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Posted Jan 20, 2022, 7:39 AM
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Registered User
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Join Date: Dec 2019
Location: Albuquerque, NM
Posts: 578
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Downtown Albuquerque News before it went on break in December had a story about developing housing in Downtown. They interviewed the developer of the Elevate project, as well as the developer of the Downtowner project. I was especially glad to see the Elevate developer confirm that the project is still in the works. It was a long story, so I'll just quote the portions where they talked to the two developers about their projects and the issues they face getting them built.
https://downtownalbuquerquenews.com/
Quote:
Single-family homes in the suburbs are often maligned as "cookie-cutter," but from a construction perspective at least, the shoe fits. Often working from a limited number of off-the-shelf blueprints, construction crews that are sometimes less specialized (and paid less to boot) can quickly move in, spread out their tools and materials, build relatively uncomplicated houses, and then efficiently move on to the next job, which itself is bound to look a lot like the last. Repeat that simple assembly line process for a couple or few decades, and you get Albuquerque's Westside.
But if you build a multi-family complex Downtown, the cookie-cutter becomes a 1,000-piece puzzle, and every one of those pieces has a cost.
You can see one of those complications playing out right now at Silver and Second, where Homewise is building a collection of townhomes just south of Silver Street Market (DAN, 6/22/21). As multi-family development goes, the project is on the small side, but it nonetheless requires a fantastic quantity of building materials, and so the non-profit developer has arranged to stage them on a vacant lot catty-corner to the job site. The city, which donated the land on which the townhomes are going, conveniently owns that vacant lot, too.
But that lot is not going to be vacant forever. The city is in negotiations with developer Jay Rembe, whose portfolio includes the Silver Lofts and many of the prominent new or refurbished structures in West Downtown, to put up nearly 200 apartments there.
So when it comes time to break ground, where is he supposed to stage all of his materials, given that the immediate area's supply of vacant lots will have run out?
To be sure, that is a problem that can be solved with creativity and good logistics, but it is also a problem that the suburban residential developers - with their comparatively small pile of materials and ample space within neighborhoods that may not even have residents yet -simply don't have.
The list goes on: Land costs are higher Downtown, and with space at a premium, parking structures can be essential but add cost - sometimes tens of thousands of dollars per space. Build high enough, and you'll be forced to use expensive metal framing rather than wood or perhaps even supplement the water pressure. If the project gets big enough, worker pay scales can go up.
"The higher you go the more complicated it gets," Rembe told DAN.
Add to that an inflation picture that has shaken the construction world particularly hard, driving up the cost of materials and delivery times, including specialty items more likely to be needed for a bigger apartment project.
"An elevator right now is a one-year lead item," said Scott Throckmorton, who is developing the 144-unit Elevate @ Lomas and Third project. He also pronounced labor availability these days as "suspect."
The improvisational and expensive nature of Downtown development is only heightened when it comes to renovating older and (possibly worn-down) buildings or repurposing, say, former offices into residences.
"That doesn't fit into a nice formula," said Mark Baker, who repurposed a former Sears built in 1936 into the offices, apartments, and the 505 Central Food Hall and more recently purchased a former convent at Seventh and Copper that he aims to turn into 15 apartments (DAN, 11/8/21). "Not all developers are willing to step into that territory."
Finding a place to build in the first place isn't easy either. There are plenty of vacant buildings, but few are actually for sale, and the situation with empty land isn't much better.
"There's very few sites in Downtown where you're going to be able to go ground-up," said David Silverman, a principal at Geltmore, which developed the Imperial Building.
Exceptions include surface parking lots, Throckmorton added, but persuading the owners to relinquish their cash flow is quite the job in and of itself.
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The complexities, paired as they are with rapidly-rising costs and a labor shortage, would seem to be enough to torpedo prospects for a housing-induced Downtown renaissance, at least in the near-to-medium term. But if there is reason to think otherwise, it comes in the form of the two projects pictured above.
Rembe's Downtowner and Throckmorton's Elevate @ Lomas and Third represent something very new in the Downtown housing game: Unlike affordable projects such as Casitas de Colores and Silver Gardens, they will rent out at market rates. And unlike other market-rate projects, such as Baker's forthcoming convent renovation and Homewise's townhomes, they are comparatively gigantic, with a combined total of nearly 350 units.
(That plays to one advantage of Downtown construction that we haven't mentioned: Build smaller and/or higher, and you can squeeze in more units per acre. That sort of economy of scale is a big help for people trying to make the numbers work.)
The hope is that the projects will act as a sort of pioneer species. If both are ultimately built and rented out at the right rates, they will make a powerful business case to other developers that Downtown is ready for more large apartment or condominium projects. Investors and lenders may have their doubts now, but there is nothing, it seems, quite as compelling as a couple of good comps. And if the new buildings inspire a few new restaurants or other amenities to open up, thus making the area that much more appealing to live in, so much the better.
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Mark Baker was quoted above as well and his project got underway in December with a bit of demolition. It's now been christened as "The Villa Agave" and will have 15 apartments. Below are two recent posts he's made on Instagram with pics of the interior demolition.
https://www.instagram.com/p/CXz0fIXrigu/
https://www.instagram.com/p/CYqCEBNsYcE/
The city's RFP for Downtown housing projects closed last month on the 10th. A list of attendees for the pre-proposal meeting included many familiar names from the local development community. The list included Zydeco 66, Homewise, Palindrome and the Garcia family, along with representatives from Hartman + Majewski Design Group and a few other local business representatives. I'm hoping this RFP will attract more than one proposal, unlike the 1st and Silver RFP. At the meeting it was asked how long the selection process would take and city staff said about 3-4 months. I expect by April we should know what the proposals were and which were picked.
https://www.cabq.gov/mra/documents/p...ifications.pdf
Below is the most recent aerial pic of Downtown Albuquerque that Ben Bunner has posted, on New Year's Day.
https://www.facebook.com/photo.php?f...84642295995&id
KRQE had a story last week about the other recent city initiative for Downtown, the Storefront Activation Grants. Two businesses were selected for the grants. Electric Playhouse will use the money to establish its administrative headquarters in the historic Occidental Life Insurance Building. Blue Door Patisserie will use the money to establish a second location after its original Sawnill Market location. It will be located in the old Park Avenue Pizzeria location.
https://www.krqe.com/news/business/g...uerque-spaces/
Below are quotes from the city's press release describing the two businesses and what they plan for their Downtown spaces. Both are exciting, especially since Electric Playhouse plans some artistic flair at its location. I've seen people comment that Electric Playhouse was already Downtown, but after they opened their Westside location and with the pandemic I'm not sure they still did have a Downtown presence in their original location at 6th and Central. Before the pandemic it did host private dinners and events, but I hadn't seen anything there during the pandemic.
https://www.cabq.gov/mra/news/city-a...ivation-grants
Quote:
Electric Playhouse, which offers immersive entertainment and dining experiences at its west side location, plans to use this funding to establish an administrative headquarters downtown. The business intends to renovate 3,880 square feet of the Occidental Life Building at Third Street and Gold Avenue, including outfitting the building’s unique Gothic Revival façade with interactive art pieces and colorful architectural lighting, and updating the interior office space.
“These improvements will help us return our creative team back to the office as well as attract and expand our workforce,” said Electric Playhouse CEO and co-founder Brandon Garrett. “As an entertainment and technology startup, COVID-19 hit us hard and continues to impact us. This program will help us get back on our feet.”
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Quote:
Blue Door Patisserie, which serves French cuisine in the Sawmill Market near Old Town, is using the grant to establish an additional location at 900 Park Ave. SW. The funds will assist in renovating the interior of the space, creating an attractive storefront, and providing living wages and benefits to staff.
“We’re excited we were selected for this grant and can’t wait to open our second store downtown at this amazing location,” said Blue Door Patisserie owner Jove Hubbard. “We love what’s happening in the Downtown area, and we can’t wait to see it thrive in the coming years.”
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I was disappointed that only two grants were made after all this time, but glad that apparently there is no deadline and businesses can still apply for the grants. I hope that more will apply. The $500,000 is enough for about 17 grants at the maximum of $30,000 available per grant.
https://www.cabq.gov/mra/storefront-...-grant-program
The new APD Downtown substation in the Rosenwald Building received its building permit on November 18th and it is under construction, with various inspections performed since then.
https://posse.cabq.gov/posse/pub/lms...ctId=144381932
The Arrive Hotel project looks like it might be back on track and getting ready to start construction. The developer recently applied for new building permits and they are listed as drafts by the city. It's been almost exactly two years since its first application for a building permit was submitted. Of course much happened in those two years to help derail the project, which has seemingly always been shaky at best. Hopefully this will be the moment that it finally gets off the ground.
https://posse.cabq.gov/posse/pub/lms...ctId=151233136
https://posse.cabq.gov/posse/pub/lms...ctId=151694230
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It just further illustrates how ridiculous the opposition to these projects can be and how long projects can be drawn out by deferrals.
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