Facing a slumping housing market, a developer has apparently backed off on plans to transform a dormant paper mill site on Main Street into a residential and retail village.
The proposed revitalization, which included plans for 219 condos and 6,000 square feet of commercial space along the banks of the Nashua River, had been taking shape for years, and town officials had been billing the project as an engine of change in the town's quiet downtown.
Now, it appears the change will not come any time soon.
Pepperell voters approved new zoning in May 2006, clearing the way for the amalgam of condominiums and businesses on the 12-acre paper mill site. Earlier this year, Carlisle-based Freedom Development Corp. rolled out its preliminary design plans to general applause, save for the few detractors who warned of potential traffic snarls.
But, apparently chilled by the sluggish real estate market, Freedom Development failed to meet several submission deadlines for moving ahead with the purchase and sale agreement, said Jerome Epstein, chairman of Perry Videx, the Hainesport, N.J., company that owns the mill site.
Epstein said he is now discussing selling the property to other prospective buyers, whom he declined to identify. He said he would entertain a second bid from Freedom Development, if it chose to submit one.
"We're just shopping to see who's got the best deal around," Epstein said. "If it takes a little longer to get it done right, then we don't mind."
Freedom Development officials were unavailable for comment for this story.
The stalled project drives home a growing concern across the region about the market slowdown and its effect on municipalities. While the real estate slump is reducing new revenue growth in some towns, a trend worrisome to many officials, other so-called smart-growth projects across the state are also at risk from the downturn. Such projects cluster residential and retail life into one common village area in an attempt to cut down on traffic congestion, land use, and energy costs.
In nearby Groton, officials have been pushing ahead plans for a smart-growth development on Station Avenue, an artery off Main Street near Town Hall. Voters signed off on zoning in October, clearing the way for a mix of condos and retail along the street.
David Hamilton, principal of Burlington-based Capstone Properties, the developer, could not say whether the downtown project may be derailed or postponed due to the real estate slump.
"It's a little premature to say now is a good time or now is not a good time," he said. "Right now, we are much more involved in a multilevel planning process."
But Hamilton said the slump certainly looms in the back of his mind. "If you don't have people stepping up to buy, then you have a frozen market," he said. "It makes it very difficult to go ahead with what you've planned."
Smart growth has become an important strategy across the state for consolidating retail and residential life, and has numerous advocates at the state level.
Still, only 5 percent of new homes on the market in many Boston suburbs are on lots of a quarter-acre or less, said Andre Leroux, executive director of the nonprofit Massachusetts Smart Growth Alliance. The majority of new homes are on properties larger than an acre, which is uneconomical and does not make for sustainable development, he said.
"It's a terribly inefficient use of land," said Leroux.
In Pepperell, Selectman Darrell Gilmore expressed disappointment at the news regarding the old mill site, but said he was hopeful about a turnaround in the real estate market.
"I think there's still potential, but I think the question is, how they are going to push it through in a tight economy?" he said. "If you build it, who is going to move into it?"