Wednesday, February 14, 2007

Industrial Conversion? Think again!

Wow, it's already Valentine's Day and I haven't posted since the 5th. Time to get back in the saddle...

So here I am in the Twin Cities. First order of business: find an apartment. Being the yuppie urbanite that I am, I naturally gravitate towards apartments fashioned from converted warehouses. You know, the kind to be found all over Cleveland (check out The Knitting Mills or the Payne Ave lofts if you want to see some examples). Nothing says "Embrace the City Center!" like turning an unused Rust Belt factory or warehouse into an overpriced labyrinth of lofts with exposed brick, high ceilings, and fabulous downtown views.

It was with great pleasure, then, that I pulled up to Stone Arch Apartments, a beautiful converted industrial building on the north bank of the Mississippi river across from downtown Minneapolis. It has all the hallmarks of a warehouse conversion: it is a huge rectangular buildings, has wide hallways, industrial chic exposed HVAC in the units, and is immediately adjacent to a steam plant, a metal refinery, and a set of train tracks. Clearly an excellent example of how you can convert former industrial buildings to residential use!

Except, apparently I was completely wrong. I mentioned to the leasing agent: "This is an impressive industrial conversion!" and was told: "Nope, this building was built very recently" (!!!).

Reeling from this blow to my otherwise brilliant urban planning wisdom, I struggled to understand. Fortunately the girlfriend is a bit more resourceful and, thanks to Google, showed me that there was instead a very interesting story behind the construction of Stone Arch. Read on...

Turns out the site itself was until recently an occupied brownfield. A developer bought up the parcels and got to work. There were a number of hurdles to get past: the site was zoned for industrial use; rezoning would have required majority support from the surrounding tenants (an unlikely prospect); the adjacent metalworks operation actually sued the developers to stop the project (a weird reversal of the more traditional residents-sue-noisy-factory story we all know); and the neighborhood association also opposed the project. Stone Arch developers were able to placate the various parties by making important concessions: (1) the building has a significant affordable housing component; (2) the building has a lot of noise reduction materials to silence outside noise from the factory; (3) the building is actually two buildings, a design that breaks up the facade; and (4) the building is built according to environmentally-friendly principles. Apparently those concessions were enough to win the political support of the various opposition groups.

What does the successful emergence of Stone Arch apartments teach us as urban planners and thinkers? I think there are a few keys lessons:

(1) Industrial and warehouse-style residential buildings are not limited to conversions. Instead, this style may indeed be popular and profitable even when built from scratch.

(2) Developers who are willing to make concessions can eventually win public support.

(3) Vacant brownfields can be adapted for residential, assuming the brownfield cleanup funds are available. In the case of Stone Arch, it cost $750k to rehabilitate the site.

(4) Given the low vacancy rate at Stone Arch, there is indeed a market for warehouse-style housing.


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