River House gives up millions

May 21, 2009
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The Downtown Development Authority agreed last week to allow Robert Grooters Development Co. to assign the reimbursements the board awarded the firm for the River House condominiums project to the development’s mortgage holder, Huntington Bank.

“They have asked the DDA to consent to this agreement,” said Jay Fowler, executive director of the DDA.

Doing business as Bridgewater Condos LC, Grooters’ firm was awarded $2 million in financial assistance from the DDA in January 2006, long before the nation’s housing market collapsed.

The assistance was granted in the form of reimbursements from tax-increment revenue that would come from the public improvements the firm would make to the property at 377 Bridge St. NW. Interest on the payments was not to exceed 4.5 percent.

Of that $2 million total, $1.3 million was awarded for the barrier-free design of the 34-story tower. The remaining $700,000 was granted for the upgrades the company would make to Scribner Avenue, the building’s cross street.

Huntington Bank granted Bridgewater Condos a mortgage for the reported $80 million project in August 2005. The DDA’s action means the bank will get all reimbursements. The DDA receives $16.20 for every $1,000 of increase in the property tax of completed projects within its boundaries.

Fifth Third Bank also reportedly provided financing for the project, which was finished last year after roughly two years of construction.

The building opened in November, after the housing and financial markets sent the nation’s economy into recession. About 50 of the 207 homes were sold and occupied.

In March, Bridgewater Condos sued nearly two dozen potential buyers in Kent County Circuit Court for not following through on the sales contracts they had signed.

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