Updated, 3:42 p.m.: Bill Collins comment added.
NORWALK, Conn. – An alternative proposal for Wall Street Place phase I, otherwise known as “POKO,” would provide “a large gathering area able to accommodate events like the Mayors Ball.”
Frank Farricker’s non-profit arts district idea relies on financial calculations which assign a $10 million value to the existing building and estimate the cost to complete its construction as $15 million.
“Led by the Wall Street Theater, a 501(c)3 nonprofit, we propose a financially viable plan in which four properties adjacent to the POKO project, plus the project itself, are merged together into an innovative, exciting and achievable project which would preserve and expand arts in Norwalk,” the proposal states.
Farricker last week told NancyOnNorwalk that he had made this proposal to City officials, an alternative to the 100% affordable housing plan reportedly developed by Citibank and JHM Group. It would feature 40% affordable housing. On Thursday, he released the “final” proposal, which he said was approved this week by the theater’s board of directors.
The plan would:
- “Create a fully nonprofit Arts Complex integrating the Wall Street Theater, the Garden Cinema, and the utilization of over 10,000 square feet on the ground floor of the POKO project for arts. These could include projects such as a black box theater, artist and musician studios, growth area for the Wall Street Theater and live-work arts business.
- “Property at 20 Isaacs Street can be acquired to make a roadway to better service all the buildings and allow the planned Isaacs road closures to proceed.
- “Apartments in the unfinished building would be completed essentially ‘as-is’, with 40% of the units being reserved as ‘affordable’, but with some properly- and legally- set aside for artists living in the area.”
City officials declined to comment.
The property at 20 Isaacs is owned by John Dias, who is suing the City and the Norwalk Redevelopment Agency. He claims to have been damaged because 20-26 Isaac St. were slated for eminent domain if he could not agree on a purchase price with POKO Partners, original developer of Wall Street Place. Dias signed a contract with POKO to sell the property for $2.5 million, but the sale was not completed, the complaint states.
Construction on Wall Street Place halted in mid-2016 due to a budget gap described as more than $9.8 million. Citibank, which granted POKO a $31 million construction loan for the project, took possession of the property. Citibank has chosen JHM, led by John and Todd McClutchy, as its expected redeveloper. Norwalk declared Citibank in default of its obligations and the matter is in court; the resultant plan is said to include demolishing the Garden Cinemas to provide needed parking spaces.
The Dias properties were slated to be demolished and a street constructed in their place, as part of the 2008-approved plan.
The theater’s proposal presents estimated financials, totaling $33 million:
- $2.5 million for 20 Isaacs St. “This acquisition settles a lawsuit between Norwalk and the property owner”
- $10 million to acquire Wall Street Place from Citibank. “This acquisition has the potential to settle two lawsuits between Norwalk and the adjacent property owner”
- $3 million for the Garden Cinemas
- $15 million to “complete the POKO project, including refitting the interior for the arts projects contemplated”
- $500,000 to demolish 20 Isaacs St., “and the creation of a new accessway to the rear lot from Wall Street”
- $2 million for “Restoration of the underground parking at the POKO project”
The $10 million estimate came from “direct conversations” with Citibank, Farricker wrote to NancyOnNorwalk.
“The $15 million estimate is an aggregate of the multiple people I spoke with regarding the work, from the original contractor, to what Jason Milligan thought, to an estimate by a friend of the theater,” Farricker wrote to NancyOnNorwalk.
Milligan, a real estate broker who has bought properties around the project and toured it last year with Citibank representatives, said Thursday that he couldn’t estimate how much it would cost to complete the existing project due to “too many” rules and regulations of which he is unaware. It would cost $200,000 to knock down the concrete and steel “podium,” the “roof of the retail and floor of the area that gets framed for apartments,” he wrote.
Citibank rep Jeremy Johnson in a July email to Milligan said he “definitely” couldn’t see the project being completed for $15 million.
Citibank on Thursday declined to comment.
Paxton Kinol, who as Belpointe Capital managing director has developed the Waypointe project, analyzed Wall Street Place financials two years ago.
“I think the land and the building skeleton is worth about $3 mm today,” he wrote Thursday.
Milligan said Thursday that he offered Citibank $7 million for the property last year, with several conditions. His lowest offer was $3 million, with no contingencies.
“Frank’s plan is a pipe dream,” Milligan wrote. “He would make a good consultant but not more at this point.”
“Needless to say Frank’s plan is a little sketchy,” former Mayor Bill Collins wrote Friday. “There are a number of moving parts which would have to be evaluated individually which I certainly am not in a position to do. For one thing it seems to suggest that Citibank would get out of this mess without further loss which, from the City’s standpoint, does not sound like a reasonable solution.”
Farricker’s Wall Street Theater opened in April 2017 in what had been the dilapidated Globe Theater, after a renovation that began in 2015, supported by state and federal tax credits. A lawsuit filed in October 2017 by The Morganti Group, which did the construction, prompted the theater to file for Chapter 11 bankruptcy in early 2018. The Hour and the Fairfield County Business Journal report that the theater resolved the bankruptcy in February, quoting theater President Suzanne Cahill as saying, “we’ve come out of it stronger and more financially solvent.”
The Morganti lawsuit was withdrawn in March.
“Morganti settled for exactly what we offered two years earlier… we heard they spent millions on legal fees,” Farricker said.
The theater’s proposal for Wall Street Place projects benefits:
- “Studies from the U.S. Bureau of Economic Analysis (BEA) state the impact of arts and cultural production provides four times more to the U.S. economy than the agricultural, transportation or warehousing and are continuing to trend positively year over year. Arts and culture are one of the three top drivers of urban economies attracting $46-$51 for every dollar invested.
- “Consider small artistic businesses selling products out of the area on the ground floor of the POKO shell
- “A black box theater like Curtain Call in Stamford next to the larger Wall Street Theater.
- “A large gathering area able to accommodate events like the Mayors Ball in Norwalk instead of Stamford.
- “The ability of the Wall Street Theater to be a nationally known broadcasting facility, attracting talent far outside its weight class.
- “A revitalized Garden Cinema that is freshened and refocused for outstanding cinematic opportunities.
- “Rebuild and open up space wide for circulation, fair parking and open spaces.”
“The public parties (City / Redevelopment Agency) reserve comment on Mr. Farricker’s proposed concept until the required site control to implement it is better understood,” Redevelopment Agency Executive Director Tim Sheehan wrote in a Thursday email. Sheehan did not respond to a request to elaborate on what he meant by “site control.”
There are lawsuits concerning the POKO properties, that are far from being resolved.
“The cost to pay Citibank and complete the unbuilt project exceeds any profit-motivated or developer fee-driven plan and would also require significant state and City subsidies,” the proposal states. “… Norwalk would like the City to complete its pledge, memorialized in signs placed on Wall Street by the City, for the area to be Norwalk’s ‘Arts District’.”
Farricker, president of Exit Realty, said last week that he’s built affordable housing and when it’s 100% low income, “You get your fees, you get your money, you get your stuff and you get out. That’s what happens: (McClutchy will) get development fees and fees for the tax credits, and fees for the construction, and all the stuff like that – and then they are gone.”