DELRAY BEACH — After transforming Atlantic Avenue into a bustling social hub, Delray Beach hopes to turn Congress Avenue and its five-mile strip littered with underdeveloped lots into its “next great street” — a move officials believe is critical for the city’s financial future.
Delray Beach is banking on a massive project at a deserted 49-acre lot that will add more than 600 apartments and 400,000 square feet for restaurants, office and retail to jump-start the growth.
Construction on the joint venture between CDS International Holdings, Key International and 13th Floor Investments is expected to begin at the end of the year or the beginning of 2022. Jeff Perlman, executive vice president of CDS International Holdings, said the hope is everything will be completed in 2023.
Located on Congress Avenue and Linton Boulevard, the empty lot has served as a visual symbol of the area’s lack of development. The lot has remained empty for 13 years since Office Depot moved its headquarters to Boca Raton.
“It’s a great first step,” said City Commissioner Adam Frankel, who added that the street has been underutilized compared with its neighbors in Boca Raton and Boynton Beach.
“This project will be the No. 1 catalyst” for growth, he said.
Further north on Congress, Aura Delray Beach is adding over 276 apartments. A representative declined to answer questions, but the company’s website said the units are expected to open by the fourth quarter of 2022.
Perlman, who served as Delray Beach mayor from 2003 to 2007, said revitalizing the Congress corridor has been a project over 15 years in the making, dating back to 2006 when Office Depot announced it would be leaving. Delray Beach initially planned to move quickly, but the financial crisis of 2007-2008 put any development talks on hold, Perlman said.
The city finally revisited the issue in 2016, allowing the development process to begin once again. The issue has been finding companies to take a chance at an underdeveloped part of the city that hasn’t had much success.
“A lot of times, [developers] don’t want to be the first people with their feet in the pond,” Frankel said.
“Success grows from success, if you see one group that has the imagination and the guts to spend their capital in an area and be the first there. It’s a risk.”
Perlman believes the area has strong potential, noting its proximity to Interstate 95 and the Tri-Rail station. The Congress area also has more lax height restrictions for buildings. In the downtown area, buildings can be no taller than 54 feet — five stories — but the limit increases to 84 feet by Congress, allowing for apartments to add more units and be more profitable.
“The downtown is so hot and has attracted a lot of the investment dollars,” Perlman said. “It’s going to take some real pioneers to take a look at another part of the city. When people think of Delray, they think about East Delray and the downtown area.”
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“I think for the city to be healthy, it needs more than one area to be performing. You can’t rely on just one part of your city. You have to have investment in various areas.
“Congress represents a great opportunity for investors and also for the city itself. Whatever tax base gets built over there, that gets added directly to the city. I think it’s critical for the city’s financial future for it to be all it can be.”
City Commissioner Ryan Boylston agreed with Perlman’s assessment, saying that banking primarily on the downtown area and the beachfront property owners for taxes is “putting a lot of eggs in one basket.”
“It’s really important we get Congress online, and it starts with carrying its own weight out there,” Boylston said.
In addition to the two housing projects, Palm Beach County is discussing spending more than $50 million to renovate its 112,000 square-foot administrative building in Delray Beach on Congress. The 28-acre facility houses numerous offices, including the tax collector and county’s Department of Health.