A phoenix could finally rise from the “ashes” of the former abandoned commercial laundry site on Highland Avenue.
Six years after White Plains Linen moved to its new facility on John Walsh Boulevard, and two years after one developer presented a failed plan to build at the Highland Avenue site, there are new hopes that the rubble and crumbling buildings there could be transformed into much-needed housing in Peekskill.
The Stagg Group, a builder of quality and affordable housing in the Bronx and lower Westchester for nearly two decades, purchased the four buildings on the site at an auction in November. Stagg paid $3.65 million for the properties, which total 42,000 square feet according to a listing posted by the brokers in the deal.
“We’re excited to improve that section the city, bring much needed housing to the community and create construction jobs,” Mark Stagg, the founder and president of Stagg Group, told the Herald in a phone interview this week.
“The site needs to go in another direction – it’s been an eyesore for the city of Peekskill for a long time,” Stagg said. “It’s dangerous – there were vagrants living in there. We’ve since gotten the vagrants out and boarded it up.”
Plans for workforce/senior affordable housing
The Stagg Group lists nearly two dozen completed projects on its website, primarily in the Bronx. One of them, The Station at 5959 Broadway, was completed in November 2018. The building stands seven stories high with 72 units and has a front row view to Van Cortlandt Park directly in front of the 242nd Van Cortlandt Park subway stop.
Other developments include Norwood Gardens at 410 East 203rd St. (11 stories, 119 affordable units), The Equestrian at Pelham Parkway at 1680 Pelham Parkway (seven stories, 129 units) and an eight-story building at 739 East Gun Hill Road in the Williamsbridge section of the Bronx opened in 2024.
Stagg said his firm is analyzing possible development ideas for the former White Plains Linen site and will begin discussions with officials from Peekskill for a proposal. He said the development will be affordable and not market rate.
“We center on workforce housing, and when you look at the area median incomes that would fit right in to Peekskill. We’ll also potentially add a senior affordable component and that will add a nice twist to it.”
Stagg is targeting a range of around 160 units in total and expects to seek a variance to raise the height slightly above the four stories allowable under the current zoning rules.
“I don’t see this as a market rate possibility,” Stagg said. “I don’t think it’s the best use, I don’t think that’s the most responsible thing to do. I see it as a workforce/slash/senior project.”
James Guerriero, who has his own development proposal for similarly empty properties just down the street at the former RAL building, expressed his support for the Stagg proposal.
“I was excited to hear the news regarding the WPL site,” Guerriero told the Herald in an email. “The sale, to a developer of considerable pedigree, further reinforces the viability of the commercial corridor along North Division Street as a hub for additional housing.”
Pointing to other recently completed or proposed affordable housing projects in Peekskill using state and local financial subsidies, Guerriero highlighted the challenges faced by market rate projects, including his own, and the benefits they bring.
“I can personally attest to the challenges associated with developing market rate housing. The combination of land and construction costs, cost of capital, and burdensome entitlement timelines have made it nearly impossible to execute a market rate project in the current environment,” Guerriero said.
“Subsidy and zoning relief and reform are going to play an increasingly important role in overcoming the significant supply issues, in Peekskill and beyond, and there are countless examples showing that the development of market rate housing directly increases the affordability of all housing.”
Guerriero first presented his plan for 125 units of market rate rental units at 201 North Division St. to the Common Council in September 2022. Ten percent of the units would be affordable as required by Peekskill law. Guerriero has been back before various boards numerous times since then, still without final approvals.
“We know we have a project that meets the needs and the approval of the community, but have been working internally to overcome a number of challenges, some more difficult than others,” Guerriero told the Herald. “We’re hopeful that we can present updates early this year and, while we’re forced to make some changes, we believe the project will be received as well as it has been in the past.”
Foreclosure action results in new buyer
The prior holder of a mortgage on the former White Plains Linen properties, JG Funding, filed a foreclosure motion in June 2023, alleging that the borrower, Peekskill White Plains LLC, stopped making payments on the loan beginning in February 2023 and also hasn’t paid property taxes.
Peekskill White Plains LLC, a company created in September 2017 with an address of 320 Roebling St. in Brooklyn, is owned by a company controlled by Brooklyn developer Cheskie Weisz. JG Funding lent the money to Peekskill White Plains LLC in December 2021.
In March of 2022, a representative of CW Realty’s financing partner made a presentation to the Common Council outlining the firm’s plan to redevelop the former White Plains Linen buildings.
Council members expressed opposition to the height and scale of the proposed project. Eager to see the abandoned buildings cleared and a new apartment building rise in their place, they asked the developer to revise the plan and return.
However, no one from CW Realty reached out to Peekskill planning department officials in response to the feedback from that evening.
The foreclosure action was resolved last month, according to court documents, leading to the sale of the property to Stagg Group. The four properties are: 418 Division St, a/k/a 961 Constant Ave., 407-419 Highland Ave., 427 Highland Ave. and 425 Highland Ave.
