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Waltham mayor continues to try resolving Market Basket issues at Polaroid site

Posted by Jaclyn Reiss  September 9, 2013 12:15 PM

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Waltham Mayor Jeannette McCarthy said Monday morning that she will continue advocating to Market Basket corporate officials to resolve issues with paying contractors so that construction workers can continue building a new supermarket at the former Polaroid Corp. site.

"We are steadfastly advocating for the completion of the entire project which includes Market Basket, a major office tenant, and other retail offerings for the citizens of Waltham," McCarthy said in an email, noting that statistics that she requested today showed that at least 3,500 Waltham residents currently shop at the Burlington Market Basket.

McCarthy's pledge comes after she announced Friday that years-long work on the entire retail and office development has been halted as a result of the internal battle at Market Basket between factions of the Demoulas family. The board battle at the supermarket company has tied up payments of construction invoices and the processing of necessary paperwork, McCarthy said.

Holding up Market Basket, the anchor tenant of the 280,000 square-foot development, has halted construction of the entire plaza, where steel framework has begun to take shape late this summer.

"I will continue to keep the lines of communication open between the City of Waltham and the Market Basket corporate group and the real estate group," McCarthy said Monday, noting that she went to grocery store officials in Tewksbury years ago to advocate for a Market Basket in Waltham.

The Market Basket fight pits president Arthur T. Demoulas against other family members, led by Arthur S. Demoulas, who recently gained majority control of the company’s board.

Arthur T. has asserted that his opponents want control of Market Basket in part to approve greater cash distributions to the company’s nine shareholders. The board recently approved a $300 million distribution. Arthur S. has sought the removal of Arthur T. as president, alleging in court papers that he ignored the board’s authority and spent money recklessly. Arthur T.’s opponents accused him of “self-dealing” transactions in which he has directed tens of millions of dollars to real estate businesses owned by his wife and brothers-in-law. Arthur T. says the transactions were vetted and approved by an outside arbiter.

The real estate project in Waltham is being developed by Retail Management and Development Inc. and 1265 Main LLC. A brother-in-law of Arthur T. is listed in state records as a principal of Retail Management and Development.

Scott Lang, a lawyer representing the development firm, said the Market Basket board recently stripped Arthur T. of the power to make day-to-day business decisions. Now the board is reviewing everything related to the company’s operations, which is holding up construction in Waltham, Lang said.

“As a result of this, things are backing up where no one has the authority to sign documents or permits, or pay invoices,” Lang previously told the Globe. “This is not something that came up at last minute — we’ve been working to get this done for six weeks, but the board hasn’t focused on it and gotten it done. Until this is resolved, everything has to come to a standstill.”

In Waltham, public officials say they are bitterly disappointed that internal Market Basket issues are delaying their years-long work to construct the new development, which was slated to open in the first quarter of next year, McCarthy said.

“The entire development is on hold because it’s all tied together,” she previously told the Globe. “This is a no-win situation. The people of Waltham lose, there will be jobs lost – both in construction and when the store opens – and the company loses because they have a lot invested in this.”

Other public officials agree with McCarthy. Ken Doucette, vice president of Waltham City Council, said he thought it was unfortunate “that the fallout from the family issues is impacting the city and the contractors and their families as it is.” Carlos Vidal, a Waltham-based real estate professional running for City Council, is imploring locals to boycott the supermarket until construction starts up again.

As for when that will be, no one knows, McCarthy said.

“The longer this goes on, the more difficult it will be to open on time,” she said, noting that the project has actually been working ahead of schedule. “Hopefully they will work out their internal issues.”

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Jaclyn Reiss can be reached at jaclyn.reiss@globe.com

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