Demolition likely for Heritage House

Photo by Laura Williams

Photo by Laura Williams

ALBANY -- If anything is to come of the blighted property that was once the Heritage House, city officials say it needs to happen fast.

The former hotel was dealt a possible death blow Thursday when the federal government denied developer Romeo Comeau's application for $16 million in stimulus funds to breathe new life into the structure.

Comeau was planning to develop the hotel into apartments and senior living residences.

Ward 3 Commissioner Christopher Pike, whose ward is home to the structure, said Friday that the process now needs to move forward.

"It can't stay in the state it's in now," Pike said. "We need to do something and need to do it pretty quick."

Assistant City Manager and Interim Downtown Manager James Taylor said that city officials were hoping that the project would be approved at the federal level because it obviously would spare local taxpayers the expense of financing the development through the use of city funds.

"This was an opportunity for the city to get this development without depending upon the TAD (Tax Allocation District)," Taylor said. "We would have rather seen it developed at the federal level, but now we're essentially back to square one."

There are essentially three options for the Heritage House.

First, Comeau could find financing on his own that would pay for the development, although some city officials concede that he probably wouldn't be able to finance it privately at the same level as he was asking for from the federal government.

Second, the city, as a second-tier lienholder on the property, could declare it a safety hazard and demolish it, but the legal issues associated with that haven't been thoroughly researched. Additionally, the city would be forced to put a lien on the property for the cost of demolition -- which is estimated at $1 million thanks to the asbestos that must be removed -- and would require any prospective buyer of the property to fork over $1 million for property that clearly isn't worth that.

Lastly, the city could take the politically controversial step of obtaining the property through eminent domain. According to city officials, this step would be more costly for the city than the previous option because the city would have to pay Comeau, or whoever holds the deed on the property, fair market value plus the cost associated with demolition. After demolition, the city would be limited to construction of a public-use building -- i.e. library, park or other public building -- which then wouldn't appear on the tax roles.

The city has been on the cusp of demolishing the property before. The wrecking ball was halted when Marvin Baptiste acquired the property and offered convincing plans for its rehabilitation. City officials again considered demolition when the property switched hands again to Comeau.