Affordable housing still is a key part of a sweeping plan to redevelop the vacant former St. Joseph Hospital site, but it's going to be created differently, due to the soaring cost of construction materials.

And as a result, the proposed $90 million mixed-use project will have one less use.

The shuffle was disclosed Wednesday at a city Planning Commission meeting, when co-developers HDC MidAtlantic and Washington Place Equities presented a sketch plan to get the panel’s feedback, an early step in a thorough and multi-faceted review and approval process by the city that will take months.

Though no vote was taken, the commission’s reaction was largely favorable. Commission member Maxine Cook said she’s hopeful that the redevelopment will turn out to “be good for the community” and provide “opportunities to thrive.” “Hear, hear!” added commission member Jon Lyons.

Lancaster-based HDC and Baltimore-based Washington Place Equities unveiled their original plan a year ago, proposing a mix of market-rate housing, affordable housing, office space and retail to revitalize the idle 6.4-acre site, bounded by College, Marietta and North West End avenues plus West Walnut Street.

The site has been dark since the final occupant, UPMC Pinnacle, left in February 2019, only two years after acquiring what was then Lancaster Regional Medical Center. Lancaster Regional lasted 17 years. Before that, the facility was St. Joseph Hospital.

“The plan has evolved, but generally speaking the (emphasis) has been consistent throughout. All the reasons that brought us to be interested in this location are all still in play. We’re still very, very excited about this,” said Dominic Wiker, vice president and director of development for Washington Place Equities. The goal remains to create “a mixed-use, mixed-income community,” he said.

Market-rate apartments

Under the newly revised plan, one pillar of the project – converting the six-story hospital at the corner of College Avenue and West Walnut Street into 150 market-rate apartments – is unchanged. The 225,000-square-foot building, which dates to 1954, could be ready for occupancy as soon as “the latter part of 2024,” Wiker said.

The second pillar -- affordable housing provided by HDC -- is shown in the same quantity but will be provided in different spots and by different means.

Last year, HDC said it would construct 50 to 60 townhouses on Marietta Avenue, construct a four-story building of 20 to 30 units on the other side of College Avenue and do the same on a site two blocks away on Wheatland Avenue.

In total: 90 to 120 units of affordable housing.

Now the plan calls for adding one story to the building on the other side of College Avenue (making it a 5-story building with 64 units), re-evaluating plans for the Wheatland Avenue site, and redeveloping the former George C. Delp Pavilion at Marietta and College avenues into 48 to 50 apartments.

In total: 112 to 114 units of affordable housing.

The 48,000-square-foot Delp building, opened as a surgical suite in 1993, initially was going to be turned into office space by Washington Place Equities. With the switch, office space is no longer included in the redevelopment.

(Delp led CNH Industrial predecessor New Holland Machine Co. for 33 years. He also was a community leader and philanthropist. He died in 2001 at age 92.)

Wiker said Washington Place Equities had been staying “flexible” about the best way to redevelop the corner. “We weren’t 100% committed” to office use, he said Thursday. When “market conditions” changed and HDC could benefit significantly from renovating an existing building, the swap was made.

Claude Hicks, HDC senior vice president of real estate, indicated that the nonprofit was being flexible too. The way it provides affordable housing on the project is being “configured differently in that we are adaptively reusing an existing building instead of building new construction.

“Adaptive reuse allows us to utilize an existing structure which means no demolition.  This is a benefit to the neighborhood and the environment. Additionally, costs should be reduced by utilizing the existing structure instead of new construction,” he said by email on Thursday.

Hicks believed the savings would be substantial but said it’s too early in the development process to specify the savings or the total cost. It could be ready for occupancy in 2025.

New construction

The 5-story apartment building at 213 College Ave., measuring 67,000 square feet, could be ready for occupancy as soon as late 2023, Hicks said. It’s a $15 million undertaking. Whether that timetable holds depends on whether HDC succeeds in getting low-income tax credits from the Pennsylvania Housing Finance Agency for the venture. The agency is set to award the next round of tax credits in September.

Because HDC is no longer using the Marietta Avenue side of the main parcel for affordable-housing townhouses, Washington Place Equities will use that area to enlarge the amount of market-rate housing it will offer.

Rather than constructing 25 to 30 row homes for sale, as originally proposed, now the developer will build 54 townhouses, in groups of three to six units. The developer has yet to decide whether these will be for sale, for lease or a combination of both, Wiker said. These units will have three bedrooms. Prices remain to be set.

These will go on the northwest side of the tract, now a large parking lot, and the southwest quadrant, where roughly 75,000 square feet of hospital buildings will be razed, said Wiker. The targeted buildings were used as a nurses’ dormitory, chapel, auditorium, office space, utility plant and in-patient mental health facility, he said.

One existing building in that area will be preserved – a one-story brick garage that dates to about 1910. “Because we’re pursuing historic tax credits, that (building) has to remain,” Wiker said. It will be used to house common-space amenities, such as a game room or meeting room, he said, but it’s too soon to be specific. A swimming pool and children’s play area might be added there too.

An eight-foot-wide trail for pedestrians and bicycles, as well as a paved lane for vehicles, will bisect the site north and south, connecting Marietta Avenue and West Walnut Street. The co-developers also will plant 53 trees across the site, create several green spaces and put green roofs on the buildings, the sketch plan shows.

The main hospital building, originally constructed as St. Joseph Hospital, will be renovated as studio, one-, two- and three-bedroom apartments, Wiker said. Units will have large windows and high ceilings. Amenities in the building are projected to include a hotel-style lobby, fitness room, roof-top patio, on-site parking and bicycle storage, among others. Rents remain to be set, he said.

As part of the renovations, the developer will shift the entrance to the former hospital building from College Avenue, where the hospital created a sheltered off-street drive-up, to its original location on the corner of College Avenue and West Walnut Street. This will put the entrance next to the building’s bank of elevators, Wiker explained.

The smallest component of the redevelopment, retail space, is unchanged. The new plan shows 8,000 square feet of retail space on the College Avenue side, with an unspecified restaurant or two among the likely tenants, Wiker said.

Washington Place Equities has the main parcel under agreement with UPMC Pinnacle, though Wiker declined to disclose the amount. UPMC Pinnacle paid $29.4 million for the property in 2017, when it was a functioning hospital, courthouse records show. UPMC Pinnacle next month will ask the city to subdivide the property so it can sell Washington Place Equities and HDC the portions each will redevelop.

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