Editor’s note: This story has been updated to include additional information about financing.
Lee —The final major hurdle has been cleared for the Eagle Mill project that could transform downtown Lee.
Late this week, Eagle Mill Redevelopment received a letter from Secretary of the Commonwealth William Galvin announcing that the company has received $400,000 in state rehabilitation tax credits. Click here to read the letter. Galvin also chairs the Massachusetts Historical Commission, which issued the tax credits.
“It’s the last major piece of the puzzle,” Jeffrey N. Cohen, who heads Eagle Mill Redevelopment, said of the $60 million Eagle Mill redevelopment project on the banks of the Housatonic River. “Without these tax credits, the project does not happen.”
Galvin added that Eagle Mill “will remain eligible to apply for additional funds in future rounds, not exceeding a total of 20 percent of the qualified rehabilitation costs for the project.”
In May, Eagle Mill received approval from the National Park Service for $6 million in federal historic tax credits. Cohen indicated he planned to apply in future rounds as well, adding that the project is eligible for up to a total of $6 million in state historic tax credits — the same amount as the project is eligible for at the NPS. The tax credits are attractive to the investors who will make the restoration and reuse portion of the project possible.
“They will attract investors who will have tax-credit equity,” Cohen explained. “It’s a subsidy … Credits are there because it costs more to reuse than to build new.”
Now that the tax credits have come through, Eagle Mill Redevelopment will also apply for financing for the housing units. Cohen is talking with NBT Bank, Lee Bank and Adams Community Bank, among others.
The mixed-use development will revive and expand the historic mill site in downtown Lee into a combination of office space, both market-rate and affordable rental units, the new hotel across the street, and a “public market” with multiple restaurants and food kiosks. Click here to see a comprehensive listing of the planned uses.
Lt. Gov. Karyn Polito and other state officials came to Eagle Mill last October to announce that Lee had received almost $5 million from a state MassWorks Infrastructure Program grant to upgrade 9,000 linear feet of water lines and support residential and commercial development in the Eagle Mill area.
That’s in the town’s northern downtown district, which most people think of as the area where Joe’s Diner is located. The grant, which was initially denied on the first and second tries, was considered critical to the success of the Eagle Mill project.
“There were two critical unknowns in this project: the water and the Mass historic tax credits,” Cohen said. “Now we’ve got both. This is a big deal.”
Next up is the financing of the commercial projects, the market, the machine shop and the office building. Cohen hopes to begin construction on the project next year and expects the project to take at least two years to complete.
Rees-Larkin Development, a Boston-based developer of affordable and mixed-income housing, has partnered with Eagle Mill Redevelopment. The manager of the apartments will be Berkshire Housing Development Corporation. Jon Rudzinski, head of Rees-Larkin, and BHDC President Elton Ogden will apply to the state in November for financing of the housing.
Cohen said he is convinced that without the help and support of Congressman Richard Neal and his staff, “we would not have achieved this result.”
