×

Buyer Sought for Iron Horse Park

Mixed-Use Development Site Needs $12 Million in Infrastructure

  • Bud Ames, the co-owner of Twin State Sand and Gravel Co. and Blaktop Inc. with his dog Duke on site in West Lebanon, N.H., on May 18, 2016. (Valley News - Jennifer Hauck) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.



Valley News Staff Writer
Saturday, May 21, 2016

West Lebanon — The owners of the 92-acre Twin State Sand and Gravel parcel off Route 12A slated for mixed-use development are hoping to sell the site for $15 million, according to the real estate firm Cushman and Wakefield.

Known as Iron Horse Park, the proposed project is zoned for construction of a combined 660,000 square feet of retail, office and industrial space. But millions of dollars of infrastructure improvements are needed before building can begin.

Bud Ames, co-owner of Twin State Sand and Gravel Co. and Blaktop Inc., said he’s been trying to market and sell the land since the project gained Planning Board approval in 2012. The site is still used for industrial purposes but is no longer a gravel source. Twin State now relies on a gravel quarry in North Hartland.

“We’ve always been hoping that someone would want to come in here,” he said in an interview on Wednesday.

Interest has been varied, Ames said, partially because developers can be wary about paying for needed infrastructure projects.

Under the Planning Board approval, a new road is needed through the property connecting it with routes 4 and 12A before an occupancy permit would be issued. Both of the current roads into the property pose problems, too.

Glen Road contains a historic railroad underpass that city officials don’t want the development to use, and Elm Street West is residential and not large enough to carry the development’s increased traffic. The project plans to make Elm Street West a dead end street on the property.

Development on the site also requires construction of sewer, water and stormwater drainage.

Ames said some minor improvements are complete, such as the razing of former quarry buildings, moving his office and creating an access point on Route 12A. He doesn’t have the estimated $12 million needed to finish off the infrastructure projects, though.

“There’s no way we can do it,” he said. “We’re just too small to take on something like that.”

Instead of requiring a future developer to take on the road and other infrastructure costs, Ames in October proposed creating a tax increment financing district. They city would issue bonds for the projects and then recoup the money through increased property revenue from new business.

Ames said TIF districts have been used successfully throughout New England, and said he believes some city officials are on board with the idea. He said turnover in the city manager’s office has prevented progress on the issue, though.

Acting City Manager Paula Maville said on Thursday the idea of a TIF district hasn’t been discussed since a meeting of the Economic Vitality Exchange Committee last fall. Ames hasn’t brought the issue up since, she said.

The property is desirable and close to both Interstate 89 and Route 12A, City Councilor Tim McNamara, an associate director of planning at Dartmouth College, said in a telephone interview.

He said industrial companies also could want to make use of space there, since there’s access to a nearby active railway.

Reusing the site is also preferable from a planning perspective, rather than using green space elsewhere in the city, McNamara said.

The one drawback is a lack of visibility for Iron Horse Park’s possible retail stores, he said, adding the road connecting to routes 4 and 12A could help solve that.

The proposed development has space for a 150,000-square-foot commercial big-box store, along with three smaller retail sites capable of supporting restaurants, according to listing information from Cushman and Wakefield’s Manchester office, which is handling the listing. It can also house two office buildings and several industrial buildings. In total, Iron Horse Park has 13 different lots.

While McNamara said he believes Iron Horse Park is capable of attracting businesses, he’s not in favor of the city financing infrastructure.

Since TIF districts require municipalities to pay for the projects up front, they “sort of rely on a ‘build it and they will come philosophy,’ ” he said. And if no businesses come, the cost would be shifted onto Lebanon taxpayers.

“You really want a key tenant or ‘power mover’ on the private sector side to say, ‘I will move in there,’ ” McNamara said.

The Upper Valley is a pretty “slow growth” environment, which could hamper development of residential units at Iron Horse Park and others like it, said John Vogel, an adjunct professor of business at Dartmouth’s Tuck School of Business. Not a lot of people are moving to the Upper Valley, he said, preventing the big development booms seen in Texas and other parts of the country.

“It’s hard to develop affordable housing, even moderately priced housing,” said Vogel, whose specialties include real estate finance.

Sales at brick-and-mortar stores are also not as strong as they once were, leaving some chains to reconsider expansion to new markets.

For every dollar spent in a general merchandise store in 2000, about 30 cents was spent online, Vogel said, quoting a recent Associated Press report. Online retailers are catching up, and are now at 70 cents.

“We’re now used to being able to in five minutes look at the price of 100 different items, just to compare them,” Vogel said.

“I’m not sure how much retail you’re going to develop up there,” he added.

Rick Kiely, a Massachusetts real estate agent familiar with Route 12A, disagrees. He said the retail portion of Iron Horse Park should do well because of the development’s location.

“The West Lebanon marketplace is still very desirable,” he said. “Retailers are definitely looking to open new stores there.”

Ames said there has been interest in the property in the past, but declined to identify the businesses that are considering building there. He retained Cushman and Wakefield to sell the property a little less than a year ago, after another company was unable to broker a sale.

Asked if there’s a timeline to sell the property, he said, “a couple of years ago would have been nice.”

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.

Correction

The 92-acre Iron Horse Park development in West Lebanon does not include a residential component; housing at the nearby Westboro Woods development is on a separate parcel. In addition, developers of Iron Horse Park would have to complete a road connecting Routes 4 and 12A in order to receive a certificate of occupancy. An earlier version of this story incorrectly described the mix of proposed uses in the development and misstated the timeline for building the road.