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Political Insiders Benefit from Hospital Hill Development
Mike Kirby
(Page 2 of 2)
The following table depicts the initial sales of Hospital Hill lots.
Ice Pond Revenues (source: Multiple Listing Service)
| Lot # | sale price | Listing office | listing agent | sales office |
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| Lot #1 | * |
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| Lot #2 | 84,000 | Goggins R.E | Goggins R. E. | Canon R.E. |
| Lot #3 | 84,000 | Goggins R.E. | Goggins R.E. | Canon R.E. |
| Lot #4 | 86,000 | Goggins R.E. | Canon R.E. | Canon R.E. |
| Lot #5 | * |
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| Lot #6 | 86,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #7 | 90,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #8 | 90,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #9 | 95,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #10 | 92,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #11 | 100,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #12 | * |
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| Lot#13 | * |
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| Lot #14 | 100,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #15 | 92,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #16 | 110,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #17 | 105,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #18 | 90,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #19 | 90,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #20 | * |
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| Lot #21 | 100,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #22 | 90,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
| Lot #23 | 90,000 | Goggins R.E. | Goggins R.E. | Jacques R.E.G. |
| Lot #24 | 90,000 | Goggins R.E. | Goggins R.E. | Jacques R.E.G. |
| Lot #25 | * |
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| Lot #26 | 92,000 | Goggins R.E. | Goggins R.E. | Goggins R.E. |
* Missing data, presumably because the sales of lottery lots had not been entered yet
Total land sales to date: $1,858,000
Total of land sales where agents from Goggins Real Estate handled sales: $1,592,000
their percentage of total sales: 85%
commissions estimated at 6%: $95,520
commissions of all other firms at 2% = $5,320
Goggins share of commissions: 98% **
The actual closings on these sales are just happening now. If we assume that the same percentages of broker commissions hold for the second phase, and if we assume that the brokers get a 6% per cent commission** , the commissions alone will be $411,600.18
| Lot # | sale price | closing date | buyer |
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| Lot #1 | * |
| Wright Builders |
| Lot #2 | 84,000 | April 5 | James C. and Linda Powers |
| Lot #3 | 84,000 |
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| Lot #4 | 86,000 |
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| Lot#5 | * |
| Wright Builders |
| Lot #6 | 86,000 | 27 February | Michael and Frances Becker |
| Lot #7 | 90,000 | 23 March | Roy J. Giangregorio dba Contemporary County Builders |
| Lot #8 | 90,000 | 23 March |
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| Lot #9 | 95,000 | 4 March | Jacqueline Geschwind |
| Lot #10 | 92,000 | March 29 | David March |
| Lot #11 | 100,000 | March 29 | “ “ |
| Lot#12 | * |
| Wright Builders |
| Lot#13 | * |
| Wright Builders |
| Lot #14 | 100,000 | 22 January | Richard and Joanne Picard |
| Lot #15 | 92,000 | 4 March | NewHarmony Properties LLC |
| Lot #16 | 110,000 | 23 March | SweetMeadow Properties LLC |
| Lot #17 | 105,000 | “ “ | “ “ |
| Lot#18 | 90,000 | 23 March | Roy J. Giangregorio dba Contemporary County Builders |
| Lot#19 | 90,000 | 23 March |
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| Lot #20 | * |
| Wright Builders |
| Lot #21 | 100,000 | March 31 | Thomas C. Foley & Nancy A. Foley |
| Lot #22 | 90,000 | May 25 | Andrew O’Brien |
| Lot #23 | 90,000 | May 3 | David A. Hardy |
| Lot #24 | 90,000 | “ “ | “ “ |
| Lot #25 | 132,000 | June 21 | Danny A. Trombley |
| Lot #26 | 92,000 | March 23 | Marek Inc.Builders |
But commissions only tell part of the story. Who was sold the land is important. Tremendous power is often in the hands of brokers who are able to sell the most desirable lots to friends and business associates. Project insiders, Jonathan Wright and his associates (SweetMeadow Properties LLC and NewHarmony Properties LLC), acquired 31% of the properties, and some of choicest lots. Jonathan Wright was an early member of the NDC , and has bought and developed land for houses for both Patrick Goggins and Charles DeRose. On September 10, 2001, Charles DeRose and his wife Leila K. DeRose sold valuable land off of North Farms Road to Sweet Meadow Properties LLC for $150,000, and granted them a mortgage to secure an additional payment of $116,000. 19 The land was subdivided into four lots and became known as the Northern Woods Residential Development. 20 Sweetmeadow then sold the properties for $625,000. Lot #4 was sold back to New Harmony properties, then the land was resold, presumably with a Wright house on it, for $475,000.
New Harmony Properties on Hospital Hill are being flipped for quick profits. On the 23rd of March, TCB Hospital Hill LLC sold lot 16 to SweetMeadow Properties LLC for $110,000. SweetMeadow is owned by Jonathan Wright, Arthur Pichette, Charles Miller and Mark Ledwell. On June 3rd, Sweetmeadow resold the property to Yvonne Ting for $131,500.00. On March 3rd, SweetMeadow sold lot#15 to New Harmony Properties LLC for $89,500.00, then New Harmony put it on the market for $109,000.00. There is a $15,000 builders deposit on the property, which means that anyone not contracting with Wright Builders to construct a house on the lot will forfeit the deposit, leaving the actual price to the purchaser who wanted to buy it as land $124,000. Selling properties to a corporation you have an interest in is a time-honored way to build spurious value and ask a higher price for resale.
Ice Pond represents just the opening phase of what probably will be a project stretching over twenty-five years or longer. Realty Services International in their appraisal of the development plan in the year 2,000 estimated that the retail value of the Commercial / Industrial land would be $3.7 million, residential lots in the 58 acres in Phase D would have a retail value of $2.9 million. The total retail land value for build out is $9.8 million. 21 The profits from brokerage fees alone would be nearly $600,000. There is no reason not to suppose that the same group of the people that profited from Ice Pond will continue to dominate all phases of the future development, and that unconnected realtors, builders and brokers will be shut out.
To summarize:
The project has been sold on its public benefits, but is controlled by political insiders. The zoning for this project was designed to steer development to Hospital Hill and away from existing neighborhoods. This has the unintended impact of unlawfully discriminating against property owners in other areas of the city, and benefiting developers, realtors and principals in LLCs and other corporations that own or represnt owners of Hospital Hill land. There is no public bidding on broker fees, nor any fair and public notification by the project to competing builders, realtors and developers.
• Many of the key players in this were involved in the bankruptcy of our regional bank, Heritage Bank, in the 1990s. Some were involved in realty partnerships where a convicted bank officer, Michael Smith, was a hidden partner. 22 Major players in Hospital Hill include Heritage insiders Patrick Goggins, Matthew Pitoniak, Edward Etheredge 23 and Michael Crowley. 24 Between l986 and l991, both Patrick Goggins and Arthur Pichette were partners with two people later convicted of bank fraud, Donald Todrin and Mike Smith. Arthur Pichette today is coordinating the affordable housing part of the Ice Pond project for Wright Builders, Patrick Goggins is broker for Community Builders, and ex-officio coordinator of the whole project for the Mayor.
• NDC and Community Builders have not made a good faith effort to preserve historic buildings on the site as required by the RFP. When they wanted designation as developer, they put a portion of “Old Main” at the center of their project design; 25 when they had designation they pushed for demolition of most of the historic buildings. Dietz & Company memoed CB on April 4, l999 its “confusion” on Old Main and recommended a better study of the building. CB went to Boston with the Dietz chart, termed by Kerry Dietz “a work in process.” 26 The chart became an oft-referenced study that became part of the materials referenced in the State Environmental Review. Dietz Architects were awarded the architectural work for the Ice Pond project.
• The 1995 Ethics Commission Ruling was designed to put a firewall between developers and the Citizens Advisory Committee (CAC): that wall has been breached. CAC member Charles DeRose has linkages to Sweet Meadow Properties LLC and NewHarmony Properties LLC, who are benefiting from Ice Pond land sales. NDC Clerk Edward Etheredge despite his 1995 assurances to the Ethics Commission that he had no connection with any development planned on Hospital Hill, plays multiple roles in the project. Patrick Goggins, excluded from the CAC in l995 now plays a central role in the project. NDC executive committee member Ruth Constantine represented Smith College; the State sold Smith College State Hospital land at below-market prices.
• The Northampton Development Corporation was a non-profit public foundation organized for tax-exempt purposes: It would seem improper for the NDC to finance a public referendum campaign where the real estate and development interests of its principals are benefited. Its conduct would seem to violate the spirit if not the letter of IRS regulations and conflict of interest laws. (G.L> c. 268A) as well as laws that relate to public financing of elections.
Future LLCs organized to develop the Hospital Hill project should exclude all parties foreclosed from involvement in the project by the Ethics Commission in l995. Attorney Edward Etheredge should step down from any position with MassDevelopment, Ice Pond Association, or TCB Hospital Hill LLC. All future sales and development contracts that involve state property should promote the public interest by following open bidding and prevailing wage laws.