The Riverhead Industrial Development Agency yesterday approved financial assistance for the developer of a 37-unit apartment building with street-level offices to be built at the corner of Osborn Avenue and Court Street.
The developer received its final site plan approval from the Riverhead Town Board last week.
The $ 19.6 million project is the first within the Railroad Avenue Overlay District to gain approvals from the town. The district, enacted by the town board in January 2021, is intended to incentivize investment and redevelopment of the area surrounding the Riverhead LIRR station, and provides developers with opportunities for increased density and a greater variety of uses.
The area is within a Town of Riverhead Urban Renewal Area and one of two federally designated Opportunity Zones in the Town of Riverhead. The town has also adopted a Transit-Oriented Development Plan for the area a picked a master developer for a key project on the site of a town-owned parking lot directly opposite the 205 Osborn Avenue site
In a resolution adopted unanimously yesterday, the IDA board approved the developers application and granted exemptions from mortgage recording taxes, sales and use taxes, and a declining abatement of real property taxes over a 10-year period.
The property will be subject to full taxes on a base assessment of $ 45,000 plus the increase to a projected assessed value of $ 992,199 abated by 90% in the first year (2023-2024), declining by 5% per year for the first five years, and by 10% per year for the next five years. The property will be subject to full taxation in the 2033-2034 tax year and thereafter.
The IDA also granted the developer exemptions from mortgage recording taxes estimated between $ 117,563 and $ 148,125 and exemptions from sales and use taxes in an amount not to exceed $ 702,294.
The development will provide 37 “highly-amenitized,” market-rate, rental units consisting of three studios, 24 one-bedroom and 10 two-bedroom apartments, according to town documents. The ground floor of the building will include a “Worksmart Coworking Space” offering a variety of business space and services to local entrepreneurs, freelancers, small businesses and remote workers. The facility will be pet-friendly and feature a full gym, basement storage units, a rooftop entertainment space, a dedicated package room and a virtual doorman, the developer said in its application to the IDA.
The project is projected to generate approximately $ 11.5 million of new economic impact in the town during the construction phase and $ 1.7 million of annual economic impact in Riverhead once the building is fully leased.
“This is an extremely important project for the Railroad Avenue area of our town,” said IDA board member Lori Ann Pipczynski before casting her vote in support of the application. “And the town has invested a lot of money and resources developing a strategic plan for the revitalization of it.” It will have a significant positive impact in the area and will “serve as a catalyst for additional investment” there, Pipczynski said.
The developer last month demolished the existing, blighted former medical office building that had been sitting vacant on that corner for many years.
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