Thursday, September 5, 2013

Easton to Sell Alpha Building to Developer Mark Mulligan

By Christina Georgiou

CEO of VM Development Group Mark Mulligan, center, talks about
plans to renovate Easton's Alpha Building during a press conference
announcing the city had chosen the firm's bid for the project in
city council chambers Thursday afternoon. From left to right, he is
accompanied by VM partner William Vogt, Easton Mayor Sal Panto,
and Easton city councilmen Ken Brown and Jim Edinger. City councilman
Roger Ruggles, as well as numerous other city officials attended the event.
VM Development Group, led by developer Mark Mulligan, will buy the Alpha Building, currently the site of Easton's City Hall and the tallest building in the city, for $4 million, it was announced at a press conference this afternoon.

"The sale price is higher than the appraisal," said Mayor Sal Panto, adding that city council will vote on the sale's approval at next Wednesday's regular meeting, and that it's expected to give final approval at the meeting after that, before the end of the month.

The City of Easton will lease back the space it currently occupies for 19 months, begining in November, while the new city hall and transportation center is being constructed.

"Should we not be out (of the Alpha Building), we have three 90-day options," the mayor noted, adding that while the city will be paying for the space, administrators expect that renting the space will ultimately save about $150,000 due to not having to pay for maintenance and other expenses related to the building.

The Alpha Building will become home to about 30 or 40 apartments on the uppermost floors, with  offices below. The first floor will continue to be retail space, Mulligan said, estimating that the conversion will take three or four years to complete.

While this will be the fifth high-profile--and multi-million dollar--property Mulligan has acquired in just a few years, Panto said he's confident of the developer's ability to fulfill his promises.

"I can assure you this developer has different investors for different projects," Panto said.

Mulligan said the necessarily delayed timing of the Alpha Building's use conversion made bidding on the project not only attractive to his firm, but also made it more possible for it to handle from a practical point of view.

"Because of (the city's) time line, it works," Mulligan said. "We're pretty confident of our ability to produce."

VM Development's work on the Pomeroy Building conversion into apartments, offices, and retail space is nearly done, and should be complete by the end of the year, he added.

While work on the Simon Silk Mill redevelopment project in the city's West Ward is ongoing and the first phase won't likely be complete until the end of next year, work on the Governor Wolf building on North Second Street, which Northampton County recently announced it would be selling to Mulligan for a mixed-use space similar to the Pomeroy project, has not yet begun, but should be complete by the time the developer starts work on the Alpha project.

"We expect to be completely done with Wolf and Pomeroy by the time we start on Alpha," Mulligan said.

The National Building, which VM Development acquired a little more than two years ago, is not slated for any changes.

Work on the Alpha Building, due to the city's lease agreement, as well as tenancy by several other private firms, won't begin in force for about two years, Mulligan said, promising that current commercial tenants in the Alpha Building will be "taken care of."

Plans to renovate the lobby are likely to move forward sooner than the major construction efforts, and Mulligan said he plans to seek out tenants for the first floor retail space more immediately too. The street-level space has been vacant since the Crayola store moved next door during the Crayola Experience expansion earlier this year.

Serious work on the Alpha Building probably
won't begin for about two years, though
the lobby may be expanded and renovated, and
tenants found for the first floor retail space
sooner, said developer Mark Mulligan.

Mulligan said the Alpha Building lobby may be expanded into the former Crayola store space, reducing its square footage, though the final decision will be made after he talks with potential tenants. He will also add seating and generally make the space more inviting in anticipation of the residential use on the upper floors. The third elevator, now only used for freight, will be upgraded and probably be reserved for the residential apartments, he added.

"It's going to be nicer, with places to sit down," he said.

Other upgrades to building, including a new roof and other necessary maintenance city officials have previously mentioned the need for are also undoubtedly part of the renovation, though the extent of these was not discussed during the announcement Wednesday afternoon.

The lobby renovation, along with getting the first floor retail space occupied, is expected to happen by the end of 2014, Mulligan said, adding that he expects major conversion construction on the Alpha building won't begin for about two years, and that the entire project won't be completed until sometime in either 2016 or 2017.

Mulligan added he's very pleased the city accepted VM's bid over others.

"It's been pretty exciting. This city has continued to grow on us," he said. "It's not just about us any more. We really want to help the city."

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