PEABODY — The city has long considered a 40B affordable housing development of 80 apartments at the Peabody/Lynn Elks Lodge to be too big for the tightly-packed, flood-prone neighborhood on  narrow one-way Oak Street.

However, there might be another way.

As plans for this development move ahead, developers have received more time from the Zoning Board of Appeals to explore the idea of developing the housing across the city at an under-utilized city-owned piece of land at 5 Berry St.

The developers of the Oak Street parcel see the less than 3-acre Berry Street parcel, which is less than a mile away, as a possible "suitable replacement."

"We understand that the so-called Berry Street property is one property owned by the city which is being considered to by surplused by the city," said attorney John Smolak of the North Andover firm of Smolak & Vaughn LLP in a letter to the Zoning Board of Appeals on Aug. 5.

"Such parcel could be a suitable replacement parcel for the type of development being proposed at 40 Oak Street," wrote Smolak. "Based on my discussion with Solicitor (Michael) Smerczynski, we understand that this approach would be supported by the administration as well as the board's chair."

At the opening of the public hearing on Aug. 5, Smolak sought and received a 60-day extension of a comprehensive permit application to redevelop the Elks Lodge into affordable housing. He did so on behalf of 40 Oak Street Development, LLC.

In an interview, Smolak said the idea was "very early on," and whether something happens with the Berry Street parcel would be up to the city.

He said developers were still "full speed ahead" with redeveloping the lodge property, but they wanted more time to answer issues and comments brought up by various department heads and others. He said the lodge parcel has been identified as in-fill development in the city's Housing Production Plan.

"As far as we are concerned, we are still going forward with the project," said Smolak, who said developers have a purchase and sale agreement on the Elks' property.

Less than a mile away, the city-owned parcel at 5 Berry St. with its uneven pavement, serves as home to city school buses and a dilapidated one-story garage, among other things. Smolak did not rule out something happening there down the road.

Ward 3 Councilor James Moutsoulas said he read Smolak's letter last week, but he did not put much stock in it because there are no plans.

"My opinion, they can talk and say whatever they want, but until I see definitive plans, I will not scare the neighborhood," Moutsoulas said.

"There has always been a great deal of interest in the Berry Street property by a large number of parties and we are evaluating the use of that site for a project that would work well for our city," said Mayor Ted Bettencourt. Smerczynski could not be reached at his office.

Hearing continued

Developers are seeking a comprehensive permit before the Zoning Board of Appeals under state law Chapter 40B, which is designed to spur affordable housing.

Under this process, a developer seeks a single comprehensive permit before the Zoning Board of Appeals. This process allows developers to skirt most zoning rules, including those on density, in exchange for the the construction of some affordable housing.

On Aug. 5, the Zoning Board of Appeals voted to continue the public hearing until Oct. 21 and extend the mandated 180-day window for the decision to be made until April 1, 2020.

"The mayor, the city solicitor, my clerk and myself have worked diligently, long hours in developing an agenda for tonight which would include scheduling of departments, neighbors all interested parties, any issues that were to be discussed," said Zoning Board of Appeals Chairperson Frances Gallugi, during the short Aug. 5 meeting. "And as a result of this prehearing preparation, we were notified through counsel that the applicant would like to have a continuance of the hearing and an extension of the deadline."

Smolak also noted at the hearing that the principals in the development, Patrick and Michael Larkin, were on hand.

This multi-family project would consist of 80 apartments wedged onto a narrow strip of more than 1.5 acres. It would be nestled amid a residential neighborhood made up of mostly single-family homes, some triple-decker apartment buildings, and some businesses.

Plans call for 72 apartments in the main building and eight townhouses. But the property also sits in a FEMA flood zone, as does much of the downtown. All of the units would be rentals, and 20 apartments (25%) would be  affordable.

City officials and neighbors have long been critical of the development.

In December 2016, Bettencourt wrote to the Massachusetts Housing Finance Agency to express public safety concerns about increased traffic on a narrow, one-way road that runs between Washington and Foster streets. The Fire Department was concerned about water pressure and the inability to get an aerial fire truck around the building.

Potential flooding, and the possible need to evacuate 80 units, was another concern. There was also concern about the project worsening flooding in the area, and that it was adjacent to wetlands.

Ward 2 Councilor Peter McGinn, who represents the area, said he stood with the neighborhood in opposition.

As far as the Berry Street property being a replacement parcel, McGinn said: "I have to take them at their word and what they presented at the ZBA was that they are interested in exploring alternatives and they asked for time to do just that."

Peabody has also contended in its letter to MassHousing that the developers' 40B submission was "punitive" in response to a perceived pending denial from the Conservation Commission of an earlier development for 26 townhouse condominiums at the same site, a proposal that drew the same objections from residents.

Despite the city's concerns, MassHousing awarded a project eligibility letter to Larkin Real Estate Group, Inc. of Middleton on March 21, 2017. The letter, which is valid for two years, allows the developers to proceed with the 40B development.

The development comes at a time when the city is still shy of the 10 percent minimum affordable housing goal set by the state. Cities and towns above this 10 percent threshold are more easily able to fend off Chapter 40B developments that may be seen as too dense or have other issues.

 Staff writer Ethan Forman can be reached at 978-338-2673, by email at eforman@salemnews.com or on Twitter at @TannerSalemNews.