Council approves sale and redevelopment plan for Manchester Hotel and Sunshine Building with $4 million incentive

Council approved an ordinance on April 7 authorizing a development agreement to sell the Manchester Hotel and Sunshine Building to Manchester Apartments LLC for redevelopment into a mixed‑use project.

Staff reported CMC Properties LLC (identified in the staff report as the proposal respondent) put forward a plan for at least 100 residential units, up to 15,000 square feet of commercial space and approximately 250 parking spaces, representing an expected private investment of more than $25 million. The proposed deal includes pre‑closing conditions (demolition and site prep), a proposed 30‑year, 100% tax‑increment financing (TIF) agreement, and an initial $4,000,000 city grant payable at the start of construction; staff said meeting pre‑closing obligations will require a mix of city funds, external grants and investments from the downtown revitalization fund of the Middletown Community Foundation.

Staff described the authorization as a first reading emergency to begin formal due diligence and noted the city’s prior rehabilitation attempts and public engagement to find a successful redevelopment strategy for these properties.

Why it matters: The redevelopment of the Manchester Hotel and Sunshine Building represents a major downtown investment with potential to add residential units, commercial space and parking capacity; it includes substantial public incentives and TIF structuring that will affect city finances and tax revenues for decades.

Next steps: Council approved the measure to allow staff to begin due diligence and proceed with the development agreement process and related incentive paperwork. Further public sessions and council readings will follow as due diligence and financing are confirmed.