Project: I-95 and Route 128 Peabody

1.0 Synopsis

In 1984, the Federal Highway Administration approved plans for the completion of an interchange between Route 128 and Interstate-95 in Peabody, Massachusetts. The project included a six-lane section of I-95 on new alignment, and the realignment of MA 128 through a new semi-directional T interchange, as well as the creation of a new interchange at Centennial Drive and Forest Street in Peabody. The project was built and opened to traffic in 1988. It is responsible for an estimate 3,100 direct jobs.

2.0 Background

2.1 Location & Transportation Connections

The Route 128/I-95/US Route 1 interchange project is located in the City of Peabody, Essex County, Massachusetts approximately 15 miles north of Boston and the Logan International Airport. The project completes a link between I-95/MA Route 128 south, MA Route 128 north (to Gloucester), and US Route 1 (north-south), and was part of the completion of Interstate 95, which runs from Florida to Maine along the eastern seaboard. The project included a major interchange connecting these routes, as well as the realignment of MA Route 128 northeast of the interchange, upgrading the road to freeway standards with three lanes in each direction through Peabody to Beverly, and providing a new interchange at Centennial Drive/Forest Street in Peabody. The realignment of Route 128 and the interchange at Centennial Drive/Forest Street opened up approximately 650 acres of land for commercial and industrial development, helping Peabody compete for business with communities farther south along Route 128.

2.2 Community Character & Project Context

At the time of the interchange project, the City of Peabody, a working class suburb of Boston, was struggling economically. The economy, which had been defined by tanneries and piggeries, was in decline. The tanneries were moving off-shore and closing facilities in Peabody. The City suffered from higher than average unemployment rates and a declining population. Efforts to develop an industrial park near Route 128 had been stymied by poor highway connections.

3.0 Project Description & Motives

The motivation for the I-95/US 1/MA 128 interchange project was to complete the connection between then Route 128 (now I-95) south of Peabody to I-95 north from Peabody to the points in New Hampshire and Maine. Original plans for I-95 called for a new road to be built through the Lynn Woods to the south. However, this project was cancelled due to environmental issues, and the Massachusetts Highway Department (MHD) instead submitted plans to connect I-95 north of Peabody to MA 128. Federal Highway approved the plans in 1984 and the interchange was constructed and opened to traffic in 1988. The project also included a realignment of Route 128 north of the interchange and a new exit from Route 128 to Centennial Road (which was created along the old Route 128 alignment) and Forest Street. The project was completed for a cost of $38 million (1987 dollars.)

From the standpoint of MHD and FHWA, the motivation for the project was to complete I-95 in this area, providing better travel connections to points north and south. However, the City of Peabody viewed the project as an important catalyst in its efforts to reinvent itself from a dying manufacturing city into a growing hub for light manufacturing, high technology, and office development.

4.0 Project Impacts

4.1 Transportation Impacts

4.2 Demographic, Economic & Land Use Impacts

The interchange has had dramatic impacts on the economic vitality of the City of Peabody. Before the project was built, employment in the City was declining. The unemployment rate exceeded the rate for the Boston metropolitan area. In the 1970s, the City had planned an industrial park on land east of Route 1 and south of Route 128, taking land for the park by eminent domain, but had not been able to attract tenants.

In the mid-1980s, the City commissioned a market study to evaluate the potential impacts of the interchange on a 648 acre area adjacent to the interchange, and Routes 1 and 128. The existing uses on this land at the time of the study included 105 acres of residential, 24 acres general business, 20 acres of office, 14 acres of trailer park, 20 acres of private recreation land, 32 acres of light industrial uses, a 75 acre landfill, and 358 acres of undeveloped land. The study identified several characteristics that made this land particularly competitive for new light industrial and office development, including the large size of available parcels, the new visibility of the site provided by the interchange and highway improvements, the availability of Urban Development Action Grant funding for the site, and the proximity of the site to highway and airport access. The study estimated that, over a 21 year period, the area could absorb 650,000 square feet of office space, 1.7 million square feet of research and development and light industrial space, and 300,000 square feet of distribution space.

To accommodate the projected development and ensure that the business park developed in a controlled and cohesive manner, the City created a Designated Development District for a 900 acre area. This allowed the City to better address site-specific development and environmental issues, create a unified and predictable development review and approval process, and institute design guidelines to provide some control over the appearance of buildings constructed in the park. The design guidelines addressed landscaping requirements, density, parking, and performance standards. To further encourage development, the City established the Centennial Industrial Park (now the Centennial Business Park) on 320 acres in the southeast quadrant of the interchange, and included an additional 600 acres just north of Centennial Business Park and Route 128 within the Designated Development District.

By 2002, over 2 million square feet of office and industrial space had been built within this area, with Centennial Park almost completely built out. By 2009, the number had increased to over 2.5 million square feet, with 96 businesses in 45 buildings. One of the first tenants, Analogic Corporation, moved in prior to the completion of the interchange, but with the promise that the interchange would be built. The transportation improvement was critical to Analogic's decision to relocate to the site from a location further south on Route 128. (Another important factor in the location decision was the proximity of the site to the home of the CEO.) In a 1990 survey of businesses in the park, 64% cited the central location and major highway connections as central to their decisions to locate in Peabody. Boston Children's Hospital is now building a new North Shore satellite facility in Centennial Park. Employment within the park is approximately 2,500. This is exclusive of new development and employment along Forest Street and Dearborn Avenue. Public sector officials, business leaders and realtors all agree that the interchange is the premier factor contributing to the success of Centennial Park and its environs.

The development at Centennial Park is credited with the attraction of six hotels (including several suite hotels) to the vicinity of the interchange in Peabody, as well as four hotels in nearby Danvers. In all, well over 1000 hotel rooms have been built in close proximity to the Route 1/I-95/MA 128 interchange since its completion, with 904 of the rooms in Peabody.

The impacts of the interchange project and realignment of Route 128 extend north along Route 128 to the North Shore Mall. This shopping center was first built in 1959 as an outdoor mall. It was later transformed into an indoor mall, but was declining in the late 1970s. With the construction of the interchange at Route 1/I-95/MA 128, access to the mall was improved from points south, north and west, and the mall reinvented itself and expanded. The mall is now a superregional facility with approximately 1.865 million square feet and 3,300 employees. In addition, land adjacent to the mall has transformed into a medical node, with Lahey Clinic building a facility adjacent to Route 128 and several medical office buildings built adjacent to the Lahey facility. While the mall existed well before the interchange and related transportation improvements, community development staff and real estate professionals believe that the ability of the mall to transform itself and survive over the past five decades, and the attraction of medical facilities to the area, were significantly aided by the improved access provided by the interchange improvements.

The City of Peabody, like most of the Boston metropolitan area, has seen a dramatic increase in housing prices between 1980 and 2008. The median home price increased from $54,400 in 1980 to $384,034 in 2007, over 600%. However, this percentage increase was below the increase in median housing prices for the Boston metropolitan area, which increased from $48,400 to $366,400, or 657% over the same time period. It is not possible to identify how the highway affected housing prices, although it is likely that the investment did have a positive impact on housing values as new employment opportunities in the City increased demand for housing near these jobs.

While it is difficult to precisely identify the impact of the interchange and related transportation improvements on jobs and property values, it is clear that the interchange was critical to the build out of the Centennial Business Park and adjacent commercial and industrial properties, as well as the related hotel development. In addition, the interchange is credited with supporting the continued operation and expansion of the North Shore Mall. At a minimum, 3,085 jobs and an increase in local property values of $280,848,080 can be attributed to the transportation investment. The City as a whole realized an increase in employment of 9,217 (59%) between 1981 and 2007, from 15,664 to 24,881. Thus, 33% of the employment increase over that time period occurred as a result of the interchange.

The City of Peabody also viewed the interchange project as a potential catalyst for transforming Route 1 in Peabody from an adult entertainment area to community serving retail and office area. The City, in conjunction with the Metropolitan Area Planning Council undertook a Route 1 corridor study in the early 1990s to develop a plan for attracting stable, community serving businesses to the corridor. The City has had some success in attracting restaurants and small offices to the corridor, but the corridor still is home to several mobile home parks and has been slow to convert to new uses. The Town of Danvers, located directly north of Peabody, has succeeded in attracting a Costco, Home Depot and several other big box stores to the corridor, presumably because of the regional access provided by the interchange. However, it is likely these businesses would have located in the general market area as the population of the region has grown.

5.0 Non-Transportation Factors

The two decades since the completion of the US 1/I-95/MA 128 interchange in Peabody have seen explosive growth north of Boston to the New Hampshire border and beyond. Many factors in addition to the interchange improvements have influenced this growth, including the extension of commuter rail service to I-95 corridor communities, and the continued growth of the technology sector in the greater Boston Area.

While much of the business growth in the vicinity of the interchange can be attributed to the improved access provided by the interchange and realignment of Route 128, some other factors also played a role in attracting new business to the area. Peabody Mayor Peter Torigian, who served the city for over 20 years strongly promoted economic development and worked to create a pro-business climate in the City. He adopted a goal of transforming the City from a manufacturing center to a high technology center, and worked closely with businesses to offer incentives for those who would locate in Peabody.

In the 1970s, the City recognized that the area that is now Centennial Business Park should be targeted for commercial and industrial development. The City began acquiring over 600 acres of land which would be rezoned for industrial uses. The City invested more than $2.5 million for infrastructure improvements, using federal Urban Development Action Grants (no longer in existence) to help fund development of the park. The City also adopted design guidelines to ensure that Centennial Park would be developed as a ?quality? facility that could compete with other locations along Route 128.

6.0 Resources

6.1 Citations

1. Sloane, Robert, ed., Route 128: Moving Toward the Year 2000 – Conference Proceedings, May 15, 1985, Metropolitan Area Planning Council.
2. City of Peabody, 1981 Comprehensive Plan.
3. City of Peabody, Peabody Master Plan Update, September 2002.
4. Sasaki Associates, Route 1/Route 128 Economic Development Strategy, prepared for the City of Peabody, April 1987.
5. Peabody Community Development Department Route 1 Task Force, Route 1 Corridor Study Phase 1 – Technical Memorandum: Inventory and Preliminary Recommendations, December 1983.
6. www.bostonroads.com/roads/I-95N_MA/
7. http://host.appgeo.com/PeabodyMA/
8. http://www.mass.gov/?pageID=dorterminal&L=4&L0=Home&L1=Local+Officials&L2=Municipal+Data+and+Financial+Management&L3=Data+Bank+Reports&sid=Ador&b=terminalcontent&f=dls_mdmstuf_proptax&csid=Ador

6.2 Interviews

Organization

City of Peabody

Combined Properties

Metropolitan Area Planning Council

Footnotes

Case Study Developed by Sue Moses & Associates