August 23, 2012

New Town’s Outlot 2 development delayed

New Town’s Outlot 2 development delayed
By Jerry W. Kram

The New Town City Council received assurances that Outlot 2 will soon be developed.
Holland Dredge, with Eagle Rock Timber, who is the general contractor on the project, presented the council with a letter from Steve Kovacs. Kovacs is the managing member of New Town City Development LLC, the company that put together an agreement to build homes on the 14 acre lot east of the Northern Lights Building.
Kovacs’ letter apologized for the delay in starting construction on the project and that the delay had to do with the complexity of financing a project of this size. Since the city didn’t sign off on the deal until the end of July, Kovacs’ lender – Quaker State Mortgage of Philidelphia – couldn’t send an appraiser out until early August. Kovacs said his lender sounded very positive about providing $21 million in funding, but as of Aug. 15 he hadn’t received final approval to proceed. He noted that he will have to pay eight points, or $1.6 million, to Quaker State Mortgage to close the loan.
Even with the delays, Kovacs said he anticipates having at least 12 foundations poured on Outlot 2 before the weather turns cold. The 12 duplexes would be available for occupancy by Christmas if all goes well. The city will get 9 units out of the estimated 120 that will be built on the site for employee housing.
Dredge reviewed the latest plans for the development with the city council. He said the city could take its units out of the first that are built, but if the employees desire those units could be swapped for others when the development is finished.

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