August 13, 2005
By JEFFREY B. COHEN, Courant Staff Writer
The city is so frustrated with the lack of progress in renovations
at the old Bond Hotel on Asylum Street that it is moving officially
to end the seven-year tax-break agreement it had with the property's
owner, officials said Friday.
"His modus operandi is to hold and flip [property] as the market
goes up," said Matt Hennessy, chief of staff to the mayor, of
property owner Robert Danial of Morgan Reed Asylum LLC. "If
we increase the cost of holding that building ... that may spur him
to do more."
Danial is in the process of converting the historic hotel into a
Homewood Suites extended-stay hotel, but an agreement signed with
the city said he was to have completed the project by March 2005.
"The developer and owner has not done a very good job at all
of getting the project accomplished. It's not their style," Hennessy
said. "From our experience, they hold property, they don't develop
"At this point in Hartford, this is not the kind of investment
we need," he said.
Multiple calls to Danial and his attorney were not returned. As
a result of the tax agreement, Danial and his company have paid less
than half of what their tax bill would otherwise have been each year.
This year alone, Danial is paying $100,000 instead of more than $250,000,
Hennessy said. He added that the city is also looking into whether
Danial should be compelled to repay the city the taxes he saved based
on the agreement.
In 2000, the city and Danial entered into the tax agreement predicated
on the conversion of the old hotel into 140 units of residential
housing. The agreement was needed to make $3 million in improvements
In the first year Morgan Reed was to pay $50,000 and in the second
$60,000. The payment would increase until the seventh year when the
taxes were to be $120,000.
Th agreement was amended in September 2003. Instead of 140 units
of residential housing, Morgan Reed agreed to build 100 to 120 units
of residential apartment housing or the extended-stay hotel. The
amendment said the Bond renovation would be completed 18 months after
the amendment's signing - in March, 2005.
The city's Director of Development
Services John F. Palmieri sent Morgan Reed a letter in December
2004 inquiring about the status of the work, noting that the "building continues to deteriorate," and
adding that "the prospects for its reuse seem less likely and
its appearance has become detrimental to our efforts to revitalize
Three months later, Morgan Reed's
attorneys wrote the city and asked for an extension of the agreement
through July 31, citing "unforeseen
complications in the renovation process" including delays in
obtaining building permits, extensive abatement work mandated by
the state and compliance with the city's minority-hiring process.
The city denied the request. In
a letter to Danial, Palmieri wrote that not only was Danial aware
of the "complications" long
in advance, but he was also behind in his taxes on another building
he owned, the Stilts building at 20 Church St., and he owned another "blighted" building,
1161 Main St., on the corner of Trumbull Street.
"The decision is to terminate the agreement," said Palmieri,
who said he is in the process of drafting a letter to Danial. "It's
obvious that Mr. Danial failed to get the project completed and he
was not making any real effort to contact us.
"The last thing the city wants to do is to impose any kind
of hardship," Palmieri said. "But in this case, Mr. Danial
created his own hardship."
Reprinted with permission of the Hartford Courant.
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