Hope for Valley Stream housing project

Hawthorne Court, a 90-unit housing development on Cottage Street, has not opened since construction began in 2007. The building has been sold and is expected to open as an apartment complex several months from now.

Andrew Hackmack/Herald

A host of people might be changing their addresses in the coming months, as the long-anticipated Hawthorne Court housing development may finally open its doors.

In August 2007, ground was broken on Cottage Street in Valley Stream at the site of the development, a 90-unit condominium project that was slated to open in the fall of 2008.

Now, five years later, its ownership has changed hands. A group of buyers plan to convert the still unoccupied dwellings to high-end rental apartments instead of condominiums.

Earlier this year, Zeus Cottage LLC, the new owners of the property, at 125 S. Cottage St., contacted the Town of Hempstead Industrial Development Agency — a nonprofit, public-benefit agency that aims to help qualified businesses and not-for-profits relocate, expand and build in the town — seeking a break on its taxes for Hawthorne Court. Fred Parola, executive director of the development agency, said that Zeus Cottage received state sales tax relief and an 18-year payment in lieu of taxes, or PILOT, agreement. The agreement was made official on Aug. 3, after members of the development agency approved it on July 25.

Parola said that Hawthorne Court is 80 to 90 percent finished, but the bad economy likely led its former developers, the Dennis Organization, to sell the property.

“This group has come forward and are going to finish the project, and I guess rehab what remains to be done,” Parola said of Zeus Cottage, “and use it for higher-end, middle-income rental housing.”

Over the span of the 18-year agreement, Zeus Cottage will make payments in lieu of all real estate taxes and assessments to several taxing agencies. The agreement commences with the 2013-14 school tax year, the 2013-14 village tax year and the 2014 general tax year, whose starting dates range from June 1, 2013, to Jan. 1, 2014. During the first year of the agreement, Zeus Cottage will make nearly $400,000 in PILOT payments. That will increase to $583,572 by 2030-31, the last year of the agreement.

Parola said that Zeus Cottage made it clear in its application that the company would not be able to proceed with the project without tax breaks. According to Parola, the company stated that high taxes would boost the units’ rents to the point that they wouldn’t be viable.

“Our role is to develop jobs and economic development,” Parola said. “If you’ve got a vacant building that potentially can house residents, that is not a good economic situation.”

Mayor Ed Fare said the process is frustrating because he wants the property to be put to use, but he added that there’s not much he can do. “The village doesn’t want to be landlords,” he said, “and the village doesn’t want to interfere with capitalism and the free market.”

Centrally located apartments, Fare said, could attract younger people to Valley Stream, or keep them from leaving. “It’s an opportunity for young people to get in, stay in, have access to the avenues, have access to the train, and not live on somebody’s second floor in a 50-year-old apartment,” he said.

In 2005, the village board introduced a new local law that allowed for mixed uses of a property. The site of Hawthorne Court was in a commercial zone, but thanks to the law, the condominium project could move forward. Vinny Ang, then the village clerk, said that the board learned that having multiple-family residences in downtown commercial areas bolsters and strengthens business districts.

Hawthorne Court is being built on the site of the old Inflight Newspapers property, and was once billed as the “new look” for Valley Stream. Even while it was still under construction, Hawthorne Court was an award-winning project. Vision Long Island recognized the development at its 2009 Smart Growth awards ceremony for its compact design, and the Valley Stream Chamber of Commerce presented the Dennis Organization with its Business of the Year award that fall for the project. (The Dennis Organization no longer has an office in Valley Stream, and the Herald could not determine whether the company is still in business.)

“I think it will be great to get people in there,” Fare said, “for the people in the neighborhood, for the stores in the neighborhood and for the tax base.”