Smiley Pushes to Buy Paolino’s Building for $18.5M - It’s Assessed for $7M

Smiley Pushes to Buy Paolino’s Building for $18.5M - It’s Assessed for $7M

Providence Mayor Brett Smiley has negotiated a deal to buy a Providence office building owned by former Providence Mayor and downtown developer Joe Paolino for $18.5 million.

According to the most recent valuation conducted by the City of Providence’s assessor’s office, the building — 444 Westminster Street — is worth $7 million. In 2024, the city only valued the building at $5,133,000.

The purchase price is 164% higher than the assessed value.

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Paolino owns the building through a corporate entity — 444 Westminster Partners LLC. He bought the building from Blue Cross Blue Shield of Rhode Island in 2008. Today, it is leased to the city of Providence, and it houses multiple city departments.

For years, Paolino has been a major political backer of Smiley. Members of Paolino's company, Paolino Properties, have donated $12,600 to Smiley's campaign.

To make the transaction even more expensive, Smiley is pushing to borrow $25 million using the Providence Public Building Authority’s bonding authority — the borrowing structure circumvents voter approval.

All this while the city is in the midst of a fiscal crisis, and the city saw one of its largest tax increases in history.

 

 

Questions Raised

State Senator Sam Bell questions the deal, “Either the sale price is a sweetheart deal, because of paying more in the building for what it is worth, or the assessment was a sweetheart deal because it's less than the building's worth. It's one of the two things.”

“My other concern here is simply, I don't think it's fiscally irresponsible to take out debt without voter approval,” added Bell.

“This has been a terrible, irresponsible [administration], with poor fiscal management practice. One of the things that has put Providence in a difficult financial situation, and I think that we cannot ignore the context. The mayor is coming up on election,” said Bell.

 

 

 

 

Smiley Defends the Deal

A spokesman for Smiley, Anthony Vega, defends the deal for Paolino’s building: “The City’s offer amount for 444 Westminster Street is based on a careful review of the financial realities of continuing as a tenant compared with the long-term value of ownership.”

“The City currently leases this property for $1.4 million annually, with automatic increases each year. On top of base rent, the City pays about $250,000 each year in management, maintenance, and utility costs. By utilizing bond proceeds to purchase the property $18.5 million, the City can stabilize costs, avoid future rent escalations, and secure ownership of a building that houses 10 City departments and will continue to be central to City operations for many years to come. In summary, the City will save $7.6M by purchasing the property,” added Vega.

Paolino defends the deal. He said the city’s valuation is flawed. “They probably never read the lease and just looked at the price per square foot… the bricks are not the only value to a building. It’s the income, like buying a bond, and the 25-year lease is the value that their appraisers never looked at,” said Paolino. 

Ironically, when the City of Providence entered into the lease with Paolino in 2011, the lease payment was $735,000 in the first year. And, then-City Council President Michael Solomon said, “It’s my understanding [that] the city will have the option to buy the property in three years and by consolidating, they are going to be saving a lot more money.”

The resolution authorizing the borrowing is scheduled to be heard before the Providence City Council Finance Committee on Tuesday at 5:30 PM. As it is a resolution, the City Council only needs to vote once to approve the borrowing.

The Resolution also approves funding to purchase the WaterFire Building and some unknown projects. See a portion of the resolution below:

"That the City Council hereby approves the Proposal of the Mayor dated August 29, 2025 attached hereto (the “Proposal”) which, among other things, requests the Authority to use its best efforts to finance the acquisition, construction, repair, rehabilitation, replacement, furnishing, equipping and improvement of: (i) the Joseph A. Doorley, Jr. Municipal Building, located at 444 Westminster Street, Providence, Rhode Island, (ii) the WaterFire Arts Center, located at 475 Valley Street, Providence, Rhode Island, and (iii) other capital projects, including the design and feasibility, engineering or other studies which may be necessary in connection with such projects and any other acts necessary or incidental thereto (collectively, the “Projects”) and to issue Bonds in an amount not to exceed Twenty-Five Million Dollars ($25,000,000) plus original issue premium, if any, to provide funding for the Projects, to capitalize interest, at its option, to fund a debt service reserve fund and to pay the costs of issuance of the Bonds and such other expenses as may be necessary or incidental to the completion of the Projects…”