Unfortunately, WPI, without prior consultation with city or business community leadership, has initiated the process to acquire two existing hotels in the City of Worcester at Gateway Park and convert them into student housing taking them off the tax rolls. This significantly impacts the city budget in terms of a major loss in annual property tax and hotel/motel tax revenue. The loss of this revenue will be passed on to the tax bills of the City’s residential and commercial industrial taxpayers. Worcester currently has the 7th highest commercial industrial rate in the Commonwealth.
This acquisition will also result in a 25% loss to the city’s existing hotel inventory, which is devastating to the city and the region’s ability to recruit conventions, tournaments and major events. Moreover, approximately 100 jobs will be lost. This is an example of why existing laws that allow large institutional nonprofits to unilaterally take property off municipal tax rolls need to change.
Moreover, WPI’s actions are contrary to the collaborative spirit in which the Gateway Park Project was initiated by government, business and higher education leaders. The following letter was presented to WPI’s president Grace Wang this past Friday by the Worcester Economic Development Coordinating Council, expressing its strong disapproval of this action taken by WPI’s President and Board of Directors.
August 16th, 2024
Grace Wang, President
Worcester Polytechnic Institute
Boynton Hall, 1st Floor
100 Institute Road,
Worcester, MA 01609
William Fitzgerald, Chair
Board of Trustees
Worcester Polytechnic Institute
Boynton Hall, 1st Floor
100 Institute Road,
Worcester, MA 01609
Re: Gateway Park
Dear President Wang,
Both as individuals and organizations many of us within Worcester’s Economic Development Coordinating Council (EDCC) have been involved in the Gateway Park Project since its beginning. From the outset, the shared vision for Gateway Park was to remediate a series of contaminated brownfield sites and underutilized commercial-industrial properties, to create a new mixed-use district that would house new business ventures, such as life science and bioengineering research and development companies, complimentary retail uses, and space for academic instruction and research. The project was an award-winning redevelopment initiative that improved the entrance to WPI’s campus and created economic development for the North Main Street area.
To advance this shared economic development vision, the project benefited from millions of dollars in state and federal grants intended for the purpose of developing a mixed-use development that would create jobs and expand the tax base, consistent with the Gateway Park Master Plan.
The Master Plan initially envisioned a taxable residential project at the corner of Faraday and Grove Street. At a later date, WPI expressed an interest in building graduate housing at that site. The City allowed this use, and as part of a signed PILOT Agreement, the parties also agreed to allow WPI to acquire one additional tax-exempt property. WPI’s recent decision to purchase 50 Prescott Street fulfills that remaining commitment.
To realize the shared vision of a vibrant mixed-use district, which to date has included the construction of the dormitory at 10 Faraday Street, buildings at 50 Prescott Street and 60 Prescott Street, the two hotels, and the parking garage; approximately $170 million in public and private investments have been made including millions in local, state, and federal taxpayer dollars. As individuals and organizations, we have made public and private representations that Gateway Park was about creating a mixed-use district that expanded the City’s tax base, created jobs, and could be an example of how government officials, businesses, and academia can work together in a mutually beneficial way.
The Gateway Park Project was never at any point, about utilizing public resources to solely facilitate WPI’s campus expansion or student housing needs, taking property off of the City’s tax rolls, and further burdening Worcester’s residential and commercial industrial taxpayers.
Over the past 15 months of your tenure, both EDCC representatives, individually and collectively, have been invited to attend multiple meetings and briefings with you and/or your leadership team, to learn about WPI’s growth plans. The first focus was on Gateway Park and a new mixed-use commercial and academic building consistent with the vision of Gateway Park. Unfortunately, despite receiving City Planning Board approval, that project apparently has been shelved by WPI. Secondly, there were conversations with the City about a new dorm on Institute Road on existing WPI property. The third briefing, of which all EDCC partners were present, involved a conversation on a potential partnership with a private developer to build more student housing next to Gateway Park. This briefing included a tour and conversation about student housing expansion and an academic research facility on the corner of Park Avenue and Sagamore Road on existing WPI property as well. Also, based upon your suggestions at this meeting and tour, the City launched the process to conduct a traffic study of the Lincoln Square area to assist with the further development of Gateway Park.
Accordingly, we were collectively stunned to learn that WPI has been exploring for many months the possibility of acquiring the two hotels in Gateway Park for student housing. The subject of acquiring these sites was never mentioned in our numerous meetings or briefings with you or your leadership team. Moreover, and even more perplexing is that WPI’s Board and former President had the opportunity to acquire with the closing of Becker College, adjacent to the WPI campus, residence halls that could house over 200 students as well as leases that Becker College held at the time that could have housed another 245 students. It is our understanding that WPI could have acquired these properties for approximately $3.8 million.
The EDCC strongly opposes the proposal under consideration by WPI of acquiring these hotels. First, we believe it violates the covenant and spirit on which the Gateway Park Project was initiated and built. The Master Plan intentionally designated a hotel for that site to benefit the adjacent development, and many area businesses rely on that amenity. Secondly, WPI’s acquisition of the properties would take over $758,000 annually off the property tax rolls, wipe out an estimated $850,606 in annual hotel/motel tax revenue the City receives, and eliminate 25% of the City’s hotel room capacity. This would devastate the City and region’s ability to attract and host conventions, events, and tournaments, which would be detrimental to the DCU Center, Polar Park, and other travel and tourism-related venues in the city and result in the loss of approximately 100 jobs at the two hotels. Further, it deviates from the public purpose for which taxpayer grant funding was invested to support the development of Gateway Park.
WPI’s lack of fidelity to the shared mission, vision, and history of the Gateway Park Project, which has existed for nearly 20 years, is disconcerting and will have severe reverberations that will make future partnerships with higher education institutions in Worcester much more difficult in the future. We urge you not to go forward with this proposal, and we stand ready to work with you in a spirit of full transparency to address any student housing needs that WPI may have.
Sincerely,
The Economic Development Coordinating Council of the City of Worcester
Joseph M. Petty
Mayor, City of Worcester
Eric Batista
City Manager, City of Worcester
Timothy P. Murray
President & CEO, Worcester Regional Chamber of Commerce
Craig Blais
President & CEO, Worcester Business Development Corporation
Jon Weaver
President & CEO, Massachusetts Biomedical Initiatives
