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Harvard University Closes on Arsenal Deal

WATERTOWN, MA-Harvard University closes on its deal to purchase the historic 30-acre Arsenal here. The purchase has faced mounting opposition from town officials because of the tax-exempt status of the university.

By Naomi Grossman | Updated on June 03, 2001

WATERTOWN, MA-Much to the dismay of local officials here, Harvard University has closed on its deal to purchase the historic Arsenal in this town for $162 million from O’Neill Properties. The deal has faced mounting opposition here because the tax-exempt status of the university could cause the town to lose millions of dollars in revenues.

Tax revenues on the 30-acre 770,000-sf Arsenal site–which was only 50% completed–was $2.7 million last year. Expected tax revenues on the completed site would jump to $4.8 million next year. If Harvard maintained the commercial leases on the site it would be obligated to pay taxes but officials here fear that the university will slowly replace the commercial leases as they expire with university space.

Harvard University has offered to make payments to the town in lieu of property taxes but according to Mary Power, senior director of community relations for Harvard, as of yet the town and the university have not been able to come to an agreement. Harvard has structured this kind of deal with Boston and Cambridge, where the university also owns property.

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