By Patrick Hedlund
DNAinfo News Editor
EAST VILLAGE — Legendary East Village dive Mars Bar could shutter in a matter of months under a plan to redevelop a Second Avenue site into mixed-income housing that received initial approval from the local community board Wednesday.
The project, which includes the construction of a new 12-story building at the corner of East 1st Street, requires the notoriously dingy saloon to close for at least two years with the option of reopening in a space as much as four times its current size at the same location.
But despite developer BFC Partners offering Mars Bar first crack at the new property after construction is completed, a whole host of issues may prevent the well-known watering hole from serving again, a representative said.
"It is an institution, so to speak, and we'd like to preserve it somehow," said Juan Barahona, project manager for BFC, noting that construction could begin as early as June. "But it's probably not going to be in its current form."
Circumstances outside the construction timeline — which could take as many as three years or more from the bar's closure until its theoretical reopening — could make it difficult for the diminutive dive to see new life.
After construction wraps, Mars Bar would have to negotiate a rent with the developer based on market-rate prices, Barahona explained, which will likely be exponentially higher than what the tavern currently pays.
"He might not even want to do it two or three years from now," Barahona said of longtime bar owner Hank Penza, who has been "on board" with the plan from the beginning.
"Their return to the space is really contingent upon us reaching a deal on a rent structure," he added, noting that the bar would have to pay for a full build-out of any future space itself.
Penza declined to answer multiple requests for comment, after telling The Local East Village earlier this week that the developers "won't choke me" and that he supports the project.
Another uncertainty involves future plans by the MTA to perform construction work at the nearby Second Avenue station on Houston Street, as the transit agency could eat into the building's ground-floor commercial space if it decides to add an easement near East 1st Street, Barahona said.
The development will create 12 new units of low-income housing essentially subsidized by the addition of approximately 50 units of market-rate housing. Barahona said the company has not decided yet whether the units will be condos or rentals.
Nine current households at the existing two buildings on the site will be allowed to return to the new, single property as owners, he added.
The project is currently going through the city's land-use approval process, ULURP, and will be voted on by the full community board this month before ultimately landing in front of the City Council for final approval.
For Mars Bar, though, the future is not quite as clear.
"I think the writing's been on the wall for a while," Barahona said of real estate changes in the area and the need to address the existing buildings' ailing conditions.
"Hank realized that something was going to happened eventually."