Morning Call account, Alvin H. Butz, Inc intends to take advantage of a $3 million state grant and NIZ financing to expand its operations.
What a sweet deal for the Butz family! Financing for their new office building through the NIZ and a Redevelopment Assistance Capital Program (RACP) grant - it doesn't get any better than that powerful subsidy cocktail. A NIZ financing package, funded by the Commonwealth, and a $3 million RACP grant, which also just happens to be funded by the Commonwealth.
This is ridiculous. Shouldn't an RACP grant recipient be barred from using NIZ benefits simultaneously? Did Senator Pat Browne think about that when he wrote the NIZ bill?
How can any "mere mortal" developer compete with that? Butz' rent should be very competitive. They can, and should, do better than even J. B. Reilly in the pricing area. The only difference is they may have overpaid for the adjacent properties. J. B. bought his properties at a more reasonable price.
By the way, did you see who owned the adjacent properties to the Butz tower? Alliance for Building Communities (ABC). Let's connect some dots. Ed Pawlowski was a former Executive Director of ABC. Current Executive Director and President is Gerry Alfano. Guess what Gerry does in his spare time? He chairs the Allentown Commercial and Industrial Development Authority (ACIDA).
You may have heard of them.
ACIDA just happens to be the current authority that is managing the Arena project. It's dispensing, rather subjectively, the financial benefits of the NIZ to interested developers. I would hope that Chairman Alfano would be abstaining from any ACIDA actions involving property formerly owned by his non-profit , ABC, which was sold to Butz for a very friendly price.
It's surprising J. B. Reilly's brother in law didn't get in on this deal. He is such a real estate maven. He had the foresight to buy properties early on Hamilton Street and then fortuitously flip them to ACIDA at a most propitious and favorable price within weeks of purchase. They just "happened" to be in the Arena block. Of course when he bought them, he had no idea. (Wink, wink!) He just had a "hunch."
Updated 10:05 AM: Blogger Michael Molovinsky, who is far more knowledgeable about Allentown than I, fills in some of the missing pieces on this post.