PORTLAND — Approvals for a $30 million mixed-use development on Newbury Street won a unanimous 15-month extension Tuesday from the Planning Board.

But the Massachusetts-based developer must address neighborhood concerns about the lack of maintenance of the former Village Cafe site, and improve the sidewalks in the area.

The project’s site plans and conditional zoning were scheduled to expire in June, but the board recommended extending that deadline until Sept. 22, 2012.

The matter is expected to go before the City Council on June 6.

The Village at Oceangate originally received approvals in 2006 for a conditional zone for the Bay House, a two-phase, five-story development consisting of 176 residential condos with parking and retail.

Although the first phase, 82 residential condos with parking and first floor retail uses, has been approved by the Planning Board, the project has not moved forward because of a lack of financing, according to developer Demetri Dasco.

“Literally, over the last two years, there have been no lenders willing to have discussions with us,” Dasco said. “However, that is beginning to change.”

Residents in the India Street neighborhood have raised concerns about the condition of the property at 112-113 Newbury St. since the former Village Cafe was demolished in 2008.

The site, enclosed with a chain-link fence, has become a dump for people getting rid of old furniture and other trash, neighbors said.

India Street resident Joe Reynolds, however, tried to take the blame for the site’s condition, which he uses as a construction staging area. But Federal Street resident Hugh Nazor said it was easy to tell trash from construction equipment.

Nazor said the vacant lot has attracted vagrants and vandalism.

“This neighborhood needs people on the streets,” he said. “People from the cruise ships no longer go up there; they used to. Graffiti is growing. The homeless population is growing.”

Several residents, including officers from the India Street Neighborhood Association, spoke against granting the company an extension. Several said the project is too large to receive financing and suggested sending it back to the drawing table.

But real estate brokers said the project has generated strong interest from prospective tenants, especially baby boomers.

“I have absolute confidence we’d be able to sell this,” broker Sandra Johnson said.

Planning Board Vice Chairman Carol Morrissette said the request to revisit the scale of the project was outside of the board’s purview, since it was only considering the request to extend the zoning and permitting.

“(But) I am greatly concerned about the condition of the place,” Morrissette said.

A condition of the extension is for the company to conduct bi-weekly or monthly maintenance of the site, removing any dumped items within four days. That work also includes grading and mulching of the former building site.

The company must also improve sidewalks and curbing around the site, which have suffered from erosion since the building was removed. The city also asked the company to post a performance guarantee to ensure that the work, totaling about $35,000, is completed.

Those conditions were paramount to receiving the support of City Councilor Kevin Donoghue, who sent a letter to the board indicating he shared the neighbor’s concerns. 

“I see this as a ‘last shot’ to prove viability of the project,” wrote Donoghue, who represents the East End. “I have well wishes for Phase I, but little patience.”

After the meeting, neighbors said they were upset with the board’s decision to extend the zoning and permits.

“I will go speak to the council,” India Street Neighborhood Association President Allison Brown said. “I just want (the developers) to be good neighbors.”

Randy Billings can be reached at 781-3661 ext. 100 or rbillings@theforecaster.net. Follow him on Twitter: @randybillings

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