Paolino Properties’ Managing Partner, Joseph R. Paolino, Jr., was featured in a recent op-ed published in The Providence Journal about businesses leaving the downtown financial district.
Read the story below:
Joseph R. Paolino Jr. is managing partner of Paolino Properties, served as mayor of Providence from 1984-1991 and was director of the Rhode Island Department of Economic Development from 1991-1994.
I am sure most people thought it was a good economic development opportunity upon reading the news that BankRI was building a new headquarters in Providence. However, it left me scratching my head and frustrated because, in my opinion, it’s a bad decision by the city, state and I-195 Redevelopment District Commission. The city and state cannot continue to enable the theft of downtown businesses to areas meant to attract new business.
For decades downtown Providence has been a hard place to lease office space. Companies are not breaking down doors to swoop-up offices, which is why many of the older office buildings have been turned into apartments. A perfect example of this is the “Superman Building.” And, the pandemic has only made things worse. Several companies continue to downsize their offices as they embrace and encourage the “work from home movement.”
My heart goes out to the owner of the Turk’s Head Building because we’re in the same predicament. How are building owners in downtown Providence, who don’t get any tax breaks, able to compete with building owners with tax stabilization agreements who can offer leases at cheaper rates? The answer is: we can’t.
Businesses are being taken away from the heart of downtown, threatening to leave it a ghost town and open to bigger problems such as crime. It also leaves small businesses like Capriccio, Pot au Feu, Ten, Circe, Cafe La France, and those inside The Arcade vulnerable to closure by eliminating their clientele.
You might remember the development of Blue Cross & Blue Shield of Rhode Island in Capital Center. At the time, public officials heralded it as a renaissance and great expansion, granting tax stabilization to any building built there. But in reality, BCBS emptied at least four buildings downtown where they were paying full property taxes for a new building with tax stabilization. Yes, it spurred economic development, but the plan is similar to the story of Robin Hood, except in this case, it’s stealing from the poor and giving to the rich. Now it’s the beautiful and historic Turk’s Head building that has become a victim. The owner is losing its largest tenant and knows that it will be very hard to fill that soon-to-be vacant space.
The old I-195 land was meant to attract new and innovative businesses to help build a new economy and complement our hospital networks and colleges like Lifespan and Brown Medical School. The Rhode Island Foundation recently released a study about jumpstarting the state’s life sciences and biotech sectors, which is a great tool that should be used as a guide. They call it the “Providence Innovation and Design District.”
Well, there is nothing innovative about a new bank building going on high-value vacant land which is why I believe every member of the I-195 Redevelopment District Commission should resign for approving this plan. An existing company paying full taxes in the Turk’s Head building is now moving to an area with automatic tax stabilization. It’s a win for BankRI and you can’t blame them for making a decision that’s good for their business, but the city and taxpayers are the losers in this deal.
I’ve been saying for years that we need to get back to the original plan for the old I-195 land and use it to attract new and innovative life science companies. Only then will we be setting our economy up for success in the future. I call on our current leaders and new elected officials this November to change the course of eroding the downtown financial district and do the work to attract new business to Providence or else the Turk’s Head building will become the next Superman building. This stuff is not complicated.