GUILDERLAND — The town’s Industrial Development Agency is helping Mill Hollow II complete an apartment complex on Route 20, just off Frenchs Mill Road, in western Guilderland.

Under a sales/leaseback transaction approved Aug. 15, the IDA becomes the “paper owner” of the project, IDA Chief Executive Officer Donald Csaposs explained, and Mill Hollow II becomes the lessee.

The project is set to include 13 residential buildings with a total of 84 units. There will also be a separate building with a senior center on the first floor, and a clubhouse on the second floor for use by Mill Hollow tenants and residents of Guilderland aged 60 and older. Steve Buck of Buck Construction said Wednesday that eight buildings are currently under construction.

The IDA will provide Mill Hollow II with sales-tax exemption on construction-related costs — the company estimated those costs, in its application to the IDA, at $3,790,000 — and with a waiver of mortgage recording taxes that the company estimated at $181,250.

Mill Hollow II had originally planned to build senior condominiums on the site, but sought and, in April, received relief from the town board from the age requirement, amid what it said was a soured market for financing for senior housing or for condos; some residents in the neighboring development objected to the change. The company also decided to make the housing units luxury apartments, rather than condominiums. The long-range plan is still to turn them back into senior condominiums, Buck told The Enterprise in April.

“Fortunately the IDA recognizes that it’s a project that’s beneficial to the town, and as a consequence they were willing to provide some very limited relief to the project, in the form of a sales-tax abatement and mortgage-tax abatement,” said Mary Beth Slevin, attorney for Mill Hollow II.

No property tax break

Mill Hollow II did not apply for, Csaposs said, a third type of relief sometimes granted by Industrial Development Agencies, in which a company is allowed to pay less than the full amount of assessed property tax. “They did not apply for this, so the IDA, of course, did not award it,” said Csaposs.

“Mill Hollow is paying 100 percent of its property taxes, as established by the assessor,” Csaposs said, explaining that reduction of property taxes is usually reserved for projects that can be expected to create a large number of jobs for a community. According to its application to the IDA, Mill Hollow will create four full-time jobs at the project facility — two of them professional or managerial, one semi-skilled, and one unskilled.

Guilderland’s assessor, Karen Van Wagenen, said that, for the year 2016, Mill Hollow is assessed at $1,323,900, because just one-and-a-half of its buildings were completed at the time of the assessment; the amount of its property tax due for the year was to be “about $45,000, including school, county, town, pretty much everything.”

She said that she could not estimate how much the project’s assessed value would be when construction is complete.

The IDA is not offering Mill Hollow II any type of loan, Csaposs said.

Mill Hollow II will receive financing from a bank lender and lease the project from the IDA “until all the terms have been satisfied,” Csaposs explained.

If the developer were to default, Csaposs said in response to a hypothetical question, “The IDA would need to advance the project.”

Csaposs noted that his role as a non-voting employee of the IDA is unpaid; his salaried post with the town is as a grant writer. The board members, he said, are all people who do not have an office in the town hall, and a decision was made in 2008 that the IDA needed a point of contact there.

The amount spent on the project so far, according to Mill Hollow II’s application, is $6 million, including purchase of the land and construction of the senior center and one residential building, and partial construction of two other buildings (60 pecent of one, and 10 percent of another, the application says). This amount also includes “top-side infrastructure … including connection to the main road, senior center parking areas, and some roadway paving.” The remaining construction costs will total $9.4 million, the application says. Phase 1 will cost $400,000, and Phase II will costs $5M in construction costs only, the application says.

History

The purchase price, in 2012, of the land was $2,190,000 on Dec. 28, 2012, the application notes. The property was purchased at that time from original developer Jeff Thomas, said Steve Buck of Buck Construction. The name Mill Hollow II was selected at that time in order to distinguish the project legally from its original name, Mill Hollow.

The apartment complex is referred to as Mill Hollow.

Benefits that the town can expect from the project listed by the IDA include private-sector investment (of $19.4 million at the project facility); provision of a type of housing not currently available; retention of existing jobs; the construction of a new community center; increased walkability as a result of the construction of sidewalks; and creation of regional wealth when users of the facility are attracted from outside the town.

The application says that Mill Hollow II will seek $15 million for the construction loan and a potential permanent loan in the amount of $18 million, subject to market conditions and cap rates in 24 to 36 months.

The developer will also be putting in sidewalks along the length of Route 20, from Frenchs Mill Road to Landbridge Drive, to connect the complex with the amenities on Western Avenue, said Csaposs, and will build sidewalks from the project to the Twenty West residential development.

“The relief of both of those taxes [sales tax abatement and mortgage tax abatement],” Slevin said, “can provide the company with additional resources to then reinvest in the project, and to accelerate the construction of the project, to make sure that they can deliver the amenities of the project that they have promised to make available.”

Town’s senior programs

All of the town’s senior programs are scheduled to move from town hall to the senior center on Sept. 19, said Supervisor Peter Barber. A ribbon-cutting ceremony will be held Sept. 27 at 11:30 a.m.

Senior Services Coordinator Mary Ann Kelley — who recently passed a Civil Service exam and was officially named to the position she had held since Cindy Wadach’s retirement in 2013 — said that the new facility will allow more programs to be offered.

Currently, at the town hall first-floor meeting room, programs can be offered for one large group or two smaller groups, Kelley said; the room can be subdivided with a temporary wall.

The senior center at the site of the old Bavarian Chalet has “multiple areas,” Kelley said, which will allow for more flexibility in scheduling. The town, which currently offers aerobic exercise programs, may expand its offerings — after getting input from seniors, Kelley said — to include other types of activities, such as yoga classes, current-events discussion groups, or book clubs.

The senior services coordinator also plans to talk with the Guilderland Public Library about activities and other types of collaboration.