Short of receiving no bids, the worst outcome at a bid opening is receiving none that is valid. That’s what happened Wednesday, Oct. 4, when Assistant Town Administrator Marie Sobalvarro, the town’s procurement officer, opened the only bid for the land next to Hildreth House, currently zoned for senior housing. But the bid from Kishan Realty LLC of Andover was incomplete, and the $510,000 bid was less than half of the required minimum purchase price.
The land had been appraised for $1.2 million, based on a site that would be used for 17 units of senior housing with an average footprint of 1,500 square feet per unit. According to Sobalvarro, the town may not legally sell the land for less than its appraised value. The person who submitted Kishan’s bid also neglected to fill out the corporate authorization form, certifying that he was authorized to act for the company.
After nearly a year of research, meetings, and crafting of the RFP, members of the Housing@Hildreth Committee, which met immediately following the bid opening, were disappointed but not defeated. Sobalvarro informed committee members that she had already rejected the bid, as she was required to do, because it was incomplete. She also said that two developers had attended the site walk, but neither had submitted a bid.
At a subsequent meeting Oct. 11, Sobalvarro told the Housing@Hildreth Committee that she had asked the two developers who went on the site walk what discouraged them from bidding. One developer said that it was strictly an economic decision, influenced by the limited unit size, the minimum asking price for the land, and the cost of development on the site. The second developer said he thought the bid was “wired for someone else” because of the short timeframe and schedule.
Committee member Victor Normand said that he felt strongly that the problem was not with the project, but with the way it was marketed. Although it was listed for about two weeks on the multiple listing service, the listing did not include the name of a real estate firm to contact regarding the details. The project was also advertised in the Massachusetts Central Register, used for public projects such as the Town Hall renovation, which Normand said was not the right place for this project.
Normand said that the committee should put the RFP out again and do a better job of marketing it. He believes that a commission should be attached to the project to attract the interest of real estate brokers that have lists of developers that do these kinds of projects. “None of those developers responded to this RFP,” said Normand. He added that the appraisal, completed by Avery Associates in Acton, has a commission built into it. Normand, a real estate agent, said that if the town will allow it, his firm would list the land on the multiple listing service for no fee, and all responses would be directed to the town. He said he would also provide direction as to where to find appropriate brokers when marketing could be directed.
The committee also discussed allowing developers to use an installment plan to pay for the land, possibly even allowing them to hold off paying for a lot until its unit went to closing. An upfront deposit would likely be required before a road and utilities could be put in.
STM warrant article remains
An article allowing the town to sell the land for a senior housing development will be up for vote at the Nov. 6 Special Town Meeting, and although the committee hoped to have a developer recommendation and a sale price lined up for that meeting, it still intends to move forward with the article. Members hope that a positive outcome at Special Town Meeting will increase developer interest in the project.
In the meantime, the committee will attend the Oct. 17 selectmen’s meeting to discuss the path forward. It will recommend issuing the RFP again, offering a real estate commission and getting the proposal to the appropriate brokers, holding a bidders’ conference to explain the project and answer questions after the RFP goes out, and offering an installment plan to allow developers to pay for the land over time. The committee hopes to get the RFP out again in early November.
