Utica to sell Kennedy parking garage near MVHS downtown hospital project; MVHS surprised by move

UTICA, N.Y. — The City of Utica’s Urban Renewal Agency on Thursday approved an application from the Pike Company of Rochester and Bowers Development of DeWitt (Pike and Bowers) to purchase the Kennedy parking garage in Utica for $1.5 million.

The final sale of the Kennedy garage is contingent on approval by the Utica Common Council.

Coupled with the $1.5 million purchase offer, the sale would “yield a nearly $15 million benefit to Utica taxpayers,” the City of Utica contended in a Thursday news release. In addition, selling the Kennedy garage will put the property on the tax rolls, “which expands the city’s tax base.”

Utica Mayor Robert Palmieri, City Comptroller Bill Morehouse, and several members of the Utica Common Council see it as a “major development which will benefit the city and Mohawk Valley Health System’s (MVHS) downtown medical campus project, as well as spur further economic development,” per the city’s release.

But for its part, MVHS says it was “surprised” to learn of this sale and project.

In a separate news release, MVHS says attorney Kevin Bernstein of Syracuse–based Bond, Schoeneck & King read an MVHS statement at the Urban Renewal Agency meeting on Thursday.

“MVHS was surprised to learn on Monday that a press release would be issued by the City relating to the sale of the Kennedy Parking Garage to The Pike Company and Bowers Development for the development of a hotel over the Kennedy garage. The Kennedy parking garage is connected to the former Mohawk Hospital Equipment (Mohawk Building), now owned by MVHS, which is being converted to serve as the new hospital’s central utility plant [CUP]. To date, $12 million has been invested in improvements to the building. The total investment in the CUP, when completed, will be $27 million. It is concerning that this sale was not discussed with MVHS given that the two buildings are connected and, in fact, when the Mohawk Building was purchased by MVHS, the organization maintained certain air rights over portions of the Kennedy garage,” Bernstein said.

Built in 1969, the Kennedy parking garage consists of 595 total parking spaces (including the deck), of which only 100 are currently utilized. The city’s most-recent cost estimate to repair the Kennedy garage tops $13 million. Pike and Bowers’ application calls for necessary repairs and the construction of a hotel above the existing garage, the City of Utica said.

“We believe that the proposed development of a hotel in that location will be very complex and costly, and could negatively impact the hospital’s central utility plant. In addition, we are concerned about the impact that the proposed Pike and Bowers development could have on the availability of parking as outlined in a memorandum of agreement signed by all parties,” Bernstein said in reading the MVHS statement.

As the Kennedy garage is an “important piece” in the development of the new downtown hospital, the city “engaged with MVHS officials on several occasions to discuss its overall parking needs,” the City of Utica said. As part of Pike and Bowers’ application, the construction of another level of parking on top of the Kennedy structure to accommodate MVHS’s needs, and the needs of the new hotel, “will be considered.”

In 2019, a structural engineer determined that building additional layers of parking was feasible, per the city’s release.

In conversations with MVHS officials, the new hospital will also utilize parking in the city-owned Washington Street parking garage, the City of Utica said. A portion of the money the city will save from selling the Kennedy garage will be redirected to fully repair the Washington Street parking garage.

Approval of Pike and Bowers’ application allows the repair of both parking garages, so they’ll be “fully operable” prior to the new hospital’s projected opening in 2023. In addition, the sale of the Kennedy garage will “increase overall public downtown parking capacity” for businesses, patrons, and residents, the City of Utica contends.

“This is an exciting day for Utica’s continued transformation,” Palmieri said. “The selling of Kennedy garage is a win-win for our entire community. The sale will save millions of dollars, expand the city’s tax base and allow us to invest in our parking infrastructure. There will be the possibility of newly constructed parking spaces, and Kennedy and Washington Street garages will be repaired in time for MVHS’ opening. This plan will also increase public downtown parking capacity, and the construction of a new hotel will facilitate further economic development.”