A development-friendly zoning overlay and tax increment financing district is benefiting commercial real estate in Windsor Locks, including Beacon Communities' recently completed Montgomery Mill redevelopment. Photo courtesy of Beacon Communities

The pending construction of a new commuter rail station in Windsor Locks is already paying dividends to the town’s real estate market, playing into the restoration of a crumbling and contaminated former textile mill as a mixed-income housing complex.

The proximity to a planned new Windsor Locks station on the Hartford Line was a key factor in developer Beacon Communities’ decision to acquire the sprawling mill, which is situated on a sliver of land between the Connecticut River and the Windsor Locks Canal.

“We love doing adaptive reuse development, and we knew about the plans for transit there and were excited about that,” said Thacher Tiffany, director of development for Boston-based Beacon Communities. “And the town was very convincing about attracting us to do the development.”

The $62 million project brings 160 apartments, including 65 affordable units, to the site of the former J.R. Montgomery Co. textile and wire factory that had remained largely vacant for three decades.

But the groundwork for the project was laid earlier in the past decade when town officials successfully lobbied for a South Main Street address for the new commuter rail station, hoping that it would catalyze growth of the nearby commercial district. A new Main Street overlay zoning district streamlined permitting for the mill property, acquired by Beacon Communities in December 2017.

While obtaining financing for affordable housing can be a multiyear endeavor, Beacon Communities received its tax credits during its first application round, an indication of state officials’ support for a transit-oriented development including mixed-income housing, Tiffany said.

“We felt lucky, but we got involved in the project because it felt like something the state really wanted to be a part of,” he said. “It met a lot of goals that the state wanted.”

Designed by Hartford-based Crosskey Architects and built by Keith Construction of Canton, Massachusetts, the development preleased most of the units pre-COVID and is currently 96 percent occupied. Units include oversized windows, high ceilings and brick or concrete walls, while common area amenities include a club room, fitness center and a connection to a four-mile canal trail.

A ribbon-cutting ceremony this month attracted protestors objecting to Gov. Ned Lamont’s COVID-19 restrictions, but local reaction to a large affordable housing component was muted, Windsor Locks First Selectman Christopher Kervick said. The benefits of reactivating an eyesore and public safety hazard were part of the reason, but the mixed-income plan dispelled stereotypes about affordable housing, Kervick said.

“When a certain percentage of the population hears about affordable housing, they think of an old-style subsidized housing project that has had mixed reviews over the years,” said Kervick, who was elected in 2015. “Mixed-income is  a modern concept, and you have doctors living next to retirees next to bank tellers. As a neighbor, you don’t know who’s paying market rate. Once people understood the concept, they started warming up to it.”

The town also sweetened the pot by creating a tax increment financing district for the downtown area, offering developers property tax discounts. The combination of the TIF district and Hartford Line restoration has helped fill long-vacant storefronts across from the mill property, Kervick said.

And the Montgomery Mill residents will provide a new source of clientele for downtown businesses, Beacon Communities’ Tiffany predicted.

“This is going to support the revitalization of Main Street just putting feet on the ground, and that makes more retail possible,” he said.

Funding for Montgomery Mill included historic rehabilitation tax credits awarded by the state Historic Preservation Office and low-income housing tax credits from the Connecticut Housing Finance Authority. Bank of America provided construction financing.