WILMINGTON — Three years ago, the City of Wilmington saw an explosion of proposed growth with four major mixed-use developments planned along Military Cutoff Road: The Avenue, CenterPoint, Arboretum (Village and West), and the older Galleria project.
Whether these projects will live up to their hype — or cause as many headaches as opponents claim — remains to be seen. Part of that will depend on shifting economic ground, uncertainty caused by Covid-19, changing site plans, and a host of infrastructure developments around the area.
A contentious corridor
As project announcement rolled in, critics called attention to overdevelopment and traffic issues — with surrounding conditions among the worst in the city before developments were approved. However, as the projects moved through the city’s planning commission, the process revealed how the Special Use Permit process made it difficult for opponents to compete with developers, as the ‘quasi-judicial’ process clearly favors well-prepared attorneys over everyday residents.
The full effect on traffic won’t be felt for years, and it remains to be seen whether the multiple NCDOT projects, including a flyover of Eastwood to cross Military Cutoff, or the Military Cutoff/Hampstead Bypass project, will help the situation — as developers repeatedly claimed — or hurt it.
On the other hand, supporters of the projects noted that several (but not all) developers have committed to extensive road upgrades. They have also pointed to the potential for considerable property, sales, and room-occupancy tax revenue. Developers have plans to collectively invest hundreds of millions of dollars into properties along the Military Cutoff corridor, a revenue boost for the city that would grow over time and last into the foreseeable future.
Supporters also pointed to the purported benefits of mixed-use developments, which are supposed to cut-down on cross-city traffic by allowing residents to ‘live, work, and play’ in one location (a claim that some found dubious, given the disparity between retail and hospitality employees’ pay and the going rate for luxury apartments).
The developments also served as an indirect indictment of the city’s ever-worsening affordable housing crisis — with projects explicitly aimed at top-tier luxury customers while displacing several mobile home parks, housing at the other end of the affordability spectrum.
Some developers offered to address the problem, but bureaucracy got in the way; when Tribute Properties offered a half-million dollars in lieu of including affording units in its Arboretum project, the city couldn’t figure out how to even accept money. Years later, it still doesn’t appear the city has created an affordable housing fund — or done anything else with money.
By the end of 2018, all of these projects had been approved. But not all moved ahead at the same speed or developed as initially proposed. Arboretum Village and West are nearly complete, The Avenue is slowly moving ahead, CenterPoint is in the middle of a rezoning request to change some aspects of the plan (to the discontent of some neighbors), and the Galleria is experiencing Covid-19 related financial delays.
The largest of the mixed-use developments on the corridor, The Avenue will likely take a decade to reach completion, including some fairly extensive improvements to parts of Military Cutoff Road.
Project managers submitted a site plan in March of 2019 but there’s been little additional activity since then, with the exception of clearing out the Hidden Lakes mobile home complex. Those leases ended as of November 2019 and the site is now behind a locked gate.
According to a spokesperson for the Carroll Companies, which is developing The Avenue, the company is still “pressing forward with our plans and approvals for The Avenue” despite economic uncertainty due to Covid-19.
Planned long before the other projects further north on the corridor, negotiations between State Street Companies and the City of Wilmington over a host of issues — most recently, where funding for proposed road improvements to Wrightsville Avenue will come from — have dragged on for years.
Earlier this year, State Street scrapped plans to apply for a Special Use Permit to build a 75-foot hotel, saying it did not want conflict with neighbors.
The development has entered preliminary plans for private streets and utilities, which will be considered by the city’s subdivision review board next week.
But the project itself may take longer than planned, due at least in significant part to Covid-19.
State Street President and CEO Jeffery Kenter said he had stepped away from the details of the project, but could comment on the impact on Covid.
“COVID has had a chilling effect on the real estate capital markets. Specifically, underwriters are currently not able to underwrite deals due to the cloudy outlook. It is tough to project future performance given the current environment. The expectation is that there will not be a return to normal until the clouds go away. In my view, that does not happen until there is a vaccine,” Kentner said.
The Arboretum projects have moved the most quickly, with both developments nearing completion. Most construction was well-underway or already completed by the time the Covid-19 pandemic began to destabilize the U.S. economy.
One minor modification was approved by the Wilmington Planning Commission last week, allowing a boutique fitness center instead of a more traditional retail outlet. As the developer noted, this would have no impact on traffic (and could reduce it) and would provide a benefit both to on-site and nearby residents.
The modification has not yet been approved by city council, but with staff support and no objections during the planning meeting, approval is expected (in fact, the tenant — F45 Training — appears to have begun setting up shop some time before the planning commission vote, launching a Facebook page in March).
Construction on the 1-million-square-foot project at the intersection of Eastwood and Militar Cutoff roads will likely have to wait in part until modified site plans are approved.
In January, developer Jason Swain applied to modify the project’s conditional rezoning to allow for changes to CenterPoint. Although the 18-page application did not actually include any description of what Swain wanted to change, eventually neighbors found out — and not all were pleased.
Swain was hoping to add additional height to several buildings, including two parking garages, bringing them up to 75 feet. Swain also aimed to scale back retail and restaurants space to up rental capacity for apartments and hotels. Neighbors pushed back, embarking on a letter-writing campaign.
In the end, the planning commission was split 3-2, with commission Chair Richard Collier, who was actually the co-applicant along with Swain, and Commissioner Bruce Bowman, who is the project’s consulting architect, both recusing themselves.
City Council is scheduled to hear the issue during its September 8 meeting.
Send comments and tips to Benjamin Schachtman at email@example.com, @pcdben on Twitter, and (910) 538-2001.