Village officials in Pelham Manor have a profit-reaping model for economic redevelopment and residential property-tax relief after a decade-long effort that has turned the village”™s southern gateway into a retail shopping destination.
At the intersection of Boston Post Road and Pelham Parkway, two sprawling shopping centers that total about half a million square feet ”“ one new and the other newly renovated ”“ draw steady traffic from the bordering Bronx and southern Westchester County. Complementing each other with their tenant mix, they have transformed a commercial area that increasingly had become an environmentally contaminated vestige of the tiny village”™s industrial past.
Post Road Plaza, a 1960s-era shopping center unmoored by the closings of successive anchor department stores, has been rejuvenated by the opening this year of that New York City grocery icon, Fairway Market, after an approximately $15 million repositioning in 2009 that has given the five-building, 268,000-square-foot property a sleekly contemporary look.
Facing Post Road Plaza across a newly landscaped Pelham Parkway, Pelham Manor Shopping Plaza has risen where rows of brick warehouses and industrial buildings once stood. The 229,000-square-foot retail center, to which a new 90,000-square-foot Storage Post facility is attached, is anchored by BJ”™s Wholesale Club. The national wholesaler opened in spring 2009 in an approximately $20 million store built by Home Depot, which abandoned its plans to anchor the site.
A land of ”˜rundown warehouses”™
In the late 1990s, that commercial area, bounded by the Hutchinson River Parkway and the Hutchinson River, “was rundown warehouses that weren”™t particularly well-maintained,” said John T. Pierpont, Pelham Manor”™s village manager. “It wasn”™t really a productive sector of the village in terms of generating real property tax.”
Village officials and their planning consultant envisioned an integrated retail area that would retain architectural features of the industrial buildings it replaced.
“The idea too was that the best use and highest value for that land would help shift the tax burden from the residential to the commercial base,” said Joseph C. Hays Jr., mayor of the 1.2-square-mile village. “That is exactly what has happened.”
In 2000, village trustees rezoned for retail use the approximately 15-acre parcel where Pelham Manor Shopping Plaza stands and imposed a five-year sunset provision to eliminate nonconforming uses there. The owner of the industrial property, Rusciano & Son Corp., brought a legal challenge to the village action, though the village ultimately prevailed in court.
In 2004, the Ruscianos negotiated a 95-year ground lease with Acadia Realty Trust, a shopping-center developer based in White Plains, and that real estate investment trust”™s development partner, PA Associates of New York City. The partners spent about $62 million for demolition and construction on the site, according to Acadia Realty”™s 2009 annual report to shareholders.
Soil cleanup keyed Post Road Plaza
Across Pelham Parkway, Consolidated Edison, which previously owned the Post Road Plaza property, worked with Levin Management Corp., the plaza”™s New Jersey-based managing company, and the state Department of Environmental Conservation to complete in 2009 an $80 million clean-up of soil contaminants from the former Westchester Lighting Co. manufactured gas plant. Levin Management that year signed Fairway Market as anchor tenant in space that had been vacated by bankrupt Kmart in 2005. Fairway in May opened a 75,000-square-foot store there, its first store in Westchester County.
The area”™s redevelopment required a long process of give-and-take between the village and the private developers. “In this climate where you have developers who feel they”™re hounded by municipalities and regulations and municipalities who feel they”™re being taken advantage of (by developers), this wasn”™t the case” in Pelham Manor, said Nanette H. Bourne, senior vice president of AKRF in White Plains, the village”™s planning consultant for about 15 years. “It was a real working together of the public and private sectors.”
Tax burden eases for homeowners
Homeowners in the village already have felt their tax burden lighten. In the current fiscal year alone, Pierpont said, the new commercial development shifted $330,000 from the residential tax levy to the commercial levy. That is a 4 percent decrease for residential properties and a 22 percent increase on the commercial side.
“I would say it”™s been a huge success, both from an impact on taxes and the community in general,” Hays said of the retail transformation.
Buoyed by that success, village trustees in January expanded the rezoning and sunset provision for property owners to an approximately 12.5-acre industrial area that adjoins the Pelham Manor Shopping Plaza site. Officials hope owners there will reach leasing deals with Acadia Realty or another developer.
Property value ”˜killed,”™ critics say
The rezoning push has its critics, however.
“They change the zoning and some guys get killed,” said Bernard Stachel, executive vice president at Tamerlain Realty Corp. in Pelham. Stachel is brokering the sale of a vacant lot in the rezoned area, the site of a former Exxon Mobil terminal whose owner is asking $4 million for the 4.5-acre parcel. The broker also is handling the sale of a 29,500-square-foot gas station property whose asking price is $2.3 million.
“By changing the zoning, they just killed the value of the property,” Stachel said. Across the Hutchinson canal in Mount Vernon, industrial property sells for $60 per square foot, he said, compared with retail property in the rezoned area that sells for $20 per square foot.
One business in the newly rezoned area, Imperia Brothers Masonry Supply Corp., welcomed the zoning change.
“We have served the community for decades from this location and are very pleased with the retail changes in the neighborhood,” said Janice Piszczatowski, Imperia”™s chief financial officer. “As a result, we have seen a positive impact on sales and are no longer the only retailer in the area.”
