Developer for downtown Bridgeport theaters short on cash
BRIDGEPORT — Mayor Joe Ganim’s administration has confirmed that Exact Capital, the New York City developer chosen last year to renovate and reopen the Majestic and Poli Palace theaters downtown, the neighboring Savoy Hotel, and to also build brand new residential towers, did not meet Thursday’s deadline for obtaining financing.
“Look, the project is alive,” Thomas Gill, Ganim’s economic development chief, said in an interview Thursday.
But, Gill acknowledged, Exact is having trouble putting together the $56 million needed to move ahead with the first phase — the work on the theaters and the hotel. The residential towers, including an 18-story building, were to come later.
“With historic types of projects there’s extreme difficulty in their financing. There’s so many different types of aspects to the capital stack. ... It’s like a puzzle,” Gill said. “But they (Exact) have been pursuing the capital aggressively. ... They’re confident they can get it.”
Gill said the 2017 City Council-approved deal with Exact will now be extended in 30-day increments.
“It wasn’t, ‘If you don’t make it we’ll see you later,’” Gill said. “We’ll give them 30 days and look at it again.”
Gill said the extensions do not require an additional council vote, but that he will update council members on the project.
Craig Livingston, Exact’s managing partner, could not immediately be reached Thursday for comment, and never returned requests for comment left on his voice mail last week.
Livingston last year had said “we’re always happy to prove the naysayers wrong” when asked if Exact’s plans were just a political prop for Ganim.
But Livingston had also initially said he hoped to break ground on the theaters in “the back half” of this year.
Ganim, originally Bridgeport’s mayor in the 1990s, was re-elected in 2015 and, while campaigning, promised to make the decaying Majestic and Poli buildings at the Main Street gateway to downtown a priority if returned to City Hall.
Then in 2017, in an effort to simultaneously deliver on that pledge and have something to boast about during his unsuccessful bid for governor, Ganim and his staff sought development proposals, chose Exact’s and got it approved by the council.
The mayor at the time touted Exact’s vision as “the most exciting urban development project anywhere in this state.”
Ganim had received some criticism for pushing to quickly to conclude business with Exact. As previously reported, the administration had not intended to bring the final deal to the city’s legislative body for approval. But ultimately City Hall reversed course and that pact with Exact — called a land disposition agreement (LDA) — was debated and voted on by council members.
Under the terms of the LDA, Exact had a year to finalize the financing for each phase of construction — five in all — before taking possession of the city-owned properties.
“Twelve months was an aggressive time frame for this, but that’s what they wanted. So we’re keeping them on a tight leash on it,” Gill said of Exact.
Gill also said there is no intention to shift around the project’s phases in response to Exact’s financing challenges.
“We do want the theaters done first,” Gill said. “They (Exact) also recognize the theaters should be the ‘stepping off’ portion of the project. There’s a lot of housing (development) going on right now.”
One possible avenue of financing for Exact would be state historic tax credits offered to encourage the restoration of significant structures. But a spokesman for the Connecticut Department of Economic and Community Development said Exact has not applied for or been awarded any tax credits.
“They’ve been working on that angle and lining up people that will by their tax credits,” Gill said of Exact. “I know they have not gone directly to the state yet.”
With Ganim running for another four-year term as mayor in 2019, progress at the Majestic and Poli site — or lack thereof — will likely become a talking point should the incumbent face a Democratic primary challenger.
Politics aside, the theaters project was also used in late summer to help woo prospective developers to other nearby parcels along Main and Congress streets.
The Ganim administration on Sept. 20 announced its support for a $12 million proposal from a to-be-formed limited liability corporation, Park City Ice Palace, to build a “premiere hockey and ice skating training facility” downtown with a fitness center, juice bar, coffee and sandwich shops.
Some questions were raised about whether the Ice Palace would compete with Wonderland of Ice, which has managed Bridgeport’s ice skating rinks at 123 Glenwood Ave. and this year entered into a new, 20-year lease with City Hall.
“We’re finalizing the LDA on that,” Gill said Thursday. “We’re hoping to have that (to the council) in January some time.”