Should Beverly Pay $8 Million To Buy Family Dollar Lot On Cabot Street?

BEVERLY, MA — A row of Cabot Street storefronts and parking lot that's potential development into a five-story apartment complex spurred sweeping downtown zoning changes will become city property if an $8 million purchase funding agreement is approved.

The City Council on Tuesday set a May 1 public hearing at 7:30 p.m. to hear from residents and discuss the proposed purchase that would include $2 million in free cash and $6 million in bonded borrowing to buy the property at 218-226 Cabot Street housing the Family Dollar, Rent-a-Center and Bonefish Harry's as well as 8 Chapman Street.

Mayor Mike Cahill said in a letter to the City Council that the city had reached an agreement with the property owners on an eminent domain purchase for $7.35 million that would preserve the property for City Hall functions during the upcoming two-year renovation as well as the surrounding parking spaces that the city currently leases.

Cahill's letter said that once the City Hall renovation is completed the property would then be slated to be converted to affordable housing in a smaller-scale building than the five-story one that had been planned for development.

"The important public services that would be served by taking this property would include to take and permanently protect 108 public parking spaces that the city has long leased and would lose if the property were to be privately developed," Cahill said in his request letter, "provide a temporary home for the municipal offices during the planned renovation of City Hall, which is expected to take approximately 24 months to complete, thereby (eliminating) the need to pay rent to a third party during that time, and the ability to pursue the potential development of an affordable housing development.

"Once the city no longer needs the commercial buildings for municipal office space the city will likely sell the existing buildings to recoup some of the cost of the taking."

The property had been appraised at a fair market value of $7.1 million with the additional cost to "avoid the uncertainty and liability created by any litigation that might arise during the taking" of the property "in exchange for a waiver against any and all claims against the city."

A two-thirds vote of the City Council would authorize the purchase.

The proposed development of the Family Dollar lot, in part, triggered calls for zoning changes approved earlier this year that eliminated the seven-story tall-building overlay district on Rantoul Street and essentially created a four-story height restriction for new development on Cabot Street and surrounding sidestreets.

The City Council approved the changes in February after months of public hearings and included inclusionary zoning changes related to affordability that state that a percentage of any new development of six units or more has to be offered at 60 percent of the market rate.

City Council President Julie Flowers said on Wednesday that the public hearing — where residents are invited to speak on the proposed purchase — would be held at 7:30 p.m. as part of the regular Council meeting set for 7 p.m. on May 1 in Council Chambers.

(Scott Souza is a Patch field editor covering Beverly, Danvers, Marblehead, Peabody, Salem and Swampscott. He can be reached at Scott.Souza@Patch.com. Twitter: @Scott_Souza.)