PathStone’s Skyview Park Apartments a model for big-box adaptive reuse

When Amy Casciani looked at the shuttered remnants of retail vitality on the former Irondequoit Mall complex a few years back, she didn’t see urban/suburban blight, she saw a solution to a problem.

Monroe County, like just about every other region of the country, is facing an affordable housing crisis, with an acute shortage of quality age-in-place residential space for seniors.

Casciani, senior vice president of real estate development at PathStone Corp., believed that with a little effort and creativity, part of the abandoned mall anchor space could be converted into affordable apartments and supportive services for seniors.

She had no idea she would be on the forefront of what now is becoming a trend: the adaptive reuse of big box and abandoned malls as to meet housing needs.

“This is clearly a strategy and an opportunity for America to chip away at a shortage of homes in the millions,” Mike Kingsella, CEO of Up for Growth, a national, cross-sector member network focused on solving the housing and affordability crisis.

Adaptive reuse of former retail space in the region has been popular, including in plazas near the former Irondequoit Mall. The Tops Friendly Markets location at the corner of East Ridge Road and North Goodman Street was converted into Riedman Health Center. A few blocks down, what was Katz Furniture became a U-Haul truck rental and self-storage facility.

But creating housing where appliances and apparel once were sold hasn’t been commonplace, which is why Casciani had to convince folks at PathStone four years ago that it made sense. Upon hearing the idea, PathStone President and CEO Alex Castro didn’t exactly dive headfirst onto the big-box-becomes-housing bandwagon.

“I thought, there’s no windows, there’s nothing inside; that would be a miserable place to live,” Castro said.

Casciani, however, provided compelling reasoning for why her idea would work, and they soon sought approval to proceed with the project.

“When Amy and I went before our board, we said, ‘We have a great idea for Irondequoit’,” Castro recalled. “One of the board members said, ‘Please don’t tell me it’s the mall.’”

But just as Castro bought into the venture, so did the PathStone board, and last week the firm celebrated the official ribbon-cutting on Skyview Park Apartments. The former Sears store was turned into 73 residential units, plus courtyards. A new building with 84 units was built just to the east and the buildings are connected by a skyway.

“We’re trying to figure out how to deal with retail locations that aren’t the same as when they were built,” U.S. Rep. Joe Morelle said. “This is the model.”

Abandoned retail centers serve no useful purpose, so community leaders and developers believe adaptive reuse is a solution. A zoning variance is usually necessary to add a residential component, but quite often municipalities are eager to accommodate an affordable housing development.

“Retail closures are harmful to local economies, and when they sit vacant for long periods of time, they become an eyesore and strain on the community,” said Leonard Skrill, assistant commissioner of New York State Homes and Community Renewal.

Folks in Irondequoit know that all too well. The former mall was a major headache before Flaum Management bought the vacant Macy’s store in 2015 and the remainder of the property was sold at auction to Angelo Ingrassia in 2016.

“It was a property that was taking from residents,” said Monroe County Executive Adam Bello, who was Irondequoit Town Supervisor from 2014-2016. “It was taking our time, our money, our resources and our efforts.”

Now it’s home to the Irondequoit Community Center, Rochester Regional Health’s nursing school and Skyview Park.

Housing components are part of mall redevelopments across the country. In downtown Providence, R.I., what had been the country’s oldest mall is now The Arcade Providence, with two floors of micro loft apartments and a first floor of food, beverage and unique shops. In the Miami suburb of Cutler Bay, upscale housing is planned for the bankrupt Southland Mall. Multifamily housing is part of the vision for a reimagined The Dayton Mall in Miamisburg Township, Ohio.

Rochester’s Cornerstone Group considered space at Marketplace Mall for affordable senior housing to complement the construction of the UR Medicine Orthopaedics & Physical Performance Center in the former Sears store.

The housing developer instead will break ground in the fall on the 150-unit community on the southwest quadrant of the property, where the former movie theater operated, according to Roger Brandt Jr., president of the firm.

Mall owners in Buffalo and Syracuse have reached out to Skrill, intrigued by the Skyview project and how Homes and Community Renewal may be able to help fund other projects.

“It’s just a logical use of space,” Skrill said. “The need for affordable housing is great and owners of malls are broadly trying to repurpose their space.”

Skyview Park Apartments cost $44.8 million. About half of the funding, $22.9 million came from Housing and Community Renewal’s Supportive Housing Opportunities Program. Another significant chunk of money, $12.35 million, came from equity in Federal Low Interest Housing Tax Credits and while permanent long-term bonds provided $4.9 million.

But turning a building built for one use into housing isn’t always easy. Among the construction challenges encountered along the way by PathStone and its contractor, Christa Construction: the facility’s need for its own power line and the discovery that the building was built on what was essentially a big sandbox. But PathStone allotted for cost overruns and engineers teamed with Christa Construction to resolve structural stability concerns because of the sand.

While the Irondequoit Sears store could be converted into residential space, not every building will be ideal.

“I think there’s an idea that you can basically turn any building into housing, and with enough money I guess that’s true,” said David Garcia, policy director at the Terner Center for Housing Innovation at the University of California-Berkeley.

Few developers, if any, have an unlimited stream of funding. So while the layout of office buildings might seem right for apartments, there could be issues with infrastructure. Buildings with shallow floor plates are preferable in order to meet natural light and air requirements, and office buildings often have deep floor plates, Garcia said during a recent National Housing Conference webinar on adaptive reuse.

He also said there could be significant remediation costs in buildings built before 1980. Because construction on the former mall in Irondequoit began in the late 1980s, PathStone did not encounter those issues.

Ventures such as PathStone’s Skyview Park Apartments could become a best-practices roadmap for others considering similar projects across the country. Members of the National League of Cities have interest in retail conversion, but they aren’t sure how to proceed.

“Our members are saying, ‘We need case examples of hearing from people just like us, other local governments,” said Abygail Mangar, program manager for the NLC’s Center for City Solutions. “ ‘Tell me how they financed it, tell me what polices or tax credits that they needed to have in place to make it happen, tell me the other stakeholders that were involved in the process so we have an idea how to do it.”

[email protected]/(585) 653-4020