Middletown announces tax-credit closing for $43 million O & W housing project

Middletown’s mayor told the Common Council the city has closed on key tax credits for the O & W redevelopment project and will soon move forward with contract awards.

"We finally closed on the project," the mayor said. He described the development as a roughly $43,000,000 project and said Recap committed about $9,800,000 to the deal. He said investor groups provided new market tax credits and historic tax credits, with the mayor citing roughly $5.3 million (historic federal) and $3.6 million (state) among the pieces of the financing stack.

The mayor said the structure required creation of private LLCs and lease banks because government entities cannot sell tax credits directly. He thanked city staff and outside counsel for coordinating the complex financing and said closing the credits was the remaining barrier to awarding construction contracts.

"The net expense to the city was about $1,900,000," the mayor said, and added the project would "net about $12,000,000" in terms of total project resources once credits and investments are accounted for. He told council members that a design-kickoff meeting with engineering was scheduled and that visible progress should begin soon.

Council members and staff thanked project leads and committed to monitoring procurement and construction milestones as the project moves into award and execution phases. No formal vote on the underlying project agreements was recorded at the meeting; the mayor said awarding contracts required the tax-credit closings, which are now complete.