Commentary: Scarborough's Firehouse Village project is a case study in cooperation
Photo / Courtesy, Kaplan Thompson Architects
In Scarborough, Firehouse Village converted the former fire and police station into a mix of uses, including an Avesta Housing development (pictured here), a Rosemont Market, Harbor Fish Market, a pizzeria, a fitness club, a daycare, offices and a community room.
Located in the Oak Hill neighborhood in Scarborough, Firehouse Village celebrates the site’s history by renovating the existing fire and police station into a mix of uses including a local grocery store, a fish market, a pizzeria, a fitness club, a daycare, offices and a community room.
In line with established smart growth principles, Avesta Housing is rounding out the mixed-use approach by constructing Village Commons with 31 new affordable senior residences. The development team persisted through a zone change, a global pandemic, and rapid construction cost escalation to deliver this project which has brought economic opportunity and replaced vacant buildings and parking lots with new housing.
The project has created a campus feel with ample placemaking opportunities to enhance the community-based setting of mixed-use development. Five businesses are currently operating out of the renovated fire and police stations while the adjacent affordable senior housing building is nearly fully leased.
Site acquisition
The town of Scarborough sought to maximize the value of the former public safety lot at 246 U.S. Route 1.
Rather than a typical request for proposals, the town council empowered the town manager to take the property to the open market in November of 2017. The site received strong interest and at least a dozen parties pursued the purchase. The Town evaluated the offers on their financial merit and development intent. Town officials targeted the highest and best use of the site, which also maximized the sales value to help fund the construction of a new public safety building.
From this analysis, Firehouse Ventures LLC was selected as preferred buyer in November of 2019. The zone changes to allow for their vision occurred concurrently with the acquisition; the Town wanted to ensure that a zone change would not occur unless the sale went through.
Municipal approvals
The entire site, the commercial buildings and senior housing, was permitted together in 2021. Only site plan approval was sought in accordance with an amendment to the State Statue, Title 30-A, section 4402(6); subdivision approval was not required despite the differing uses. However, in only seeking site plan approval and not subdivision approval, we complicated our eventual closing. State law requires that divisions of land in excess of two require subdivision approval.
Our initial plan for ownership had required that we subdivide the land into at least three land condominium units. We thus abandoned the plan for a land condo and pursued a 90-year land lease of approximately 0.44 acres of the larger site. Leases must typically be in excess of 90-years for LIHTC financing.
Village commons financing
To develop the affordable senior housing, Avesta Housing secured Low Income Housing Tax Credits and financing from MaineHousing and tax increment financing (TIF) from the town of Scarborough to support a larger MaineHousing loan. In addition to these sources, Avesta secured funding from the Scarborough Housing Alliance, Cumberland County American Rescue Plan funds, Cumberland County HOME and the Federal Home Loan Bank of Boston.
The final capital stack included eight different sources of funds with their own terms and conditions. This level of complexity has become more common as construction costs have risen and developers have had to pursue more
sources from more lenders.
Timeline
- November 2017: site put on market
- November 2019: Firehouse Ventures LLC selected
- November 2019: zone changed to accommodate proposal
- April 2021: Firehouse Ventures LLC begin work on commercial spaces
- June 2021: tax increment financing approved
- December 2021: award from to MaineHousing
- October 2022: construction-loan closing
- February 2024: certificate of occupancy
Construction complexities
The construction of 31 units of senior housing was priced at $212 per square foot in September of 2021. By the time we closed in October of 2022, construction costs had ballooned to $300 per square foot.
Avesta closed the gap with scope reductions and by securing additional resources from all other lenders to close on our financing and start construction. To mitigate significant supply chain delays for our house meter switch gear, we purchased a temporary house meter solution so that we could get our certificate of occupancy and occupy the building. The temporary gear was enough to power the house panel but could not accommodate the solar array. We switched out the gear in late March, and with the final gear installed, the solar array is now integrated into the grid.
New life
The redevelopment of the former public safety campus in Scarborough is especially relevant today given the recent announcements that the vacant courthouses in Biddeford, York and Springvale could be converted into housing. Municipal buildings are a form of public space. They are assets of the town and broader community.
The redevelopment of these sites must therefore look to their history and former use. Any transformation should seek to build on and improve these public sites and repurpose them for continued community benefit for years to come.
The combination of affordable housing, retail and small business breathed new life into the Scarborough lot, and we’re hopeful that Firehouse Village can be a model for similar transformations of former public spaces throughout the state.
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