Developer hopes to ‘turn’ Portland’s historic telephone building into apartments
The historic, mostly vacant New England Telephone & Telegraph Co. building in Portland could be converted into 81 small apartments, continuing a nationwide trend of turning offices into residential properties.
If the Portland Planning Board approves a change in use over the next few weeks, the redevelopment of 45 Forest Ave. will add an essential inventory to the city’s rare housing stock. The addition would include 20 units deemed affordable in accordance with zoning requirements approved by voters last year.
Built in 1912, the six-story brick building originally housed a switching center and offices for NET&T, and was owned by Telecom Consolidated Communications until developer Redfern Properties purchased it.
Redfern aims to create 30 one-bedroom apartments and 51 studios. The building will also have a fitness room and a lounge, according to a plan submitted to the Town Planning Council. The price of the project is $ 18-20 million.
The apartments are in the range of about 350 square feet to about 600 square feet.
“We’re trying to make it more affordable,” said Jonathan Culley, managing partner of Redfern, in Mainebiz. “These are small spaces, but there is access to amenities. There is possibility of walking to downtown, washer and dryer, air conditioning. These are comfortable apartments with 13 foot ceilings. People can decide to give up space for amenities.
Market apartment rents will range from $ 1,300 to $ 1,800 per month. The remaining units will be affordable for people earning 80% of the region’s median income, which is $ 56,504 for a single person to $ 64,526 for a two-person household.
The building was previously considered a dormitory for the Maine College of Art & Design, but that plan fell through when the city decided to move its social services and public health units next door.
Redfern is using historic state and federal tax credits to offset some of the costs of renovations, Culley said. The small size of the apartments and the lack of parking also help reduce the cost of the project, he added.
He said he hoped to have a decision from the Planning Council in the coming weeks, with construction scheduled to begin in March 2022. The units would open in 2023.
“It’s a fairly straightforward change-of-use exercise. We are very confident of getting approval from the city, ”Culley said.
The move to create homes from unused office space follows further moves in Portland and cities across the country.
“It’s a trend that’s happening and I still expect it to continue,” said Nate Stevens, partner and broker of Boulos Co. “The demand for Class B office space is not great and residential demand is through the roof. “
Similar projects in Portland that turned office space into housing include 50 Monument Square and 121 Middle St., Stevens said.
The costs of such conversions include the expense of adding sprinkler systems, secondary outlets and other safety measures. But the rent per square foot can be considerably higher, offering significant return potential.
Converting buildings is also less expensive than building them from scratch, as there is less environmental waste compared to demolition and reconstruction.
In 2010, the conversion of hotels to apartments was all the rage, followed by a wave of warehouses. Today, vacant office space is the latest nationwide push, according to research from RentCafe, a nationwide apartment listing service.
According to the analysis, 2021 has so far set a record for ‘adaptive reuse’, which means the creation of housing in buildings that were originally used for other purposes, such as an office building, hotel or warehouse.
This year, 20,100 apartments will be created in older buildings, RentCafe said. This amount is almost double the rate for 2020 and 2019 combined. Of the 32,000 units created through “adaptive reuse” during this decade, 41% were in old office buildings.
Philadelphia and Washington, DC, converted the most units in 2020 and 2021 combined, while Los Angeles and Cleveland have the most projects slated for 2022, according to RentCafe.
“There is a big return to urban areas for housing that we have seen. People want to live downtown, ”Stevens said.