PAWTUCKET – The 10,000-seat United Soccer League stadium anchoring the Tidewater Landing project is going to cost more than expected – about $40 million more, according to the city.
Originally estimated at $84 million, the initial phase of construction is now pegged at $124 million due to “unprecedented cost inflation,” according to a news release from the city of Pawtucket.
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Previously approved agreements for the $284 million mixed-use development along Pawtucket’s waterfront called for $36.2 million in city and state bonds to cover public infrastructure improvements for the 28-acre development that would eventually be paid back using tax revenue from the project. Another $10 million in net state tax credits was also approved by R.I. Commerce Corp. for the project, with developer Fortuitous Partners agreeing to foot the rest of the bill, mostly through private investment.
But those financial plans were made in February 2021, before the supply chain stranglehold and inflation issues truly took hold, and now the price has gone up.
Now, the city and developer are working to amend their financial plans to cover the 47% cost hike. Specifically, the “framework” to be considered by the R.I. Commerce Corp. Investment Committee at a meeting Tuesday afternoon would have Fortuitous put in another $25 million in private equity and $31 million in private debt investment. There would also be revisions to the tax-increment financing plan, the release stated, although it is unclear if that will require changes to the public contribution.
Pawtucket Mayor Donald R. Grebien in a statement praised the project as “transformational,” crediting the developer for putting in the extra money needed to ensure the project happens.
Brett Johnson, principal of Fortuitous Partners, also touted his commitment despite higher-than-expected costs.
“The world is very different than it was when we announced Tidewater Landing two and half years ago,” Johnson said in a statement. “Despite that, I am pleased that the project remains well within the original parameters for public investment that we set at our announcement.”
The cost overruns and new financing plans apply only to the soccer stadium. Other portions of the first phase of the project includes the soccer stadium, outdoor event plaza and a riverwalk on the 17-acre Tidewater site west of the Seekonk River. There would also be 435 housing units, plus a parking garage and retail and commercial space, according to prior plan documents.
It is unclear how price increases will affect the timing of the project, which has already suffered several delays. Prior plans called for the stadium to be open for a USL season in the spring of 2023, with a second phase, including a hotel and indoor event center along Division Street east of the river, to be built in 2025.
Master agreements between the city, state and developer are intended to protect public taxpayers from cost overruns, and to set incremental deadlines by which certain construction and financing milestones must be completed.
Representatives for Tidewater and R.I. Commerce said they did not have additional information to share in response to inquiries for comment.
(UPDATES: Story has been corrected in ninth paragraph to clarify that the $40 million cost increase applies only to the soccer stadium.)
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
A bad idea that just keeps getting worse.