Model Railroad Museum Options to Buy Heritage Park for $1.2M
The Redevelopment Authority on Thursday voted to enter into the agreement with the Extreme Model Railroad and Contemporary Architecture Museum being developed by museum maestro Thomas Krens.
The private for-profit development group will pay a non-refundable $20,000 payment for the one-year option effective on Friday and $30,000 should it request to extend the option a second year. It will also begin paying $1,500 a month for the space it currently occupies in the park beginning on Jan. 1, 2018.
Mayor Richard Alcombright said the selling the property was preferable to a long-term lease that would have obligated the Redevelopment Authority to continue to maintain the park.
"This is cash up front that buys the park so we no longer have the obligation to run a park, to manage a park," he said.
Ben Sosne, representing EMRCA, said possession of the property was critical in attracting capital investors because the "figures are set in stone."
"It's dependent on the fundraising but we want to move forward because we want to build this thing," he said. "There's no question that the project is at a point where we think it will attract a lot visitors."
The high-tech museum is expected to have more than 100 trains at 1:48 scale operating in environments ranging from the Empire State Building (at 37 feet tall) to the city's historic railroad and is projecting upwards of 300,000 visitors a year.
Originally sited for the current Hoosac Tunnel museum operated by the state Department of Conservation and Recreation, the project grew in size and scope to include a "museum of time," cafe, retail and a boutique distillery to start. Last month, Sosne and project manager Andre Heller outlined the need to encompass the Sons property to the south.
The current tenants will not be immediately impacted by the option, although that will change should agreement be executed. Freight Yard Pub has been central to the project's plans but the nonprofit North Adams Museum for History and Science is expected to move. The museum, operated by the local Historical Society, has been in talks with other locations.
As for DCR, attorney Michael MacDonald, retained by the authority to negotiate the agreement, said "what the agreement contemplates is that the Redevelopment Authority and Mr. Krens' organization will work with DCR to come to some arrangement that is satisfactory to everybody."
He said the agreement also includes language to ensure that ERMCA does not diverge from the plans presented over the last year or so.
It would have to limit the park's development to "museum uses, distillery use, related cafe, retail and restaurant use as presented to the Redevelopment Authority," MacDonald read, adding that "the developer is required under the document to conduct their environmental due diligence and title due diligence on or before the date, which is six months from the option, so that we're not waiting out potentially two years to find there is a problem."
The agreement is in part based on an appraisal of the park done in 2014 for the failed Greylock Market project that sought to revamp the park into an artisan live/work space. The appraisal was $875,000 but only for the park, not the land to the south, MacDonald said.
In this case, an appraisal can be done that could affect the purchase price or the state Department of Housing and Community Development could issue a waiver for economic development based on the area's high unemployment and poverty rate.
The mayor said the authority has reached out DHCD to determine what it's next steps should be.
Alcombright thought that this agreement had been reached faster because the museum project's for-profit profile made it easier to develop financing than for Greylock Market, which never got off the ground.
"I think it's the premise of the significant amount of private sector investment in this," he said. "The other deal, as you recall, relied much more on government money, tax credits. The financing piece was much more complicated. This enhances the ability to move it along much more quickly."
The agreement gives the authority some funding whether the museum is developed or not, which was not the case with the market proposal. The mayor said it was "putting some dollar amounts in place that would incentive the Krens people to move as quickly as possible so we can see something come to fruition."
Alcombright said the sale would give the Redevelopment Authority an established fund to work with should it look to do further redevelopment in the downtown area. He said the administration is in talks with the state on how the funds could be used.
"The Redevelopment Authority, I'm guessing, would be able to make decisions about how to utilize that money," he said. "Whether to make further development of the downtown in a newly defined urban renewal area or further define our urban renewal zone ... it will take money to do that ...
"All of us would agree that any proceeds would need to be targeted back to development of the city."
Tags: EMRCA, Heritage State Park, model railroad, purchase & sales , redevelopment authority,