by Catherine Carlock Winter is coming to Greater Boston’s real-estate industry, and panic is setting in as dozens of developments await natural gas work without any timeframe for when it might get done. The issue stems from the ongoing lockout of National Grid union workers, as well as the commonwealth’s moratorium on non-emergency gas work. While the lockout is approaching the five month mark, the moratorium has been in effect since early October following deadly explosions in Columbia Gas’s Merrimack Valley territory and over-pressurization in Woburn. What’s more, next week brings a winter-season moratorium on gas main work that developers anticipate will create even more of a backlog. “This is a crisis of huge proportions,” said Ted Tye, managing partner of National Development, a real-estate development firm based in Lower Newton Falls. The combined effects of the moratorium and lockout mean that about half of the state — most of Eastern Massachusetts — is blocked from getting gas connections to commercial and residential real-estate developments. Meanwhile, Boston is in the midst of the largest building boom in the city’s history, and the slowdown has had a profound ripple effect on real-estate development of all types across the region — from hotels and condominiums to offices towers and single-family homes. That has developers across the state anxious about losing millions of dollars. “People are panicking because they’re sitting there with buildings. Winter is staring us in the face, and they just don’t know. They don’t know if this is a month problem or a year problem or a year and a half problem,” Tye said. “The commonwealth has to figure out a way together to get National Grid to act and to say here’s our list, here’s our schedule, here’s what we’re doing to bring in crews. There’s nobody to talk to right now.” A ‘staggering’ ripple effect Tamara Small, the incoming co-CEO of commercial real estate development association NAIOP Massachusetts, said she’s in daily contact with members who are panicking about the inability to complete development projects. “I would say honestly this is the biggest crisis to affect real-estate development in the past 15 years,” Small said. “Literally 50 percent of the commonwealth right now is on a gas moratorium. ... There are a lot of projects that are not having connections made, and there’s no real path forward.” Small explained the many problems the delay in gas work is causing. No gas heat increases the probability that water sprinkler pipes will burst when temperatures drop. Sprinklers, in turn, are necessary to maintain insurance on new developments. And those insurance issues are a big concern to lenders, who worry about the return on their investments. It comes down to this: Without a gas connection, it’s tough for commercial buildings and residential homes alike to receive the necessary approvals to occupy the properties. And without an answer on when gas work will start up again, there’s an indefinite delay on construction as well as tenants moving in. “It goes on and on and on. It’s truly staggering,” Small said. “Safety is obviously a very important issue, and we want to ensure there are safe procedures in place, but we need to think about what the economic development impact is.” Some developers are working around the issue by converting to propane heat and redesigning plans to add underground tanks rather than hooking up to natural gas pipes. But while that may be feasible on a single-family home, a larger commercial project is a whole other story, developers said. Tye said the conversion can cost hundreds of thousands of dollars per project, and also creates new issues with zoning and permitting that projects had already ironed out. “You have to basically convert your mechanical equipment,” he said. “That’s not even an option for very many situations.” Some developers are installing diesel generators, which is not an ideal long-term solution, developers say. And even finding a diesel generator is difficult, given the increased demand for the machines. One Boston-area commercial developer who didn't want to be named said if he can’t find a diesel generator, he'll have to send his workers home. That could delay the opening of his project by at least six months, he said. “The people that were hired to work are going to be out of work for those six months. It’s a ripple effect,” he said. What’s also aggravating, he says, is that the gas lines are already on the construction site and simply need a connection to the building — a step that requires a licensed gas worker. “It’s about an hour’s worth of work,” the developer said. “It’s crazy that something that simple can’t get done.” ‘Not a fair impact’ Relationships between utilities and real-estate developers have historically been marked by a frustrating lack of communication. That changed with Gov. Charlie Baker’s appointment of Angela O’Connor to chair the commission that runs the state's Department of Public Utilities, said Mark Leff, past president of the Homebuilders and Remodelers Association of Massachusetts and co-chair of the association’s utility subcommittee. O’Connor instituted a working group to discuss service and pricing issues from both utility providers and developers. But that group hasn’t met since before the June lockout, Leff said. “What’s happening now is an aberration to what was a very, very good working process,” Leff said. “The damage is adding up, and the consequences in terms of the affect on builders and consumers who are buying homes is real.” Homebuilders typically pay National Grid or other utility providers for service before the service is complete, and Leff says many of his members have paid tens of thousands of dollars for gas work that has not yet been completed. One member has three homes under agreement in Dracut where buyers expected to to move in by the holiday season, and cannot. That issue is reflected all over eastern Massachusetts, from Burlington to Weston to Salisbury, Leff said. “All they need to do is get a meter and connect a service, and it’s not being done,” he said. “It’s not just that they need the heat to convey the homes. The builders also need heat to finish the homes.” Leff is concerned that homebuilders could lose customers if they can’t meet delivery dates. “There’s an impact, and it’s not a fair impact,” Leff said. “These builders didn’t do anything wrong, and they’ve paid for the service, and they’re not getting it.” ‘Recipe for disaster’ With gridlock on all sides, and an impending winter season, developers are impatient for the lockout to end. John Buonopane, the president of United Steel Workers Local 12012 — one of the two unions now being locked out by National Grid — said that he’s not hearing pressure directly from the developers to find a solution. “I think they know that it’s the company that’s responsible,” he said. They’re trying to hide from the decision that they made and don’t want to take the blame.” Marcy Reed, president of National Grid Massachusetts, said that there have been some waivers granted to complete work in non-emergency circumstances. “We need to basically lift the moratorium so we can prioritize the entire set of work that’s out there and do it in a logical, ordered, prioritized fashion,” she said. Developers say the end of the lockout can’t come soon enough. “We’ve paid for service that they can’t provide right now, and we need it to be provided,” Leff said. “We’ve had great working relationships with the utilities and National Grid recently, and we’d like to return to that.” Said one anonymous developer: “You can’t shut down half the state indefinitely for gas connections going into the winter. It’s a recipe for disaster.” Read article on BBJ website.