PROVIDENCE, R.I. (WPRI) – The new owners of the Providence Journal building on Fountain Street are asking the city for a 12-year tax deal as part of their effort to convert the 83-year-old structure into multi-tenant commercial offices.
Arnold “Buff” Chace Jr., managing general partner of Cornish Associates, said Monday he is seeking a tax-stabilization agreement from the city in order to contemporize the property, a costly endeavor in a building whose only tenant for much of the last century has been the state’s largest newspaper.
Chace, who partnered with Massachusetts-based Nordblom Company to purchase the building and two nearby parking lots, said he hopes the property’s large floor plate will be attractive to potential occupants.
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The tax-stabilization ordinance, introduced to the City Council last week, also states that several restaurant or retail tenants will be located on the first floor of the building. Chace, who has no ownership role in the Providence Journal itself, said the newspaper will remain on one floor in the building.
“The redevelopment of the building requires utilizing the incentives that are in place,” Chace told WPRI.com.
The six-story 75 Fountain St. building, which was built in 1932 and has 160,000 square feet of space that could be rented, is currently valued at $10.4 million, according to the Providence tax assessor’s office.
Under the terms of the tax-stabilization proposal, Chace and his partners would pay a tax rate of $36.75 per $1,000 on an assessed value of $3.3 million for the first three years of the deal before gradually increasing their payments in years four through 12 based on the new value of the building.
The City Council Finance Committee is scheduled to vet the proposal in the coming weeks. Attorneys Zachary Darrow and Nicholas Hemond, who have carved out a niche negotiating tax deals with the city, has representing Chace and Nordblom.
Chace – whose family founded Berkshire Hathaway, and whose father sold his piece of the company to Warren Buffett – is widely credited with helping transform Westminster Street into one of the most vibrant sections of downtown Providence by converting decaying buildings into residential space. But some groups, including the city’s landlords, have criticized him for taking advantage of the city’s tax-stabilization policy.
Council President Luis Aponte is the sponsor of the tax-stabilization proposal.Correction: The original version of this report included an incorrect height for the building.