11/30/2007
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Staff photo by David Leaming
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Staff photo by Jeff Poulandfrom the Kennebec Journal
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Rhode Island developer Paul Boghossian and his partner, Thomas Niemann of North Carolina, announced the sale Thursday afternoon, saying they have secured $40 million in financing from Bank of America to do the work.
The project represents the first phase of a $65-$70 million plan to renovate not only Hathaway, but also two neighboring buildings in the Lockwood Mill Complex off Water Street.
"I've waited three years for this day," Boghossian said. "Certainly, by this time next year we'll have people working and living in the Hathaway building. There will be offices open before that. I'd like to have the apartments ready by September of next year."
Boghossian was on the road late Thursday afternoon, but spoke via speaker phone with Niemann, who was in the Hathaway leasing office at Post Office Square. They had met earlier in Portland.
"I'm very excited," Boghossian said. "It's been great for the community. It's been fabulous at every juncture."
Niemann, who joined Boghossian in the project 18 months ago, said he was excited not only for the city but for all of central Maine. A $6 million Historic Preservation Tax Credit approved by legislators for the project will provide a tax break of up to that amount over the next six years to support the mill's redevelopment.
Niemann and Boghossian said support from Gov. John E. Baldacci, state and federal legislators, the City Council, Mayor Paul R. LePage, City Manager Michael Roy, the Waterville Main Street Program and others was critical to launching the project.
They also cited Colby College, which offered a $1 million loan to help finance the plan and pitched in $60,000 toward the $350,000 purchase price; and MaineGeneral Health, which plans to move its HealthReach offices and some human resources functions to the third floor of Hathaway -- including 260-280 employees.
"We'd like to thank Bank of America and Colby College for their important roles in financing for this project," Niemann said. "We are also deeply grateful to our federal and state legislative delegations for their leadership and support of the federal New Market Tax Credit Program and the State Historic Tax Credit for this project -- without which the revitalization of this historic property would not be possible."
Niemann noted that the project is important for the entire state, as it paves the way for such development and historic preservation to take place in other old mills. Ultimately, jobs will be created and the whole community benefits, he said.
Building contractors will start construction in the Hathaway building within two or three weeks, and an official celebration to include the governor, legislators and local officials will be held in the middle of January, according to the developers.
They expect 500 people will be living and working in the building when it is completed, and 1,000 will occupy the three buildings.
Besides HealthReach, tenants for the Hathaway building include three radio stations, including The river 93.5, Mix 107.9 and a morning talk sports station on the first floor, as well as financial services company and information technology firms on that floor; a major salon and spa on the second floor; and 66 apartments in the fourth and fifth floors. Restaurants and a brew pub also are likely tenants.
The apartments range from studios to three-bedroom units averaging 800-square-feet in size with an average rental price of $880 a month, Boghossian said. Heat is included in the rental price, as are privileges to an on site health facility for working out and likely a business center for faxing and other activities.
He and Niemann said they already have two letters of intent for every apartment, mostly from young professionals as well as older people whose children have moved out and they want the security and comfort of apartment living.
"We're very comfortable the apartments will be a hit," Boghossian said. Within 18 months, work will start on phase two, to include purchase and renovations of the adjacent Central Maine Power Co. and Marden's Surplus & Salvage buildings. The Marden's building is targeted for a small hotel and more apartments; and the CMP building's use is still a question but the developers hope to make it a destination place with artisans, a marketplace, conference space and museum.
The three buildings represent 450,000-square feet of space. The complex will be landscaped and an area developed for access to the Kennebec River and hiking trails.
LePage said the Hathaway project, coupled with other capital projects in the city including one proposed for Waterville Public Library, will create a very vibrant downtown. He said he is ecstatic Hathaway is headed for development.
"I think it's terrific," he said. "You've heard me say many times I've been cautiously optimistic. Now, I'm elated. I think it's wonderful."
Betsey Greenstein, president of Bank of America Maine, said in a prepared statement that bank officials are proud to be part of the effort.
"As a national leader in community development, Bank of America is able to bring a unique combination of expertise and financial acumen to the task of rebuilding the Hathaway mill," Greenstein said.
Colby President William D. Adams called the project an initiative that holds much promise for Waterville and the entire region.
"And we are pleased that this effort is being led by one of our own -- Paul Boghossian, Colby Class of 1976," Adams said.
Niemann, who also developed the Kennebec Arsenal building in Augusta, said his and Boghossian's experience with state and local officials -- from the governor on down -- has been very positive and the community has been extremely supportive.
"I believe Maine is a good place to do business," Niemann said.
Amy Calder -- 861-9247
acalder@centralmaine.com
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