Norwich — The sale of the nearly 50-acre Norwich portion of the former Norwich Hospital property to a private developer for $300,000 could be completed within the next week, a state official informed Norwich Mayor Deberey Hinchey this week.

Shane Mallory, administrator of leasing and property transfer for the state Department of Administrative Services, told Hinchey in an email that “the hospital purchase and sale agreement has been fully approved now, and we are ready to close. A specific closing date hasn't been set yet, but we expect it to be within a week or so.”

Developer Mark Fields of Colchester, a member of Thames River Landing LLC, the development firm that reached an agreement with the state to buy the abandoned property in 2013, could not be reached for comment Tuesday.

In March, Fields said he had reached the purchase and sales agreement with state officials, but several state agencies had to sign off on the deal before it could be completed.

Fields said at the time that once he obtains the property he would seek financing for the environmental cleanup and work on potential development plans.

The Norwich property, located on both the Thames River side of Route 12 and east of the state road, is zoned for a variety of commercial uses, including hospitality, resort, hotel and retail businesses, but residential development is not allowed under the city's current regulations.

Hinchey and Norwich Planning Director Peter Davis said they have not heard from Fields on possible plans for the property.

“I think it will be interesting to see what the new owner has planned,” Hinchey said Tuesday, “and hopefully the city can work closely with him.”

Unlike Preston, which took over ownership of the 393-acre former hospital property in that town, Norwich declined to take ownership of the Norwich portion, leading the state to sell it as surplus property with the developer to take responsibility for the environmental cleanup and demolition of the decaying buildings.

The state had approved Thames River Landing LLC's proposed purchase of the 49.65-acre property for $300,000 in summer of 2013, but development partner Ronald Shelton of Farmington died a month later.

The contract became part of Shelton's estate, and the parties had to wait for the probate court to settle the estate before the sale could move forward.

The initial contract called for Thames River Landing LLC to pay a nonrefundable deposit of $30,000, which was paid in 2012. The remaining $270,000 is due by wire transfer or bank check at the closing.

The sale involves a 40.95-acre parcel on the east side of Route 12 at the Preston line that includes a former residential subdivision for hospital employees along with institutional buildings.

On the Thames River side of Route 12, the developer would purchase an 8.7-acre parcel that borders Preston – and includes a tiny portion of one building that stands mostly in Preston. The parcel also borders the former Brewster farm owned by the Mohegan tribe.

The pending sale comes as Preston is nearing completion of the massive cleanup and demolition project on the Preston campus, being marketed as Preston Riverwalk. To date, 49 of the 57 structures targeted for demolition have been torn down.

But the Preston Redevelopment Agency cannot complete the demolition without working with Thames River Landing. One building that straddles the municipal border is 10 percent in Norwich and 90 percent in Preston.

Preston officials welcomed apparent progress on the sale of the Norwich piece.

“It's been sitting idle for way too long,” Preston First Selectman Robert Congdon said. “I hope that whoever bought it has a plan to clean it up and develop it. It certainly would make marketing our property much easier if we don't have a blighted brownfield right next door.”

c.bessette@theday.com

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