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July 14, 2023

Bronin: Potential state office building consolidation could help grow Hartford’s tax base

Hartford Mayor Luke Bronin said he would like state-owned, tax-exempt properties to be put back on the city's tax rolls.

The state is planning an office consolidation in the salmon-colored twin towers at 450 Columbus Blvd., a property that sits on the outskirts of downtown Hartford along the Connecticut River.

In late June, the state Bond Commission approved $1 million as the initial seed money for the project.

While the state has not yet listed any properties for sale in anticipation of the consolidation, Hartford Mayor Luke Bronin said he sees it as a chance to get state-owned buildings back on the city’s tax rolls.

“I think it's a positive thing,” Bronin said. “I support trying to move some of that state-owned, tax-exempt property into private ownership, and to have the opportunity to re-imagine those buildings, whether as commercial office space or potentially residential opportunities.”

Occupying just 18 square miles, Hartford is a tiny city that houses many tax-exempt properties, significantly limiting the city’s ability to grow its grand list and forcing commercial property owners to shoulder the highest tax burden in the state, at 68.95 mills.

*Tax rates are for the 2022-23 tax year, the latest data available from OPM.

In fact, more than 50% of properties in Hartford don’t pay property taxes because they are owned by nonprofits, colleges, hospitals, religious institutions, or the state. Hartford, with a population of about 120,000, has a taxable property base that is barely larger than the tax base of small suburbs like Farmington (27,000 residents) and Glastonbury (35,054 residents), officials have said. 

One key way to address the issue is to get more properties on the tax rolls. 

The state Department of Administrative Services is evaluating the footprint of state agencies, looking for cost savings and efficiencies, according to John McKay, a spokesman for the agency.

“The state is constantly evaluating its property holdings, including leases, and after careful review will make decisions that are in the best interest of the taxpayers of Connecticut,” McKay said.

He emphasized that no decisions have been made, although the state is in the early stages of considering the possible closure of several offices in Greater Hartford: 

  • 61 Woodland St., Hartford: home to the Connecticut State Colleges & Universities system; 
  • 39 Woodland St., Hartford: home to the Connecticut Technical Education and Career System; 
  • 505 Hudson St., Hartford: Department of Children and Families’ headquarters; and
  • 60 State St., Wethersfield: Department of Motor Vehicles.

McKay said no decisions about future uses for those sites have been made.

With demand for commercial office space low following the COVID-19 pandemic and accompanying rise of remote work, there are questions about how the properties could be used.

“The commercial real estate market is facing some significant challenges here, as it is everywhere,” Bronin said. “And so, I imagine potential buyers will be looking at a full range of possibilities, including residential.”

Not all potential uses would yield tax-paying entities. 

The federal General Services Administration is looking for a site for a new federal courthouse to replace the aging Abraham A. Ribicoff United States Building and Courthouse at 450 Main St. One of three sites in contention is 61 Woodland St., which spans about 10 acres. 

The others are 154 Allyn St., currently a surface parking lot in downtown Hartford, and 201 Hudson St., a surface parking lot with an auto detailing shop on it.

Remote work debate

Tax revenue isn’t the only consideration. Bronin said he’d like to see more state employees working in-person, and hopes the DAS study will result in bringing more state workers into the Capital City.

“What matters is not whether employees are attached to any particular building on paper,” Bronin said. “What matters is whether they're actually in the building.”

The Lamont administration last year reached an agreement with state employee unions that gave thousands of state workers the ability to work remotely for as many as four days per week. 

“When considering the amount of office space available in the future, one of the primary considerations will be the future of telework by state employees,” McKay said.

The consolidation at 450 Columbus Blvd. could signal a renewed focus on increasing the concentration of state workers in downtown Hartford, which would help merchants who rely on patronage from foot traffic. 

“Even though this state is not currently in a full return-to-work mode, presumably it'll evolve in that direction,” said Larry Levere, an office broker with Hartford-based Sentry Commercial. “The more people coming downtown, the better for the restaurants and the retailers in the downtown area.”

The consolidation could ultimately help state government operate more efficiently, while lowering maintenance and operational costs.

“There's an efficiency in putting as many people under one roof as possible, rather than spreading them out over several buildings,” Levere said.

Sellers, not buyers

DAS has issued a request for qualifications for consultant/architectural services to “assist in the development of a space utilization plan to maximize office space within 450 Columbus Blvd., and evaluate state buildings to meet workforce needs and requirements.”

The RFQ was posted on May 11, with a June 12 deadline for firms to submit responses. DAS is currently reviewing those submissions. 

The state is planning an office consolidation at 450 Columbus Blvd., a property that sits on the outskirts of downtown Hartford along the Connecticut River.

The property at 450 Columbus Blvd., formerly known as Connecticut River Plaza, consists of two buildings, north and south towers that span a combined 575,000 square feet.

The state purchased the property in 2013 for $34.5 million from a consortium of investors and completed a renovation in 2016. It had been mostly empty since its previous major tenant, United Healthcare, moved to City Place.

Now, the complex houses about 800 employees from the Department of Revenue Services and Commission on Human Rights and Opportunities, which moved to the 11-story South Tower in 2016. 

In addition, more than 1,300 employees from the State Office Building at 165 Capitol Ave., were relocated to the 15-story North Tower between 2016 and 2017. 

Also, the state has for years been consolidating offices near Bushnell Park, an area seen as key for the ongoing mixed-use redevelopment in the Bushnell South area.

In 2021, the state listed properties it owns at 30 Trinity St. and 18-20 Trinity St. for sale. A development team is under contract to buy both Trinity Street buildings, with plans to convert them into more than 100 apartments.

A former church property at 129 Lafayette St., which the state purchased in 2008, also was listed for sale in 2021. It has been considered for various uses, including a performance venue.

It’s unclear what lies ahead for that property, but according to CoStar, it’s under contract. A spokesman for the Office of Policy & Management said the state does not currently have any office buildings for sale.

Efforts to sell state-owned office buildings mark a policy reversal from Gov. Ned Lamont’s predecessor. Under the administration of former Gov. Dannel P. Malloy, the state became one of Hartford’s most active landlords, purchasing both 450 Columbus Blvd., and 55 Farmington Ave., formerly owned by The Hartford.

Those purchases were part of the Malloy administration’s long-term strategy to reduce the state’s real estate costs by consolidating more expensive leased space into state-owned facilities.

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