Developer pulls plans for Heritage Square rezoning in Durham
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Previous renderings for the Heritage Square project. Photo: Courtesy of Sterling Bay
A Chicago developer proposing a new life sciences campus near downtown Durham has pulled its rezoning application from the City Council at the 11th hour.
Why it matters: The plans from Chicago-based Sterling Bay envisioned a mixed-use life sciences campus on the site of the Heritage Square shopping center on the edge of the Hayti neighborhood and across the Durham Freeway from downtown.
- The shopping center currently sits vacant, but was once home to a grocery store, some smaller shops and restaurants.
Driving the news: The developer's plans, which were set to be heard at Monday night's Durham City Council meeting, were facing pushback from residents of Hayti, a historically Black neighborhood that has faced rising costs in recent years.
- Many of those residents expressed concern at the City Council meeting that a project of that size will cause property valuations across the neighborhood to soar even more, the News & Observer reported.
- Before the council could vote, however, Sterling Bay withdrew its application, a move that surprised the council and the dozens of people in the audience. The council ultimately voted to approve the withdrawal 5-2.
Zoom in: A Sterling Bay spokesperson told Axios the company is disappointed that the project will not proceed, and noted that it's worked for the past three years to speak with residents in the neighborhood about the project.
- The company said it proposed $2.3 million in contributions to the local community as part of its rezoning, including scholarship money for N.C. Central University and Durham Technical Community College, a contribution to the Hayti Promise Community Development Corporation, affordable retail space and several other measures.
- "While the initiative will not move forward, we remain proud of the collaborative efforts that shaped it," the spokesperson said in a statement.
What's next: The withdrawal means that Sterling Bay could resubmit another rezoning in six months or potentially build without it.
- Sterling Bay only filed the rezoning after discovering issues with the bedrock that made building underground parking more expensive and required taller buildings. The company had bought the 10-acre property for $62 million in 2022, according to county records.
- Sterling Bay said it was "exploring new steps" but declined to comment further on what might become of the property.
Between the lines: The pulling of the rezoning also comes at a time when financing for office and lab buildings is much harder to come by.
- After a surge in remote work and an increase in vacancy rates for office space, no new office projects are planned in the Triangle at the moment.
- And several lab buildings remain empty, which has caused several potential projects in Research Triangle Park and Durham to be put on hold.