Even as construction idles on Norwalk”™s District 95/7 development, planners are negotiating with Connecticut officials to expand the city”™s designated enterprise zone to include the mixed-use project, which would give businesses incentives for moving in when offices are built.
The expansion of the enterprise zone would also encompass a stretch of Woodward Avenue farther south that has multiple industrial buildings.
Also termed the Reed Putnam Urban Renewal Project and located at the junction of Interstate 95 and Route 7, District 95/7 was conceived by Norwalk-based Spinnaker Real Estate Partners L.L.C.
Spinnaker partners Clay Fowler and Kim Morque have said the project is unlikely to move ahead until a corporate “anchor” tenant can be secured, adding that is an unlikely scenario at present due to large blocks of available office space in Fairfield County.
Some 50 office buildings in Norwalk had a vacancy rate of 18 percent in the first quarter, according to Cushman & Wakefield.
Norwalk planners say they meet periodically with Spinnaker, and that the developer continues to actively market the site to office, hotel and retail tenants without specifying the nature of Spinnaker”™s outreach.
The Norwalk Common Council voted to attempt to expand the enterprise zone after commissioning a study late last year by JCI, a real estate consultancy.
Norwalk has offered Connecticut enterprise zone benefits since 1982, which provide tax breaks for businesses locating within urban neighborhoods that otherwise have difficulty attracting commercial tenants, similar to the Empire Zone program that New York is in the process of phasing out. Under the Connecticut program, the first such program in the country, a neighborhood must have a higher unemployment rate or poverty level than surrounding areas.
The Connecticut program allows corporations to take an 80-percent abatement on local property taxes for a five-year period, and either a credit ranging between 25 percent and 100 percent of a business”™ corporate income taxes, depending on its profile.
Any expansion would require approval of the Connecticut Department of Economic and Community Development.
While a portion of the Reed Putnam project is located within Norwalk”™s existing enterprise zone, the large majority of the project is not, which currently is slated for some 600,000 square feet of office space and a hotel.
Susan Sweitzer, a Norwalk Redevelopment Agency official who manages the city”™s enterprise zone program, said it marked the first time the city has asked for an expansion of its enterprise zone, having previously relied on the state”™s Urban Jobs Site program to lure corporations.
“We”™ve had very good luck in taking significant tenants and, when they qualify, processing them through the Urban Jobs Site (program),” Sweitzer said, citing Diageo PLC, FactSet Research Systems Inc. and Hewitt Associates L.L.C. among others.
She could not provide a timeline on when the process might be complete, but said her office is already communicating with the Connecticut Department of Economic and Community Development.
While Spinnaker has touted the District 95/7 offices as among the best that would be available in Fairfield County, planners are also noting that the similarly impressive Harbor Point development already under construction in Stamford”™s South End will be able to offer enterprise zone benefits to tenants. That project is led by Norwalk-based Building & Land Technology L.L.C. with financial backing from Philadelphia-based Lubert Adler.
Spinnaker itself bet on the Stamford market last month, leading the acquisition of the empty, former Clairol plant there with stated plans to lease it to multiple tenants. And in May the company secured the final piece of financing needed to begin a hotel conversion project in St. Louis.
