Special to the Reformer
BRATTLEBORO >> A recent Vermont Life magazine cover story called it a "Miracle on Main Street."
But mild-mannered engineer Bob Stevens wasn't seeking to become a downtown-redevelopment superhero when, five years ago, he ventured into the smoldering shell of Brattleboro's fire-ravaged Brooks House.
"I went through with emergency responders to determine if the structure was stable," he recalls. "Everything was so wet, the building was literally weeping."
Built in 1871, the onetime hotel boasted such guests as U.S. President Rutherford B. Hayes and British writer Rudyard Kipling, the latter who drank lager in a basement bar and played poker in a penthouse suite. Renovated a century later into a business and apartment building, the five-story monolith was fully occupied when flames sparked the night of April 17, 2011, drawing 150 firefighters and 2 million gallons of water.
Stevens determined Main Street's biggest block was soaked but salvageable. What he didn't know was that he'd soon buy it. And find too many unwelcome surprises. And face too many unwelcome delays. And ultimately spend $23 million to restore a property valued at $8.5 million.
Downtowns from Springfield to Swanton house empty building upon empty building. Why do they sit vacant so long? Stevens and his partners aren't alone in understanding the challenges of restoring a community cornerstone. Read the applications of the two dozen projects receiving state Downtown and Village Center Tax Credits this fiscal year and you'll find similar stories.
Consider Barre's former Homer Fitts department store, "a local landmark that closed in 2006 and has languished in recent years." Or Hancock's General Store, "operated for over 100 years before closing in 2013." Or Randolph's Foundry Park complex of commercial and industrial buildings, "flooded in 2011 and suffering from deferred maintenance." Or Vergennes' former theater, "virtually empty and abandoned when the current owner purchased it."
"One part of why Vermont is so attractive is our historic downtowns," says Patricia Moulton, secretary of the Vermont Agency of Commerce and Community Development. "But it's one thing to redevelop buildings so they look good, it's another thing to have commerce happening."
That's why local developers and state leaders increasingly are advocating the best way to save storefronts isn't simply through restoring bricks and mortar but also by reinforcing a city or town's larger foundation of residents, tourists and jobs.
Construction was simpler a century and a half ago when the late Brattleboro businessman George Brooks spent $150,000 to turn 1 million bricks and 500,000 feet of lumber into his namesake block after an 1869 blaze consumed the west side of his town's central business district.
"Without expecting to realize any return from it as an investment, he spared no money in making it a superior among the hotels of New England," the Annals of Brattleboro report.
Stevens appreciates such history, so the present-day engineer was happy when the Brooks House's previous owner hired him to help rebuild. Then costs to simply clean up the remnants and cap the roof topped $1.5 million, spurring the landowner to voice second thoughts to Stevens and a local tax credit financing lawyer, Craig Miskovich.
The two didn't blink. Instead, they decided to buy the property themselves.
"How do we keep downtown buildings vital?" Stevens says. "We were afraid this one would either sit on the market for years or a buyer might do the minimal amount to get it up and functioning."
Stevens and Miskovich had the professional skills to do the job right. But eyeing an initial restoration estimate of $14 million, they also faced enormous personal risk.
Enter brothers Peter and Drew Richards and cousin Ben Taggard, third-generation leaders of the southern Vermont insurance and financial services firm The Richards Group. Teaming with Stevens and Miskovich, they stitched together a crazy quilt of private and public money and tax credits — only to have a Boston bank unravel a final loan agreement at the last minute.
"You need every piece of funding," Stevens says, "but the tax credits alone are incredibly complex, which is new territory for many banks."
Gov. Peter Shumlin and Vermont House Speaker Shap Smith, calling their own contacts, joined the frantic search to nab a new lender. Some two dozen tries later, developers found a taker in the Upper Valley-based Mascoma Savings Bank, which subtracted one hurdle while adding two others: specifically, requirements for a $1.5 million contingency fund and rental commitments for 70 percent of the building.
The latter seemed a particularly tall order: Asking strangers to lease space in a charred skeleton that developers didn't yet own. But Community College of Vermont and Vermont Technical College agreed to rent a quarter of the building for $250,000 a year, and a collection of retailers, apartment dwellers and a restaurant committed to another half of the 80,000-square-foot structure by the summer of 2013.
'What we need'
Cleanup crews had long removed the waterlogged flooring, ceilings and wallboard. But carpenters from the Breadloaf Corporation of Middlebury still found the remaining wood and brick riddled with rot and mold. With only about a year to finish the project before the first signed leases were set to start, they worked double shifts to meet contractual deadlines.
"We discovered and we designed, we re-framed and we re-addressed," Stevens says.
Developers officially reopened the building in October 2014. But the ribbon cutting didn't mark the end of their work. They're still trying to fill one last empty storefront and the basement bar space, as well as learn how to juggle a long list of maintenance and marketing tasks.
Then comes what Stevens considers the larger challenge, one echoed by peers statewide: It costs the same to develop a downtown in a rural or urban area, but Vermont can't support metropolitan rents. Stevens remembers when his wife opened a Main Street business 25 years ago. What she paid then to lease space is still about what she'd pay now.
"Even though we have a great downtown and a lot of independent businesses, if you talk to store after store after store, they're just hanging on," the engineer says. "There's a direct relationship between market rents and what landlords can do to take care of their buildings. That's the challenge we face not only in Vermont but most of the older towns in New England."
Public and private entities are trying to bridge the gap with grants, loans and tax credits, but experts are calling for more broad-based help.
"If you want a vibrant downtown, you need to support it," Moulton says at the Agency of Commerce and Community Development. "You need to patronize businesses, engage in activities, lease office space and apartments, bring in more visitors, and create employment that gives people the ability to shop. Those are all part of the puzzle of what makes a community whole."
(The city of Newport knows the struggle: Moulton made her comments Thursday just before joining Shumlin as he announced that developers who had bulldozed a dilapidated Northeast Kingdom building to make way for a $70 million "Renaissance Block" had been charged with running a "Ponzi-like" scheme, leaving that downtown with a cellar hole.)
Back in Brattleboro, Stevens believes in the big picture: "We collectively need to create enough vitality to increase the number of shoppers so businesses can increase their sales and afford to pay higher rents, which translates into developers being able to take care of their real estate assets."
For the building owner, it's not only about individual actions but also everyone working together to support all aspects of the local and state economy.
"We borrowed to the max to get this rebuilt, so a couple more tenants would make a difference," he says, "But we're extremely pleased with the progress we've made. The activity is increasing, and that's part of the whole downtown revitalization. Are there ways to create more energy and prosperity that will help us all improve assets? The trajectory looks good, but we've got to keep working on it."