North Elba considers rezoning for Wesvalley apartments
LAKE PLACID — The North Elba Town Council is set to decide whether to authorize a property rezoning that could pave the way for the construction of a new affordable housing complex in Lake Placid. The public will have the opportunity to weigh in at a hearing on Aug. 11.
This next public hearing is the latest step toward the construction of “MacKenzie Outlook,” a proposed 60-unit apartment building on Wesvalley Road. Ardsley-based Regan Development is currently seeking state and federal funding for the complex, which the company plans to manage after they build it.
The lack of affordable housing in Lake Placid has had, and is having, many impacts on the community.
Over the years, multiple business owners — as well as administrators at the local hospital and school district — have described problems they’ve had with trying to attract and maintain a reliable workforce, an issue many have linked to the housing crunch. The local school district’s enrollment has continued to decline for years, a problem the superintendent has attributed to a lack of affordable family housing. And overall, the town of North Elba — which includes the village of Lake Placid, part of the village of Saranac Lake and the hamlet of Ray Brook — is expected to show the most severe population decline in Essex County in the 2020 census. According to the 2019 census estimates, the town is projected to see a population decline of nearly 10%. The town’s population in 2010 was 8,957, and the latest estimate shows a projected loss of 891 residents. Consultants hired by the Lake Placid-North Elba Community Development Commission to study Lake Placid’s housing needs said this community is currently facing a “workforce housing crisis.”
The Lussi family, which owns the Crowne Plaza and the land on Wesvalley where the housing development is proposed, have applied to have 5 acres of their parcel rezoned from “vacant commercial/village center” to “planned development.” That rezoning application is what’s currently under consideration by the North Elba Town Council and the North Elba-Lake Placid Joint Review Board — not the proposed apartment complex itself.
“As of now the P-D line runs through the middle of the Crowne Plaza property along the village (of Lake Placid) and town line,” Arthur Lussi wrote in a project narrative submitted to the Review Board in May. “We proposed to move the westerly boundary of the P-D line from the village/town line to Wesvalley Road. This area is served by existing village water, village sewer and village electric.”
If this rezoning is authorized by both the town council and the review board, the property would be divided and donated to Regan Development, according to a project summary. Then, it’s up to Regan Development to secure state and federal funding to aid the company in shouldering the cost of building the new complex, and go through the review and approval process at the local level.
The public hearing on the rezoning application before the North Elba Town Council is slated for Tuesday, Aug. 11 at 5:30 p.m.
Larry Regan, owner of Regan Development, estimated that MacKenzie Outlook would cost upward of $18.1 million to develop, $13 million for construction plus soft costs. That estimate, according to Regan, is even with his company deferring $1.31 million of their developer’s fee “to make the deal work.”
“We get that back in the form of the equity in the project,” he told the town council on Tuesday.
Regan is hoping to see more than $13.6 million in equity through the federal Low-Income Housing Tax Credit program, plus permanent loan financing of more than $3.1 million from the federal HOME program.
Regan said he’s hopeful that his company will be able to partner with the Housing Assistance Program of Essex County as they apply for state funding through the state Department of Homes and Community Renewal. It’s not clear when the department’s next funding round will open, but Regan said he expects it could come as soon as September.
In addition to seeking funding through HCR, the developer has requested a PILOT agreement if the project moves forward. PILOTs, or payments in lieu of taxes, can be negotiated to provide tax breaks to a developer working on a property that creates a public benefit. PILOTs could include either the limitation or deferment of property taxes owed.
The Lussi family’s corporation, Lake Placid Vacation Corp., paid a combined $3,530 in local and school taxes on its Wesvalley property last year, according to Essex County tax records. The property, nearly 16 acres in all, was last assessed at $276,700. Regan Development is predicting that the assessment of the MacKenzie Outlook complex will be around $2.06 million, with full taxes of approximately $26,424 each year, according to a project summary.
This development would also need approval from the state Department of Environmental Conservation and the Adirondack Park Agency, which is set to review before moving forward.
Regan is facing a tight deadline.
Though it was initially unclear early this year whether the complex was tied to the 2023 World Unversity Games, Regan confirmed that local officials are hoping to use MacKenzie Outlook for athlete housing during his presentation to the board on Tuesday. With the Games slated for January 2023, that means the building would need to be approved and completed within the next two years.
The Games are an 11-day event. After that, the complex would open up to long-term renters.
“I could see 30 days, then flipping it over,” Regan said.
The developer has proposed to build a 53,600-square-foot, 44-foot-tall apartment complex into the existing terrain: four stories in the front and three stories in the back, on a slope. The facade would have a river rock stone veneer, tan siding and a green roof, accented by timber.
Regan said the materials “aren’t fixed in stone,” however. If anyone has suggestions for how it should look, he’s amenable.
“We are somewhat open as long as it fits the price point for what we’re trying to build,” he said.
The complex would have 60 one- and two-bedroom apartments. Of those, 40 would be one-bedroom, 20 would be two-bedroom. One of the apartments would be set aside for the building superintendent.
Gross monthly basic rents will range from $691 to $996, according to a project summary. That would include a utility allowance of $110 per month for one-bedroom units and $130 per month for two-bedroom units. The developer would only be allowed to raise rents as the median income in Essex County increases, per federal financing rules.
The developer has proposed building 75 parking spaces and eight handicapped parking stalls for tenants — fewer than the 90 spaces required by the land use code. The review board would have to sign off to allow the complex to have fewer parking spaces.