PROVIDENCE, R.I. (WPRI) — The outgoing head of the I-195 Redevelopment District Commission says it has been no easy task filling vacancies in the downtown district.
While Peter McNally said he is proud of his three-and-a-half years heading an effort to revitalize several acres of downtown property, he expressed concern about the slow pace of new development. As it stands, several properties remain vacant, and McNally isn’t sure how quickly new projects will be completed after he’s gone.
“I would have hoped we could have moved a little faster and got more buildings done,” he said.
In an exclusive exit interview with WPRI 12, McNally – who is retiring Friday – discussed a variety of topics, including the Wexford Innovation Center, the controversial Hope Point Tower and why it’s challenging to redevelop property in a city where new growth – absent public investment – is scant.
“To create a new urban environment, and at the same time put companies and people in those buildings … that’s no easy task,” McNally said.
McNally, who will return to the private sector where he’s worked most of his career, took the helm in 2015 at the quasi-public agency created to redevelop the downtown land reclaimed after the relocation of Interstate 195.
And while he points to some success during his tenure, such as the Wexford project and the effort to protect some open space, McNally said companies are still not clamoring to develop on the land – underscoring a long-existing concern among some elected officials that redevelopment is taking too long.
Of 20 parcels of land, the agency has sold two, designated another two for public space and McNally said another three are either under consideration or under agreement.
To date, land sales have totaled about $1 million, which is a far cry from what was originally expected when the state floated $38.4 million in bonds for the commission to buy the land in 2013.
The state has since decided to refinance the outstanding debt, extending the terms of the bond an additional decade. The restructuring will help keep annual expenses low, but ultimately cost taxpayers more when accounting for 10 additional years of fees and interest payments.
McNally declined to comment on the specifics of the bond refinancing, but said land prices would increase if commercial rents grow in Providence, which hasn’t happened in recent history.
“Rents have not moved to a level to justify new development,” he said.
To make the math work in a low-rent environment, developers often seek public investment – as was the case with the Wexford project, which received nearly $40 million in incentives – or look for opportunities with high returns, such as high-end residential units.
McNally’s exit is happening amid ongoing controversy surrounding the so-called Hope Point Tower, a proposal to develop luxury condos in a near 600-foot residential high-rise on Parcel 42 near the Wexford property.
The proposed development would alter the Providence skyline, becoming the tallest building in the state, and has been met with fierce opposition from neighborhood groups, along with Providence Mayor Jorge Elorza, who has said the proposed building is too tall.
The second-term mayor last year vetoed a zoning change approving the height of the 46-story building, butting heads with the City Council, which ultimately voted to override the mayor’s veto. A lawsuit has since been filed in R.I. Superior Court challenging the City Council and the zoning change.
Opponents argue – in part – luxury condos are not necessarily the type of housing currently needed in a city where the median household income totals $40,366.
The decision to allow the Hope Point Tower is ultimately up to the I-195 Commission, a decision that will happen after McNally departs. But when asked whether the market could bear so many luxury apartments, and whether such a building would successfully be filled with tenants, McNally was skeptical.
“It’s not entirely clear if it will,” he said.
Meanwhile at the State House, Senate President Dominick Ruggerio, a North Providence Democrat, is frustrated with the pace of development in the I-195 land. On April 11, he filed legislation to give the General Assembly authority over local zoning when it comes to major development projects, such as the I-195 land.
Ruggerio has said such legislation could make the state more efficient when it comes to dealing with significant development projects, but McNally isn’t convinced zoning is really the issue at hand.
“We’re basically subject to the laws of supply and demand,” McNally said. “At the policymaking level, we can move some levers to help the demand and help the supply, as we’ve done recently with several of our projects, but zoning is not one of our concerns.”
Caroline Skuncik, the commission’s vice president and senior project manager since 2017, will serve as acting executive director until a permanent successor is named.
Looking forward, McNally says the future success of the I-195 land depends on whether the commission, along with local and state officials, ensures current projects are supported on an ongoing basis. The continued success of those projects, including the Wexford building, public park and pedestrian bridge, will ultimately contribute to the success of future development in the district.
“We can’t chalk them up as wins and just move onto the next things,” he said. “There is no finish line.”