Housing in Portsmouth at Service Credit Union? Water Country? Rezoning creates options

PORTSMOUTH — The City Council recently changed the zoning of about 39 properties to encourage the development of more housing in Portsmouth.

Barely two weeks have passed since the vote to rezone the properties from office/research to Gateway, and the initiative already appears to be having its desired effect.

One of the properties rezoned was the Christ Episcopal Church parcel off Route 1, which the Portsmouth Housing Authority announced will be part of a major multi-faceted redevelopment plan. The site will now include a new worship space, a Portsmouth headquarters for Haven, an upgraded and expanded daycare and 44 affordable housing units.

Service Credit Union pledges to build affordable housing

Several of the properties on the list of rezoned parcels are owned by Service Credit Union, according to city documents.

They include its national headquarters on Lafayette Road and a 29-acre parcel on Lang Road, according to city documents.

During the recent meeting, Michael Mulhern, the assistant vice president of real estate lending for Service Credit Union, urged the City Council to make the zoning changes.

He told the council, “Service Credit Union shares your commitment to this community.”

The company has 700 employees in New Hampshire and “we have made Portsmouth our international headquarters for the last 67 years,” he said.

But Mulhern acknowledged “independent housing is not attainable by our employees.”

“They are commuting miles to get to work, it’s expensive, it’s exhausting, it’s 12-hour days when they have to take care of their children,” he said. “We need to take care of affordable housing here in the city of Portsmouth.”

Mulhern pledged if the city made the zoning changes, “we would develop it with the intention of affordable housing.”

“We define affordable housing as 30% of your income, for housing,” he stated. "There are some of our employees that have 50% of their income going to housing.”

Paying that much for housing means “you can’t save, you can’t do anything for the future,” Mulhern said.

In terms of work-force housing, Mulhern pointed out in Portsmouth it “is defined in ownership of a purchase price of $409,500, and an income of $136,000, a family income of $136,000.”

“If we can’t provide housing for that kind of income, and that kind of purchase price, what are we doing?” Mulhern said.

“Zoning is critical,” for Service Credit Union to build affordable housing, he said.

The rezoning, which the council approved, would allow Service Credit Union to develop the housing density needed to create “inventory at an affordable price for our employees and the employees here in the beautiful city of Portsmouth.”

He did not say which parcel the company intends to develop with housing. Mulhern couldn’t be reached for additional comment.

Portsmouth mayor pleased with early results of rezoning

Portsmouth Mayor Deaglan McEachern, reached Tuesday, said the zoning changes — which first were suggested by the Land Use Committee — were aimed at encouraging more housing development in the city.

Plus, it “doesn’t seem there’s a big demand for office or research (buildings) in a post-COVID world.”

“Everybody who looked at the properties, the council, the Land Use Committee and the Planning Board, said housing could go there,” McEachern said.

He is pleased the zoning change has already shown progress.

“At the Episcopal Church, to have Haven and affordable housing there as part of a Portsmouth Housing Authority project, that doesn’t happen without that zoning,” McEachern said.

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He does not know any details yet about what Service Credit Union is proposing, but said he’s “excited to be able to see that happen.”

“It means a whole hell of a lot for them to be doing that,” he said. “Residents have been asking for affordable housing, and I hope we’ll start to see some of these projects with the gateway zoning.”

Could housing come to Water Country site?

The council also voted to rezone the 79-acre Water County water park property off Lafayette Road, according to city documents.

McEachern described the parcel as the “largest single property in the city of Portsmouth.”

2300 Lafayette Road, where the Water Country water park is located, is owned by Festival Fun Parks LLC, according to city records.

It was most recently appraised at $8.4 million.

Festival Fund Parks bought the Route 1 property in May 2000 for $10 million, according to city records.

McEachern said, “I haven’t heard directly from them” when asked if the property owners had shared any plans to redevelop the land.

A spokesperson for Water County says they lease the property from Bellwood Associates Limited Partnership. Because of that the spokesperson declined to comment on rezoning.

Water Country sent out an email in late April announcing plans to hire 300 employees for the 2024 summer season. The park's opening day is scheduled for Saturday, June 1.

Parcels around Portsmouth rezoned to allow housing

Other properties rezoned to Gateway include the 3.5-acre Holloway car dealership at 500 Route 1 Bypass, the Rite-Aid at 1303 Woodbury Ave., the 5.9-acre New England Marine property at 200 Spaulding Turnpike and a 6-acre U.S. Army owned property on Lafayette Road, according to city records.

City Planning Manager Peter Stith said the Land Use Committee came up with the list of properties “to rezone to Gateway to create more opportunities for housing development.”

Stith told the council that the 39 properties are located off Lafayette Road, along the Route 1 Bypass, off Market Square and up to the Newington border.

In response to a question, Stith agreed the rezoning would not hurt commercial development.

“It’s just the introduction of residential to make it a mixed-use district,” he said.

City Councilor Andrew Bagley said he supports the zoning change.

“It's been a three-year journey to get here. I know some people say it's been kind of quick,” Bagley said. “I feel like it's been kind of slow. The Land Use Committee did two years of great work.”

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City Councilor Beth Moreau stated there are some industrial uses allowed in Gateway districts, too.

“By changing these districts it gives us more options, it gives builders, developers, owners of these properties, more options of what they can put on their property,” she said. “We’re just trying to open up the door to more options.”

This article originally appeared on Portsmouth Herald: Portsmouth rezoning could bring housing to 39 more sites around city