A plan to convert 154 apartment units at Pepperell Mills in Biddeford into condominiums is back on despite the city’s condo conversion moratorium. Contributed / Pepperell Mill

Biddeford City Council passed a moratorium last month preventing the conversion of units into condominiums, inspired in part by the proposed conversion of apartments in four mill buildings. But now the city has reversed it’s decision in allowing those conversions to to take place.

Although the moratorium remains in place, under the Terms of Agreement between the city and Pepperell Mill Progression, LLC, the condominium conversion project for the four buildings would be allowed to move forward with tenant protections in place.

Biddeford Mayor Martin Grohman said Thursday, Nov. 7, that the new agreement will ensure residents are supported and secure during the transition.

“This collaborative effort underscores our commitment to protecting tenants while enabling responsible development,” Grohman told the Courier. 

On Oct. 15, the Biddeford City Council approved a six-month moratorium on condo conversions, which became effective retroactively on Oct. 6.

Some Biddeford residents said on Oct. 15 they had concerns about the mill building project, which proposed converting 154 apartments in buildings 15, 17, 18, and 35 at the Pepperell Mill campus into condominium units.

Some on the City Council at that time also said they were troubled by the proposal.

City Council President Liam LaFountain said the city is currently “ill equipped” to handle a conversion at the mills, and the ripple effect on the downtown and the city as a whole could cause more difficulties for those already struggling to find housing.

“This isn’t creating any new units,” LaFountain said. “What it’s doing is making current units more exclusive and less available, less attainable for residents of Biddeford.”

Chris Rhodes, a partner with Presidium which owns the Pepperell Mill, noted on Oct. 15 that his company had spent a long time working on the mill project. “We’ve worked closely with town leadership (on the project ) for over five months,” he said.

During the process of the proposed conversions, Rhodes said, tenants would be offered generous terms to purchase one of the condominiums and those who preferred to continue renting their unit would be allowed to do so for three years.

“We wanted to have a very thoughtful approach on how to look after each and every tenant that we have on our campus,” Rhodes said.

Ultimately, the Biddeford City Council voted 6-2 on Oct. 15 to enter into a moratorium that was designed to put a hold on Presidium’s plans to convert rental units in three of the four mill buildings into ownership units within the next three months as well as other such projects of eight or more units.

Although the moratorium remains in effect, the city is reversing its stance regarding the Pepperell Mill apartments.

Building 15, one of the buildings involved in the condo conversions, was not included in the moratorium, as approvals for this portion of the project were already in progress.

However, following the moratorium vote, Pepperell Mill Progression, LLC challenged whether buildings 17, 18, and 35 could be included in the retroactive moratorium, according to a statement from the city. The City Council discussed a settlement on Nov. 1.

The City Council last week authorized the city manager to enter into an agreement with Pepperell Mill Progression, LLC that permits the conversion of not only building 15, but also of the other three buildings to proceed and “provides additional tenant protection and benefits that exceed the city’s minimum legal requirements for condominium conversions,” according to the city.

Mayor Grohman said the tenant protections will provide residents with clear communication, reasonable timelines, and assistance to minimize disruption as the buildings undergo conversion.

“I want the tenants to know that we will continue to advocate for their needs and support a process that is fair and considerate,” Grohman said.

Rental Tenant Protections 

In the terms of the agreement, the City Council ensured that residents of building 15 would receive the same tenant protections and benefits promised to buildings 17, 18, and 35, even though building 15 was not included in the moratorium.

The agreement also requires Pepperell Mill Progression, LLC to provide a higher contribution of financial support – $500 per converted unit, $150 more than the current requirement – to the city’s Affordable Housing Trust Fund.

Tenant protections agreed on by both parties include a term in which tenants must receive at least 180 days of notice to vacate their unit for the purpose of condo conversion.

Also in the agreement, tenants who leave will be given $1,000 or more to help them relocate.

Future annual rent increases for tenants who choose to stay will not exceed 5% per year for the next three years, and tenants who choose not to purchase a unit will be entitled to assistance by on-site staff at the Pepperell Mill in finding nearby rental accommodations.

Homeowner Tenant Protections 

Residents who choose to purchase their unit will also receive protections.

Not only will tenants be able to purchase a unit at an off-market price without competition from the general public, but they will also receive an additional 3.5% buyer credit towards their closing costs, and other incentives.

“For those that want to buy a home, the new agreement strengthens that opportunity,” Grohman said.

Grohman also said that the City of Biddeford recognizes that housing stability is a cornerstone of the community’s well being, and he believes the new agreement reflects that.

“Our community thrives when we balance growth with compassion, and this agreement is a testament to that balance,” Grohman said.