Lancaster Toyota Mazda Scion is planning an $8.5 million expansion that will enlarge its parts-and-service department and its new-car display lot.

"The reason we're doing this is to have a nicer environment for our employees and customers," the company's vice president, Rob Allen, said.

A new parts-and-service building of 58,000 square feet will be constructed on the former J.C. Ehrlich property at 1107 Enterprise Road.

The 7-acre site adjoins the dealership's used-car lot across the street from the new-car showroom and existing parts and service department at 5270 Manheim Pike.

East Hempfield Township supervisors on Wednesday voted 5-0 to approve final land-development plans for the new building.

Demolition of the 30,000-square-foot former Ehrlich building is scheduled to begin Monday, Allen said.

The new structure, set to be completed in March, will boost the number of service bays from 20 to 31, but not increase the work force, Allen said.

Speedwell Construction is the project's general contractor.

Once the parts-and-service department relocates, its current space will be razed and made into a new-car display lot.

The new configuration will improve access to both the new car display lot and the parts and showroom department.

Customers will drive into a state-of-the-art facility that's climate controlled.

"It's going to be beautiful," Allen said.

Lancaster Toyota, with 175 employees, has wanted to change its layout for years.

In 2009, it bought an undeveloped portion of the Ehrlich property and used that land for new-car storage and employee parking.

That didn't solve the cramped parts-and-service situation, however.

As recently as last year, Lancaster Toyota considered developing a two-floor parts-and-service facility behind its showroom.

The idea was to make the most of its limited land.

"We didn't expect the other half (of the Ehrlich property) to become available. But it did. So we jumped on it," Allen said.

The second deal was completed last week. Dan Berger of NAI Commercial Partners handled both real estate transactions.

The $8.5 million project price tag includes the cost of construction, equipment and acquisition of both parcels.

"We ended up spending more (than the two-floor project would have cost), but this gives us room to grow," Allen said.

That won't be the end of the improvements at the dealership, though.

Lancaster Toyota intends to invest another $1.5 million to $2 million in a makeover and expansion of its showroom and offices in 2012.

That expansion will use some of the space to be freed by the relocation of the parts and service department, Allen said.

Ehrlich moved to the Enterprise Road property from Loop Road in 1993.

Before that, the Enterprise Road property had housed the first Lowe's store here. It closed in mid-1992 after 17 years of operation.

Ehrlich's new location is a 7,400-square-foot leased space at 360 Steel Way, near Red Rose Commons.

tmekeel@lnpnews.com