There’s a remarkable transformation happening all around us, thanks to smart developers who see the win-win scenario in turning empty lots, old buildings, and unused industrial sites into versatile mixed-use developments. Properties that were once underutilized or abandoned are getting readied for their close-ups. Welcome to the new neighborhoods.
Drive through many Westchester downtowns these days, and you see construction cranes and eye-catching renderings depicting modern residential buildings with shops and shared public green space. It’s the result of a boom in developing what’s known as mixed-use spaces. According to the Commercial Real Estate Development Association (formerly NAIOP), a mixed-use property combines multiple land uses such as retail, office, and residential, within a single plot of land or adjacent sites in the same development.
Mixed-use functions in a symbiotic way, offering residents the seamless convenience of services such as a gym, grocery store, restaurants, and retail shops right by where they live, and giving businesses the benefit of a built-in customer base. Since 2019, Westchester has experienced a surge of this kind of development, with billions of dollars in new construction projects underway throughout the area. Projects supported by the county’s Industrial Development Agency alone represent $4 billion in private investment between 2022-2024. And of those, mixed-use are arguably the most ambitious, creative, and visionary.
Behind the Boom
Several factors are driving the surge in mixed-use properties. The largest and most urgent is the shortage of available housing in the area, not only for lower-income families, but for families of all income levels. The low inventory of housing stock puts the area at risk of losing population that contributes to the tax base. The fastest shrinking demographic in Westchester is residents between the ages 30 and 45, “which is a big flashing red light for all of us,” notes Tim Foley, CEO of the Building & Realty Institute (BRI) of the Hudson Valley. “Traditionally, the way people have migrated into Westchester is they get to that point where they’re having a family, and they want to move from the city to the suburbs. But that’s the group that we’re losing pretty quickly right now.”
This is a major concern for leaders of all of Westchester’s 45 municipalities. “If you can’t build out a workable regional talent ecosystem,” says Michael Romita, President and CEO of the Westchester County Association (WCA), the leading independent economic development and business advocacy organization in Westchester, “then the businesses will eventually leave.”
The need for appropriate housing for older people is also becoming more urgent. The fastest growing segment of Westchester’s population over the past few decades are those 65 and older. They’re looking to downsize and get out from under the maintenance demands of property ownership. They don’t want to worry about dealing with trash, cutting the lawn, or clearing snow. And they want the services they need, such as doctor’s offices, nearby. The current inventory in Westchester simply doesn’t match the types of homes that the aging —and often wealthy—population is seeking.
Rules in Need of Review
Why such a housing shortage? The short answer is, zoning rules and an environmental protection law known as SEQRA (The State Environmental Quality Review Act), passed in 1975) which can make it difficult to obtain approvals for new development. Developers must apply for variances to zoning rules, and while the concept behind SEQRA was intended to provide environmental protections, it’s currently blocking certain construction that has little or no environmental impact. These stopgaps cost both time and money. Reviews can take months or years and add tens of thousands of dollars to the cost of building, which has resulted in fewer new residential builds overall and has contributed to the current housing crisis. And it’s putting New York at a disadvantage—young professionals are choosing to put down roots in more development-friendly areas of New Jersey and Connecticut, and even Massachusetts and the Philadelphia area. New York State Governor Kathy Hochul is trying to slow the exodus; her recent “Let Them Build” campaign seeks to reform the SEQRA rules, allowing for new construction that will not only yield housing but also include a variety of spaces that modern life demands, such as childcare centers and supermarkets.
The fastest shrinking demographic in Westchester is residents between the ages of 30 and 45, which is a big flashing red light for all of us.
“Cities Within a City”
According to the National Association of Realtors 2023 Community and Transportation Preferences survey, a majority of Gen Z and Millennials said they’d be willing to pay more to live in a walkable community, and that they’d opt to live in a home with a smaller yard if it meant they’d have access to retail and amenities within strolling distance. Gen Z also specifically noted they prefer to live near public transit.
These strong sentiments among younger generations—whether driven by health considerations, environmental concerns, convenience, or a mix of the three—are fueling a trend toward transit-oriented development (TOD), which is when mixed-use properties are built near public transportation. TOD developments foster walking communities because they help people get where they need to go easily, without the need for a car.
Kevney Moses, Director of Land Entitlement for Toll Brothers, which developed one of the residential buildings in Edge-on-Hudson in Sleepy Hollow, says, “TOD mixed-use developments have proven to be very successful because, where there’s solid public infrastructure, traffic can be mitigated by bus lines and rail and the ability for people to walk down the street.” Where new development can be challenging in many municipalities, TOD development is seen as more favorable in the eyes of current citizens.
The nature of work is also driving the need for more mixed-use spaces, not only for Gen Z but for all generations of the workforce. Even with Return to Work (RTW) initiatives being handed down by large corporations, the fact is, plenty of people are still working from home post COVID. And if they’re not commuting to New York City, they still want more culture and community near home. Through mixed-use developments, these needs can be met, creating what Romita refers to as “cities within a city,” places that are environmentally more sustainable while also fostering a sense of belonging and connection.
“A lot of the mixed use that you’re seeing in local communities is revitalizing downtown areas, allowing them to re-energize their local economies that were impacted by the pandemic, the economy, so many different things,” says Blanca Lopez, Commissioner of the Westchester County Department of Planning.
Bruce Berg, CEO of The Cappelli Development Company, which is involved in both the District Galleria and Hamilton Green mixed-use developments in White Plains, notes how the synergy of mixed-use spaces creates an environment for economic growth. “When we build these mixed-use projects in downtown areas, they become an economic driver—the residents go to the restaurants, buy things at the local stores, go to the movie theaters. During the day, the people who work in the offices use those same services. So as we’ve been bringing people into downtown New Rochelle and White Plains, they’re creating more demand for the existing retailers and enabling new ones to open.”
One Community at a Time
While mixed-use developments can be layered and complicated, they serve the purpose of meeting long-term goals of each individual community. As Lopez explains, every municipality periodically updates their comprehensive plan, which looks at everything from parks to buildings to homes to transportation modes. “All the stakeholders ask the question: How do we see our community growing, what do we want it to look like 10 to 20 years from now? What is it about our values and the local culture that we want to continue to exist?”
“A comprehensive plan is the single most valuable thing a community can do to foster growth in the proper way,” adds Romita. A plan means that new developments aren’t considered on a case-by-case basis but instead, evaluated based on how they fit within that community’s cohesive long-term goals.
Andy Cohen, Managing Director of BRP Companies, which has just completed The Leaf—12 Church Street—in New Rochelle, likes that mixed use isn’t just building for building’s sake. Cohen worked for New York City in planning for several years before moving into real estate and feels strongly that for cities to remain strong over time, construction projects need to be considered as part of the whole. “The good thing about mixed use is the developer and the city can really curate the program in a specific neighborhood,” he notes.
Cohen notes that this has been a learning curve for the industry through the years, especially in the case of retail. “Retail, historically, has been an afterthought,” explains Cohen. “A developer might have said, ‘This would be great for a restaurant,’ but if they didn’t build it with ceiling heights or ventilation systems, a restaurant would never opt in to that retail space.” These days, the industry has gotten a lot better at designing for different types of uses, even building with commercial tenants in mind. “Instead of just building a concrete box, we’ll put in partitions, lighting, and an HVAC system to entice a ground floor tenant to invest even before construction is complete.”
Toll Brothers’ Moses agrees that there’s a smart business case for mixed-use: “Mixed-use provides some buoyancy to the development. It makes it more resilient and really strengthens the marketing side of the business.”
A plan means that new developments aren’t considered on a case-by-case basis but instead, evaluated by how they fit within that community’s cohesive long-term goals.
Smaller Towns, Smart Ideas
It’s not just the bigger Westchester cities like White Plains and New Rochelle that are seeing the mixed-use boom. In Peekskill, with a population of about 25,000, the building that housed Genung’s department store and then became the offices for the New York State Workers’ Compensation Board, sat empty for several years. The property was purchased by The Children’s Village, a non-profit organization that plans to convert the upper floors of the building into affordable housing, including some designated specifically for young people who are aging out of the foster care system. The ground floor of the building will be the new site of the Peekskill Public Library, providing a welcome and important public service to the entire community. This re-imagining of a vacant space to support housing for a vulnerable population and become a hub for education could become a model for other municipalities.
Mixed-use developments are also an opportunity for smaller municipalities with tight tax bases to create partnerships that benefit the community. In Pelham, a town of 12,000, public-private partnerships between the town and developers are solving the problem of upgrading infrastructure without raising taxes. According to Lopez, “You see more and more municipalities saying, ‘How do we partner with developers so there are some community benefits along with the development?’” One example is Pelham House, a 5-story residential building with ground-floor retail; a new municipal building with the fire station, police department, and other municipal offices will be across the street.
Overcoming “NIMBY”
While most Westchester residents would agree that more housing is sorely needed, many are not as keen on new development in their own area. Concerns over school crowding from an influx of new families, pressure on current municipal services such as garbage and snow removal, and the traffic headaches that accompany construction periods, are among the most common objections that jurisdictions and developers face when building proposals are put forward. However, the vast majority of school districts within Westchester have been losing school population over the last two decades. Tim Foley says that while the concern about school crowding is understandable, “The effect of additional residential buildings on schools tends to be far more muted than what might be expected”
As for traffic issues, they tend to be site specific, he says. A mixed-use development in a smaller village like Pelham may see more pronounced traffic effects, but in White Plains, where traffic already flows around the Galleria, construction shouldn’t tend to cause an inordinate level of inconvenience.
Lopez is sympathetic to a town’s residents, noting that one of the biggest challenges to overcome is how people feel about their town in its current state. Especially if there hasn’t been much development there in a long time, she says it can take some doing to get citizens on board. But significant mixed-use transformations Westchester has already seen—for instance, Ridge Hill in Yonkers and City Center in White Plains—have breathed new life into those cities. “Yes, there’s going to be some inconveniences, traffic issues, roads being blocked. But these changes in the long run will benefit municipalities, expanding and diversifying their tax base by attracting both young professionals and empty nesters,” says Lopez.
As Cappellis Bruce Berg points out, these kinds of developments allow cities to evolve and grow in an organic and positive way. He recalls that about 25 years ago, people were afraid to walk around downtown White Plains near the old Macy’s at night. But once City Center was built—a mixed-use development with residences as well as shopping, restaurants, and theaters—the area developed a strong heartbeat. “These developments have made downtown White Plains a really vibrant community and have completely transformed the city.”
What does the future hold? Governor Hochul’s executive budget proposal with the SEQRA reforms, if accepted by the Legislature, will open up opportunity for more mixed-use developments and downtown revitalization. “If this gets banged out in Albany this year,” says Romita, “this could be an important change for Westchester.”
Concrete Examples
Proof positive of the mixed-use real estate boom is abundant; we asked those in the know at BRP Companies, Toll Brothers, Capelli Organization, and Westchester County to share their take.
The Leaf, 12 Church Street
Location: New Rochelle
Total Size: ~602,000 square feet
Mixed Uses: 477 apartments in a 26-story tower, 119 of them affordable rate; ground-floor commercial space and a worship space for New York Covenant Church; rooftop pool, rooftop dog run, fitness center, co-work areas
Project Perspective: “It provides a little bit of everything to everyone, rather than providing expensive services to just one group.” —Andy Cohen, BRP Companies
Edge-On-Hudson
Location: Sleepy Hollow
Total Size: 70-acre redevelopment of a former industrial waterfront site
Mixed Uses Approximately 1200 homes, including townhomes, condominiums, single-family residences and rental apartments; waterfront retail district anchored by DeCicco & Sons, along with restaurants and shops; public waterfront parkland, walking trails and landscaped plazas along the Hudson River
Project Perspective: “Location means everything in real estate, and this is a beautiful waterfront location on the Hudson, in lower Westchester, near 287, and in a great town with a good school district.” — Kevney Moses, Toll Brothers
District Galleria & Hamilton Green
Location: White Plains
Total Size: More than four million square feet across roughly 15 acres
Mixed Uses: About 4000 units planned spanning both developments, of which ~500-600 will be affordable; retail and commercial spaces; public spaces including parks for community events; pedestrian connections from White Plains train station to Mamaroneck Avenue.
Project Perspective: “Right now the Galleria is like a wall that stretches two blocks from the train station to Mamaroneck Avenue. By opening up the property and allowing pass-throughs, we’re going to be able to really bring the whole city together.” — Bruce Berg, Cappelli Organization
41 North Division Street Redevelopment
Location: Downtown Peekskill
Size 10,000 square feet
Mixed Uses: 22 affordable residential units including some for young adults aging out of foster care; expanded public library with program spaces on ground floor and basement; aims to be a downtown cultural and educational hub.
Project Perspective: “This was originally a department store and then was the Workers Compensation building but has sat vacant for many years. The non-profit Children’s Village has bought the building and is giving a new use to an old space.” —Len Gruenfeld, Program Administrator, Housing & Community Development for Westchester County