ATTLEBORO — Tax breaks are in the works for converting an old factory building on Union Street into housing.
The project, at 54 Union St., is expected to cost the developer around $10 million, which will bring construction investment in downtown, either planned or in progress, to about $64 million.
The property owner, Jonathan Cozzens of 54 Union Street LLC, intends to build 43 market-rate apartments in the factory, which stands at the corner of Union and Dunham streets.
Cozzens bought the building from Peter Alexander Realty in July for $800,000.
Permits for the project have already been obtained from the zoning board of appeals.
In a presentation before the city council Tuesday, Economic Development Director Catherine Feerick said the project is not financially feasible without tax breaks at both the local and state levels.
Under a 20-year program the city would exempt tax payments on 85 percent of the value of the improvements for five years, 75 percent for five years and then 65 percent for the final 10 years.
That means 54 Union LLC would pay full taxes on the current value plus 15 percent, then plus 25 percent and then plus 35 percent.
After 20 years it would pay the full amount.
Despite the tax breaks, the city would still reap an additional $517,000 over the 20 years of the program, according to Feerick’s presentation.
Local tax breaks must be granted to enable the company to be eligible for state tax breaks.
A public hearing on the tax breaks is slated for Jan. 19.
The five-story building, which includes an attached two-story building at 12 Dunham, stands on a 14,810-square-foot lot, which is a little more than a third of an acre.
Together the buildings have about 32,978 square feet of interior space, according to their field cards on file at the city’s assessor’s office.
The buildings are assessed at a total of $597,600 for tax purposes.
The property has only three parking spaces, but Cozzens told the council that he’s in negotiations with the city to lease additional ones in a city-owned lot behind the building.
The city’s Economic Development Incentive Board, of which Mayor Paul Heroux is a member, approved the proposed tax incentives on Dec. 28.
While some people complain about the number of apartments being developed in the center, Feerick said it’s crucial for the reestablishment of a strong business presence.
People living in the center are likely to shop there, she said.
The aim is to create an “18-hour economy” by populating it to a large extent with people who take the train to Boston or Providence for work.
54 Union and 12 Dunham are across the street from the MBTA commuter rail station.
Retail demand becomes high when people, especially people with good jobs in Boston or Providence, live in the center, Feerick said.
In comments to The Sun Chronicle, she said developing residences and businesses at the same time is important.
Thanks to a business development contest run by the city, financed by a state grant, there are four new businesses slated to open downtown in the coming months.
“I would like to emphasize that the new residents in our downtown will be far more likely to consistently patronize downtown businesses than those living farther away, and will improve the overall demographic profile for regional and national retailers that currently will not invest in Attleboro,” Feerick said.
“We need to strengthen both sides of the equation at once, because we’re in a period of incredible opportunity right now, even while COVID has upended so much of our daily and economic life.”
The 54 Union project is just one of four multi-million dollar projects unfolding downtown.
Work is beginning on a $25 million project that will convert the Foster Building at 37 Union into 54 apartments, and work is expected to start this spring at 29 South Main St., the site of the former Briggs Hotel. The building will be razed to make way for a $10 million development with 46 apartments.
At the corner of Wall and South Main, developer Marco Crugnale is well into construction on a $19 million, 136-unit building.
Currently the structures at 54 Union and 12 Dunham house the Metal Tile Technology and Plastic Craft companies, respectively.
54 Union was built in 1908 and once housed the A.S. Ingraham Co., which produced chemicals, paints and varnishes.
The building at 12 Dunham was built in 1931 and has housed Plastic Crafts since that time.