As first set of wind turbine parts leave New London, new wind project gets key approval
John Penney
New London – Eversource officials had two reasons to celebrate Tuesday as they announced the departure of the first load of wind-power components from State Pier and the brokering of a financial decision that will allow the staging site to be used as a pre-assembly area for another large-scale wind farm project.
Eversource President and Chief Executive Officer Joe Nolan said Ørsted, the Danish wind company his firm is partnering with on the South Fork Wind project, said a final investment decision was reached earlier in the day to move ahead with another joint venture, the 704-megawatt Revolution Wind project, which is expected to deliver power to sections of Connecticut and Rhode Island.
A financial investment decision is the point in the planning process when the major financial commitment is taken. It is the final decision to determine whether the investment in a project is worth it.
The decision notice came on the same day the first load of offshore wind components were set to be shipped from New London’s deep-water port via barge to the coast of Long Island for assembly as part of the South Fork Wind project.
The 130-megawatt South Fork project promises to deliver energy to 70,000 homes on Long Island with power expected to begin flowing to the grid before the end of the year.
Nolan described the Revolution project as “six times bigger” than its South Fork counterpart with assembly work slated to begin in New London by next year.
Ulysses Hammond, interim director of the Connecticut Port Authority, which oversees State Pier, said the Revolution job will employ between 70 to 120 workers – about 70 currently work the South Fork job – and involve the assembly of 65 turbines that will be shipped to two offshore wind stations in federal waters 15 nautical miles southeast of Point Judith, R.I.
The Revolution project is expected to generate 400 megawatts of power to Rhode Island and 304 megawatts to Connecticut.
Dock workers spent the weekend loading an unnamed barge with wind turbine tower sections, blades and a generating nacelle, the first of 12 such sets of cargo that will travel during the next several weeks to waters about 35 miles east of Montauk Point as part of the South Fork Wind project.
“This is a great day for our nation and the birthing of a new industry,” Hammond said. “This is the first large-scale wind turbine farm in federal waters in all of the Americas.”
Jeff Martin, Eversource’s director of offshore wind business development, said the barge will rendezvous sometime early Wednesday morning with the Aeolus, a Netherlands-flagged “jack-up” ship whose deck can be hoisted above the waves to take on the wind components. Crews will spend roughly 60 hours installing the pieces on a waiting platform.
After a 40-hour unloading process, the barge will return to New London and pick up another set of turbine pieces. On Tuesday, dock workers were placing 320-foot blades and tower stems that will reach 800 feet once assembled near the water in anticipation of their departure.
Nolan said weather will play a big role in determining when all 12 turbine sets are delivered.
“Today it’s fair winds and following seas,” he said referring to the clear fall weather. “It’s an historic day with the first sailing of this barge.”
Nolan said it had taken several millions of dollars, but State Pier is now the “envy of everyone in the wind industry.”
Mayor Michael Passero praised the “perseverant vision” of Gov. Ned Lamont and other project boosters.
“This is an amazing technological achievement,” Passero said.
State Rep. Anthony Nolan, D-New London, acknowledged the “turmoil and disagreement” that preceded the launch by “naysayers,” seeming to refer to the cost overages associated with the $309 million refurbishment of State Pier.
“The evidence is how great this is,” he said. “There were naysayers in the beginning and a little more in expenses, yes. But we did what we were asked to do.”
Orsted scraps 2 offshore wind power projects in New Jersey, citing supply chain issues
WAYNE PARRY
ATLANTIC CITY, N.J. (AP) — Danish energy developer Orsted said Tuesday night it is scrapping two large offshore wind power projects off the coast of New Jersey, adding uncertainty to a nascent industry the Biden administration and many state governments are counting on to help transition away from the burning of planet-warming fossil fuels.
The company said it is canceling its Ocean Wind I and II projects in southern New Jersey, citing supply chain issues and rising interest rates.
Orsted CEO Mads Nipper said in a statement the company was disappointed to be halting the projects because it believes the United States needs wind power to reduce carbon emissions.
“However, the significant adverse developments from supply chain challenges, leading to delays in the project schedule, and rising interest rates have led us to this decision,” Nipper said.
Orsted stands to lose a $100 million guarantee it posted with New Jersey earlier this month that it would build Ocean Wind I by the end of 2025. That money could be returned to ratepayers.
The company said it would move forward with its Revolution Wind project in Connecticut and Rhode Island.
Orsted, the world's largest wind energy developer, warned in August that it might walk away from one or both of its New Jersey projects, which it said needed more financial subsidies beyond a tax break approved by the state that would have let the company keep as much as $1 million in tax credits that otherwise would have had to be returned to electricity ratepayers.
At the time, New Jersey Gov. Phil Murphy, who is pushing to make his state the East Coast hub of offshore wind, said the break was necessary to save the jobs and economic activity Orsted would have brought to the state.
Murphy, who took significant political heat for the tax break, reacted angrily to Orsted's decision to walk away from New Jersey.
“Today’s decision by Orsted to abandon its commitments to New Jersey is outrageous and calls into question the company’s credibility and competence," the Democratic governor said. “As recently as several weeks ago, the company made public statements regarding the viability and progress of the Ocean Wind I project.”
He noted that Orsted was required to put up an additional $200 million to benefit the state's offshore wind industry, and said he would make sure the company abides by that obligation.
Murphy said Orsted was facing the same supply chain, inflation and other challenges that competitors in the offshore wind industry face. But he insisted the industry will succeed in New Jersey, noting that the state will solicit yet another round of project proposals soon.
The decision was the latest in a series of setbacks for the offshore wind industry in the northeast. Two weeks ago, New York regulators rejected a request from companies for larger subsidies to complete large-scale wind, solar and offshore wind projects, saying the companies were expected to to abide by the terms of their deals with the state.
A handful of other offshore wind projects have been canceled. They include the Park City Wind project off the coast of Massachusetts. Avangrid, a subsidiary of Spanish utility company Iberdrola, and several Connecticut utilities scrapped a long-term power purchase agreement.
Offshore wind in general, and particularly in New Jersey, has faced growing opposition, both politically — mostly from Republicans — and from residents concerned about impacts on the environment, increased costs and the impairment of views of the ocean horizon.
Jeff Tittel, a longtime environmentalist and former New Jersey chapter president of the Sierra Club, called Orsted's decision “a devastating setback for offshore wind in New Jersey.”
“These projects have been mishandled from the beginning by Orsted,” he said. “They didn’t listen to the public and did not understand our needs or politics. They thought they would get a blank check."
Still projects in some places are moving forward.
In Virginia, a utility’s plans for an enormous wind farm off that state’s coast gained key federal approval Tuesday. Dominion Energy received a favorable “record of decision” from federal regulators who reviewed the potential environmental impact of its plan to build 176 turbines in the Atlantic, more than 20 miles (32 kilometers) off Virginia Beach.
Dominion said its project will be the largest offshore wind farm under development in the U.S. and eventually expected to generate enough electricity to power up to 660,000 homes after completion of construction by late 2026.
And New Jersey still has several other offshore wind projects in various stages of development, with four new proposals submitted in August alone. They join the one remaining project of the three originally approved by the state, Atlantic Shores. That is a project by Shell New Energies US and EDF Renewables North America.
The White House in statement Tuesday night noted that in just the past week several investments in offshore wind had been made.
“While macroeconomic headwinds are creating challenges for some projects, momentum remains on the side of an expanding U.S. offshore wind industry — creating good-paying union jobs in manufacturing, shipbuilding, and construction; strengthening the power grid; and providing new clean energy resources for American families and businesses,” Michael Kikukawa, White House assistant press secretary, said in the statement.
Why the US offshore wind industry is in the doldrums
Scott Disavino and Nerijus Adomaitis
Oct 31 (Reuter - Energy giants BP(BP.L) and Norway's Equinor(EQNR.OL) have booked hundreds of millions of dollars worth of impairments on their U.S. offshore wind power portfolios in recent days, the latest examples of a renewable energy industry in turmoil.
Danish energy company Orsted (ORSTED.CO), the world's largest offshore wind farm developer and a big player in the U.S., said in late August it may see $2.3 billion in U.S. impairments due to supply delays, high interest rates and a lack of new tax credits. It will report third quarter earnings on Wednesday.
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The companies are among several energy firms trying to build new offshore wind farms in the U.S., but feeling pain, raising questions about the future of fleet of projects that U.S. President Joe Biden hopes can help fight climate change.
Biden’s administration wants the U.S. to deploy 30,000 megawatts (MW) of offshore wind by 2030 from a mere 41 MW now, a key part of his plan to decarbonize the power sector and revitalize domestic manufacturing, and has passed lucrative subsidies aimed at helping companies do that.
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But even with regulatory rules and subsidies in place, developers are facing a whole new set of headwinds.
Here is what they are:
INFLATION
The U.S. offshore wind industry has developed much more slowly than in Europe because it took years for the states and federal government to provide subsidies and draw up rules and regulations, slowing leasing and permitting.
However, as government policies started to line up in the industry's favor in recent years, offshore wind developers unveiled a host of new project proposals, mostly off the U.S. East Coast.
Two small projects came into operation - Orsted's five-turbine Block Island wind farm off Rhode Island and the first two test turbines of U.S. energy firm Dominion Energy's (D.N) Coastal Virginia Offshore Wind off Virginia.
Then came a hitch.
The COVID-19 pandemic gummed up supply chains and increased the cost of equipment and labor, making new projects far more expensive than initially projected.
"It appears the offshore wind industry bid aggressively for early projects to gain a foothold in a promising new industry, anticipating steep (cost) declines similar to those for onshore wind, solar and batteries over the past decade," Eli Rubin, senior energy analyst at energy consulting firm EBW Analytics Group, told Reuters.
"Instead, steep cost gains threw project financing and development into disarray," Rubin said, noting many contracts will likely be renegotiated as states look to decarbonize, with higher prices ultimately falling onto power customers.
INTEREST RATES
Financing costs also spiraled as the U.S. Federal Reserve boosted interest rates to tame inflation.
Many contracts for offshore wind projects have no mechanism for adjustment in the case of higher interest rates or costs.
Some developers have paid to get out of their contracts rather than build them and face years of losses or low returns.
In Massachusetts, two offshore wind developers, SouthCoast Wind and Commonwealth Wind, for example, agreed to pay to terminate deals that would have delivered around 2,400 MW of energy, enough to power over one million homes.
In New York, offshore wind developers Equinor and BP also sought to boost the price of power produced at their planned projects there, but were rejected.
Orsted, meanwhile, told utility regulators in June that it would not be able to make a planned final investment decision to build its proposed 924-MW Sunrise Wind project unless its power purchase agreement was amended to factor in inflation.
INSUFFICIENT SUBSIDIES
Biden’s administration has sought to supercharge clean energy development with passage of the Inflation Reduction Act (IRA), a sweeping law that provides billions of dollars of incentives to projects that fight climate change.
Since the law passed last year, companies have announced billions of dollars in new manufacturing for solar and electric vehicle (EV) batteries across the U.S.
But the offshore wind industry is not fully satisfied.
Bonus incentives for using domestic materials and for siting projects in disadvantaged communities are too hard to secure, developers say, and they are crucial to making projects work in a high-cost environment.
The credits are each worth 10% of a project's cost and can be claimed as bonuses on top of the IRA's base 30% credit for renewable energy projects - bringing a project's total subsidy to as much as 50%.
Equinor, France's Engie (ENGIE.PA), Portugal's EDP Renewables (EDPR.LS), and trade groups representing other developers pursuing offshore wind projects in the U.S. told Reuters they are pressing officials to rewrite the requirements, and warning of lost jobs and investments otherwise.
Quebec-New England transmission line gets Biden backing
Bruce Mohl
THE BIDEN ADMINISTATION on Monday pledged financial support for a two-way transmission line capable of carrying hydroelectricity from Quebec into New England and eventually offshore wind and solar power from New England to Quebec.
The transmission line, being developed by National Grid and Citizens Energy, was one of three transmission projects receiving a total of $1.3 billion under a new federal program funded by the Bipartisan Infrastructure Law. The other two projects would develop transmission interconnections between Nevada and Utah and link renewable energy produced in New Mexico with markets in Arizona that rely on fossil fuels.
The goal of the program is to expand the nation’s transmission capacity and also break down barriers between regions, allowing electricity to flow from one state or groups of states surpluses to areas dealing with periodic shortages.
The federal funding represents an upfront commitment to purchase power from the projects, but the expectation is that the money may never be needed. Joseph P. Kennedy III, the managing director of Citizens Energy, likened the situation to an investor pledging to rent out two floors of a proposed 10-story building, a commitment that makes it easier for the developer to raise funding for the overall project.
If the capacity of the transmission line (the 10-story building in Kennedy’s analogy) is fully purchased, the federal government wouldn’t have to put up any money. But if the capacity is not fully purchased, the federal government would be on the hook for its share of the capacity and could resell the power to recoup its investment. Kennedy said the expectation is that the New England states and the provincial utility Hydro-Quebec will be interested in purchasing the electricity provided by the transmission line, which goes by the name Twin States Clean Energy Link.
The roughly $2 billion transmission line, which would run from the Quebec border south into Vermont before crossing over into New Hampshire and ending up in Londonderry, is designed in such a way to avoid the controversy that has plagued other transmission lines from Canada. For example, New England Clean Energy Connect, a transmission line running from Quebec into Maine, was derailed by a Maine law passed by voters that was ultimately overturned by the state’s supreme court. The project is now back under construction.
The Twin States Clean Energy Link would enter New England at the border town of Canaan in Vermont. From there the line would travel 75 miles underground in Vermont along roadways bordering the Connecticut River. It would then go under the river and into New Hampshire near Dalton, traveling 26 miles underground to Monroe, where it would then come above ground on an existing transmission right-of-way to Londonderry.
Hydro-Quebec has enormous hydroelectric resources, but there has been a lot of discussion within the province this year about its ability to decarbonize its own economy using electricity while continuing its lucrative electricity export business.
A spokeswoman for Hydro-Quebec did not return a phone call on Monday.
Riehaneh Irani-Famili, vice president of clean energy development and infrastructure at National Grid, said Hydro-Quebec has adequate power to supply another 1,200 megawatts to the proposed Twin States transmission line. “We have been in dialogue with them. Teams are meeting regularly. We are very confident they would have capacity for this line,” she said.
Citizens Energy is putting up 10 percent of the capital for the Twin States projects and using its share of the profits it expects to pump $100 million over the next 30 years back into the communities along the path of the transmission line. Combined with National Grid contributions, the total amount available for local investments would be $260 million.
Kennedy said he hopes the money can be leveraged with other funds to help the communities, perhaps by aiding them in the transition away from fossil fuels.
“We really think that this can become a model for how transmission infrastructure can be built,” Kennedy said.
State grant, new train station spur $42M Windsor Locks mixed-use apartment development
Hanna Snyder Gambini
Windsor Locks has been awarded a $4.8 million state grant, helping secure a developer’s commitment to build a $42 million mixed-use apartment project near the town’s new planned train station.
Half of the grant — provided by the state through its Community Investment Fund program — will go toward converting the town’s existing vacant and historic 2,300-square-foot train station into a visitor’s center, which will feature bathrooms, Connecticut-made products and grab-and-go food and beverages.
The welcome center will be located a stone’s throw away from the town’s new $65 million train station, which broke ground last year and is expected to be completed in 2025. The new station will be served by the CTrail Hartford Line, which connects New Haven to Springfield, and four Amtrak lines.
The other $2.4 million in state funding will go toward acquiring the Windsor Locks Commons property at 255 Main St., adjacent to where the new train station is being built. The property is currently home to an underutilized retail complex.
Boston-based real estate development firm Trinity Financial plans to build a mixed-use development at the site, which will include 75 affordable and market-rate apartments over ground-floor commercial space. The transit-oriented project is designed to engage with Main Street and connect to the new train station.
The Community Investment Fund is an economic development program created by the Lamont administration to invest up to $875 million in distressed communities over a five-year period.
So far, there have been three rounds of CIF grant funding. The latest round, approved in September, allocated $76.4 million to 20 projects.
‘Blank canvas’
Trinity Financial has been negotiating to purchase the Windsor Locks Commons property for the last eight months, according to Dan Drazen, the firm’s vice president of development.
“Between the relocation of the new train station, the proposed redevelopment of the historic train station, this site and the improvements to Main Street, I started to see a really compelling narrative starting to be woven together in terms of all these different threads,” Drazen said.
“Trinity does a lot of transit-oriented development projects, and this site could not be closer to transit. I think that was really what piqued our interest.”
Windsor Locks First Selectman Paul Harrington said he approached Trinity to collaborate on the proposed redevelopment. Acquiring the state funds to purchase the land clinched the partnership and project, he said.
“We had this blighted property that’s been an albatross,” Harrington said of the Windsor Locks Commons plaza, “and no one wanted to spend that kind of money to buy the land.”
Harrington said stalled negotiations over the purchase of the property initially killed the redevelopment plan, but the new state funding “resurrected” the deal.
Once Trinity acquires the property, it will demolish the existing plaza, which is owned by Locks LLC and John Lombard. The 29,400-square-foot retail center was built in 1987.
More detailed designs of the new apartment complex, including layout of the residential units, will be completed once a development team has been pulled together and the plan goes through the town’s land-use approval process.
Drazen said he anticipates 85% of the apartments will be affordable, and 15% market rate. The property will also include two or three ground-floor commercial tenant spaces.
“It’s really a blank canvas,” Drazen said. “There are a lot of different directions we could go, and I think we need to work closely with the town to understand what they’re looking for and what the market will support.”
Harrington said he expects Trinity to close on the property by the end of this year, with a groundbreaking in 2024, and project completion in 2025.
Project financing will likely come from a mix of public and private sources, including the Connecticut Housing Finance Authority and state Department of Housing, Drazen said.
Trinity Financial isn’t new to Connecticut. The company has projects in Stamford, New Haven, Norwalk and Meriden. This will be the development firm’s first project in Hartford County, Drazen said.
Harrington said the new train station and nearby Montgomery Mill Apartments — a 160-unit mixed-income development on Canal Bank Road that debuted in 2020 — have spurred significant interest in the town, as evidenced by the Windsor Locks Commons plan.
Harrington said he’s held meetings in recent weeks with three different development teams looking at potential projects on the other side of Main Street.
“There’s a lot of interest in our town right now, even up on the Route 75 corridor,” he said, adding that there’s more room for public-private partnerships, as well as grants, incentives, and other funding options for future development.
“It’s all on the table, we’re using as many tools as we can to entice developers,” Harrington said.
Meriden to receive $11.6M in FEMA money for flood control, funding 75% of total project
Mary Ellen Godin
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MERIDEN — The city received two grants totaling more than $11.6 million from the Federal Emergency Management Agency aimed at addressing flood control in the downtown area, Congressional lawmakers said Tuesday.
"I am pleased the city of Meriden will receive over $11 million in FEMA funding for the Harbor Brook Flood Resilience project,” U.S. Rep. Jahana Hayes said in a statement. “The grant will cover 75% of the cost of the project and fund ongoing efforts to reduce flooding along Harbor Brook.”
An additional $480,000 was also awarded to support staff assigned to the project, announced Hayes, D-5th. "Meriden is no stranger to flooding and residents know the devastating impacts flooding has on communities. She credited the Biden administration for the funding.
Hayes was joined by Democratic U.S. Sens. Christopher Murphy and Richard Blumenthal in making Tuesday’s announcement.
“As chairman of the Appropriations Subcommittee that funds FEMA, I’ll continue pushing to support programs that help towns in Connecticut become more resilient,” Murphy said in a joint statement announcing the funding. "This project to mitigate flooding along Harbor Brook has been in the works for a very long time, and I’m glad this $11.6 million in federal funding will help get it across the finish line. It’s going to make a major difference for the homes and local businesses that are constantly at risk of flood damage in downtown Meriden.”
The funding from FEMA will support $11,165,250 million of the city’s $14.7 million total project cost. The project includes channel realignment and profile adjustment, removing two undersized bridges that constrict water flow, floodproofing buildings along the brook, creating riparian floodplain and wildlife habitat, modifying impacted utilities, and installing a waterfront trail system. An additional $480,000 grant from FEMA will fund costs for the administration and management of this project.
Improvements will be made along an 1,800 foot stretch of Harbor Brook spanning from Cooper Street in downtown Meriden to the Amtrak railroad near Colony Street. The former ION Bank building on Hanover Street was razed to make way for the channel widening and deepening. Another building at 116 Cook Ave., an area prone for flooding, has been slated for demolition and reconstruction to make way for a new senior center.
The linear trail will travel along Hanover Street with views of the uncovered brook.
City officials have said the intention of the ongoing Harbor Brook remediation project is to keep incidents of flooding concentrated around those areas closer to the Meriden Green as they continue to widen the brook and reduce flooding in the downtown area.
Flooding during significant rainfall events historically has been an issue in Meriden. But officials say ongoing efforts during the yearslong Harbor Brook flood control project, which is ongoing, have reduced the severity of those such storms.
The Meriden Green is a cornerstone of those efforts, as it is capable of storing some 58 acre feet of water during a 100-year storm event, officials said.
One acre-foot equals 326,000 gallons.
City Engineer Brian Ennis described the Meriden Green as a bowl flood storage facility that is slightly elevated along its perimeter.
The Green allows for smaller brooks that feed into Harbor Brook to have places to drain more freely, instead of topping over onto roadways, Ennis explained.
A current phase underway involves replacing the Cedar Street Bridge span. The former 35-foot long bridge has already been removed and will be replaced with a new span that is more than 50 feet long, and six inches higher in elevation. The city received a $4.7 million grant from the South Central Regional Council of Governments, toward the project.
Officials expect that phase of the project will be completed by December of this year, at an estimated cost of $4.1 million. That project is not included in the FEMA funds and the city has applied to the state Department of Economic and Community Development to fund part of that project.
The efforts to expand and deepen Harbor Brook represent one component in a multifaceted, decades-long initiative to confront over a century of repeated flooding in downtown Meriden. Ennis told the Record-Journal earlier this year that floods began as a byproduct of the second Industrial Revolution in the mid-19th century after factories were built directly on top of natural floodplains along waterways snaking across Meriden, effectively removing a buffer between river waters and the city.
"There's a lot of rivers and streams that go through town, and because of the industrial nature of Meriden, a lot of overdevelopment on the brook was done," Ennis said. "So, what used to be floodplain at the Brook was filled and developed and buildings were put on it and when there's no place for all the water to go."
Flood Control Implementation Agency member Michael Rohde recently outlined development progress in and around Hanover Street, suggesting the city is rapidly approaching an end to channeling in the area. "We're coming down to the final phases," Rohde said. "We're about 70% plus done with the whole project."
Joseph Feest, the ciity’s director of economic and community development called the FEMA funding “great news for the city.”
“We continue to apply for more grants to correct the historical problems of flooding in the city,” Feest stated in an email. “Our Public Works Department has been working diligently with types of grants and I am happy to work alongside them to get these projects completed.”
CTDOT to replace second bridge on I-95 south in Westport: Here's when to expect delays
WESTPORT — Drivers should once again avoid Interstate 95 in the Norwalk and Westport area this weekend due to the second phase of the Saugatuck bridge replacement project.
After a successful northbound bridge replacement nearly two weeks ago, Connecticut’s Department of Transportation will replace the southbound bridge, also by using a lateral slide method, this weekend.
Southbound traffic on I-95 will be diverted to the northbound side from 8 p.m. Friday, Nov. 3, to 6 a.m. Monday, Nov. 6. During that time, the crew will work around the clock to demolish the existing bridge and then slide in the newly constructed bridge.
CTDOT learned some lessons about improving communication with drivers from the first lateral slide project from Oct. 20 to Oct. 22, CTDOT spokesperson Josh Morgan said.
During the northbound project, traffic was fine that Saturday and Sunday morning, but traffic built up when CTDOT began opening the new bridge ahead of schedule, Morgan said.
“It was Sunday afternoon when we began the reopening process,” he said. “That basically means that the highway goes to one lane in each direction.”
For the project this weekend, CTDOT is encouraging drivers to find alternate routes and to avoid I-95 all weekend, but especially on Sunday afternoon, Morgan said.
“So we’re really messaging for folks to seek alternate routes, especially on that Sunday afternoon, like post-lunchtime,” he said.
“I know it’s unavoidable for some, but if you are able to detour over to the Merritt Parkway or use public transportation, it’s certainly advisable, especially during the reopening,” Morgan said.
Using the accelerated lateral slide bridge construction method, CTDOT crews have built the new southbound bridge on stilts next to the existing bridge. On Friday night, the old bridge will be demolished, then the new bridge will be slowly rolled into place on I-95.
The northbound lateral slide was completed faster than expected, allowing crews to reopen I-95 about 14 hours earlier than planned, Morgan said.
“Knock on wood, we’ll have similar success with things going well and running ahead of schedule through the weekend,” he said.
The second bridge replacement will conclude the largest element of the $104 million Norwalk-Westport I-95 improvement project. Crews will continue to work from exit 16 to 17 and the Saugatuck River Bridge to improve drainage and safety. The project is expected to wrap up by November 2024.
Morgan encouraged drivers to follow along online at the project's website at www.i95norwalkwestport.com and check the live updates from ctroads.org.
Settlement of nearly $10 million in lawsuit over this CT ballpark wins backing of city council
HARTFORD — The Hartford City Council Monday swiftly approved
paying nearly $10 million to end a 7-year court battle over the development
of Dunkin’
Park and the land around it, clearing the way for further apartment
construction, possibly beginning later this year.
The backing of the city council came just days after
Hartford Mayor Luke Bronin announced that the city had reached a
$9.9 million settlement in which all sides in the court dispute agreed
there would be no further litigation involving the city.
Council members unanimously supported the settlement, with
little comment because most of Monday’s meeting was held in executive session
behind closed doors.
But when the council came out of executive session to cast
their votes publicly, Councilman Joshua Michtom, of the Working Families Party,
said he was frustrated by the short turnaround in sending the settlement to the
council, given the complex nature of the agreement.
“This is not the ordinary settlement,” Michtom said.
“Usually our settlements involve personal injury or workers comp or things that
all of us are a little more familiar with, whereas this has a lot — an
insurance company and the folks involved in the suit — it’s complicated and I
say that as a lawyer.”
However, Michtom said he supported the agreement because of
the uncertainty and cost of further litigation could be significant and could
delay further development around the 6,100-seat stadium and sorely-needed tax
revenue needed by the city it could generate.
It “seems worth closing out this terrible chapter and this
period of the stadium,” Michtom said. “Even though it’s a lot of money, the
city is laying out, I feel convinced that it is money well spent compared with
the uncertainty of many years of litigation.”
The $9.9 million settlement calls for the city to pay that
amount to Arch Insurance Co., the insurance company that financed the
completion of the city’s minor league ballpark just north of downtown. Arch
stepped in after the former developers — Centerplan and DoNo Hartford LLC
— were fired by Bronin from the unfinished ballpark project in 2016, and
a year later, the mixed-use development around the ballpark.
Negotiating directly with Arch was critical to reaching a
settlement, Bronin said. The settlement relieves Centerplan chief executive
Robert Landino of paying a court-ordered $34 million to Arch for finishing the
ballpark, making the settlement acceptable to the developers. Arch also would
pay Centerplan and DoNo Hartford $1.8 million under the settlement.
Centerplan and DoNo Hartford filed a wrongful termination
civil lawsuit shortly after being fired and initially sought $90 million in
damages. The lawsuit touched off a court battle that stretches back
to the earliest days of Bronin’s two-term tenure.
“This settlement ends the litigation with Centerplan for a
fraction of the $34 million that Arch Insurance paid to finish the job in 2016,
and it’s without a doubt the right thing to do for the city of Hartford,”
Bronin said, in a statement late Monday.
Bronin said Dunkin’ Park is nationally recognized, and the
first phase of the North Crossing development around the park. Now, future
phases can be built, with developer RMS Cos. of Stamford aiming to break ground
on the next phase by the end of this year.
“I’m glad the next administration will be able to focus on
keeping that development momentum going, without the distraction or burden of
endless litigation,” Bronin said.
Bronin has estimated that years of further appeals could
cost as much as an additional $6 million in legal fees. Since 2016, legal fees
paid to outside firms with expertise in construction law have reached about $6
million. With those fees, the costs of defending and settling the lawsuit are
closer to $16 million.
Soaring interest rates and economic jitters have slowed the
Greater Hartford industrial market this year, but demand remains healthy,
providing opportunities for well-financed investors and developers, experts
say.
Massachusetts-based Winstanley Enterprises is a good
example.
The real estate investment and development firm has been one
of the most active industrial developers north of Hartford since 2015, when it
paid $12 million for Hallmark’s 1-million-square-foot distribution center and
324 associated acres in Enfield.
The firm has made several big plays over the past three
months.
In August, Winstanley paid $122.3 million for a
1-million-square-foot Windsor warehouse, at 200 Old Iron Ore Road, that hosts
an Amazon fulfillment center under a long-term lease. In October, it paid $4.6
million for a 133.6-acre Enfield site, at 1679 King St., already approved for
more than 600,000 square feet of logistics development.
Days later, Winstanley announced it had settled a legal
challenge brought by Enfield residents, which will allow it to build an
819,000-square-foot warehouse at the former Hallmark campus, on Bacon Road.
Winstanley will partner with Kansas City-based NorthPoint
Development on a roughly $135 million construction project at the Hallmark
site, expected to launch early next year.
That development is moving ahead without an identified user,
a big show of faith in the market.
Adam Winstanley, a principal in his family’s firm, said high
interest rates, wary lenders and stiffening resistance to warehouse development
in some communities have made it more difficult to build.
But demand remains strong and inventory tight for logistics
space north of Hartford. That means developers who manage to open quality
industrial properties are very likely to find willing renters, Winstanley said.
“I believe the north-of-Hartford market between Springfield
and Hartford is the preferred zone for distribution in New England,” Winstanley
said. “It has consistently attracted large tenants.”
The area has great highway access to New York and New
England. Proximity to Hartford and Springfield provides access to two great
labor pools, he said.
“So, we are doubling down on our investments,” Winstanley
said. “We are going to continue developing properties and acquiring properties
we think could benefit our portfolio in this region.”
Winstanley said the current economic cycle has eased
construction costs. Prices for industrial land are beginning to follow suit,
opening opportunities for well-financed and experienced builders/investors.
Winstanley said his company typically uses relatively small
amounts of debt, insulating it from the tight lending market. He said his firm
is considering investment opportunities in several other states as well.
“In the last six months, I’ve seen more opportunities than
I’ve seen in the last two years,” Winstanley said.
Strong fundamentals
Winstanley isn’t the only big player making moves in the
Greater Hartford region.
A joint venture between Los Angeles-based real estate
investor Tryperion Holdings and real estate management firm Greenmont Group in
September paid $17.75 million for a 450,625-square-foot, 60-year-old warehouse
at 295 Ella Grasso Turnpike in Windsor Locks.
Jeffrey Karsh, managing principal and co-founder of
Tryperion, said the industrial market nationally has not been immune to the
slowing economy. But it has proven more resilient than other real estate
sectors.
“The fundamentals are still strong in industrial,” Karsh
said. “You couple that with what I call a capital-markets recession
(increasingly inaccessible capital), and all of the sudden the relative
attractiveness of industrial is strong to investors and is sort of a bastion of
security.”
Karsh predicts the industrial sector will remain strong
until a true recession hits.
The scarcity of capital from lenders has caused prices to
come down for some properties, creating more “value-add” opportunities, which
is Tryperion’s model, Karsh said.
That’s when an investor/developer buys a property it
considers underperforming — either because it needs renovations or has
significant vacancies— and then improves, and eventually resells it.
Karsh said the Windsor Locks property was underpriced
largely because its main tenant, international contractor Permasteelisa, is
vacating 256,000 square feet at the end of November.
Karsh said the company was paying “a very low rent,” which
means the new owners will be able to fill it at more profitable market-rate
rents.
Launched in 2013, Tryperion has invested more than $1
billion in office, retail, hotel, industrial and multifamily properties in 11
states. Its investors include institutional partners, family offices and
high-net-worth individuals.
Karsh said opportunities for those with access to capital
will increase as interest rates squeeze others out. Tryperion is focused on
taking advantage of anticipated price corrections, Karsh said.
“We’ve known industrial has been strong for years, but when
you match it with the prices they were commanding, the industrial buildings, we
didn’t like those investments,” Karsh said. “But now, you couple today’s
fundamentals with today’s prices, which have been corrected to a certain
degree, and we like that.”
Karsh said he’s confident in Greater Hartford’s industrial
market, which is less than 3% vacant.
Strong numbers
Vacancies in the region have been falling for at least three
years, while lease rates have gradually risen.
Industrial vacancies in Greater Hartford dipped from 7.2% at
the end of the second quarter in 2021, to 5.3% at the end of the second quarter
in 2022, to 3.1% at the same point this year, according to market research by
CBRE.
During the same period, average rents per square foot rose
from $5.30 to $5.66.
Winstanley said he expects demand in the Greater Hartford
industrial market to remain strong, given the scarcity of new spaces.
The region has 3.2 million square feet of industrial space
under construction, according to CBRE. But most of that is already claimed.
Massachusetts-based National Development, for example, has
signed leases with Lowe’s Home Improvement and online retailer Wayfair for
adjacent 1.3 million- and 1.2 million-square-foot buildings it is erecting at
Rentschler Field in East Hartford.
Target has signed a lease for a 530,000-square-foot
warehouse Kansas City-based NorthPoint has nearly completed in Windsor, at 500
Groton Road. Winstanley Enterprises sold NorthPoint the 93.78-acre development
site for $43.5 million in August.
Adam Winstanley said he wouldn’t build the
819,000-square-foot building on Hallmark’s former Enfield campus, at 35 Bacon
Road, if there were other large industrial buildings being built speculatively.
But right now, there are no other permitted sites north of Hartford, he said.
“If there are no sites permitted and no supply coming
online, I feel good we will be able to attract a tenant,” Winstanley said.
That sentiment was echoed by Christopher Metcalfe, a
senior vice president with CBRE, which is marketing the Enfield site for
Winstanley.
“We are quite confident on the demand profile,” Metcalfe
said. “That is the only fully entitled site in Connecticut that can do anything
close to that size.”
Kyle Roberts, also a senior vice president with CBRE, said
higher interest rates are pushing lease rates up, pressuring deals. That has
prompted a slowdown in the number of industrial sites being built.
He said there is appetite for higher rents on existing class
A and B spaces.
“For the first time in a long time rates are pushing higher
across the board with all landlords, which is really reflective of demand,”
Roberts said.
Roberts said northern Connecticut has proven attractive
given its relatively easy access to other points in New England as well as New
York. It is also generally easier to gain local permits for construction, when
compared to land-use processes in Massachusetts.
But it’s getting harder, given increasing resistance to
warehousing in some communities.
Windsor Locks, for example, is considering a moratorium on
zone change requests for logistics projects. It would not impact zones where
warehousing and distribution facilities are already allowed by right.
Metcalfe said tenants, so far, have proven willing to absorb
higher lease costs, as it represents a relatively small fraction of their
overall expenses.
Activity slowing, but still healthy
Art Ross, executive managing director of brokerage firm
Newmark’s Hartford office, said activity in the Greater Hartford market has
been slowing since early 2023, but remains “very healthy.”
“It’s not just Connecticut,” Ross said. “It’s kind of
everywhere. There are still big deals being done, but it’s not quite as
active.”
He expects demand to remain high given the continued embrace
of e-commerce — which requires modern logistics spaces — and Connecticut’s
increasingly strong defense manufacturing sector.
“The groups that have cash and equity and believe in the
market — and there are still plenty of them — are making investments,” Ross
said.
Developing last open land in Norwich business park a challenge
Claire Bessette
Norwich ― The owner of one of the last remaining undeveloped
parcels in the city’s business park hopes to create two development sites but
would need permits to fill steep slopes and wetlands first.
The Inland Wetlands, Watercourses and Conservation
Commission is reviewing a plan by property owner Sammy Piotrkowski to create
two development sites on the Norwich side of a 77-acre property Piotrkowski
purchased last December that spans the border of Norwich and Franklin.
Forty-six acres are off the dead-end Myrtle Drive in the Norwich business park.
Norwich wetlands commission members walked the property last
week and plan to discuss the proposed project at a special meeting at 7 p.m.
Nov. 16 at the planning office, 23 Union St.
At the Oct. 5 wetlands commission meeting, David McKay, a
project engineer for Boundaries LLC, representing Piotrkowski, told the
commission the project would involve clearing 18.6 acres of the Norwich
property and grading it to create a 4-acre site behind St. Jude Commons senior
residential facility and a 1.4-acre site behind the FedEx property.
Piotrkowski, who now lives in Mystic, was a long-time
Franklin resident and owner of Piotrkowski Auctions.
Piotrkowski said Monday he has no commercial users lined up
for the proposed Norwich development sites and has no current plan to develop
the Franklin side of the property, which has frontage on New Park Avenue in
Franklin.
“I first have to determine how much land I have available to
develop and then go to the city and surrounding properties and find out what’s
most conducive to the site and the neighborhood,” he said. “The land is
surrounded by a great deal of residential development, but the zoning is
business park, which has a vast variety of uses you can do with it.”
Piotrkowski faces several obstacles in developing one of the
last available parcels in the Norwich business park. The Norwich land has
slopes ranging from 5% to 20% from east to west, and water drains westward
toward the Franklin portion of the land he owns.
McKay told the wetlands commission the project would entail
clearing 18 acres, filling about 7,000 square feet of wetlands and regrading
the sloped land to create the 4-acre development pad and relocating an
intermittent stream by creating a drainage channel to direct the water around
the proposed development site.
McKay told the commission that two water basins, seeded with
wetlands plants, are proposed for the bottom of a slope at Dominican Drive in
Norwich for stormwater management.
City Planner Dan Daniska said the commission will discuss
the proposed development at the Nov. 16 meeting, but it’s uncertain whether the
commission would be ready to vote on the application that night. The planning
office referred the plan to officials in Franklin because the property spans
the border and it has not yet received comments from that town, Daniska said.
Kevin Brown, president of the Norwich Community Development
Corp., said the Piotrkowski property conditions exemplify the status of any
remaining land in the Stanley Israelite Norwich Business Park. The business
park is more than 90% occupied in both building availability and available
land. Brown said Piotrkowski’s land will take a lot of work to create what he
estimated to be development sites for about 100,000 square feet of commercial
space.
“This is it, and it’s not simple to get to,” Brown said of
any further development in the business park. “Well before Piotrkowski, I told
everyone the remaining land is topographically and wetlands challenged.”
NCDC is developing a second business park on 384 acres of
former farmland, woodland and commercial property in the Occum area. The
project has been criticized by neighbors and others, who have said the city
should concentrate on filling the current business park and vacant buildings
first.