Warehouse conversion plan returns – with tax credits and compromise

Plans to turn a warehouse near Hardywood Park Craft Brewery into apartments have resurfaced and are progressing through the city review process.

Developers David White and Louis Salomonsky of Historic Housing have brought back their proposal for an apartment conversion at 1650 Overbrook Road – a century-old former tobacco warehouse across the street from the brewery. The 113,000-square-foot building on 6.4 acres stretches the length of three football fields to Overbrook’s intersection with Hermitage Road.

The veteran development team is proposing to fill the bulk of the building with 117 apartments – a reduction from its most recent proposal in 2014 that would have filled the entire building with 205 units. That proposal, which sought to qualify for state and federal historic tax credits, was withdrawn when it failed to pass muster with the National Park Service.

At issue was a plan to cut windows into the building’s south-facing wall, which is devoid of windows but would need to remain that way for the project to qualify for the credits. The developers initially planned to go forward with the project – with the windows, and without the credits – but instead spent the past two years working with the city and state and federal regulators on what White described Monday as a sort of compromise.

While they agreed to keep the wall windowless to qualify for the credits, the developers also agreed to a provision from the city that would require – at the discretion of the city planning director – that the windows be cut after a five-year period: the length of time that city staff said the state’s tax credit program requirements would be enforceable. Staff said doing so would satisfy a Richmond Planning Commission resolution regarding windowless dwelling units, which became a point of debate a few years ago.

Addressing the commission at Monday’s meeting, White said: “We’ve been trying to resolve competing interests of the Department of Historic Resources and the City of Richmond, working through issues relating to a desire (by) the historic folks to leave the exterior of the building as much like it currently exists as possible, and ours and the city’s interest in getting as much light and air into these apartments as possible.

“We have been back and forth many, many times, and what you see here today is a negotiated settlement worked out to marry both of those requirements together,” White said.

City resident Charles Pool, who spoke in opposition to the project, described the scenario as “gaming” the tax credit system, alleging that the Department of Historic Resources was not aware that the credits that would go toward preserving the exterior of a building would end up supporting a project that would put holes in its walls.

But White and James Hill, a project manager with Sadler & Whitehead Architects, said the state was made aware of the city’s provision, which White said after the meeting may or may not be required by the city planning director.

“We’re not gaming anything. We negotiated this,” White said after the meeting. “This is not something we want. This is something we negotiated” at the request of the city.

Should the city require the windows, which would serve individual units, White said they would likely be installed with some sort of leasing concession and techniques to minimize impacts to affected tenants.

The commission voted 8-1 to endorse the project to Richmond City Council, which will decide on a required special-use permit. The property’s current industrial zoning does not allow for apartments without such a permit.

The $15 million project would convert the primary part of the warehouse – about 110,000 square feet – to 117 apartments with a courtyard and a swimming pool. Per state requirements, the courtyard would include an open-air, Plexiglass-style roof that would provide additional light. White said the roof may be removed after the five-year period as well, or kept if residents like it.

The westernmost end of the building, including a 2,300-square-foot structure at the corner of Overbrook and Hermitage, would be developed in a second phase for commercial use. Commission members noted that the space could not be filled with more apartments – as the 2014 proposal called for – without an amendment to the permit or other approval from the city.

Units would be primarily one-bedroom apartments, ranging in size from 700 to 900 square feet. The rest of the units, about 35 percent, would be two-bedroom apartments ranging from about 1,000 to 1,200 square feet. White said monthly rents would range from $1,000 to $1,600.

Should the project pass council, White said construction would start 30 days thereafter, with a project schedule of 12 months and leasing to start in spring 2017.

The builder on the project is Candela Construction, which White described as a successor to Historic Housing’s traditional construction arm, SWA Construction. Salomonsky’s SWA Architects is designing the project, and M&T Bank is providing financing.

The project’s resurgence comes as White and Salomonsky are proposing more apartments in Scott’s Addition. That project, called Roseneath Towers, was recently revised in height and appearance.

Historic Housing also developed the nearby Todd Lofts apartments on Hermitage Road. The developers’ real estate management arm, Main Street Realty, manages those apartments as well as the 1 Scott’s Addition apartments on Summit Avenue.