Construction is expected to begin in October on this newly approved 171-unit apartment building on Hanover Street. Rendering courtesy of Cube 3 and Soren Deniord

A former public works garage in Portland’s Bayside neighborhood is set to become a 171-unit apartment building, a project that could inject a healthy dose of housing into a city that desperately need it.

The planning board voted unanimously to approve the project at a meeting Tuesday night, and the developer said Wednesday he hopes to break ground in October.

Tom Watson & Co., a prominent Portland property owner and developer, plans a five- to eight-story building with an outdoor courtyard and swimming pool at 52 Hanover St. The estimated $60 million project is expected to take two years to build and should be ready for occupancy in the fall of 2023, the development team said.

“We are pleased to have the planning board’s approval to proceed in realizing the potential we see for this space – what is now an abandoned old public works garage and surface parking lot,” Tom Watson said. “Our team is looking forward to beginning the next phase of work to bring these rental apartments to Portland. We intend to continue collaborating with city staff and the neighborhood throughout construction.”

The board voted 4-0 in favor of the project, with members Maggie Stanley recused and David Silk and Marpheen Chann absent.

The project is the largest apartment proposal to be approved by the city since the Midtown development in 2014. That project, which was originally approved for 850 units on Somerset Street in Bayside before being scaled back to 450 units in response to a lawsuit, never moved forward.

By comparison, the largest projects approved or built in recent years include a 75-unit apartment building under construction at 510 Cumberland Ave. and a seven-story building with 139 units on Congress Street approved in 2015.

Two other, larger projects are in the pipeline. An 18-story 263-unit apartment building proposed by Redfern Properties at 200 Federal St. won a zone change from the City Council last week and will now proceed to planning board and historic preservation reviews. And the redevelopment plan for the Northern Light Mercy Hospital’s State Street campus calls for more than 500 units of housing.

Watson’s project will include 132 one-bedroom units and 39 two-bedroom units. The apartments would be built above a two-story parking garage with 176 spaces, which would be leased separately from the units. Four retail spaces of 1,500 square feet each are proposed on the ground floor facing a proposed plaza facing 82 Hanover St., which Watson redeveloped to include Banded Brewing Co., The Yard bar and Wilson County BBQ restaurant, among others.

The project will include 20 units that will be deed restricted to remain affordable to middle-income families, defined as earning 100 percent of the area median income. The 2020 rent limits for similar workforce units would be $1,765 for a one-bedroom to $2,018 for a two-bedroom, according to the city.

The developer has said rent prices for market rate units will be finalized later.

The 52 Hanover St. site is exempt from the new requirements of the Green New Deal for Portland, which increased energy efficiency standards, increased the percentage of required workforce housing units from 10 percent to 25 percent and lowered the maximum rents for those workforce units, because the application was filed before the citizen initiative was approved in November.

Watson won the right to develop 52 Hanover St., which includes the city’s old public works garage, in 2018. He had originally planned to create makers spaces for artists and others, but switched to a market-rate housing project last year.

Six people spoke during a public hearing ahead of the planning board’s vote Tuesday. All of them either raised concerns about the size of the project and potential impacts on traffic and congestion, or criticized the city’s planning process for not giving neighborhood residents more of a voice earlier in the process.

Mechanic Street resident Heidi Souerwine said she supports the addition of more housing and business development in the neighborhood, but the Watson proposal seems too large and out-of-scale with the neighborhood. She’s concerned that the addition of between 100 and 144 vehicle trips during peak hours will make traveling along the narrow, one-way streets more difficult.

“In general, I’m both excited and concerned,” Souerwine said. “We’re seeing a lot of outsized developments in Bayside right now.”

Parris Street resident Christine Arsenault said she has lived in the Bayside for about 20 years and she was upset that the development team seemed dismissive of neighborhood concerns around congestion and potential noise.

“Part of moving into a neighborhood is having respect for residents and the businesses that will become neighbors,” Arsenault said. “Believing you’re bigger and better, and allowing your ego to assume you know what’s best, is pretentious. Designing a building privately without an initial community insight and then presenting it as a final product when it’s too late to change anything is also wrong.”

Although the development includes the planting of new trees, Watson will be required to pay upward of $60,000 into the city’s tree fund. The Bayside Neighborhood Association requested that money be earmarked for Bayside, rather than being diverted to other neighborhoods, but the board did not have the authority to do that.

“The planning board cannot put a condition of approval on the city,” board chairman Brandon Mazer said. “We can put conditions of approval on the applicant – they have to fund the tree fund. But once it’s passed over to the city, it’s up to the city to use those funds.”

The project is part of a transformation in Bayside that accelerated when the city moved its public works campus off the peninsula to Canco Road.

Since the properties were sold in 2017, the area of Bayside roughly defined by Kennebec, Parris, Lancaster and Hanover streets has been converted from an old industrial area of heavy equipment, garages and sand piles into a burgeoning neighborhood, offering a little of everything that Portland is known for – food, drink and the creative economy.

The area also includes new housing, which the city encouraged to help ease a shortage of rental apartments, especially those affordable to workers.

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