Technology and Real Estate & Retail

Shrinking neighborhood in path of Lilly's progress: Drugmaker offers to buy rest of Little Valley homes

April 3, 2006

It's called Lilly Valley for a reason.

The official name of the modest neighborhood on the near-southwest side is Little Valley, but many people call it by the name of the pharmaceutical giant looming nearby.

Eli Lilly and Co. has been gnawing away at the neighborhood south of Morris Street for several years to accommodate expansion at Lilly Technology Center just to the west along Kentucky Avenue.

Now, Lilly is seeking city approval to take over more of the neighborhood, closing off most of two streets-Silver Avenue and Bridge Street-to expand the parking lot for LTC employees.

When that's finished, all that will remain of Little Valley is about 30 small-but-tidy frame houses and Little Valley Park. The homes will be a residential island in a sea of industrial development, with Lilly, National Starch & Chemical Co. and a vacant industrial site surrounding it on all sides.

Soon, the sea may take over entirely. Lilly recently sent a letter to remaining residents, offering to purchase their homes for 105 percent of the appraised value. The company's not yet sure what it's going to do with the land, said Lilly spokesman Ed Sagebiel.

For residents, however, the offer gives them a way out of a decimated neighborhood that few buyers would likely find attractive on the open market.

"People who have not sold may not want to live in this reduced area and may want a way out," said Jeff Gearhart, executive director of West Indianapolis Development Corp.

The letter is the latest overture in what at times has been a strained relationship between the drugmaker and its neighbors. A Lilly expansion in 1990 ate 50 homes and several businesses, and closed part of Kentucky Avenue. At the time, residents were irate at what they perceived as a lack of involvement in an expansion that drastically altered their neighborhood.

Since then, relations have improved. Lilly, through contributions of volunteers and money, has helped make improvements in the neighborhood, and neighborhood groups

KENTUCKY AVENUE MORRIS STREET Lilly Technology Center

Lilly parking lot expansion homes Lilly is offering to purchase

IBJ Graphic/Kevin Gor al m & Tammy Lieber

o N e S i l v e r d y k e e A v e n u r Y r A v e n u k t e e r t S Bridge Street DROVER STREET say they have more of a voice with the drugmaker.

A few years ago, Lilly took out another chunk of Little Valley, wiping out homes along Nordyke Avenue to accommodate a nearly $500 million, 788,000-square-foot expansion of its biotechnology facilities on the north end of LTC.

Many Little Valley residents, apparently accepting of their fate, began calling Lilly instead of a real estate broker. In the soon-tobe parking area, most of the land was acquired when homeowners contacted Lilly about buying their homes, rather than vice versa, Sagebiel and Gearhart said.

"Is everybody happy? No," said Gearhart of the latest expansion and Lilly's subsequent offer to purchase remaining homes in Little Valley. "But in the end, it's working out as good as it can. ... if their neighbors hadn't sold out. [The offer letter] is letting those out who want out."

City staffers have recommended approval of Lilly's rezoning request for the 30 or so lots it needs for parking. Department of Metropolitan Development staff noted the rezoning from residential to industrial use doesn't fit with the neighborhood plan, but because Lilly already owns the land, "there is little opportunity for the subject sites to be utilized in compliance with the neighborhood plan recommendations."


Lilly Technology Center, background, recently offered to purchase remaining homes in the Little Valley neighborhood, which lies in its shadow.
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