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June 3, 2013 Deal Watch Today

CT nearer to buying ailing Morgan St. garage

Contributed photo Morgan Street parking garage in downtown Hartford.

The state is on the verge of taking over the three-quarters stake in Hartford's money-losing Morgan Street Garage it doesn't already own for $23 million following City Council approval. Retiring the garage's debt early will save the city another $27.7 million, authorities say.

The council voted a resolution Friday to convey the city's 77 percent stake in the 2,290-space garage to the state, Hartford Parking Authority CEO Mark McGovern said Monday.

Closing is set for July, with law firm Pullman & Comley hired to represent the city.

The state previously announced in April that the purchase of the 14-year-old garage was a cornerstone of its buyout of Connecticut River Plaza, 450 Columbus Blvd., and that building's companion parking garage, for which it is paying $34.5 million to move thousands of state employees to downtown Hartford.

In addition, the state will also pay the city $3.2 million over four years to lease for 99 years the land beneath the garage, officials said.

According to city council papers accompanying its sale resolution, Morgan Street is the worst performer of the city's three garages. The eight-story garage is only about 54 percent occupied, even with several upper floors closed to parkers.

The papers cited City Treasurer Adam Cloud's estimate that the city loses some $650,000 a year running Morgan Street, after taking debt service into account. The garage actually turns an operating profit, McGovern said.

But paying off early the bonds floated to finance or refinance the facility will save the city some $27.7 million in principal and interest, city documents show.

Meantime, the authority named Carey E. Redd II acting CEO, to temporarily succeed McGovern, whose last day is June 14. McGovern was recently named community services director to the town of West Hartford.

A search is underway for a permanent successor.

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