Flashcube Building Apartment Project Expects to Start Early 2019
Published August 17th, 2018 at 12:15 PM
By Kevin Collison
The planned redevelopment of the historic “Flashcube” building into apartments has hit a “profound” budget jump due to price increases for construction materials and labor, raising the cost by 38 percent to $69 million.
In response, a request by the developer, Worcester Investments, to have its “prevailing wage” labor goal set at 20 percent was approved by the Planned Industrial Expansion Authority Thursday, but not without some pushback.
“My issue is the labor cuts, they seem to be the first thing,” said board member Kevin O’Neil. “You’re already getting a full, 100 percent abatement.
Last year, the PIEA board approved a 25-year property tax abatement for the project, which calls for the redevelopment of the nine-story, building at 720 Main St. into 184 apartments and 35,800 square-feet of commercial space.
Since then, budget costs have jumped substantially and the project is no longer pursuing financing from the U.S. Department of Housing and Urban Development. HUD sets the prevailing wage component at 100 percent.
The prevailing wage is in a community is established by the U.S. Department of Labor.
“We want to move forward with the historic nature of the Flashcube building, but our biggest concern is managing costs,” said Matt McCauley, Worcester chief operating officer.
Charles Renner, the attorney representing Worcester, said the developer is now pursuing private financing for the project.
And in response to O’Neil’s concern about labor, Worcester officials said reducing labor costs had not been their first choice to save money.
Jim Calvert, director of development and construction, said the project has been redesigned to save money. He added that costs also have risen due to environmental remediation work and building deterioration.
And in a reference to current global economic political climate, Calvert said concern of a tariff war have caused the price of steel to rise.
To sweeten the appeal of the redevelopment project, the developer has agreed to increase the number of what were described as affordable units from 25 to 40. Those apartments will rent for an average of $1,187 per month.
McCauley said Worcester plans to begin work on the project at the beginning of 2019 with completion expected in mid- to late 2020. McCownGordon Construction is the contractor.
It’s nicknamed the Flashcube because of its reflective glass exterior. The former office building has been vacant a dozen years. It was built as the Executive Plaza Office Building in 1972 and is on the National Register of Historic Places.
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