#

The New Hampshire Attorney General’s Office says no laws were broken when state and local officials worked with China-based Nongfu Spring ahead of the company’s controversial $67 million purchase of a Nashua property.

But Gov. Kelly Ayotte says she’s deeply concerned about a company tied to China’s communist regime making a major infrastructure investment in the Granite State.

“Foreign adversaries like China should not be doing business in New Hampshire, and I am taking action today to ensure it,” Ayotte said in a statement released minutes after the report went public. “In addition to a new law banning these types of land purchases, I will issue executive orders to ensure the Chinese Communist Party and other hostile groups are not doing business with our state government.”

Nongfu Spring is owned by Zhong Shanshan, China’s richest man and a billionaire with documented ties to the ruling Chinese Communist Party. As a large private business in China, Nongfu operates under Chinese regulatory systems. That means it must comply with national standards and oversight by government authorities.

On Monday, Attorney General John Formella’s office released its report on the Nongfu Spring purchase. While no laws were broken, the report faulted an unnamed Department of Business and Economic Affairs (BEA) employee for failing to disclose the company’s Chinese ownership to supervisors for several months after the process began.

Mike Bergeron

The BEA business development manager in question has worked at the agency since 1997. Public records show Mike Bergeron, one of three BEA business development managers and the only one with that tenure, matches that description. NHPR has also identified Bergeron as the manager in question.

Bergeron did not respond to a request for comment on Monday.

According to the report, Bergeron did not inform his supervisors about the pending transaction until December 2024 and did not disclose that the buyer was Chinese-owned until January 2025—despite knowing as early as June 2024 that Zhong was connected to Nongfu. That summer, Bergeron helped organize a tour of the Nashua site for Zhong and his entourage, coordinating with local officials including Nashua Administrative Services Director Tim Cummings.

Formella’s report, requested by Ayotte amid mounting controversy over Nongfu’s operations in Nashua, clears Bergeron, BEA, and Nashua officials of any lawbreaking. At the time, there was no law preventing a Chinese-based company from purchasing property in New Hampshire.

Nongfu’s representatives told Bergeron they were seeking approval from the U.S. Treasury’s Committee on Foreign Investment in the United States (CFIUS), but Formella said he could not confirm the status of that review. His report also notes the FBI is currently investigating Nongfu and its plans in New Hampshire.

And the report concludes that the nature of the deal, along with evolving legal standards in Washington, D.C., indicate that CFIUS review is warranted.

“On Dec. 9, 2024, the Department of Treasury’s Office of Investment Security published a final rule that expanded CFIUS’s ability to review certain real estate transactions by foreign persons. CFIUS review of the Nongfu Spring transaction thus would have been advisable in the context of the Nashua property’s proximity to Joint Base Cape Cod, which is listed as 87 miles from the purchase site,” according to the report.

“A CFIUS analysis as a matter of course should have been conducted and documented prior to the completion of the transaction.”

Since the Nongfu purchase became public, state lawmakers have passed legislation banning companies from “hostile” nations — including China, Russia, North Korea, and Iran — from acquiring property in New Hampshire.

On Monday, Ayotte went further, signing two executive orders: one prohibiting the sale of state-owned land to entities from those countries, and another banning the state from purchasing technology from companies based there.

“China, Russia, Iran and other countries like them should not be doing business in the state of New Hampshire — it’s as simple as that,” Ayotte said. “We must do everything we can to protect our state from foreign adversaries, and it starts with making sure they cannot access sensitive data, do business, or purchase property here. Under my administration, New Hampshire will always do our part to keep America safe.”

Formella’s report also addressed one lingering question: Why did Nongfu pay $67 million for 80 Northwest Blvd., a property valued at about $15 million?

“According to a number of individuals interviewed for this report, the selling price is not widely regarded as exceeding market value,” the report stated. “In fact, the property was reportedly one of the few structures of its size in New England available at the time that was capable of meeting the bottling company’s structural and technical requirements.”

Nongfu initially proposed a $200 million investment in the Nashua facility, promising to create hundreds of jobs. But according to the report, the company halted all activity in May, emailing Nashua’s planning office to announce a “pause” in development.

“Due to evolving global trade and investment conditions, our client is conducting a broader reassessment of project feasibility and associated costs. As part of this review, they have decided to pause all entitlements and permitting activities,” the email stated.

The pause may have more to do with Washington, D.C., than Concord. President Donald Trump reignited his economic confrontation with China earlier this year, triggering tariff swings between 145 percent and 30 percent on Chinese imports. His administration also began arresting Chinese nationals studying at U.S. colleges, moves that further strained relations between Washington and Beijing.

New Hampshire’s $100 million housing investment, InvestNH, is starting to pay off.

“InvestNH was absolutely critical in allowing more housing to be built,” said developer Jack Franks.

Franks, president and CEO of Avanru Development Group, said InvestNH’s help was key to some of his new affordable housing projects in Newport, Swanzey, and Hillsborough.

“Hillsborough would not have happened,” Franks pointed out.

Polls consistently show housing costs are a top priority for Granite Staters, and many of the state’s employers say housing is one their biggest challenges in attracting quality workers. Using federal ARPA relief funds to get more apartments and homes built, InvestNH is making a difference, though there’s still a long way to go.

“This crisis is not going to be solved overnight, but we are working with local leaders to get them the resources they need to match housing needs in their community,” said Department of Business and Economic Affairs Commissioner Taylor Caswell.

Administered by the BEA, InvestNH has already impacted more than 4,657 new housing units throughout the state, according to Caswell, with more to come.

BEA worked through InvestNH to create a capital grant program to fund the development of affordable housing; a demolition program to assist municipalities in preparing for or addressing housing challenges and project developments in older dilapidated properties; a per-unit incentive grant program that awarded municipalities $10,000 per unit of approved affordable housing, and the Housing Opportunities program, which assisted 67 communities to review and develop planning and zoning strategies to facilitate appropriate housing in their towns.

“The goal with these one-time funds has been to help accelerate affordable housing units getting to market and setting the stage for more private investment in affordable housing statewide by providing incentives and resources to local communities,” Caswell said.

BEA used InvestNH to fund: $64 million for the Capital Grant program that impacted 1,605 new units; $16.2 million for the Per Unit Grants program that impacted 1,910 units; $11.5 for the Demolition Grants program that impacted 2,302 units; and $7.9 million for the Housing Opportunity Planning Grants program that went to 67 communities throughout the state.

BEA’s new state Housing Champions program will soon be able to continue the InvestNH programs, thanks to state general funds totaling $15 million.

Even with InvestNH, New Hampshire has a vacancy rate of around 1 percent or less, according to Franks, leaving Granite Staters to pay more for rent or looking out of state for a decent home they can afford.

“It’s beyond critical mass at this point. It’s at absurdity, the amount of housing that’s needed in the state,” Franks said.

Of his three new developments, two were fully rented soon after opening. Both the Swanzey and Newport apartment projects now have waiting lists, and the Hillsborough development is taking applications now.

The biggest obstacle to building more affordable housing that Franks encounters are the sometimes redundant and contradictory local regulations that slow construction, or stymie projects altogether. Franks hopes incoming Gov. Kelly Ayotte will work to streamline those regulations and cut the red tape that make the housing crisis worse. 

Ayotte told NHJournal she’s ready to help.

“Tackling New Hampshire’s housing crisis is a key priority for my administration — we need more housing for our workforce, our seniors, our families, and every community across our state,” Ayotte said. “As Governor, I’ll work to streamline the state permitting process, cut unnecessary red tape that creates barriers to construction, and bring stakeholders together to discuss how we can incentivize construction of more affordable housing while respecting local control. Working together, we’ll keep New Hampshire moving in the right direction.”