October 3, 2017

CT Construction Digest Tuesday October 3, 2017


Hartford Fires Centerplan From Development Around Dunkin' Donuts Park

Hartford leaders on Monday fired Centerplan Construction Co. and DoNo Hartford, the original developers of Dunkin’ Donuts Park, from other projects in the city’s stalled Downtown North neighborhood.Centerplan and DoNo were chosen in 2014 to erect Hartford’s minor league ballpark and to oversee a sweeping redevelopment effort at the northern tip of downtown. That development was to include retail, housing, a hotel and parking.
In 2016, after missing several key deadlines to complete the baseball stadium, city officials fired Centerplan and DoNo, barring them from completing work on the facility. After some legal wrangling, Whiting Turner was brought in to finish the structure, and in April, the Yard Goats – the Colorado Rockies’ Double A affiliate team – began their first season at the new stadium.
But the 16 acres surrounding the ballpark remained in limbo. Centerplan sued the city last year claiming wrongful termination, and the dispute has dragged on in court.
The former developers are seeking $90 million in damages from Hartford. They have maintained that they were unable to complete the publicly financed project because the city added more than 100 change orders in the months leading up to the final deadline.
Now that Centerplan and DoNo have been fired from the rest of the development, city leaders said they’re looking for developers “with the interest and capital” to invest in Downtown North.
Mayor Luke Bronin has told The Courant that Hartford received several inquiries from interested developers, though he has declined to identify them.
On Monday, the mayor said Centerplan and DoNo “never should have been chosen to build the ballpark.”
“In failing to deliver the ballpark on time, failing to do the work well and failing to pay numerous subcontractors, Centerplan violated the development agreement that covers the surrounding parcels,” he said. “By terminating the Master Development Agreement with Centerplan today, we hope that we can begin to move forward with finding a strong and capable partner for the next phase of development that is so essential to the city of Hartford.”
Bronin did not say when the city would issue a request for proposals for the parcels around the stadium.
Raymond A. Garcia, a lawyer for Centerplan, said of the firing Monday: “We don’t think the city will be able to justify that action.”
Development of the properties near the ballpark is crucial for Hartford, which faces a $65 million deficit and has threatened to file for bankruptcy.
When previous city administrators green-lit the project, they estimated that the bulk of the revenue would come from taxes on parcels surrounding Dunkin’ Donuts Park. The revenue from those properties was supposed to support Hartford’s financing of ballpark, which this year cost the city about $2.9 million.
Projections show the city is on pace to take a $5.5 million loss on the stadium in its first two years.
The second stage of development in Downtown North was scheduled to begin in late 2015. That phase was supposed to include apartments, a grocery store and a Hard Rock Hotel on Main Street opposite the ballpark.
Construction to the east of the stadium, beginning with parking, had a similar timeline. A new brewery was supposed to serve as the anchor in that area, but plans collapsed after Thomas Hooker Brewing Co. couldn’t reach an agreement with the developer.
Hartford officials on Monday also filed a counterclaim in Centerplan’s lawsuit against the city.
In court papers, the city accused Centerplan of fraud and civil theft, charging that the company falsely said it had paid $8 million to subcontractors in order to collect reimbursement from the Hartford Stadium Authority, which owns and operates Dunkin’ Donuts Park.  CLICK TITLE TO CONTINUE

US construction spending rebounded 0.5 percent in August

U.S. construction spending rebounded 0.5 percent in August after two months of contraction, helped by strength in home building, and commercial and government construction.
The climb came after declines of 1.2 percent in July and 0.8 percent in June, the Commerce Department reported Monday. It was the best showing since a 1.6 percent rise in May. Still, the August gain was not enough to recoup the losses of the past two months, leaving spending 1.5 percent below the May level.
Housing construction was up 0.4 percent. Nonresidential activity increased 0.5 percent, reflecting strength in hotel and office building. The August rebound was also helped by a gain in spending by state and local governments, which helped offset a further decline at the federal level.
Economists believe that construction spending will get a boost in coming months as rebuilding efforts get under way from the recent devastating hurricanes. Government analysts said that Hurricane Harvey only affected construction activity in Texas for the last week of August, while Hurricane Irma did not have any impact until September.
The overall economy grew at a 3.1 percent annual rate in the April-June quarter, the best showing in more than two years. Analysts believe activity slowed a bit in the July-September quarter to around 2.5 percent GDP growth. But they expect the impact of reconstruction efforts to start boosting GDP as soon as the current quarter.
The 0.4 percent advance in home building reflected a 0.3 percent increase in single-family construction spending and a 0.9 percent jump in the smaller and more volatile apartment sector.
Overall public construction was up 0.7 percent in August, reflect a 1.1 percent rise in state and local activity which offset a 4.7 percent plunge in spending at the federal level, the third straight drop in federal government construction activity.