May 24, 2017
By GAYLA CAWLEY
SWAMPSCOTT — Town officials have signed a purchase and sale agreement with Groom Construction for the redevelopment of the former Swampscott Middle School on Greenwood Avenue, which included a stipulation to dismiss the longstanding lawsuit the company had against the town.
Last month, the Board of Selectmen unanimously approved a proposal from Salem-based Groom Construction, which had submitted two concepts.
The Board of Selectmen entered into a purchase and sale agreement with the company for the construction of a 28-unit apartment or condominium project, which the board accepted as the primary concept, and adhered to the zoning approved at Town Meeting last year. In lieu of not offering any affordable housing, Groom would contribute $150,000 to the town’s affordable housing trust, officials said.
“I’m happy that we’ve been able to negotiate an agreement and we’ll be able to move forward on this chapter of our really long history with this building,” said Naomi Dreeben, chairwoman of the Board of Selectmen.
The company can switch to a 60-unit Chapter 40B affordable housing project, with 25 percent of the apartments or condominiums allocated as affordable, which the board approved as an alternative, if there is litigation from the neighbors for the primary concept, officials said.
Town Administrator Sean Fitzgerald said part of the purchase and sale agreement was contingent on having the lawsuit dismissed that the company had against the town. According to a Salem Superior Court document, the lawsuit has been dismissed “with prejudice, without costs and with each party waiving all rights of appeal.”
“I think that really resolves a potential risk to the town and any time we can avoid a potential lawsuit and situation that was a financial risk to the town, that’s a good thing,” Fitzgerald said.
The suit stemmed from an initial zoning change approved at Town Meeting, which allowed for a multi-family unit on the parcel. That was overturned in Massachusetts Land Court after neighbors filed suit in 2014, and zoning reverted back to single-family housing.
The litigation with Groom, which originally won approval for a 41-unit condominium project on the site in 2012, had to be settled before the town could proceed with the sale of the property.
Peter Kane, director of community development, said the purchase price for the property is $1.2 million, with the company responsible for costs to abate and demolish the entire structure.
He said the company would be credited for those costs up to $1.2 million, which would offset the purchase price, but Groom has to have documentation for whatever is spent on abatement and demolition. He said the company has previously estimated those costs to be $1.3 million, which could technically make the purchase price zero dollars.
Kane said the purchase and sale agreement allows for the buyer to go through the permitting process before they close on the property. He said the permitting process can take up to six months.
Once that is complete, Kane said the company and town can close on the sale of the property, and then Groom can sign off on the land development agreement attached to the purchase and sale agreement, which puts the buyer in the position to develop the property in the way agreed to with the town.
Officials estimate the project will generate at least $325,000 annually in real estate tax revenue.
Selectman Peter Spellios has said the Chapter 40B alternative project would give the town protection against a potential spot zoning lawsuit from neighbors, as it is exempt from zoning, and therefore, harder to appeal. The proposal from Groom approved by the Selectmen last month was the company’s response to the town’s most recent Request for Proposals (RFP) for the project.
In January, the board decided to act upon the advice of Town Counsel and reissue the RFP with both options — conforming to Town Meeting zoning and a Chapter 40B project — when the Selectmen had been slated to approve or deny a proposal from Groom to convert the middle school into 28 luxury apartments or condominiums.
Officials said at the time that Town Counsel made the recommendation because neighbors had been clear they were again intending to bring litigation against the town. Neighbors were concerned that a 28-unit structure would be out of character with the existing neighborhood.
Kane said at this point the town has not received any notice of a lawsuit.
Tom Groom, owner of the company, could not be reached for comment.
Gayla Cawley can be reached at email@example.com. Follow her on Twitter @GaylaCawley.