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May 27, 2013 Financial Sense

Northland refinances $11M debt on Hartford property

Despite its financial woes in recent years, Massachusetts development company Northland Investment Corp. is still attracting private capital to maintain what’s left of its Hartford real estate empire.

Northland recently reached an agreement with a Massachusetts commercial realty investor to refinance an $11 million mortgage on its 242 Trumbull St. office tower, commonly known as the Standard Building, city records show.

The funding was provided by Shem Creek Trumbull, a limited liability company formed by Shem Creek Capital.

The funds paid off a mortgage on the property held by Waterbury lender Webster Financial Corp., which had been trying to sell the loan for months, sources say.

Webster Bank provided Northland a $14 million mortgage for the property in 2003, but was forced to modify and extend the loan on several occasions. Now, Webster Bank is off the hook for that debt.

Northland and Shem Creek officials didn’t return requests for comment.

Northland bought the 310,000 square foot Standard Building in 2003 from Travelers for $11.7 million, city records show. The property had a fair market value of $7.5 million in 2011, city records show.

Like many downtown Hartford properties, the Standard Building has had to cope with a changing tenant base in recent years. Law firm Day Pitney is the anchor tenant. UBS Realty Investors moved out of the building a few years ago, leaving a noticeable vacancy in the property. But sources say the building has had better luck filling empty space recently. Its newest tenant is Amenta/Emma Architects.

The Shem Creek deal represents the second time in two years Northland has been able to refinance debt on its Hartford real estate.

Last year, Northland secured a $75 million mortgage from UBS Real Estate Securities for its Hartford 21 residential and retail tower, city and regulatory records show.

The loan proceeds were used to refinance about $70.3 million of remaining debt that Northland took out in 2004 to build the city’s tallest residential/retail tower.

The original $80 million mortgage on Hartford 21 was provided by Citizens Bank, which also had been trying for years to sell off the loan, sources say. Citizens modified that loan nearly a half dozen times before it was paid off.

Both deals represent good news for Northland. Since 2011, Northland has lost three downtown Class A office buildings to foreclosure including Metro Center, CityPlace II and Goodwin Square.

• • •

Finance job hiring slows

As college graduates head out to the workforce, they won’t be meeting a robust financial services job market in Connecticut.

Hiring in the state’s key insurance and financial services clusters was down significantly in the first quarter and employment in the sector fell by 2 percent or 2,300 jobs in February, according to an occupational outlook report recently published by the Connecticut Insurance & Financial Services Cluster, in partnership with SkillPROOF Inc.

Job demand in Connecticut’s financial services sector felt the largest declines falling 27.8 percent, followed by insurance and banking declining by 13.8 percent and 4.8 percent respectively, the report said.

The study monitors and reports on the hiring demands of 49 insurance, banking and financial companies in Connecticut by tracking job postings on their websites.

Greg Bordonaro writes the Financial Sense column every other week. Reach him at

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