both the city and the state," said High Rock spokesperson Fischer. "We are certainly open to a renewed discussion going forward about the best way to restore the building to a purposeful usage."

Editor's Note: A previous version incorrectly referred to the surveys as the RI Foundation's.

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