Salem News Article 3/3/2006 (courtesy Salem News):
Large development proposed for Salem's downtown
By Tom Dalton
SALEM — A Somerville company has unveiled one of the most ambitious
downtown development plans in recent history — an almost complete
makeover of an entire city block.
The real estate firm RCG wants to turn a largely vacant former newspaper
plant and an underused urban marketplace into a sprawling condominium
complex with three large buildings, upscale retail stores, an outdoor
courtyard and underground parking.
The estimated $80 million project would include up to 180 residential
condominiums and as many as 500 parking spaces. The developer hopes to
start construction in spring 2007.
The downtown property eyed by the developer includes the former Salem
News building and the city's historic marketplace, a block bordered by
Washington, Front, Lafayette and New Derby streets.
It would take six to 10 years to build, the developer said.
"The market is strong in Salem but not so robust we can say we're
going to build the whole thing all at once," RCG principal Alex Steinbergh
said yesterday to a standing-room-only crowd in the Edgewater Café.
The dramatic announcement was greeted with both enthusiasm and caution.
Mayor Kim Driscoll stressed that this is not a final plan, only a concept
and the beginning of what will be a lengthy "discussion" between
the city and developer.
While the project could bring life to a long-dormant city block and help
solve the city's nagging parking problems, it also is laced with challenges
and questions. The developer will have to acquire city land — the
marketplace and parking lots — figure out how to construct two levels
of underground parking and convince the community that this large project
can fit along the cobblestone Front Street in the shadow of historic Old
"While I'm extremely excited to begin this discussion, I really want
to stress it is the beginning," Driscoll said. She added, however,
that RCG's interest is one more positive sign for the city.
"I'm thrilled about what this project says about our downtown ..."
she said. "The downtown of Salem is really at a rebirth."
RCG is completing the Derby Lofts condominium redevelopment next door
at the former Salem Laundry building. While it does not own any of the
property on the Salem News block, it has purchase-and-sale agreements
signed with the owner of the Salem News property and with the owner of
the Delande Lighting building, Steinbergh said.
The developer will have to negotiate with the Salem Redevelopment Authority
and other city entities to acquire the marketplace and city parking lots
on Klop Alley and at the corner of Front and Lafayette streets.
One of the many challenges will be constructing a two-level underground
garage with up to 500 parking spaces — almost half for public parking.
RCG has done some initial testing that shows it's feasible, Steinbergh
The project will be done in phases, Steinbergh said, starting at the corner
of Washington and New Derby streets.
Although it is impossible to say how long it will take to secure city
permits, the developer hopes to start construction next year.
Under the current plan, Delande Lighting and the former Salem News building
and printing plant would be demolished and replaced with new buildings.
Another condo/retail building would go up at the corner of Front and Lafayette
streets. The three main buildings would be five and six stories tall.
The popular restaurants on the block, Edgewater Café and A Passage
to India, are expected to stay, Steinbergh said.
The struggling marketplace would become a large courtyard under this plan
with seasonal vendors, outside dining and maybe even a performance space.
The only properties left untouched by the development would be the ones
RCG doesn't control — Salem Fire Department headquarters and two
buildings on Front Street, the Jewish Federation of the North Shore and
a building next door with law offices.
The developer was asked lots of questions about the impact the project
will have on existing businesses, the amount and kind of parking planned
and the type of retail stores envisioned. Steinbergh said he has been
surprised by the success at Derby Lofts, which has leased space to a bookstore
and a furniture store and other tenants. He said he hopes that success
will extend across the street.
The current proposals projects 160 to 180 condominiums selling for between
$350,000 and $550,000, which are similar to the prices at Derby Lofts.
If there is a lot of retail and office interest, Steinbergh said they
may reduce the number of residential condos. He said he hopes to attract
a speciality food store, a fitness center and other businesses.
Building for the future
* Three buildings with a total of 160-180 condominiums
* Two levels of underground parking with up to 500 spaces
* Upscale retail shops
* Courtyard with outdoor dining, seasonal vendors
* Construction in four phases over six to 10 years
Salem News Article 3/7/2006 (courtesy Salem News):
Developer bets heavily on Salem's future
RCG,a real estate development firm, proposes to redevelop almost this
entire city block, shown facing New Derby Street in this artist's rendering.
By Tom Dalton
SALEM — Alex Steinbergh has a favorite cartoon. t shows a group
of Indians standing on the shore greeti g the Pilgrims as they land at
Plymouth Rock. The Indi n leader says to the Pilgrims: "Are you planning
n spending the night
That same question could have been asked of Steinbergh four years ago
when he arrived in Salem looking to buy a commercial property. He didn't
like the building he was shown but perked up when a local real estate
agent took him past the old Salem Laundry building, a rickety, largely
vacant structure on Derby Street.
"That's exactly the type of building I'm looking for,'" Steinbergh
told Julianna Tache, the Realtor who drove him around that day.
Steinbergh liked the Salem Laundry building so much he decided to spend
the night — and then some.
His Somerville development company, RCG, not only bought the Salem Laundry
but spent $17 million converting it into Derby Lofts — a six-story
building with 54 condominiums that held its grand opening this winter.
RCG then crossed the street to buy the former Dracula's Castle at 90 Lafayette
St., where it wants to erect another six-story building with 30 condos.
That project went before the city's Planning Board last week.
Over the past few months, RCG signed purchase-and-sale agreements for
two more properties in the downtown, Delande Lighting and the former Salem
News plant. On Thursday, the Somerville real estate developer unveiled
an ambitious, $80 million plan to build 160 to 180 condos and 500 underground
parking spaces on the old Salem News block.
Talk about a whirlwind romance.
In four short years, RCG has swept a good chunk of the city off its feet.
And it is already talking to another property owner about buying other
large downtown tracts.
"We'll be in Salem as long as we're wanted," said Steinbergh,
one of the founders of RCG. "I think that's the major point. If we're
not wanted, we won't be there."
Steinbergh, 65, is an amateur wrestler — he took part in a world
age-group championship a decade ago — with an MBA from Harvard.
He began as a management consultant in the energy field and, over several
decades, has shifted most of his attention to real estate development.
RCG did its first project in 1989, Cambridgeport Commons, a 100-condo
development with underground parking. As the real estate market heated
up, so has the firm. It has done 11 projects since 2001, including three
in neighboring Lynn.
High on Salem
RCG has been highly successful in Lynn, selling out two projects before
they were completed. Despite the firm's clear interest in Salem, it has
had a rougher time here. The company ran into lots of problems on Derby
Lofts — dumping its construction firm at one point — but remains
bullish on the city.
"Salem is an incredible place," said Steinbergh, who rattled
off the names of new developments and restaurants with the familiarity
of a native son. "I guess I've always had some interest in Salem,
but Salem for a long time had a reputation of not being a good place to
That has changed in recent years, he said, with the Peabody Essex Museum's
expansion, the construction of the Jefferson at Salem Station apartments
at the former Parker Brothers site, the arrival of a new hotel on Pickering
Wharf and the creation of about 100 new downtown condos.
But Steinbergh also knows that the latest project, which calls for construction
of three large buildings at the site of the former Salem News plant and
the city's marketplace, presents great challenges. For starters, RCG has
to acquire several pieces of city property, including the marketplace
and two parking lots.
"I think the Salem News project is one of the more ambitious ones
we've undertaken," he said.
The development will be done in phases over six to 10 years.
RCG is betting on Salem because it appears to be a magnet for baby boomers.
It has culture, fine dining, a waterfront and transportation to Boston.
"We feel that Salem will be a natural place for North Shore retirees
to want to live," Steinbergh said.
In just four years, RCG has gained a foothold in Salem. It will take time,
however, to find out what kind of reception this new proposal will get
and how big the foothold will be.
RCG PROJECTS SINCE 2001
Brookline Village Lofts, 21 condos, Brookline
Cypress Lofts, 45 condos, Brookline
323 at Cypress Lofts, 29 condos, Brookline
Broadway Lofts, 5 apartments, Chelsea
Boston Machine Lofts, 30 condos, Lynn
Ladder 3 Lofts, 15 condos, Lynn
Sloan Machinery Lofts, 32 condos, Lynn
Derby Lofts, 54 condos, Salem
Park Street Lofts, 18 condos/townhouses, Somerville
Building 15 Lofts, 12 condos, Waltham
The Residences at Atlantis Marina, 44 condos, 91 boat slips, Winthrop