The hotel is out and life sciences are in at Riverside.
Mark Development, the developer building a mixed-use development at Riverside Station, is asking the City Council for an amendment to the special permit the Council approved in October to allow for additional office space, which will be lab space dedicated to life-sciences uses. The public hearing is tomorrow (Tuesday) at 7:00. Agenda. Zoom link.
The revised proposal reflects a vision to create a life-sciences innovation center of the new Riverside office space and the next door Riverside Center (the one-time Jordan Marsh warehouse, which was converted to office space in 2000). Specifically, Mark Development has a deal for the lab space with the Alexandria Corporation, who are building and acquiring life-science properties across the region. Another proposed project at the former Liberty Mutual campus up the road in Weston would enhance the area as a life-sciences cluster.
Life sciences are shaping up to be the hot industry for commercial real estate in the area. As discussed in a very interesting Newton/Needham Chamber of Commerce presentation, Bringing Life Sciences to Newton, if the city is able to establish a kernel of life science space, the city could become attractive for further investment in this growing industry. And, life sciences could be a stable, long-term source of commercial tax revenue. This is particularly true post-COVID as life sciences lab space are likelier to require employees to be in-office.
With the uncertainty, post-COVID, of the hospitality industry, it stands to reason that life-science office space would be financially preferable to the approved proposal’s hotel. The developer’s estimate, presented at the Chamber presentation, bears that out. They estimate that the change to the plans would result in an additional $800,000 of tax revenue to Newton.
The request for amendment to the special permit is not simply a swap of hotel space for office space. The hotel would have been a 77,300 s.f. building. Mark Development wants to increase the office space by 115,615 s.f., a net increase of 38,315 s.f. To keep the project’s net size the same at 1.25 million s.f., the residential portion will be reduced from 582 to 550 units (32 units, 21,280 s.f.) and the retail portion will be reduced by 17,035 s.f.
Counterintuitively, the developer proposes reducing the number of residential units, but the number of deeded affordable units will go from 102 to 110 units. That’s because the new proposal will be subject to new inclusionary zoning rules, which now require 20% affordable units for a project this size, instead of the 17.5% the original proposal was subject to. In fact, the new proposal would include included five fewer units of housing for households with low-to-moderate income (under 80% of area median income (AMI)): three fewer units at 50% AMI and two fewer units at 80% of AMI. The new proposal would have thirteen more units at 110% of AMI.
The building that would have been the hotel and will now be lab space will grow roughly 39 feet in height. The already planned office building will shrink about 26 feet. The height of two other buildings will change by less than 10 feet. There are also some changes to the massing and configuration of the residential buildings along Grove St.
Drawing from Mark Development from their presentation to the Chamber.
Total traffic is projected to grow by 1%, with peak period traffic projected to reduce by over 35%.
Commentary follows …
The prospect of a life-sciences hub is genuinely exciting. This isn’t a case of a fond wish to change the commercial landscape, but a concrete plan with commitment. The City Council should definitely approve the use change.
But, the benefit of the change in use justifies increasing the project size. We don’t need offsets in the residential and retail components. Let’s just increase the overall project size to 1.29 million.
The need for housing in Newton has not diminished. The need for affordable housing in the city has not diminished. The environmental benefits of transit-adjacent housing have not diminished. And, the residential component has already been substantially reduced. In September 2019, Councilor Lenny Gentile and Right* Size Newton activist Randy Block got Mark Development to reduce the size of the project by 151 residential units (more than 20%) and the hotel by 40 rooms. Based on the inclusionary zoning rules effective at the time, the loss of 151 residences was a loss of 26 affordable homes. Let’s hold the line at 582 units and retain those 5 units of affordable housing for households with 50 and 80% AMI.
The retail component is important to provide the kind of service retail that would support the residents in the development and discourage them from driving, particularly groceries. Reducing the retail by nearly half is not consistent with the vision of the development as a true mixed-use development.
Let the development grow a smidge to take advantage of this great life-sciences opportunity.
Everybody and their brother now believes that “life sciences” are going to be the magical ticket out of the catastrophic office space glut, apparently because the “life sciences” people can’t work from home in their pyjamas. “Life sciences” has even been suggested as a panacea for the rezoning of the Muzi Ford parcel over here in Needham. Alas, rest assured that by the time a get-rich-quick revenue opportunity appears on the radar of elected officials in Needham, it’s about as hot as an Edy’s [sic] Pie.
Life sciences companies are going to relocate from Kendall out to interstate highway exits for what reason, exactly?
Not to mention what a boring proposition this. Is there anything that could be more detached and isolated from community life than a “life sciences” facility? The hotel would have at least hosted weddings and bar mitzvahs and allowed people to use their bathrooms.
Here’s a fun article about Alexandria Real Estate Equities! (The first case got dismissed.)
https://www.bostonglobe.com/business/2019/02/07/marcus/tfIaxJZKL6mZMLLqKnr2HK/story.html
Sounds sensible to me, Sean. Yes to increasing project size to retain units at deeper affordability and adequate retail. Interested to see if developer and city play ball.
Masterful bait and switch by Mark Development. I’m very opposed to allowing these changes to the Special Permit, which was subject to extensive public review and just approved this past October.
What does the city negotiate in return for “backstopping” the developer from loses (hotel to commercial)?
Nice to know that as a resident, if I invested in hotels I would be taking on huge losses right now. But as a developer, the city will backstop my loss and allow me to switch to commercial without any loss.
Not saying this new plan is not better… but is the city is holding all the cards and should negotiate aggressively here.
Michael,
I’m skeptical of municipalities — Newton! — chasing the fad of the day. But, here we have a property management company making a significant investment across two large properties.
C’mon, Mike. You know as well as anyone that the process to get an amendment to a special permit is just as comprehensive and open as the process to get a special permit in the first place.
This isn’t an underhanded move, as you seem to imply.
I’m skeptical. All the city councilors are going to see is $800,000. All the housing advocates are going to see is 110 affordable units. I question whether anyone will see or value the impact these changes will have on the neighboring communities in terms of noise, traffic, public transportation, building heights, biosafety, open space, etc etc etc.
Sean– Not “underhanded.” Strategic! The City Council gets played again!! This revision will not draw the same public attention as the original Special Permit process approved just 6 months ago.
Agreed. Six months ago the special permit was passed unanimously and the process was lauded as an example of how communities and developers can work together to come to an agreement that makes everyone reasonably comfortable and now all the work to get everyone to agree is being thrown out the window. Really sleazy.
Let’s not cut off Newton’s nose to spite its face.
I get some people don’t like developers, or this particular developer. But our city has a golden opportunity to attract life sciences companies here, a sector that has allowed Watertown to build three new elementary schools (without an override) and fund its liability pension. These are the kinds of jobs and companies municipalities all across the state are competing for.
As for traffic, the studies show that this sector produces less rush hour traffic than traditional office use because these are not 9-5 jobs.
I would have liked a hotel. We have a very small house and are transplants, so often extended family stay at a hotel and there aren’t that many hotel choices in Newton. I know a lot of other people in the same boat. Plus, it could have been good for restaurants along the green line and maybe tourists would have used it as an alternative to staying downtown. Especially for the marathon! A missed opportunity for sure.
Hello Mary: Appreciate your concern for our restaurants. If you want to help this sector, life sciences is a really helpful path. The hotel industry is not expanding right now. The office market isn’t either. While travel is down and many workers will continue working from home even after the pandemic, life science workers show up to the lab every day and look to eat locally as well. The economics benefits are clear.
So my question is what limits or conditions has the town of Watertown imposed on the developers or life science companies who have built or want to build in their town? There must have been some type of concessions that were made.
@MMQC I entirely agree about the loss of hotel rooms. But I don’t think it’s the fault of this particular developer. Newton hasn’t built a single new hotel room since 1971, even as the market boomed and our I-95 neighbors (Waltham, Burlington, and Needham) saturated the market. Yes, Newton could use the room tax revenue and I’m sure we would all like to have rooms closer to home. But since the city spent the last 50 years fighting any kind of development (and putting in restrictive zoning rules that made hotel development impossible) we lost out.
We should learn from that mistake and not miss out again.
This is *exactly* the type of commercial development Newton needs. Biotech has flowed from Central Square up to Kendall, also into Harvard, and has a huge footprint in the Seaport. Real estate is expensive and space is tight. Especially with this space sitting on mass transit, it could be a good solution for more biotech space with a lower environmental footprint than those sitting in Watertown, Lexington, or Waltham (although the developers would be cautioned to think carefully about also attracting some interesting retail / restaurants and not making it a boring suburban office park-like space).
City council is sitting on something valuable here that is worth negotiating.
Bugek, how is the city backstopping the loss for a hotel that hasn’t been built?
Mike, are you implying the project wouldn’t have been approved in the revised configuration?
Micheal, Kendall square rents are exceeding $100 a foot and there’s very little if any available.
I think this revised configuration is a huge win for the town, higher tax revenue, higher ratio of affordable units and great high paying science jobs in Newton.
It’s very likely the developer had difficulty securing financing for a hotel during a pandemic, which should be a surprise to no one. This is a rational pivot to an industry that is receiving significant investment and rightfully so.
Greg – “life science workers show up to the lab every day.” Not really. I’m in a family of biologists and none of them are working on site with any regularity and their employers are preparing to keep it this way indefinitely. There are some young lab and research associates who go in to do benchwork but not necessarily 40 hours a week and not at capacity.
Kyle,
You anwered your own question regarding backstopping the developer
“It’s very likely the developer had difficulty securing financing for a hotel during a pandemic…”
They obviously crunched the numbers and the hotel would less financially viable compared to life science building.
If the permit is not approved, the land will not collect revenue until a hotel can be financed at a profit.
To be fair, they could not have seen forseen the trend of people moving into suburbs for more space and wanting to live close to a suburban office.
I agree with Greg. Newton would lose an opportunity for stable tax revenue and to bring jobs to the area. Yes, it does benefit the developer, but this will also benefit the City of Newton greatly towards raising revenue and not relying so much on its residential tax base. Life Sciences is a growth industry. Though some researchers can do their work remotely, the need for labs and research facilities will continue to exist. If it doesn’t happen in Newton, they will set up shop in a neighboring community that will reap the benefits of an increased commercial tax base.
I was never a fan of the hotel with (very) short-term occupants in the midst of a significant number of residential units. The life science building makes much more sense as it will provide a stable population that will keep restaurants and coffee shops in business.
Some folks are assuming that the tax revenue would be a gain for Newton, while in fact it may be a net loss. You can’t possibly evaluate gain, loss, or public safety, without specific knowledge of the planned activity at the proposed laboratory. Mark Development should clarify who the end user[s] would be for this lab, and exactly what they will be doing.
Mike: It is rare at best and unrealistic for any developer to be able to confirm and announce a tenant for a project that hasn’t even been approved yet. No employer would want to be in that position to say to their employees, customers, share holders, maybe even their current landlord, etc. “Here’s where we’re going to move if this project gets approved.” That’s just not how things work in the business world.
“Total traffic is projected to grow by 1%, with peak period traffic projected to reduce by over 35%.”
Who projected it? Was it a consultant hired by Mark or hired by the city?
This projects makes a ton of sense. It also sounds like a great opportunity for Newton to get more concessions out of Mark Development. This is why in November we need to push out the city councilors aligned with developers.
Let’s get an even bigger and better splash pad!
Greg–
I think Mark Development has a pretty good idea of potential tenants for the lab. They wouldn’t be asking for the Special Permit modification if they didn’t have interest from a specific end-user[s]. They wouldn’t be dangling $800K in the City Council’s face like a carrot from a stick, if they didn’t have a lab tenant that was ready to commit. The City Council should insist on complete transparency from Mark Development before even considering a modification for this use.
As I pointed out, there is no way to determine whether this would be a good or bad deal for the city, without understanding the potential costs of a laboratory to the city. And I’m pretty sure the people of Newton would have some reservations about a laboratory that was doing military research for the Department of Defense, or a lab working on live viruses like the one in Wuhan, China. This is not something we should be guessing about. It’s something the people of Newton deserve to know in advance.
I was a supporter of the original Special Permit. I would support the modification if the use did not pose a public safety threat, and if there were no new costs to the City resulting from that use.
Just within Newton’s city limits, we have the Marriott and Indigo in Auburndale and the Four Points over the pike in Newton Corner. Do we seriously need another hotel?
Correction: I understand the original plan was to replace the Indigo hotel.
Increase the city’s commercial tax base, add a significant amount of new housing, some of it affordable – all at the intersection of a transit line and a highway. Why wouldn’t this be a good thing for the city?
Hey Jerry. What transit line is that? And since these units will likely be assessed at a fraction of the mean for the city, it seems like the tax base may not be increased more than costs incurred?
Can you help me through the math?
I’m keeping an open mind, as someone who appreciates the value of life sciences and the potential economic benefits to Newton.
However, there needs to be information on what kinds and amounts of gaseous or aerosol emissions or hazardous waste the HVAC & waste/exhaust systems would be designed to handle. As Mike Striar notes, there is a wide range of processes within “life sciences”. Conditions can and should be placed on what specific activities are allowed, ahead of time.
Nathan – federal and state environmental law, and associated review processes, already should constrain a tenant’s operations from harming the surroundings. Are you suggesting Newton impose conditional use restrictions related to pollutants above-and-beyond existing law?
I agree with Gregg, Sean, and Jerry. I live up the street from the site and think the new plan makes sense. Adding housing and life sciences facilities near transit is a good, forward thinking plan.
Adam – read up on the Weymouth Compressor to see how well federal and state environmental laws and regulations protect local communities.
@Patrick Moriarty …
>> What transit line is that?
The Riverside D Line
>> since these units will likely be assessed at a fraction of the mean for the city, it seems
>> like the tax base may not be increased more than costs incurred?
The majority of the new housing will be market rate and tax assessments would be the same as any similar housing elsewhere in the city. More importantly, commercial property is taxed at a higher rate than residential and this would be a significant addition to Newton’s commercial tax base. Unlike some of our neighbors, Newton is much more constrained when it comes to commercial properties – i.e. we don’t have areas with big expanses of commercial property like Needham, Waltham, or Watertown.
Nathan – it appears federal and state regulations achieved their intent at the Weymouth compressor: the required permitting and approvals have not yet been met, and opponents of the project have influenced the development trajectory. As an energy facility that proposal falls under FERC which, due to the special pollution issues related to those facilities, has a specific permitting regime in place. In any case, what’s the connection between federal and state energy permitting and whether or not the Newton city council should attach special conditional use restrictions related to pollutants to the Riverside life sciences project?
Adam, you need to do a little more homework on the Weymouth case.
And you are putting words in my mouth as to which strategies might be used for environmental protection. I did not say the City Council has the power to impose conditions.
What I am saying is that people should be ready to challenge rubber stamps from the state that favor corporate interests over public health.
Finally, like I said, I’m keeping an open mind. We just need to be proceed carefully.
Nathan – I’m familiar with the Weymouth case. Sounds like you are too. The thread here was about the public hearing in front of the City Council last week to re-configure the Riverside project to life sciences. In that context you wrote that environmental conditions should put on the project. If you didn’t intend it would be the City Council attaching those conditions, ok, who would be the body then? No disagreement here that Newton’s health should be our local govt’s priority over developer profits, and that commercial development and permitting should be carefully, not recklessly.
Most of the questions here are part of the city’s analysis–the Planning Department hired consultants with needed expertise to evaluate everything that Mark Development asserts in its proposal.
The few here that aren’t, I will bring up as part of the process. I also want this change to be a net positive for the city, the neighborhood and the environment.
Let’s see what we find out!
The Planning Department has on-call consultants to evaluate the questions raised in the comments here about transportation, economic impact, tax results.
As a member of Land Use, I will ensure the other questions are addressed. Let’s find out what the answers are, and then evaluate whether this is a good change.
Andreae,
One other big question to ask Mark Development is, why didn’t they announce their intention to make this Hotel to Life Sciences pivot PRIOR to receiving approval in October. There is no way they were not already in serious internal discussions to make this move prior to October. This is the essence of negotiating in bad faith. Proof of their poor faith negotiation is the fact that they already had the slick renderings and partnership with Alexandria ready to roll within a few months of original approval. This is a time tested developer tactic to push through their real project.
They chose to gain approval from the city on a project they knew would not be built as approved. Why should we as a city trust their new proposal ?
Because a significant amount of neighborhood group and Newton city council time was wasted negotiating with Mark Development on a proposal they knew would never be built as approved we must gain serious concessions for this requested change. How about 100 affordable units rather than the bare minimum they have thrown in to appease people ? If this life sciences is such a “golden opportunity” they should be able to afford it.
About this “golden opportunity”. What are we really gaining as a city for this pivot ? The right to compete with Cambridge and other 128 communities for a life science company to come in with jobs ? Does anyone think this comes for free ?? I’ve seen the $800k tax gain thrown out as a benefit to Newton. Has this number been vetted vs the concessions we would need to make to compete with other Massachusetts city’s and towns (Hello Amazon) ?
Overall, I do believe the proposal is worth evaluating but I am asking that Mark Development (and their supporters on this site) realize that we demand FULL transparency and SIGNIFICANT concessions to the project to move forward.
Thanks Andreae
Those who championed commercial development at places like Northland and Riverside have little to complain about here. Wasn’t it their argument that the infusion of residents would raise city expenses without generating the income to cover them? If this project is safe and environmentally secure, and if it generates net income for city coffers, where then does the problem lie?
It seems that councilors like Andreae Downs will look into the various issues raised in this discussion. For now, let’s all sit tight.