Converting Untraditional Properties into Residential Spaces
Helping to Meet the Demand for Market-Rate and Affordable Housing
by Stephanie McLane and Justin Askew
Transforming untraditional properties into residential spaces is an emerging trend that not only breathes new life into existing structures but also addresses pressing housing needs while leveraging numerous financial benefits.
This innovative approach takes advantage of tax incentives and affordable housing subsidies, creating a win-win situation for developers, investors, and communities alike.
The Conversion Concept
The concept of converting unconventional assets into residential units revolves around adapting structures such as warehouses, factories, or office buildings into living spaces. By doing so, we enhance urban landscapes, preserve historical architecture, and contribute to sustainable development.
As cities evolve, the demand for housing continues to grow, and finding solutions that are both economically viable and environmentally conscious is imperative.
Economically, asset conversion presents an attractive option. Traditional development can be costly, with expenses tied to land acquisition, demolition, and new construction. Conversely, repurposing existing structures can significantly reduce these costs. Developers can reinvest these saved funds into enhancing the quality of the residential units or integrating sustainable technologies, thereby increasing the property value and appeal.
One of the main attractions of converting untraditional properties is the array of tax incentives available. Governments worldwide recognize the potential of these projects to stimulate urban revitalization and often provide tax breaks to encourage investment. These incentives might include reduced property taxes, tax credits for preserving historical elements, or subsidies for incorporating energy-efficient systems. For developers and investors, these financial breaks can significantly improve the project’s return on investment.
Moreover, many governments are keen to tackle the affordable housing crisis, offering subsidies and grants to developers who incorporate affordable units into their projects. By reserving a portion of the residential units for low-income families, developers can access these financial supports, making their projects not only more profitable but also socially responsible.
This alignment of business objectives with social good fosters stronger community relations and enhances the overall marketability of development.
Location, Sustainability and Aesthetic Appeal
The strategic location of many untraditional properties adds another layer of attractiveness. Often situated in the heart of urban centers, these sites are prime candidates for transformation into vibrant residential communities. Proximity to amenities, cultural attractions, and public transportation makes these converted properties desirable for potential residents, driving demand and ensuring a steady stream of occupancy.
From a sustainability perspective, repurposing existing buildings is a much greener alternative to demolition and new construction. It minimizes waste, conserves resources, and often reduces the carbon footprint associated with the building process. Moreover, integrating modern energy-efficient systems during conversion can further enhance sustainability, appealing to environmentally conscious buyers and tenants.
The aesthetic appeal of these converted properties cannot be overlooked. Many untraditional buildings possess unique architectural features that, when preserved and integrated into residential designs, offer distinct living environments. High ceilings, exposed brickwork, and large windows are just some elements that contribute to creating charming and sought-after homes that stand out in the housing market.
The Asset Conversion Process
AREMCO’s Asset Management team works with investors to guide them through the entire process. We locate investment opportunities and provide guidance for the project. AREMCO provides detailed Property Improvement Plans (PIP). We are well equipped to assist with all phases of a PIP, from strategy to procurement to installation.
Our Asset Management Plans (AMP) are unique to each investor and the asset we are converting. These plans include:
» Initial Cost Estimations
» Detailed Budgets and Schedules
» Bidding and Contract negotiations
» Design Management
» Construction Services
» Construction Management and Supervision
» Coordination of Inspections
» Cost and Quality Controls
» Property Management Direct and Oversight
» Property Marketing and Brokerage Services
» Operational and Feasibility studies
Case Study: Frank Spicer Building — Norfolk, VA
Nestled in the heart of Norfolk, Virginia, the Frank Spicer Building is a beacon of historical significance and an enduring industrial legacy. Originally constructed in 1919, this 20,000-square-foot warehouse has been a silent witness to over a century of community evolution. Now, with AREMCO’s visionary foresight and strategic partnership with investors, this historic landmark is undergoing a transformative journey.
At the core of our project is a detailed Asset Management Plan that prioritizes precision and foresight. AREMCO co-founder and COO, Justin Askew, has played an instrumental role in guiding the investor through every phase, ensuring the optimization of tax credits and abatements vital for redevelopment success. Our expert team, in collaboration with architects, engineers, and contractors, examines every potential obstacle, providing accurate construction cost forecasts—an essential component for aligning the budget and achieving an impactful Return on Investment.
The investor’s active involvement throughout the project’s duration underscores our commitment to transparency and collaboration. Our Construction Division has facilitated seamless coordination and bidding processes with contractors, emphasizing our dedication to project efficiency. As we approach the final stages of this redevelopment—scheduled for completion in the coming months—the excitement and anticipation are palpable. Local businesses are already expressing keen interest in occupying the commercial spaces, a testament to the building’s promising future in the community.
AREMCO’s mission with the Frank Spicer Building is more than just restoration—it’s about enriching Norfolk’s urban tapestry with a dynamic fusion of residential and commercial vibrancy. The meticulous conversion plan envisions fourteen beautifully crafted residential units on the second and third floors, offering unique living experiences that blend modern comfort with historical charm. Meanwhile, a significant 6,000 square feet of ground-floor commercial space is earmarked to invigorate local enterprise, including potential ventures like a bustling restaurant, an eclectic market, or an energizing fitness center. This is not merely a redevelopment; it is a renaissance that invites life back into the heart of the city.
Summary
The conversion of untraditional properties into residential spaces offers a multifaceted approach to modern urban challenges. It provides a pathway to sustainable development, offers substantial financial incentives and subsidies, and meets the growing demand for both market-rate and affordable housing.
By tapping into the potential of these projects, developers and investors can not only achieve impressive financial returns but also contribute to the dynamic revitalization of our urban landscapes.
This synergy of economic, social, and environmental benefits makes asset conversion a compelling and forward-thinking strategy for the future of housing development.
Our vision at AREMCO is to be committed to maintaining a dynamic and trusted nationwide real estate asset management company that is pioneering the industry by adding value and implementing real, transformative solutions in real time to meet client goals. Converting properties from one asset class to another completely aligns with this vision.
We are also the defining difference in real estate asset management when it comes to innovation. We leverage highly respected industry experts with logical solutions built from revolutionary technology and an expansive network of partnerships consisting of credible vendors and contractors. We are able to meet all of our clients’ real estate asset management needs under one roof and achieve real results in real time through trusted advisors, commitment to business objectives, end-to-end transparency, and superior service.
It is through our vision and innovation that we can breathe new life into existing structures and address pressing housing needs while leveraging numerous financial benefits.
SIDEBAR
Solutions Provided by AREMCO
Commercial Asset Management
» Commercial Inspections
» Commercial Preservation and Maintenance
» Default and Performing Liquidation Strategies
REO Asset Management
» Securing
» Eviction and Cash for Keys Services
» Valuation and Analysis
» Maintenance and Repairs
» Marketing and Disposition
» Compliance and Reporting
Nationwide Mortgage Field Services
» Occupancy Inspections
» Preservation and Maintenance
» FHA conveyance
» SFR and Multifamily
» Insurance Loss Draft Inspections and monitoring
Construction Services Division
» Ground up / Design and Build
» Rehab
» Renovation
» Commercial Transformation
Disaster Management Services
» Mobile team that deploys to Natural Disasters
» Preferred Contractor for Largest Insurance Companies
» FEMA Inspections
» State, Municipality, Golf course and Private HOA contracts
For more information, contact Justin Askew at jaskew@aremcocorp.com or visit http://www.aremcocorp.com/
