Editors note: This story was corrected at 5:06 p.m. on Dec. 29. An earlier version incorrectly stated when the tax impact was recorded for the 2016 property sales.
The city has sold a group of vacant lots close to downtown to an investment group as part of a plan to build townhouses on the land.
The construction planned for the Barrett Street parcels will be the first project for the Live In Schenectady program, under which local investors have agreed to spend $1.5 million to construct new housing on vacant properties in the city.
“We’ll begin construction in the spring,” said David Buicko, chief operating officer of The Galesi Group and a leader of Live In Schenectady, which bought the properties last week for $152,516. Officials said the purchase price was the appraised value of the parcels.
Three more property purchases that haven’t yet closed will bring the city’s proceeds to $200,000 from the sales.
“To have a partnership like this between public and private investors to expand home ownership, I think it’s very exciting,” Buicko said.
The city acquired the properties because of unpaid taxes over a number of years. They are in what was once part of nearby Little Italy, until that neighborhood fell on hard times, said Mayor Gary McCarthy. Most of the properties are vacant or uninhabitable and off the tax rolls; the project will return them to the tax rolls.
“It will be a major investment building off the turnaround we have seen downtown,” McCarthy said.
Buicko said there are plans for construction of 10 two- three- or four-unit condominium townhouses, though the site has room for more in the future. The townhouse units are to be owner-occupied.
Buicko said the homes’ prices will be reasonable, though he would not give a price range.
“What we want to do is price them moderately, so that new homeowners or young families can come in and invest at a price that’s reasonable,” Buicko said.
The location is key: Barrett Street is within a couple blocks of downtown, the lower Union Street commercial district and Union College. Buicko said the new homes will also be within walking distance of the Price Chopper headquarters, Ellis Hospital and Mohawk Harbor, where the Rivers Casino is being built.
“People are looking to have places they can walk to,” Buicko said.
He and McCarthy said they hope the Live In Schenectady partnership on Barrett Street will become a model for other parts of the city and in other cities.
Live In Schenectady was announced in October 2015, with the goal of increasing home ownership.
Investors include Jim Connolly, former CEO of Ellis Medicine; HighBridge Development; Neil and Jane Golub; the Galesi Group; Antonio Civitella, president and CEO of Transfinder; NBT Bank; BBL Construction; Re4orm Architecture; Precision Industrial Maintenance; Schenectady Hardware and Electric; The Daily Gazette; Capital Region Gaming; Northeastern Fine Jewelry; Jackson Demolition and Union College.
“It’s a lot of business leaders in the community looking to invest in the community,” said Ray Gillen, chairman of Schenectady Metroplex, which has also been involved in the plans.
McCarthy said the city closed last week on 17 back-tax sales, most of them for the Barrett Street project.
In total, the city sold 106 lots in 2016 for $1.7 million, revenue that city officials said helped reduce property taxes about 0.5 percent in 2016.
McCarthy said he believes 2016 saw the most properties the city has ever sold in one year.
The city’s Industrial Development Agency, meanwhile, sold a 2.55-acre lot it owned on Duane Avenue to a real estate company linked to the neighboring SuperPower plant.
The IDA sold 451-453 Duane Ave. to BNH Properties LLC for $172,000. BNH is affiliated with the company that owns the building across the street that is leased by SuperPower. That firm makes high-temperature superconducting electrical wire and other electrical superconducting technology.
Gillen, whose agency operates the city IDA, said income from that sale will go back into economic development projects.
The land was acquired before Gillen’s tenure at the IDA, and he couldn’t say why it was bought by the IDA.
“Our goal is to get the IDA out of the property business and invest money back in economic development,” he said.