There’s gold in them there office parks!
These are tough times for cash-strapped towns across Massachusetts. And as communities along the Route 128 beltway go prospecting for new tax revenue, they are finding a rich vein in long-neglected office parks and commercial properties near New England’s most vibrant commercial thoroughfare.
Needham is the latest to make this discovery, as it wraps up the revamp of one aging 1950s office complex, and launches into another potential redevelopment of valuable land along the Interstate 95 corridor.
The hope, officials say, is that by opening up zoning rules to allow for bigger and more lucrative buildings, developers and investors will follow.
“In order to entice people to come here, we have to make the investment worthwhile,’’ said Devra Bailin, Needham’s economic development director. “It’s true of a lot of mature suburbs of Boston.’’
Needham’s New England Business Center, which has seen vacancies rise in recent years, got a major shot in the arm last fall.
Town Meeting voters approved changes in the zoning rules to encourage development in the property, off the highway’s Exit 19A. The changes will allow for taller buildings and as much as 2.5 million square feet in new office space, growth that could eventually bring in millions in tax revenue for Needham each year, Bailin notes.
The revamp is badly needed at the business center, more than 50 years old. It once accounted for as much as 22 percent of Needham’s tax revenues, but that number is just 11 percent now.
Meanwhile, the value of residential property in Needham has soared, with the town featuring some of the area’s highest home prices. The median home price stood at $649,400 as of last month, up nearly $20,000 over the end of 2010, according to the Warren Group, a Boston-based real estate data firm and publisher.
The change has left homeowners bearing an increasing share of the local tax burden.
“We haven’t seen the development on the commercial side, so the residential taxpayers are paying a larger percentage of the tax,’’ Bailin said.
But as it looks to spur new commercial development, Needham may just be getting started.
The town is turning its attention to a collection of just over 1 million square feet of underdeveloped commercial properties along Route 128, just across Highland Avenue from the New England Business Center.
It is an area of low-slung buildings and many small lots that have the potential to be redeveloped into larger blocks of commercial and residential space, Bailin said.
It might make sense, for example, to increase the density and height of what could be built in this area, especially along the highway, she said.
But for any redevelopment to move forward, zoning rules would have to be updated and smaller lots combined.
Bailin plans to meet with property owners, businesses, and tenants in the area next month to get a sense of their appetite for new development.
Needham is hardly alone as it looks for tax relief in new commercial development.
On the other side of I-95, Newton officials will soon begin reviewing plans for a big office and residential complex at the MBTA’s Riverside Station, just off the highway.
A little farther north, Sam Park is hoping to turn the former Polaroid campus in Waltham into a mix of office and retail space.
And just to the south, Dedham is reaping millions in new tax revenue from the Legacy Place shopping center, which replaced a fading cinema and its sprawling surface parking lot.
But timing is everything, and Needham’s efforts to boost its commercial tracts are taking place at a crucial juncture.
Route 128 is in the midst of a major overhaul that is gradually adding a travel lane on both sides of the highway between Route 9 in Wellesley and Route 24 in Randolph. The work is rolling north to Needham, where the planned improvements include a new ramp system at Kendrick Street near the business center, further increasing the value of space in the park.
And the higher the value, the more commercial real estate taxes the town can bank on, without some of the headaches new homes can bring.
“It brings with it the tax revenue without the overhead,’’ Bailin said.