The Northland Newton Development Project may swap out office space for more housing units, according to presentations from Newton’s Land Use Committee on Tuesday.
The Northland Project is a 22.7-acre, 14-building mixed-use housing and business development on Needham and Oak Streets in Newton Highlands. One of these buildings is the Saco-Pettee Mill, an old textile mill Northland planned to renovate into office space.
But given low demand for office space and high demand for housing in Newton, the project may pivot to turning the mill into an apartment building.
Demand for office space is still below pre-pandemic levels, and it may be between six and 10 more years before demand rises back to those levels, according to market analysis by Camoin Associates, an economic development consulting firm.
“As we’re kind of working our way out of the spike in vacancy that occurred during the pandemic, hybrid and remote work models have continued to be common in lots of office users,” said Tom Dworetsky, Camoin’s vice president and director of research.
Still, building some office space may be worthwhile for the city because it’s taxed at a higher rate than homes. If the building were all office space, the city would gain 27 percent more revenue than if this space were made into housing, according to Dworetsky.
Regardless, the Northland Project would have to compete with other office spaces in the Newton area, as there is 1.7 million square feet of vacant office space within 5 miles of the project site. Some of these competing office buildings even have near-identical appearances and amenities, according to Dworetsky.
“There are a number of brick-mill-type buildings in the area, particularly in Watertown, but also in Nonantum and Waltham,” Dworetsky said. “So it would not be the only Class A with a brick mill building on offer, and that has available space.
After the consultants presented their findings, the council opened a public hearing.
One resident, Lynn Weisberg, said she supported building more housing instead of more office space because of its potential value to the city.
“Although office space generates a higher tax revenue than residential, office space that is empty—that is not rented—does not generate any tax revenue,” Weisberg said. “At this point, I would hope those counselors, who were concerned about whether or not Northland was acting too quickly to eliminate the commercial space, can be satisfied.”
Marc Laredo, Ward 7 councilor-at-large, said he accepts that office space is no longer viable to build at Northland, though he said he hopes to support more projects focused on economic development in the long term.
“It is a fair request in these circumstances from the developer to say, ‘Look, it really isn’t economically feasible anymore for us to build office space,’” Laredo said. “And I do think we all have a collective concern that if something’s built and then it remains vacant for a fairly extended period of time, that would not be good for the community.”
Ward 2 Councilor-at-Large Tarik Lucas said he agreed that an office-construction project of this size would be too big, but countered that there was potentially a market for a smaller-scale office space project at Northland.
“Clearly, there is a market for small office space, not 180,000 square feet of office space, I’m giving you that,” Lucas said. “But could we not do some small office space on the ground floor in this building?”
The updated version of the project also included changes to traffic impacts and overall square footage.
The updated version of the project would reduce the square footage taken up by office space by 188,200 and the amount of retail square footage by 19,083 square feet. In return, 22 units of housing would be added to the project, according to Dennis Flynn, an engineering associate with BETA Group, Inc.
Overall, these changes bring the average square footage of the project down 10 percent.
As a result of these changes, Flynn said new traffic brought by the project would have less of an impact on residents, projecting that the updated project would see a 13 percent reduction in the amount of weekday vehicle trips in the surrounding area.
The committee held the item for discussion and kept the public hearing open, meaning it will return to the issue at its next meeting.
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