New Worcester Plaza owner planning more investment in the city
Photo | Thomas Grillo
Greater Worcester Chamber of Commerce housed a panel discussion on Opportunity Zones.
Synergy Investments is not done investing in Worcester.
Three months after paying $16.5 million for Worcester Plaza, the glass office tower in the downtown, the Boston developer is looking at other properties in the city.
During a round table discussion about Opportunity Zones at the Worcester Chamber of Commerce Thursday, Ryan Chamberlain, Synergy’s director of business development, said they have a $100 million fund created to invest in properties in Greater Boston.
“Worcester Plaza will not be the only building we buy,” he told the packed crowd of developers, lenders, nonprofits, and attorneys. “We expect to invest in two or three more Worcester properties.”
Chamberlain noted Synergy intends to spend $12 million to renovate the 24-story building over the next two years.
One other thing seems certain, he said. The building is assessed at $30 million, about half of what they paid for it, and they intend to file for an abatement.
His firm is also looking to invest in MetroWest and the North Shore, Chamberlain added.
The panel on Opportunity Zones, designated economically-distressed districts where new investments may be eligible for preferential tax treatment, included Roberta Brien of the Worcester Business Development Corp., Richard James of Bank of America, James Umphrey of real estate brokerage Kelleher & Sadowsky, Sandra O’Neill from the law firm Bowditch & Dewey, Karen Kelleher, executive director at LISC, and Daniel Ryan of the law firm Sullivan & Worcester.
Some of the participants agreed while the program has its advantages by inviting major developers into Gateway cities, they said the benefits have mostly gone to investors and less so to communities.
“Opportunity Zones work well for investors who are using the program,” said Kelleher, who humorously described herself as a recovering lawyer. “But it does not require investors to deliver a public benefit and the disclosures are few.”
While there was excitement around the launch of the program, she said, investors are using the Opportunity Zone tax benefits for projects or purchases they would have made without it.
O’Neill agreed it is a boon to the investment community. She said very little is required of the investors other than completing two Internal Revenue Service forms.
Still, Umphrey, a principal at Kelleher & Sadowsky, said there are $6 trillion subject to capital gains taxes that could be funneled into Opportunity Zones.
He said three major projects are planned in Worcester’s Opportunity Zones including the Worcester Red Sox’s Polar Park, Synergy’s office tower on Main Street, and the Greendale Mall.
“We are seeing outside developers coming to Worcester for the first time,” Umphrey said. “That creates momentum and may spur development in and around those areas.”
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“But it does not require investors to deliver a public benefit and the disclosures are few.” First, we are not socialist, well yet. The public benefits from increased local real estate taxes, construction jobs, removing blight and new blue and white collar jobs after construction is completed.
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