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July 7, 2009

Developer Of $60M Framingham Project Files For Bankruptcy

Framingham Acquisition LLC of Wellesley, developers of what would have been a $60 million mixed-use project downtown, has filed for bankruptcy.

The project included several buildings that would have been redone to house almost 300 apartments and 60,000 square feet of commercial space across the street from the Framingham Memorial Building. It also would have included a six-story parking garage.

"We're clearly disappointed, but we did anticipate this," said Alison Steinfeld, Framingham's director of economic and community development. The project received all of its permits several years ago, but did not move forward, she said.

"I'm sure there were a number of factors involved," Steinfeld added, noting the problems in the real estate and financial markets.

The company filed for bankruptcy June 18 in Boston, claiming it has estimated assets of between $1 million and $10 million, and estimated liabilities of the same amount. It also said it had between 1 and 49 creditors.

Included in the filing's list of the 10 largest unsecured creditors are:

  • The Town of Framingham, which is owed $500,000
  • Clinton Design Associates of Framingham, which is owed $234,070
  • NY Urban Servicing Co. Inc. of New York, which is owed $1.25 million

NY Urban Servicing is a real estate finance company.

Calls to the principals of Framingham Acquisition LLC, Roger J.F. Lehrberg and Michael Perry, and their bankruptcy lawyer, Melvin Hoffman, of Looney & Grossman LLP of Boston, were not returned.

A lot of hopes for downtown revitalization were pinned to the project.

"It certainly would have added life and vitality just having more people walk around downtown," said Ted Welte, president and CEO of the MetroWest Chamber of Commerce in Framingham. "It certainly would have been a great boost to downtown revitalization."

Welte believes that the level of scrutiny the project was under for three years as it went through the permitting process may have helped bring the project down, though he acknowledged that the real estate market's condition probably played a big part as well.

"Clearly this particular project received so much review that it seems to me, it should be able to have an expedited permitting process should someone else pick up the project," Welte said.

Jay Grande, planning director for Framingham, said he would not respond to Welte's comments about the planning board's review processes.

"I'll let the record speak for itself," he said.

But the city doesn't plan to wait and see what happens downtown.

"We're waiting for several studies in progress to conclude," Steinfeld said. "Once they're submitted, we can begin to address the railroad crossings, improvements to the streetscape and intermediate traffic improvements we can put in place."

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