After months of negotiations, New York
City developer Jacob A. Frydman said he will not bail out the
bungled Capitol View
project at Cameron and Herr streets in Harrisburg.
Rumors have buzzed around Harrisburg for months about whether a private
developer would rescue the approximately $28 million project that broke down in
the spring of 2008.
But Frydman, who also wants to lease the city’s parking
system for 75 years, said there were too many headaches surrounding the
long-stalled and half-built abandoned structure. The cost to finish
construction also was too high in a bad economy, he said.
He said he was not able to determine what the cost would
have been to complete construction of the 215,000-square-foot building.
Frydman was interested in leasing it for office space and
retail, and also planned to lease space to Advanced Communications. David
Dodd, who owns Advanced Communications, also owns the Capitol View property and
ran the project into the ground, contractors that worked on the project, said.
“There have been a lot of liens filed. There are a lot of
issues,” Frydman said. “There were roof problems because of the storm (from
several weeks ago). There isn’t one deal breaker. It was costs and building
methodologies. We have conducted a due diligence, looked at it and concluded
that based on market conditions and based on cost that we are not going to
proceed with that building.”
Reed’s office expressed regret that a deal could not be reached with
Frydman. But there is still hope for the center since other investors
previously expressed interest in the project, wrote Matthew S. Coulter,
the mayor’s spokesman, in an e-mail.
Commerce Bank will conduct a new analysis of the building
throughout the next few weeks. After that, efforts to work on a deal
with other private investors will continue, Coulter said.
“Frydman’s decision to pull out of the project may now open the
door for others to take a look at the site,” Coulter wrote. “Several
prospective investors had expressed interest in the purchase of the
Capitol View was supposed to be a shining example of how
private and public investment could team to turn a brownfield site into
economic growth and job creation when ground was broken on the building in
Dodd, who was developing the project under the moniker
Cameron Real Estate, was going to relocate his printing business into 115,000
square feet of the building and lease the remaining space.
With about $7 million invested, Commerce Bank/Harrisburg is
the largest private backer of the project. There was about $17 million in
public money promised for the project, from which
Dodd has spent at least $8 million, according to financial records provided by
Harrisburg Mayor Stephen R. Reed’s Office of Economic Development.
Almost all the contractors working on Capitol View walked
off the job last spring when Dodd stopped paying them. Various regional contractors
have said Cameron Real Estate owes them millions of dollars.
Most contractors have filed liens against Dodd. Some are
suing him, Commerce Bank and the city, which acted as a clearinghouse for the
money. Contractors have filed suits against the city and Commerce Bank for not
keeping them up to date on where the project stands, they said.
This item was modified from its original version to add comment from Mayor Stephen R. Reed’s spokesman.