Construction to begin by year’s end for Newport workforce housing project 

By PATRICK O’GRADY

Valley News Correspondent

Published: 10-12-2023 10:49 PM

NEWPORT — Almost seven years after the Planning Board first approved a proposal to convert the former Ruger Mill on Sunapee Street into housing, the project is ready to move forward.

Work is expected to begin before the end of the year.

“We are ready to start construction,” Jon Livadas, agent for the developer, told the Planning Board Tuesday night. “We have full bids. We have construction documents.”

The board voted 4-0 to approve the proposal for 70 units in the four-story brick building that was constructed in 1905 as a woolen mill and is on the National Historic Register. The plans presented Tuesday had some minor changes, including a variance approved in April for 1½ parking spaces per unit, down from two, and a new entryway moved from Canal Street to Cross Street.

Livadas said after the meeting the board had given extensions on the previous approvals, but he had conflicting information as to whether they had expired.

“So we came back out of an abundance of caution and to be sure there are no issues,” Livadas said.

He anticipates a 14-month construction period beginning in December.

The project is designated as workforce housing and is eligible for $700,000 in InvestNH funds that will go directly to the town.

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“That money is there, ready to be handed to Newport,” Livadas said. “That can be used for anything. Schools, roads, you name it. It is up to the town. We are excited to bring that as part of the development.”

The Selectboard has not discussed how it might use the money.

Andrew Dorsett, housing finance director for InvestNH, a state program established to address the statewide housing shortage, said the Ruger Mill is one of 30 workforce housing projects that InvestNH is looking to support.

Dorsett said the rental vacancy rate in New Hampshire is 0.5% and the estimated shortage of 23,000 units is expected to grow to 90,000 in the next decade.

“We are trying to have an impact on the housing shortage,” Dorsett told the Planning Board

Estimated to cost $17 million, the project is funded by several sources, including the New Hampshire Housing Authority.

Eligible tenants can earn no more than $60,000, or 60% of the area median income, Chris Schleyer, principal and head of Elm Grove Companies of Manchester, which will manage the property, told the board. The minimum income requirement is $40,000, he added.

The developer, DRSWM Limited Partnership of New Hampshire, has an option to purchase the property from 169 Sunapee Street LLC with an expected close in November, Livadas said in an email. The building is nearly 89,000 square feet on a nine acre parcel. The Sunapee Street entity bought the property in 2016 and received Planning Board approval for 66 units. When it was unable to obtain sufficient financing for redevelopment, it sought other investors.

Livadas also addressed what he believes have been misconceptions about the prospective tenant mix.

“People who will be living here live in Newport,” he said, refuting rumors that there will be an influx from large cities.

“They work at the post office, in the restaurants and schools here and can move from a place that is not in great condition. It will be a true mix of everyone in the community and is going to be a very high-quality place to live. Our goal is to eliminate the misconception of this development.”

Schleyer told the board his company does credit, criminal and eviction background checks and verifies income of prospective tenants.

He said most tenants will be seniors or adults, and any families likely would be from Newport with children already in the school system.

There will be 19 studios, 31 one-bedroom, 16 two-bedroom and four three-bedroom units.

Dorsett said the town also is eligible to receive $420,000, or $10,000 per unit, from InvestNH for a 42-unit workforce housing project now under construction on Spring Street.

Jack Franks, the developer on Spring Street, and Livadas are contesting in court the combined $260,000 in water and sewer connection fees the town is charging for the housing projects.

After the Planning Board meeting, Livadas said he believes that a resolution acceptable to both sides would be forthcoming but declined to say anything further. Franks concurred.

“We have been working with the Board of Selectmen and the town manager to come to an amicable resolution and believe we have a path forward,” Franks said Wednesday.

In December 2022, the Newport Selectboard approved the property for the Community Revitalization Tax Relief Incentive Program, which will freeze the pre-construction assessment of $2.7 million for three years after it is occupied. The program, adopted by Newport in 2018, is designed to encourage reuse of older buildings in an established geographic area so the owners can build equity before being hit by a large tax bill.

Patrick O’Grady can be reached at pogclmt@gmail.com.