Store owners welcome their new landlord: Yale

JULIA TIERNAN/YH COLLEGE CORNER: Yale recently purchased ten properties on College and Chapel Streets that house many long-established New Haven businesses.

When Yale bought 10 properties on Chapel and College Streets at the end of December, area owners barely mustered a complaint. In fact, many echoed Claire Criscullo, the owner of Claire's Corner Copia Restaurant, who described herself as "really psyched" about the University's takeover.

On Tues., Dec. 22, Yale committed to a deal with the Federal Deposit Insurance Corporation (FDIC) and Schiavone Management Company, purchasing 10 properties on Chapel and College Streets. The city of New Haven had asked Yale to purchase these properties several months ago. The papers are now signed, but the deal remains to be closed.

Under the contract, the University will pay $5 million to the FDIC for the land, and the FDIC will pay the city of New Haven approximately $1.5 million in back taxes owed to the city under Schiavone's ownership, according to University Properties Directory Joe Fahey, SOM '97.

In the past, Yale's holdings have created friction within New Haven because the city was unable to collect revenue on the property. Just this August, for example, Yale faced protests when it began to redevelop along Broadway and then closed the insolvent Daily Caffe.

Connecticut's new Payment in Lieu of Taxes (PILOT) program has resolved many of these concerns, according to Mike Kuczkowski, the press secretary for New Haven Mayor John DeStefano. Under PILOT, the state gives New Haven 77 cents for every dollar that Yale would be paying in property taxes, if it were an average landholder.

"It used to be difficult for the city to embrace the University buying property and then developing it for its own purposes," Kuczkowski said. "We lost considerable revenue. But now, we're probably at the best point we've been concerning town-gown relations."

Local businesses involved also seem largely in favor of Yale's ownership. Gideon Gebreyesus, the manager of Caffe Adulis, hopes, like many of his fellow owners, that the transaction will build continuity within the New Haven community. "[Yale's ownership] is a good idea, because it allows the neighborhood to stay intact," Gebreyesus said.

Other owners believe that Yale's ownership will make the general perimeter of Yale safer and help their businesses. Criscullo, for example, believes that her store will gain "a more secure atmosphere."

Joel Schiavone, SM '58, however, has mixed feelings about what Yale's purchase says about the current state of New Haven. On the one hand, Schiavone is pleased that the properties are remaining under one owner. "I think it's nice that Yale's taking an activist role. If they hadn't bought all of the property, it would have been divided up and sold to a host of investors," Schiavone said.

However, Schiavone worries about the lack of "an active real-estate market" in New Haven. "I think it's kind of sad that one of the only people who wants to buy property in New Haven is Yale, because the rent's so low. For instance, in the Harvard Square area, you don't have that problem. Harvard isn't the only one who owns property in that area because there are other people involved in the bidding process," Schiavone said.

After graduating from Yale, Schiavone returned to New Haven and began a management business in 1980. He bought the Chapel and College buildings shortly afterward, when they were in poor condition. "When I was at school here, people always talked about how nice it would be to renovate downtown New Haven, but no one ever did anything about it. I finally decided that I would be the only one to do something," Schiavone explained.

Schiavone turned over his ownership of the properties to the FDIC in 1990 when his lender, the First Constitution Bank, went bankrupt. Since then, Schiavone Management has managed the properties. The company will continue to manage them under the new agreement.

As the new owner, Yale does not plan to make many changes to the existing properties, according to University President Richard Levin, GRD '74. "Some of the buildings need repair and maintenance. We certainly don't want to displace the businesses. Most of the properties are a viable and important core of downtown," Levin said.

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