The Construction Manager: Todd Wright, Woodley Wright & Lynn, Emeryville, Calif.: The biggest challenge for Wright was controlling construction costs for the 2.6-acre property, which originally was a men’s dormitory. The National Park Service insisted that some original walls and corridors remain in place. “This required a redesign of the unit plans for the ground floor of each building which caused us to lose two units and provide several units that were long and narrow, measuring less than 12 feet in width,” says Wright.
Ho also confronted yet another conflict between the historic past and the current reality. The National Park Service said the building’s existing stairways had to be kept—but because the stairways did not meet current residential building codes, residents and visitors couldn’t actually use them. They remain in place but are, effectively, stairways to nowhere, cordoned off and ending at the ceiling.
Still, the extra effort was worth it: The cost of meeting these historic preservation requirements, which generated $3 million in tax credits for the Villas at Hamilton, was approximately $650,000. Construction costs ended up at $149 per square foot at the project, which has 128 apartments and 210 self-storage units.
The Financial Advisor: Steve Whyte, Pacific Housing Advisors, Seattle: Before the rehab, Novato had little in the way of senior housing and self-storage, making the villas’ combination attractive to developers.
“But while rental income from the self-storage units generated [additional] proceeds, it also made the project mixed-use, which is harder to get through the approval process,” says Whyte, who assists developers in the structuring and management of tax-exempt, bond-financed affordable housing transactions.
The $300,000 storage facility also resulted in $200,000 in additional construction costs for new traffic patterns and different construction methods that were necessary to persuade the nearby single-family homeowners. The storage component generates about $211,000 annually on rents ranging from 90 cents to $1.96 per square foot.
—Margot Carmichael Lester is a free-lancer in Carrboro, N.C.