2017-09-21 / Front Page

Resident has questions about Lincoln Mill project

By Grant McPherson
Staff Writer

BIDDEFORD – Lincoln Mill developers could receive financial assistance with redevelopment of the mill, but taxpayers wonder if it’s the best use of municipal funds.

Tim Harrington, founding partner and creative director of Kennebunkport Resort Collection, announced work on Lincoln Mill would finally begin, two years after he purchased the building. The announcement came Monday, Sept. 11 and named Chinburg properties as the commercial restorative developer. Harrington’s real estate development company Atlantic Holdings, LLC purchased Lincoln Mill in January 2015 for $2,500,000, according to the city website. Ownership of the mill changed to LHL Holdings, LLC in August the same year.

Biddeford resident and former city councilor Howard Hanson of Ward 7 has reservations about the agreement between the city and developers. He published a post on the blog MyBiddeford.com Monday, Sept. 18 outlining his frustration. Hanson would like the agreement to be more specific about the amount of money LHL will invest. As of now, the $40 million cited in the agreement is an estimation.

“(The city) should have something locked in to what the developer will commit before agreeing to any type of credit enhancement,” Hanson said.

Aside from 181 residential units, meeting space and restaurant, Harrington said Lincoln Mill will eventually include a standalone hotel. He also confirmed that rooftop amenities would include a pool and gardens. Harrington is excited about the prospect of a parking garage near the mill and believes it is imperative the city of Biddeford construct one.

“I don’t think our project is underserved by parking, but it would be a lot better with a parking garage,” he said.

Harrington does not know exactly what kind of work will

Project permits

Two permits were applied for Phase 1 and Phase 2 of the project. The Phase 1 permit was valued at $10 million and would have required a $140,000 fee. The Phase 2 permit was valued at $20 million and would have required a $280,000 fee. The developer will have to go in front of the planning board again for new permits in October.

begin in December, but expects exterior scaffolding to be in place for workers to access outer brick walls. Eric Chinburg, president and CEO of Chinburg Properties, was on vacation at the time of deadline and did not return a request for comment. Remediation work inside the mill, such as sandblasting, has already begun.

Harrington said the project was delayed by a complicated permitting process and time required to secure investors. Harrington has about 30 people on his planning and design team, comprised of architects, interior designers, space planners, engineers and landscape designers. His largest project prior to the 250,000-square-feet Lincoln Mill was 125,000-square-feet.

Harrington said rent in Biddeford is higher now than when he bought the building in 2015.

“The project gets better as time goes on from a financial standpoint,” Harrington said. “That’s the way it goes. We have a fiduciary responsibility to our banks, to me and to our investors to make good financial decisions.”

Harrington didn’t want to sell the building to any other developer, which meant finding one willing to be partners. He will handle design and branding for the Lincoln Mill project, similar to his role with the Kennebunkport Resort Collection, a group of luxury boutique resorts and restaurants. Harrington hopes to foster a more urban environment downtown, with greater walking access to shops and restaurants.

“I think Biddeford is happening, who wouldn’t want to live there?” Harrington said. “I’m honored to be part of the project and it’s been a complete pleasure to work with the city of Biddeford. They’ve been nothing but helpful and I hope to do more things in the city.”

Matt Assia, director of asset management for Chinburg properties, said the company’s recent renovation of Saco Mill No. Four was a success, with all 150 residential apartment units preleased and occupants moved in this past summer. Chinburg Properties sought the Lincoln Mill project to continue similar work. Assia said former mills translate well to residential experiences.

“There’s a richness to the buildings and to the downtowns they lie in,” he said. “The river and urban core are irreplaceable.”

Unknown levels of decay present the greatest challenge to Chinburg Properties in the course of its redevelopment work. The mill in Saco was left open to the elements for almost 30 years and water damage in many areas meant much of the flooring needed to be replaced. Assia said developers have contingencies in place to fill in gaps in the budget when unexpected costs arise. However, Lincoln Mill is expected to be easier since it still had tenants in 2015.

“It’s not a challenge we haven’t gotten around before,” Assia said.

Assia looks forward to helping another mill come back into service.

“Biddeford has become a great place to live and visit and we take a lot of pride in that,” he said.

The city council planned to vote Tuesday, Sept. 19 on a joint development agreement between the city and Lincoln Mill developers to ensure work would begin in December. Chinburg Properties had a similar agreement with Saco during the work on Saco Mill No. Four. The joint development agreement commits LHL Holdings, LLC to invest $40 million to develop at least 90 high-end market rate apartments, a boutique hotel, commercial space for restaurant and bar, office use, rooftop pool and other commercial uses. LHL will seek planning board modifications in October. LHL can begin the project no later than Sunday, Dec. 31 and must have workers present at Lincoln Mill within 30 days of the agreement’s approval.

In return, the city would repair the retaining wall along Lincoln Street, continue road improvements along Main Street, begin work on Lincoln Street sidewalks and modify the Lincoln, Adams and Main street intersection. The city would also provide a credit enhancement of $750,000 over the course of five years, $150,000 per year. The money will come from a tax increment financing district that includes Biddeford Crossing and the mill district. Economic Development Director Daniel Stevenson said joint development agreements of this kind are fairly common as a way for both parties to ensure projects are begun in a timely manner.

“We’re looking at a very short term tax increment financing to get over the finish line and bring the deal to fruition,” Stevenson said.

As a municipality adds value to its community, county taxes increase. The fiveyear TIF allows the city to shelter itself from the increased tax burden for a period of time while Lincoln Mill is finished. This allows the city to receive the same amount of money from the state in subsidies, such as education. Stevenson expects the permitting fees and property taxes from Lincoln Mill to exceed $750,000 within two or three years.

“The TIF is one tool to get some economic growth in the community and at the same time not reduce subsidies or increase county taxes,” Stevenson said.

With the addition of at least 90 residential units, Hanson is concerned what the effect will be on the local school, police and fire departments. Hanson said Biddeford is one of the highest taxed communities and a great burden is placed on existing property owners. In 2015, the state weighted average mil rate was $15.03 per $1,000 of value, according to the state government’s website. The only town in York County with a higher mil rate than Biddeford that year was Sanford, with $21.19 per $1,000. Biddeford’s was $19.24 and the county average was $13.38.

“There really needs to be a public discussion amongst community members, not just city council, about how they’re spending our tax dollars,” Hanson said.

Hanson doesn’t think the contract does enough to explain what would happen if developers fall through on their end of the agreement. He said it’s a common trend throughout the country, as developers take advantage of communities that are looking for economic growth. Hanson is worried developers could walk away with $300,000 after two years and not face any consequences.

“They’re saying developers will bring in revenue from taxes and permitting fees and we’re going to give them money,” Hanson said. “Nothing in the contract says we are going to penalize them if they don’t do that. You always try to get as much as you can in a contract so if it doesn’t work out you have something to fall back on. This one doesn’t appear to have that ability.”

According to Stevenson, developers won’t see any money from the city until December 2019, after a significant portion of the project has been completed.

Hanson wants to see Lincoln Mill developed, but not at the expense of taxpayers. His philosophy is that private investors should finance the project without help from the city. He hopes the decision can be tabled until the council’s next meeting to allow for more input from the community.

“Everything related to downtown seems to be done secretly,” Hanson said. “It isn’t well explained until we get onto Facebook or write letters and start making complaints. Then they seem to come out and be a little more open. They should just do it in the beginning and save themselves some problems.”

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