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Developer says Brunswick base housing could become rentals if he can't own land

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Developer says Brunswick base housing could become rentals if he can't own land

BRUNSWICK — Auburn developer George Schott said this week that he could be forced to turn all of the 702 military housing units at Brunswick Naval Air Station into rentals, including those on McKeen Street, if he doesn't get assurances that he'll soon own the land beneath them.

Meanwhile, the Midcoast Regional Redevelopment Authority, the likely front-runner to own the land, said it won't sign any agreement with Schott until he divulges a specific development strategy.

Last spring, the two parties bid against one another for control of the housing. Schott, who says he's close to finalizing a deal to buy the units, met recently with the authority to discuss a potential development agreement.

While both sides say they share common goals, MRRA's attempt to safeguard its redevelopment goals for BNAS and protect local real estate markets from an influx of vacant housing could be at odds with Schott's objective to create a financially viable project that turns a profit.

Although MRRA Executive Director Steve Levesque said the agency is willing to work with Schott, he said the group's main objective is to make sure the housing owner adheres to the principles in the reuse plan. In fulfilling that role, it appears MRRA is using its potential control of the land as leverage to ensure Schott develops the housing in accordance with the reuse plan. 

BNAS is the first base closure in which the military owns the land while another entity, Northeast Housing, owns the actual buildings.

Schott said he is close to finalizing the housing purchase. Meanwhile, MRRA believes it's at the top of the list to own the land, which means the two parties will likely have to sign a joint development agreement.

MRRA, Levesque said, ultimately wants to sell the land to the housing owner. However, Levesque said Tuesday that MRRA also wants Schott to reveal his development plans first.

Schott, so far, has refused.

"We've requested them," said MRRA executive director Steve Levesque. "And we'll need to see them before we sign any kind of joint development agreement."

A consultant for the developer said Tuesday that Schott wants to own the land, or he may be forced to turn all of the units into rental housing.

"We're following the plan that (MRRA) has proposed, although may not be exactly what (MRRA planned)," Mathew Eddy of the Eaton Peabody law firm said.

"It's in MRRA's best interest to work with (Schott)," Eddy added. "Without the land (Schott) would have to rent all those units. It's a quid pro quo kind of thing."

Turning all the housing into rental dwellings would sharply contrast with MRRA's strategy. The organization has proposed demolishing a significant portion of the units and converting others into owner-occupied homes – specifically those on McKeen Street. The housing there is embedded in an established neighborhood of mostly single-family homes.

Although Schott said Tuesday that he shares that vision for McKeen Street, he said it doesn't make financial sense for him to demolish any buildings until he owns the land.

"There is no reason to thin out the housing when, without the land, it could be the only source of income," he said. 

So far the land-control issue has emerged as the primary sticking point between the two sides, but both say they're willing to work out their differences.

"I look forward to working with MRRA," Schott said. "They're intelligent people. But right now there's not a whole lot you can do without the land issue decided."

Levesque said the organization still believes it's in the best position to manage the disposition of the military housing. But given that Schott will likely own the housing, Levesque said MRRA's primary objective is to "facilitate the community's goals." 

"We see ourselves as the guardians of the reuse plan," Levesque said. 

Steve Mistler can be reached at 373-9060 ext. 123 or smistler@theforecaster.net