s-scarfairchild-012309 Fairchild: Time, not money, drove decision to stay in S.P.
SCARBOROUGH — Fairchild Semiconductor Corp.'s decision to remain in South Portland leaves a business and economic hole in Scarborough.
A 90,000-square-foot, $20 million building once hailed as "vitally important" to the community by Town Manager Tom Hall would have been the centerpiece to the Gateway Square development on Haigis Parkway.
But the failure of development company New England Expedition to secure financing in time to move forward on an ambitious construction schedule led to the company's decision to opt out of its contract and stay in its leased headquarters on Running Hill Road.
Although there has been some speculation that layoffs at Fairchild drove its decision, spokeswoman Patti Olson said Wednesday that was not the case.
"It wasn't a financial issue; it really was a time issue," she said. "If we could have come up with a reasonable plan that worked we would have come to Scarborough."
But Olson did confirm that the company is laying off between 50 and 70 people at its two South Portland locations.
Fairchild is now in the process of negotiating a new, five-year lease with Dead River Properties, Olson said. As part of its agreement, Fairchild hopes to upgrade the building to be more energy efficient, she said.
Olson said the company considered asking for an extension to its lease to give developers more time to get financing for the proposed building, but "didn't feel it was an option."
Though losing the Fairchild project was a blow to New England Expedition's Gene Beaudoin, whose company has been key in the development of the Haigis Parkway, he said Wednesday that plans for a hotel and a couple of 30,000-square-foot office buildings are going forward.
"I reconfirmed that the hotel is going ahead the other day," Beaudoin said.
He said tenants are "weeks, not months away" from signing on, but declined to identify them.
Beaudoin also confirmed he and business partner Barry Feldman still intend to seek an amendment to their credit enhancement agreement with the town that would extend the length of time they have to recoup $8.25 million in taxes.
Under the original agreement, the window is 10 years. After a meeting between developers and town officials two weeks ago, Hall proposed extending the term to 13 years. But Beaudoin indicated that he and Feldman will be asking for more.
Hall said Wednesday that he "was not surprised" by Beaudoin's intentions.
"For them to receive full reimbursement, they need to more than double the current value of that property," Hall said. "It's unlikely they'll get to that higher assessed value any time soon."
Though Hall acknowledged the decision is up to the Town Council, he said he thinks the town must consider extending the time restriction, adding that the total amount would never exceed the original agreement.