Aristides Koutouvides and his brother, Niko Koutouvides, want to erect an apartment building on property by the corner of lower Black Rock Turnpike and Commerce Drive that was formerly home to The Edge, a gym that moved to Kings Highway Cutoff several years ago.
The brothers, who are principals in Skala Partners LLC, haven't filed a formal application in Sullivan-Independence Hall to construct the apartment building on the 2.6-acre property at 665 and 711 Commerce Drive, but their interest came to light during the Town Plan and Zoning Commission's review last week of a proposed amendment to local zoning regulations.
Blackrock Realty's project, which has yet to go to a public hearing of the TPZ, would have 197 apartments, while the Koutouvides' proposal would house 102 apartments above retail and office space on the first floor, according to a March 24 letter that William Fitzpatrick, the Koutouvides' lawyer, wrote to Matthew Wagner, chairman of the TPZ.
The apartments would be a mix of one-bedroom, one-bedroom with a den, and two bedrooms, according to the letter.
Fitzpatrick mentioned his clients' project because the TPZ was reviewing whether to require that "residential use" on 15 properties in the Commerce Drive area be restricted to 70 percent of a building's total floor area. The current limit is 50 bedrooms per acre, and Assistant Town Planner James Wendt said the 70 percent restriction had been omitted because of editing errors when regulations for those properties were adopted in 2011.
Fitzpatrick said his clients would prefer that residential use be restricted to 80 percent of a building's total floor area so the Koutouvides' project could have four floors of apartments above a ground floor of commercial space. He said the Koutouvides' "cannot conform to the 70/30 split in an economically viable fashion."
"The difficulty in financing mixed-use projects increases as commercial use increases," Fitzpatrick said to TPZ members. He said having retail and commercial tenants on the second floor of a building "is really not a viable entity and does not work."
"My clients and the landowner are anxious to proceed with this proposal," Fitzpatrick said. "The proposed amendment here ... just doesn't work in our opinion."
Mark Barnhart, director of the town's Office of Community & Economic Development, also supported increasing the residential limit to 80 percent. He said in a March 25 e-mail to Wendt that the maximum allowable density for the structure would be 60 feet or five stories and that "it would seem appropriate to have a maximum allowable FAR (floor-area ratio) of 80 percent ... or one story in the five stories presently allowed."
Wagner said a potential way the Koutouvides' firm could meet the 70 percent restriction would be to build "a larger base" on their proposed mixed-use building. But Aristides Koutouvides said that would eliminate parking spaces, as well as require more parking spaces, because of the increased commercial space. He said he and his brother can meet parking requirements for their proposed building if the ratio is 80 percent/20 percent, but likely would have to build a parking garage if the base were larger.
"We didn't think that would be a desirable design outcome," he said. He said all the parking spaces under the 80/20 split would be surface parking.
Wagner asked if the Koutouvideses had considered underground parking for the development, but Aristides Koutouvides said the project would become "less finance-able" because of higher costs without increased revenue.
"You could make the base bigger. Nothing stops you from underground or structured parking," Aristides Koutouvides said. "Then it becomes a design issue. Can we hide that? Is it appropriate for the neighborhood? We wanted to be a little more thoughtful about how we designed this building."
Tim Donahue, an owner of the site that the Koutouvides' firm wants to redevelop, said a mixed-use building would be "a great use for the property" and that the Koutouvides brothers were "a quality applicant" and would build a project "the town will be proud of over time."
Gerald Alessi, a TPZ member, questioned the impact of an 80/20 split in light of other properties that would be affected. "In the next couple of years, how many more apartments are we going to be looking at in the future?" he asked.
Wendt said some of the properties in the area are not likely to be redeveloped in the near term because they already have tenants, though he said the proposed amendment would apply to the Commerce Drive property formerly home to Syms clothing store. He said development projects reflect the existing marketplace and that the current demand for office space is not as high as residential space.
The Koutouvides' project, if built, would be the first of its kind in the Commerce Drive area, and Town Planning Director Joseph Devonshuk Jr. said the quality of the development is more important to him than whether the ratio is 70/30 or 80./20. "What you want in the first development is something that sets a standard," Devonshuk said. "What's more important is that you want a quality development there."
Kurt Wittek, a managing director at Blackrock Realty, LLC, said last week that he also favors increasing the split to 80/20.
Wendt said the Metro Center property is one of the 15 that theoretically could be affected by the proposed amendment, but added that an application to build an apartment building on the Metro Center property likely would be put forward as an amendment to a different section of the zoning regulations. The Metro Center was designated as a "Transportation/Commercial Park," while the proposed amendment discussed last week was to regulations for a "Transit-Oriented Development Park."