A century-old industrial building that has stood vacant for more than a decade in Worcester’s Main South neighborhood is being transformed into 58 apartments, part of a growing effort to turn the city’s former manufacturing properties into housing.
MassDevelopment provided a $1.8 million bridge loan to Beacon Street Lofts LLC, an affiliate of Bluestone Residential, to help finance the redevelopment of the four-story building at 98 Beacon St. The project, undertaken by Bluestone Residential in partnership with Civico Development LLC, converts the former industrial property into a mix of market-rate studio and one-bedroom apartments.
Construction is underway, with completion expected within two years, according to MassDevelopment.
Built around 1900, the building is among Worcester’s aging industrial properties being repurposed as the city seeks to expand its housing supply while preserving structures that reflect its manufacturing history.
The redevelopment relies on a combination of conventional financing and historic preservation incentives. Clinton Savings Bank is providing a $7.5 million first mortgage, while the Massachusetts Historical Commission has allocated $2.55 million in state historic rehabilitation tax credits. MassDevelopment’s $1.8 million loan serves as temporary financing until construction is completed and the tax credits can be sold to generate funding for the project.
The financing arrangement illustrates how developers are using historic tax credits and public-private partnerships to make the rehabilitation of long-vacant buildings financially feasible.
For Main South, the project represents another investment in a neighborhood where former industrial properties are increasingly being considered for residential and mixed-use development.
“Transforming a historic building that has sat vacant for more than a decade into 58 new apartments is a big win for Main South and for our city’s broader housing goals,” Mayor Joe Petty said in the announcement.
Petty said projects such as Beacon Street Lofts can preserve Worcester’s architectural character while expanding housing opportunities without displacing existing residents.
City Manager Eric Batista also pointed to the neighborhood’s changing identity.
“The adaptive reuse of Beacon Street Lofts will create new housing units while preserving a historic building and complement recent investments in the neighborhood as it evolves from a legacy manufacturing district to a mixed-use environment,” Batista said in the release.
The project adds to Bluestone Residential’s portfolio of adaptive reuse developments in Central Massachusetts. In 2021, MassDevelopment partnered with Fidelity Bank to provide $6.1 million in financing for the first phase of the redevelopment of the former Jefferson Mill in Holden, converting the previously vacant industrial building into 34 apartments. Two years earlier, MassDevelopment provided a $2.8 million loan, in partnership with Main Street Bank, to support Bluestone’s conversion of a former school on Ararat Street in Worcester into 23 apartments. The company specializes in mid-sized residential developments, particularly the conversion of vacant or underused properties into apartments with modern amenities.
Tim Adler, principal at Bluestone Residential, credited MassDevelopment’s financing with helping move the Beacon Street project forward.
“We enormously appreciate MassDevelopment’s early and critical support to this important project in the Main South neighborhood,” Adler said in the announcement. “With their support, we look forward to transforming this blighted building into much-needed high-quality housing.”
MassDevelopment President and CEO Navjeet Bal said the project addresses two challenges facing Massachusetts communities: a shortage of housing and the continued presence of vacant properties that have outlived their original industrial uses.
“This project will breathe new life to a vacant and blighted property, add much-needed new housing, and support local economic growth,” Bal said in the release.
The agency has increasingly played a role in financing projects that combine housing development with the preservation of historic buildings.
During fiscal 2026, MassDevelopment financed or managed 538 projects statewide, generating more than $6.52 billion in investment. Those projects supported an estimated 42,113 jobs and helped create or preserve 4,355 housing units, according to the agency.
At 98 Beacon St., the result will be 58 new homes inside a building that has been part of Worcester’s industrial landscape for more than a century.
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