Concord, N.H., is selling $10.1 million of general obligation bonds today as part of the citys plan to reanimate its downtown, which spreads over eight blocks and includes 400 businesses and 4,500 workers.
Bond proceeds will pay for a 500-space municipal parking garage on Concords Main Street, which retailer Sears, Roebuck and Co. abandoned a decade ago for a mall nearby.
The garage will serve new construction on the two-acre former Sears Block, bought by the city in 2002, which begins next month with a six-story, brick and glass signature building, according to the citys community development project manager, Matthew Walsh.
The 102,000-square-foot building will house office and retail spaces, an upscale restaurant, and the state capitals first independent art film house, he added. Redeveloping the block will cost $25 million to be paid with a combination of private financing and the current debt sale that is secured by tax increment financing from the Sears Block TIF District, parking lease and meter revenue, the citys parking fund, and general fund revenue.
Concord is the states third largest city with a population of 41,404. Its $3.6 billion tax base is mostly stable, thanks to a large government sector, and has grown in recent years in part thanks to development efforts. Revaluations following residential and commercial construction projects helped push the citys taxable valuation growth to 16.5% annually between 1999 and 2004, according to Moodys Investors Service.
Downtown revitalization dates back to the 1970s, when the city began buying entire blocks and partnering with developers to restore buildings, according to Walsh. In 1998, Concord redeveloped 40 acres of property then valued at $3 million. Following restoration and development, its value is now estimated at $50 million, Walsh said.
The citys reserves are healthy last years general fund balance was $7.78 million, or 20.8% of revenue but will continue to decline in the near term as the city continues to use its tax stabilization reserve to finance growing fixed costs, Moodys said.
Concord has about $57 million of outstanding debt and typically sells between $5 million and $10 million of GOs every year, though the size of the current project required a separate sale, city Treasurer Michael Jache said.
Standard & Poors and Moodys rate the debt AA and Aa2, respectively. Fitch Ratings is not expected to rate the deal.
