Town Forming United Front on Cushing Village’s Future

By 1 Comment

Photo: The proposed Cushing Village.

The meeting held Monday night, Feb. 22 in the Chenery Middle School’s teacher’s lounge took longer than expected. But what is an extra half hour when the subject under discussion is a troubled commercial project more than 900 days behind schedule?

In attendance at the executive session were the Board of Selectmen (which called the meeting), Chair Liz Allison and Barbara Fiacco of the Planning Board, Town Counsel George Hall, Treasurer Floyd Carman and Town Administrator David Kale with only one agenda item on the schedule: Cushing Village, the proposed 164,000 sq.-ft. residential/retail/parking complex at the corner of Common Street and Trapelo Road in the heart of Cushing Square.

While nothing was officially revealed at the closed doors conference, enough was evident from the people assembled, the time spent in conference as well as off-the-record comments from town officials; Belmont is preparing to move on the troubled Cushing Village project, with or without the currently designated developer, Smith Legacy Partner Series. 

This new united front will likely be unveiled tonight, Tuesday, Feb. 23 at 7 p.m. as the Planning Board will receive another “update” on the project from the development team, a requirement the board imposed on Smith Legacy after it failed to meet “three agreed to ‘milestones’ with the town” set the first week in December to begin the initial construction phase of the $63 million project with the purchase of the municipal parking lot adjacent to Trapelo Road. 

To keep its option to buy the municipal lot for $850,000, Smith Legacy has paid more than $600,000 in penalites to Belmont, with the knowledgment that half of that amount would be used towards the purchase of the parcel when financing is secured. 

The project, beset with endless delays and missed deadlines, has been in a development purgatory as the team – comprised of Smith Legacy and its partners Urban Space and the recently added NJ-based Micheals Development Company – has been unable to secure the myriad of financing sources required to construct the three-building complex with includes 115 residential units, 225 parking spaces and approximately 38,000 square feet of first floor retail space.

The apparent breaking point for the town came earlier this month when Starr announced respected industry leader Cornerstone Real Estate Advisers was no longer involved with the project to provide important mezzanine financing to the project. 

Yet, as one observer who is in banking said, the best case senario for Belmont is to push the developer towards giving up control of the parcel to either its lead lender, Wells Fargo, or sell the development rights to an established developer rather than simply declare the developer incapable of completing the project in a reasonable time.

“You don’t want to go through the [Planning Board] process again. You want a smooth transition,” she said. 

Two Years Late: Cushing Village Taking First Step Towards Construction

By 1 Comment

Photo: The municipal parking lot up for sale in Cushing Square is adjacent Starbucks.

Exactly two years to the day after the town’s Planning Board approved a special permit granting him permission to begin construction, the developer of the troubled Cushing Village complex will be before town officials early next week seeking to purchase a critical piece of town-owned property so he can finally begin construction on the long-stalled project. 

The Belmont Board of Selectmen’s Monday, July 27 meeting agenda calls on the board to initially meet in executive session before proceeding to vote whether or not to sell the municipal parking lot at Williston and Trapelo roads to a newly-formed partnership consisting of original developer, Smith Legacy Partners, and its new business associate, Cambridge-based Urban Spaces.

The price tag for the parking lot adjacent Starbucks – set two years ago – is $850,000; along with fees and permits, the final price is closer to $1.3 million. The property will house the first of three buildings making up the 186,000 square-foot retail/housing/parking development in the heart of Cushing Square.

The vote to sell the property marks the two year anniversary when Smith Legacy’s Chris Starr was granted the 25-page special permit from the Planning Board at the culmination of an 18-month design review phase on the project made up of 115 residential units, 38,000 sq.-ft. of retail space and 235 parking spaces. 

At the time, Starr proclaimed an accelerated project schedule. Starr told media outlets construction on the first building – located on the parking lot – would be open for retail businesses and resident housing by the late fall/early winter of 2014. The entire project would be completed by mid-summer 2016, said Starr.

But it soon became apparent Starr was unable to find a financial source willing to back him due to his lack of experience building large-scaled projects. In March 2014, Starr struck a deal with the town to extend the closing on the parking lot by a month for a $20,000 fee. The fee increased to $30,000 a month after a year.

By Sept, 2014, Starr hired a Boston realty firm, Boston Realty Advisors, to unearth a partner or sell his stake in the development. The campaign went international with large ads on a leading Asian real estate website.

In the end, a young development firm, Urban Spaces, joined with Starr. It remains unclear the partnership arrangement between the two, including whether there is a majority stakeholder or arrangements for future management of Cushing Village. 

And it does not appear the partnership has been damaged with the arrest of Urban Spaces’ CEO and founder, Paul Ognibene, who was arraigned last week on one count of sexual conduct for fee after he was arrested by Cambridge Police in a sex sting.

White Knight to the Rescue: Cushing Village Partnering with Cambridge Firm

By 1 Comment

Photo: Cushing Village on the Chinese-language website, Jei Wi. 

After more than 21 months since the town approved its construction, the developer of the multi-use Cushing Village project has apparently found his “White Knight” to help rescue the 167,000 square foot project that has been floundering since 2013. 

In a press release dated April 27, Cushing Village’s developer, Smith Legacy Partners said Cambridge-based Urban Spaces would become its “development partner” in constructing the three-building complex comprising 115 apartments, about 36,000 square feet of retail/commercial space and a garage complex with 230 parking spaces. 

Urban Spaces’ “development expertise will help to ensure that the vision we have for the Cushing Village project becomes a reality,” said Chris Starr, the managing partner of Smith Legacy Partners located in Acton.

Movement on the long-stalled project at the corner of Trapelo Road and Common Street was met with approval from town officials.

“We welcome any news suggesting that the Cushing Village project is progressing,” said Sami Baghdady, chair of the Belmont Board of Selectmen. Baghdady was chair of the Planning Board, which spent nearly 18 months reviewing Starr’s plans for the project before approving the development plans in July 2013. 

Reports have yet to reveal the exact relationship between Starr and Urban Spaces, in terms of an equity stake, or which party has the controlling interest currently or in the future. In Urban Spaces’ past developments, the still young firm – it was founded in 2005 and completed its first major development in 2010 – has a history of continuing to hold onto properties once they are completed. 

“Unlike most developers, who are there to get projects built and move on, we manage all of our own properties,” said Urban Spaces’ Vice President of Operations Jeff Hirsch.

“We’re in it for the long haul,” Hirsch said in an article in the trade journal Construction Now.

The press release announcing the partnership said Urban Spaces “acquires, develops, and manages high-end residential properties in close proximity to urban centers.” 

Town officials are not aware of the partnership arrangement between Starr and Urban Spaces. 

“I am not aware of the nature of Urban Spaces’ participation in the project, but I am sure we will learn more before the developer purchases the Cushing Square parking lot property from the town,” said Baghdady. 

The initial step forward to begin construction of the complex will be the sale of the municipal parking lot adjacent to Trapelo and Williston roads by the town to the partnership for $850,000. That sale will be completed once the new team meets a series of provisions in the development agreement, once of which is identifying the development’s financing. 

The town can expect to receive about $1.5 million in the parking lot sale and fees and permit costs. 

But despite the announcement, nothing has taken place between the partners and the town with no firm date for the beginning of construction, according to Glenn Clancy, the town’s director of Community Development. 

The partnership announcement appears to bring an end to a tumultuous 21 months for Starr – who personally sued each of the Board of Selectmen in 2010 in a dispute over the municipal parking lot – as proclamations to the town of quick start on the project quickly turned into a series of delays and broken promises. 

Stalled by financing

In January 2014, Starr made public statements that construction would begin in the late winter or the early summer with the first stores opening by the spring of 2015. Yet the next time the development team was before town officials was in March 2014 when Starr’s representatives  negotiated with the Board of Selectmen a month-to-month extension to purchase the Trapelo Road  municipal parking lot by paying a $20,000 monthly non-refundable fee.

So far, Smith Legacy has sent nearly a quarter of a million dollars into town coffers. This month, the fee is scheduled to increase to $30,000. 

Discussion within the local business circles indicated that Starr – whose previous development experience has been building a small retail development in his hometown – was finding it difficult finding the necessary development financing to come before the town to purchase the parking lot. 

In addition, Starr had parted ways with his previous development partner, Porter Square’s Oaktree Development before finalizing the building rights with the Planning Board, which many business insiders said only made it more difficult finding a financial backer.

By August 2014, Starr hired Boston Realty Advisors, a commercial deal maker, offering up Cushing Village as a “pre-sale or joint venture development opportunity.”

By the beginning of 2015, the development showed up on the leading real estate website in China, JuWai.com, where it was seeking investors willing to pay up to $8 million to become a financial partner.

While the development stalled, the project lost an opportunity to lease the anchor retail space to a grocery store Starr has longed sought, when Foodie’s Urban Market decided to rent about 30,000 square-feet in the former Macy’s site in Belmont Center. 

It appeared activity was about to occur at the development with the news that the popular laundromat E-Z Duz It at the corner of Horne Road and Common Street was closing on April 30. 

What Urban Spaces brings to the partnership is just about everything needed to start, complete and run the development. The firm, founded by Paul Ognibene (who incidentally is the chair of the Cohasset School Committee), has experience developing Cushing Village-like projects. A recently completed building is a commercial development at 159 First Street in Cambridge’s Kendall Square, totaling 126,000 square feet housing 115 apartments with an underground parking garage and ground floor retail.

Screen Shot 2015-04-29 at 8.51.54 AM

159 First Street, Cambridge, built by Urban Spaces.

Another, currently being planned on the Brighton and Brookline line on Washington Street, would include 130 units on five floors, first-floor retail space with 80 underground parking spaces. In that project, Urban Space acquired a 99-year lease on the property. 

Urban Space is also very active in the property management field and has financed projects it builds such as 7 Cameron Ave. in North Cambridge, and 30 Haven St. in Reading, built in 2012.

Coincidently, Urban Spaces partnered with Oaktree Development in the Reading development. 

“We’re in a big growth stage,” Urban Spaces’ Hirsch said in the Construction Now article.

“We’ve tripled in size in the last year and a half, and our property management business has quadrupled. We have been able to bring in some amazingly talented people with the same core values towards value, quality, and plain old hard work,” he said.

Cushing Village Returns to Planning Board Tonight as the Developer Speaks Out

By Leave a Comment

Sixteen months after receiving the go ahead to begin constructing the 167,000 square-foot, multi-use development in the heart of Belmont’s Cushing Square, the developer of Cushing Village will be back before the Belmont Planning Board tonight at 7 p.m. in Town Hall. 

But don’t expect any major announcements from the first appearance by Smith Legacy Partners before a town governmental board since coming to the Board of Selectmen in March. According to documents at the Office of Community Development, the development team will propose four minor design modifications to the Project Plans, approved by the Planning Board in July 2013.

In an email sent to selected residents late last week, Smith Legacy’s principal partner Chris Starr asked residents to show up to the meeting, saying “[w]e hope that you can attend this Planning Board meeting, which is another critical step in making the vision of new quality rental housing and retail space for Cushing Square a reality.”

As noted in the Community Development documents, the “proposed modifications [does not] alter the size of the development or reduce the number of apartments or parking spaces.”

Cushing Village’s emergence before town officials is the first time since September when the Acton-based developer began actively shopping the three-block site to an array of commercial developers to take on Smith Legacy as a partner, or to purchase the future home of 115 residential units, 230 parking spaces and nearly 36,000 square feet of retail at the corner of Trapelo Road and Common Street.

The last time the development came before the town was in March when Smith Legacy requested a month-to-month extension for the closing date for the $850,000 purchase and sale agreement for the municipal parking lot on Trapelo Road.

As part of the agreement, the developer agreed to pay a $20,000 penalty for each month it delayed the purchase. To date, Smith Legacy has paid $100,000 into town coffers.

Despite the delays and uncertain future of his involvement with the project he spent eight years seeking to build his first large-scale development, Starr continues to make optimist statements on the future of the retail/residential project.

“We realize that it is a project with many moving parts and lots of stakeholders to protect, so we understand how important our project execution is to the town. Our work will need to be carefully integrated with the Trapelo Road Redevelopment project that will be active in Cushing Square at the same time as our project,” said Smith as he also introduced members of the development team in the message.

“Soon we will sending out invitations for you to join us for a cup of coffee and meet the team. We think it is important that we keep the channels of communications flowing. I look forward to sitting down with you to discuss your ideas and concerns for the project,” said Smith.

Cushing Square Developer Seeks Equity Partner, Buyer for Delayed Project

By Leave a Comment

After more than a year of promises and delays, the developer of Cushing Village – the nearly 167,000 square-foot, multi-use development in the heart of Belmont’s Cushing Square – is actively seeking an equity partner or is hoping to sell the project’s development rights to the highest bidder as financial constraints have plaguing the project.

Beginning this month, a big-time Boston commercial real estate search firm hired by Cushing Village’s developer Acton-based Smith Legacy Partners, Inc. has been actively shopping the three-block site to an array of experienced commercial development teams and investors in an attempt to convince one to take on Smith Legacy as a partner, or to purchase the right to build the future home of 115 residential units, 230 parking spaces and nearly 36,000 square feet of retail at the corner of Trapelo Road and Common Street.

In an advertisement distributed to the commercial real estate community, Boston Realty Advisors, the Boylston Street consultancy known for its deal-making prowess, has been or will soon conduct tours of the site – now occupied by abandoned retail and commercial spaces, a laundry and a Starbucks Cafe – as it seeks a “pre-sale or joint venture development opportunity” for the development it describes as “fully permitted and shovel ready.”

Jason Weissman, BRA’s founder and principal, told the “The Real Reporter,” which covers the New England commercial real estate industry, Smith Legacy will seek “creative proposals and will entertain innovative deal structures,” with the opportunity made available “[without] pricing guidance.”

While Chris Starr, the man who has shepherd the project for the past eight years, did not comment, a member of a PR firm working with Smith Legacy was adamant the development will stay with Starr.

“To be clear, Cushing Village is not for sale – Smith Legacy Partners is pursuing partnership opportunities because they realize that others might want to invest in Belmont but there’s no intention to sell the property,” Suzanne Morse, a vice president with O’Neill and Associates wrote in an email.

Yet in its pitch, BRA makes it clear that Cushing Village “represents a rare opportunity to acquire a 163,883 gross square foot mixed-use community, on a pre-sale or joint venture basis, in one of Metro Boston’s most affluent communities.”

Smith Legacy’s apparent need for a partner or buyer would, at first glance, appear unnecessary as the market for mixed-use projects is “ideal” given the advanced recovery is sparking interest in ground-up projects, especially those permitted and ready for launch, one commercial real estate insider told “The Real Reporter.” With interest rates at historic lows, Cushing Village’s residential segment “is especially attractive given the amount of capital chasing that asset class.”

Yet, according to numerous sources within real estate, business and government, the sense Smith Legacy – a first time development team attempting to build a large development – was over-its-head with the development was evident well before the town began the planning process. In the summer of 2011, Starr and his development partner, Cambridge-based Oaktree Development, parted ways, leaving Starr without an experienced hand to reach out to banks, investors and commercial brokers.

“This deal was going south when Oaktree left,” one industry insider told the Belmontonian.

One did not need to scratch the surface very hard to hear reports of Smith Legacy’s difficulties in both securing and then keeping its financing in place. One source indicated Smith Legacy had a tentative financing deal set, but the lender backed out for an unexplained reason.

A lending source told the Belmontonian while many debt providers would listen to the developer’s pitch; none would expand their hand in agreement.

“[Starr] would have placed the biggest sign on the [SS] Pierce Building (the abandoned building where the entry to Cushing Village will be built) announcing the bank doing the deal,” said a person with knowledge of the process. “Do you see one?” they quipped.

Another source said Smith Legacy was caught in a vicious vortex of an inexperienced developer: they lacked the wherewithal to attract financing, and so commercial tenants were leery of committing to long-term leases in a project without financing. Ironically, without tenants, lenders are unwilling to fund a financing deal.

But when Starr received the Planning Board’s final OK to build after a hard-fought design process, all appearance was that Cushing Village would be up and running in record time.

After receiving the Planning Board’s OK in July 2013, Starr announced he would break ground “in a few months” with the first of the three buildings – the “Winslow” which would be located on the municipal parking lot along Trapelo Road and – completed by summer or fall of 2014, with the third building and the parking finished by the spring of 2015.

But other than crews conducting test borings and limited work on preparing the site for development, no activity commenced at the site during the rest of 2014 and into the New Year. Nor would Starr present to town or elected officials a firm financial commitment from an investor or lender.

Suddenly in March, Smith Legacy’s attorney, Mark Donahue, requested the selectmen grant a 30-day extension for the closing date of the purchase and sale agreement for the municipal parking lot until June 27. The pre-approved price for the lot is $850,000.

“We’re working diligently on a number of different fronts,” Donahue told the board, saying Smith Legacy was firming up the Starbucks relocation plans and deciding the site for temporary construction parking. Additionally, Donahue advised the board the construction would “begin between August and October.”

In addition, Donahue sought and was given the right to extend the closing date by 30 days but only by paying the town a $20,000 fee. Since that agreement was in place, Smith Legacy has deposited $80,000 into the town’s coffers.

Starr’s lack of movement on the project had tried the patience of Rojas and the other selectmen who were prepared to set a fall deadline for the municipal lot’s purchase. Only after meetings with town officials was the ultimatum shelved.

This summer, Smith Legacy attempted and failed to convince the Zoning Board of Appeals to allow Starbucks to move from its current location adjacent to the municipal parking lot to a temporary location near the corner of Belmont Street and Trapelo Road.

The future of Smith Legacy holding ownership of the property is not as crystal clear as Starr is telling people. A source told the Belmontonian an established and seasoned development team would not enter into such a deal as a “junior” partner, reducing its involvement to simply being a lender without a say in the development.

This will be at least a 60/40 deal, said a real estate source.

The real value, according to nearly everyone who discussed the project, is in the development rights; the permitting and design agreements with the town.

Smith Legacy’s current predicament – without an finalized financial package, a single new commercial tenant in 14 months (a “tavern” to be managed by a Washington Street resident to open in 2017) and few options – is now being seen as inevitable by many in town.

“This is not a complete surprise,” said Andy Rojas, chair of the Belmont Board of Selectmen who sat on the Planning Board during the majority of the 18 months it took for the town and Starr to cobble together a development deal in July 2013.

“Many involved in the process have for years thought and anticipated that Mr. Starr would need to bring in an experienced equity and development partner,” he said. “I believe that it finally has dawned on Mr. Starr that this is the only way forward for him.”

The need for an experienced hand to build what many would consider a moderate-sized suburban multi-purpose project has become critical in today’s commercial environment said one real estate observer.

“I think a lot of the reasons have to do with lenders being more demanding of higher-equity levels in a project and the developer either finds selling out a better route or if they want to stay in, they can spread the risk some and or use that capital for something else,” said Joseph Clements, founder and editor of the “The Real Reporter”, which covers the New England commercial real estate industry.

Starbucks Staying Put During Cushing Village Build

By Leave a Comment

Like the little house in the Pixar film, “Up,” the Cushing Square Starbucks Coffee cafe will stay put at its current location as the proposed Cushing Village development – the three building, 186,000-sq.-ft. residential housing, retail and garage complex – goes up around the popular cafe, according to a town official.

And when Starbucks does move, it will not require 20,000 balloons but a few hand trucks to transport the shop as it will go into one of the newly-completed building.

According to Glenn Clancy, Belmont’s director of the town’s Office of Community Development, Starbucks will remain in the former Friendly’s restaurant structure at 112 Trapelo Rd. “with relocation coordinated with the construction of the new buildings.”

The announcement comes as developer Acton-based Smith Legacy Partners withdrew its application before the Belmont Zoning Board of Appeals last week to temporary relocated the busy Cushing Square Starbucks to a pair of store fronts at 6-8 Trapelo Rd.

Residents who have been critical of the proposed relocation plans by Cushing Village’s developer Chris Starr to place the national coffee retailer to the corner of Belmont Street and Trapelo Road across from the neighborhoods where they live.

“We are pleased that the proposal was withdrawn and that [Mr.] Starr seems to have found a way to uphold his original statements that Starbucks would not need to relocate during construction,” said a joint statement to the Belmontonian from four neighborhood residents.

Since the proposal was made public at the May meeting of the Zoning Board of Appeals, residents voiced their concerns the store would generate additional parking on nearby side streets while promoting greater trash and litter, creating safety issues and other nuisances.

The development team was scheduled to present the latest proposal incorporating mitigation plans on Sept. 9.

By pulling its application, the developer has “withdrawn without prejudice which means they retain the right to resubmit in the future should they choose to do that,” said Clancy.

The town has yet to receive the development team’s new development scheme or construction timetable.

“[W]e are waiting on final confirmation,” Clancy told the Belmontonian.

The neighborhood group is also waiting to catch the latest word on the development team’s plans.

“Commenting on a possible future proposal would be premature, though the arguments made by the neighbors remain valid, and we will, of course, closely monitor developments over the coming months,” said the group made up of Rita Carpenter, Doug Koplow, Mark Clark and Dr. David Alper.

Developer Drops Plan To Move Starbucks … For Now

By 1 Comment

A controversial proposal before the Belmont Zoning Board of Appeals to relocate the Cushing Square Starbucks for nearly a year to a site near residential neighborhoods near the intersection of Belmont Street and Trapelo Road was suddenly scuttled this week by the applicant, developer Smith Legacy Partners.

But a source within Belmont Town Hall noted Smith Legacy’s action could lead to a new proposal being brought before the ZBA in October.

The developer’s withdrawing the requests scheduled to be heard at the ZBA’s Sept. 9 meeting agenda shuts the door on Smith Legacy’s proposal to decamp Starbucks to a pair of store fronts at 6-8 Trapelo Rd.

The move was deemed necessary as construction is reportedly scheduled to begin in October on Cushing Village, the 186,000 sq.-ft. multi-building residential/retail/parking complex being built by developer Chris Starr, Smith Legacy Partners’ lead partner.

The developer’s trial balloon, first floated in May, was met with considerable consternation from residents who live on nearby streets during a pair of ZBA meetings in May and June. Residents believed the store would have a negative impact on parking while generating greater trash and litter, creating safety issues and other nuisances.

ZBA members also expressed concerns on placing the busy cafe in a semi-residential area where a popular ice cream business would be just a few feet away.

While an initial assessment of Smith Legacy’s action would appear to close the door on the developer’s attempts at relocating the popular store, a Town Hall insider said the move can be seen as a strategic retreat.

If the ZBA denied Smith Legacy’s application at the Sept. 9 meeting, it would have been effectively barred from returning back with a similar proposal for the next 24 months, said the Town Hall source.

By withdrawing the application, Smith Legacy can submit a new plan to the ZBA at the board’s following meeting. Just how significantly different a new proposal will need to be – in terms of location, size and parking – will become clearer with a closer examination of the ZBA’s rules and regulations, said the source.

E-mails and calls have been sent to Smith Legacy and the town. Return to the Belmontonian for updates on Friday morning, Aug. 22.