Major Developments on the Horizon for Peabody Square

[Editor's Note: This article has been updated to reflect a correction in the size of the building.]

Main Street has been reconfigured and beautified, Peabody Square is next, and the city may soon be getting a welcome boost from new commercial development right in the heart of the downtown.

Bandar Development out of Middleton recently purchased what is known as the Second O'Shea Building, a visual landmark downtown at 9-13 Main St. The sale price was $1 million. The three-story structure was placed on the National Register of Historic Places in 1905 and sits right in the square at the corner of Main and Foster streets.

According to records from the registry of deeds, the sale occurred Aug. 19 between Angela Karavolas, who was a trustee of the property, and 407 Squire Road, LLC (Bandar). The building is currently occupied by China Corner, a furniture store, barber shop and some offices, but part of it is vacant.

Dan Bandar, who runs the firm with his brother Hany, isn't publicly committing to any one plan for the building at present, but instead has a number of options and plans for the property, according to a report by the Salem News.

Bandar told the paper they're looking at various options and multiple plans to determine what's feasible, including keeping the existing tenants or converting the building into another use.

Those discussions are also keeping the city closely in the loop -- a $250,000 loan from the city (from federal urban development grant money) did help finance the sale. Bandar even told the Salem News it was Mayor Ted Bettencourt who inspired them to invest in the downtown.

"He's got some ambitious plans," Bettencourt told Peabody Patch, adding that he'll be meeting again with Bandar later this month.

Bettencourt highlighted this purchase and the acquisition of the building next-door by another developer in his recent State of the Region address as evidence that private investors are taking notice of the city's efforts to revitalize the downtown.

The other project is at 11 Main St., which houses Congressman John Tierney's district office with two vacant floors above. Norman Lee received approval from the City Council earlier this year to convert the upper floors into 10 residential apartments -- all told the project would cost $1.25 million.

Bettencourt said the O'Shea project in particular can play a significant role in stimulating redevelopment and further investment in the area.

Bettencourt likewise hasn't seen any definite plans for the property, but said Bandar will have to appear before the City Council at some point in addition to securing building permits.

Parking will definitely be an issue, he confirmed. There is limited space on the street and behind the building, and metered spots are available directly across the street at the municipal parking lot on Foster Street, although several of those spots are already permitted spaces.

The property is in a Central Business zoning district, which allows for restaurants, retail stores, banks, offices and similar uses by right and residential apartments by special permit. Other commercial uses, such as hotels, bakeries or package stores would also require a special permit.

Bettencourt noted this investment and future developments over the next year or two could help move forward on putting a mixed-use municipal parking garage downtown.

That project, which was a campaign point two years ago, is aimed at resolving some longstanding parking challenges and bolstering economic development.

Bettencourt's vision is for a garage with offices, shops or restaurants above it, similar to projects underway in Salem and Beverly. Those projects were also financed heavily with state transportation money.

A garage could be built at the Mill Street parking lot the city purchased last year from the MBTA or at the Foster Street lot right off the square -- both locations are viable sites, said Bettencourt. He added that the city will be seeking state transportation funds, grants and other available monies.

The city also has a more favorable position now for economic development funding due to its status as a Gateway City.

As for the square itself, the city is now pursuing a $2.9 million state grant to majorly overhaul the intersection, according to Bettencourt. The city should learn in the coming weeks if that funding will be approved.