A local nonprofit has a buyer on the hook for the former hotel building in Scott’s Addition it had hoped to make its flagship redevelopment project.
Better Housing Coalition is under contract to sell the former Quality Inn & Suites building at 3200 W. Broad St. to Richmond developer Louis Salomonsky, according to multiple sources with knowledge of the deal.
BHC CEO Greta Harris confirmed the building is under contract but said she could not confirm or deny Salomonsky is the buyer. She said the deal is slated to close in December.
Salomonsky, who runs Shockoe Bottom-based Historic Housing with business partner David White, would not comment when reached Monday morning.
BHC has been in talks with prospective buyers for months since announcing in February it was weighing its options for the property after resolving a legal dispute with local developer Dominion Diversified Real Estate Group, which had alleged the nonprofit stole its idea to redevelop the six-story, 136,000-square-foot building.
BHC had planned a $42 million mixed-income, mixed-use redevelopment that would hinge on a $7 million capital campaign, which Harris has said lost momentum from the legal dispute.
After reaching an undisclosed settlement with Dominion Diversified, Harris said BHC was weighing whether to go forward with the project as previously proposed, pursue a joint venture with a private commercial developer or sell the property and its 3.5 acres, which it purchased in 2016 for $5.9 million.
Harris said BHC has an executed contract to sell the property outright, without any involvement in its development or contingencies requiring housing types or price ranges. It’s unclear whether the building would be redeveloped or razed to make way for new construction.
“It was very difficult, but it was the right business decision,” Harris said. “Because of the notoriety, the huge amount of grant money that was going to be needed to make this (project) work – we just couldn’t hold onto it much longer because it had the potential to harm the organization.”
Adding to BHC’s concerns is a rash of recent break-ins that Harris said emphasize the need for additional housing options in Richmond. She said BHC has worked with city police and area homeless shelters to clear and relocate people – in some cases families with children – from the property on multiple occasions.
“We’re struggling to secure the building,” she said, adding that fencing that was cut has been fixed or replaced, and armed guards are providing overnight security to prevent further break-ins.
“I think it emphasizes that people are desperate for a place to call home,” Harris said, adding that about a dozen people were found and relocated from the building in each sweep.
She said BHC’s income-based rental properties are more than 98 percent occupied and its single-family housing units in development are all presold.
The Scott’s Addition building has been vandalized with graffiti in recent months, marking its stagnancy in contrast to other development in the fast-transitioning neighborhood. The building is across Mactavish Avenue from the redeveloped Sea Dream Leather building that now houses The Highpoint collaborative space.
A couple blocks away, Salomonsky and White are in the midst of constructing Scott’s View, a pair of residential towers with commercial street frontage on 2.5 acres at 1400 Roseneath Road.
Those towers are planned to house 350 apartments with monthly rents ranging from $1,100 for a larger one-bedroom unit.
Rents at the converted Quality Inn were expected to range between $700 and $1,000 a month for a two-bedroom apartment. BHC had targeted the project to serve families with incomes between $28,000 and $58,000 for a two-person household.
Harris said proceeds from the building’s sale would help BHC fund other projects throughout the Richmond area.
Without the hotel building as an option, and with its other properties mostly occupied or sold, Harris said: “We have no more inventory. That’s a tell-tale sign that we have a blossoming affordable housing crisis in our community.”