THE CITY OF SPRINGFIELD, MASSACHUSETTS

MAYOR DOMENIC J. SARNO

HOME OF THE BASKETBALL HALL OF FAME

City of Springfield 36 Court Street Springfield, MA 01103-1687 (413) 787-6100


PRESS RELEASE, CONTACT: Jim Leydon, Communications Director

BREACH OF CONTRACT COMPLAINT FILED ON 195 STATE STREET REAL
ESTATE, LLC.

J uly 14, 2014 -Springfield, MA- The City of Springfield is filing a Breach of Contract complaint in
Hampden County Superior Court against 195 State Street Real Estate LLC in regards to an unfinished
development project at 195 State Street, the former headquarters of the Springfield School Department.
The company was to have developed 35 units of market rate housing. The complaint will seek to return
the building to city ownership as well as an injunction barring the transfer of the property to anyone else

We have worked patiently with this developer, but we have come to the point where the city needs to
move forward and the property needs to be fully redeveloped, said Mayor Domenic J. Sarno. We have
given this company ample opportunity to perform and were hopeful they would be able to complete this
important project.

The property was transferred to 195 State Street LLC in October, 2011 after a competitive Request for
Proposals process. The development group was given 18 months to complete the market rate housing
project, and then given an extension when financing difficulties arose. The company was able to
complete initial cleanup activities, asbestos remediation, and limited framing work of units; however
work has since stalled.

Were comfortable with the changes in the downtown real estate market since this was first put out to
bid, said Kevin Kennedy, Chief Development Officer. Its a great building in a prime location on State
Street - its too important to leave dormant any longer.

The property was sold for $1 to 195 State Street LLC due to the significant costs of the asbestos, HVAC,
elevators, windows, and general construction costs required to redevelop the building to market rate
housing. The Springfield City Council approved the transfer in 2011. The city has received




approximately $20,000 in tax payments during this time, and the building is now free of asbestos and
should generate strong interest in redevelopment.

BUILDING HISTORY

The property at 195 State Street was built for the Springfield Fire & Marine Insurance company in
1905 and designed by Peabody and Stearns, one of the few buildings in the Springfield region designed
by the well-known firm that also designed the Boston Custom House property. The building was added
to the National Register of Historic Properties in 1983.

The Springfield Fire and Marine Insurance Company itself was responsible for many payouts of
legendary events across the country including the Chicago Fire of 1871 and the San Francisco Fire of
1906 just a year after this building opened that resulted in a payout of over $80 million.

The property maintained use as a private insurance company office building until July 22, 1965 when it
was sold to the City of Springfield. The property has been utilized most recently as the Springfield
School Department headquarters until July, 2010 when the offices relocated to 1550 Main Street,
making it available for redevelopment. The property, approximately 53,000 square feet, had been well
known to lack modern amenities, such as central air conditioning and modern elevator equipment.

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