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Inflation causing issues for redevelopment projects in CT

Inflation and higher interest rates have increased the project by $8 million.

CONNECTICUT, USA — Inflation has hit home for many if not all of us here in Connecticut.

From gas prices to groceries.

RELATED: Complaints sent to attorney general's office of suspected price gouging at gas stations

It is also impacting many redevelopment projects in the area.

“It is not limited to the MLK project. It is a national phenomenon. It is in Connecticut,” said Executive Director of the Capital Region Development Authority, Michael Freimuth. 

He’s talking about the impact of inflation on redevelopment projects. 

The authority is helping fund the redevelopment of the Martin Luther King Apartments in Sheldon Charter Oaks. A project that’s been hit by rising costs. 

“We thought we had a handle on the budget but two things have impacted it. One: the current supply chain impact on construction and secondly interest rates have gone up,” said Freimuth. 

Inflation and higher interest rates increased the project from $50 million to $58 million. 

“We’re trying to come up with besides value engineering which is reducing the costs as many ways as we can is come up with resources for new funds,” said Freimuth. 

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The executive director of the apartments said that the redevelopment was supposed to start in March but she’s hopeful that it’ll start by the end of the year. However, this project isn’t the only one affected by inflation. 

“If a project hasn’t been bought out, in other words, locked in with their contracts, it is subject to crazy inflationary pressures at the moment,” said Freimuth. 

RELATED: Drivers see uptick in gas prices

Pressures are causing developers to think outside the box to get the job done.

“It is impacting projects whether it’s in Stamford, New Haven, or Hartford and we’re just going to have to figure our way through it,” said Freimuth.

DeAndria Turner is a multi-media journalist at FOX61 News. She can be reached at DTurner@fox61.com. Follow her on FacebookTwitter and Instagram.

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