New London City Council discusses lease for city office consolidation
New London — It would be dramatically cheaper for the city to relocate its offices to a Howard Street office complex than moving them to Eugene O’Neill Drive, according to competing bids presented to the city.
The city opened bids from two companies offering at least 33,000 square feet of space last week as it considers selling off buildings that now house city offices.
Fairfield-based Julian Enterprises, which owns 6 Shaw’s Cove, offered up two floors of its office building for what amounts to a $577,362 yearly cost, which includes rent, utilities and improvements. Old Lyme-based Readco, owner of 63 Eugene O’Neill Drive, currently home to Citizen’s Bank, offered up its building for what amount to about $848,375 a year to start.
The numbers were presented to the City Council on Monday by Felix Reyes, the director of the office of development and planning, who adjusted bid amounts and projected costs for 25-year leases with 10-year options.
The two locations are in stark contrast to one another, 6 Shaw’s Cove being a modern office building about a half mile from the city center and 63 Eugene O’Neill being an historic building a block from City Hall.
The council is mulling the idea of selling off at least three of four buildings that contain city offices. The move is an attempt to save money on yearly maintenance costs for the aging structures and avoid future capital costs, as well as to provide a single location for most city departments.
The city spends more than $300,000 annually on operating expenses at four buildings, including City Hall, the Richard R. Martin Center at 120 Broad St., the Stanton Building at 111 Union St. and the finance building at 13-15 Masonic St., Reyes said.
Over 20 years, Reyes said the cost to save the buildings could amount to nearly $18 million in debt service, a major factor when it comes to considering the yearly hike in expenses that a lease would bring.
The Martin Center already is on the market, and the city’s Park and Recreation Department moved to the Stanton Building earlier this year, “a triage move until we find something better,” Reyes said. The Masonic Street building is expected to be used as swing space when the city renovates city hall.
Monday was the first public discussion of the consolidation and the council agreed to continue its discussion at a future date.
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