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Albert Rex

Albert Rex
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From the Road: Buffalo, NY

Posted by Albert Rex on Wednesday, July 27, 2016

In Buffalo, New York, there is a great architectural legacy forged by two centuries of commerce and some of the countries finest examples of architectural style from the Louis Sullivan Guaranty Building to the Art Deco Buffalo City Hall. Because the city has retained a large number of its historic buildings, there are many opportunities for historic rehabilitation projects utilizing federal and state historic tax credits. That is why tomorrow I will present with my peers from the legal, accounting, development communities as well as the State Historic Preservation Office, and overview of the tax credit programs and the impacts they can have on a city like Buffalo at Transforming Communities with Historic Tax Credits Buffalo, NY, An IPED Conference. The program will include and overview of the basics, the impact of the state historic credit and other programs, case studies and a discussion of hot button issues.

I have seen first hand the impact the combination of the state and federal historic credits can have with our work on PS 60, now Riverside Apartments, in the Black Rock Neighborhood of Buffalo. MHA worked with our client DePaul, a private non-profit housing and service agency founded in 1958, to help them acquire state and federal historic tax credits for the redevelopment of the former Public School #60 (PS 60) first constructed in 1898 and significantly expanded in 1922. The elementary school was converted to 68 units of housing, a larger number of them with supportive services for individuals with mental health issues.


Working with SWBR Architects out of Rochester, NY, MHA guided DePaul through the entire historic tax credit process including a National Register Nomination. Some of the larger challenges for the project included preservation of the formal 1922 auditorium and grand stair. The former gymnasium was converted to housing units and a new secure main entrance was artfully designed by SWBR. Given the adaptive use of the building, there were significant life safety and other compliance issues that had to be overcome.

Riverside_Before.jpg      Riversdie_Exterior.jpg
                  | Before - Main Stair                                                                                            | After - New Entrance

_DSC6127.jpg         Riverside_1.jpg
                                                                  | After - Auditorium                                             | After - Hall

DePaul’s attorneys at Nixon Peabody can attest to the fact that every penny of the state and federal historic tax credit equity, as well as many other sources, was needed to make the project work financially. And it did work. This award-winning project is a great example of the transformative power of the historic tax credits.

Topics: Events, New York, Historic Tax Credits

Going Green in South Boston

Posted by Albert Rex on Thursday, March 17, 2016

What better day is there to talk about going green in South Boston than St. Patrick’s Day?

The green we mean, of course, is sustainable building technology. And the building itself is located in the Fort Point/Seaport District on the edge of South Boston – known for its Irish residents and their St. Patrick’s Day parade. 

| Fraunhofer Center for Sustainable Energy Systems (Photo by Robert Benson Photography)

Our client, CV Properties, converted a seven-story Classical Revival style building in the district for a commercial. The tenant of the building is the Fraunhofer Center for Sustainable Energy Systems (CSE), a non-profit applied research and development laboratory whose mission is to foster economic development through the commercialization of clean energy technologies for the benefit of society.

The building was originally constructed by the Boston Wharf Company (BWC), a group of clipper ship owners who decided in the mid-1830s they could make more money developing warehouses than sailing ships. Over BWC’s history, they created over 95 acres of land from the mudflats of South Boston and developed over 95 buildings in what became known as the Fort Point District, an area recently designated the Innovation District. The rehabilitated building, designed by DiMella Shaffer Architects, not only houses the lab of CSE but also serves itself as a test subject. Sustainability experts monitor the effects of different treatments on and around the building including chambers on the south elevation that can have their materials changed out to understand their reaction to weather.

The building’s initial use as a warehouse, with exposed brick walls and wood beams and columns, provided both challenges and opportunities for the tenant and its function for testing and finding green solutions. While many project teams may have (and do) consider challenges such as the issues around window and wall treatments as an outright burden, CSE was able to learn from their own rehabilitation how real buildings live and breathe.

It’s like treasure at the end of a rainbow to work on a rehabilitation project that will benefit the real estate industry in the way that CSE does. To that, we say “Slainte!”

Affordable Housing and Rehabilitation Updates

Posted by Albert Rex on Friday, February 26, 2016

This week, a diverse group of housing professionals has gathered at the National Housing & Rehabilitation Association’s (NH&RA) 2016 Public Housing Joint Venture Symposium at the Breakers in Palm Beach, Florida. According to Thom Admur, Executive Director of the organization, this is one of the best-attended NH&RA events to date, and all types of players in the affordable housing community have come together including representatives from HUD and many state agencies and local housing authorities.

While sessions covered a wide range of topics, including innovative approaches to HUD and historic preservation, the program has focused on the Rental Assistance Demonstration Project (RAD) through HUD.

RAD provides an opportunity for housing authorities to access private dollars profit developers to bring dollars the country’s many units of public housing. Sunia Zaterman, Executive Director of the Council of Large Public Housing Authorities, noted that there is $26 billion backlog in capital investment in public housing units across the country.

One takeaway from the symposium was that RAD is not a cure all for every public housing unit, but in certain cases it’s an affective way to combine public and private sources to preserve very important affordable stock. Another takeaway is clearly the need for bringing all the resources to bear for these important assets. 

10.19.15_Multifamily_CottageSq.jpg| Cottage Square Apartments
Easthampton, MA
Affordable Housing
NH&RA Timmy Award Semi-Finalist

Many of the country’s public housing complexes are more then 50 years old and are good candidates for the tax incentives such as the low-income and historic tax credits. Some housing authorities are partnering with for-profit developers to tap into these sources of funding. These properties are usually historically significant for the period in which they were built, typically in relation to important moments in local history, and how they were financed versus the buildings’ architectural character. In order to receive the historic tax credits, these types of narratives must be made to list the properties on the National Register of Historic Places.

The consensus is that the state of the market is good, which makes it clear that need for affordable housing is not lessening. As for historic tax credits, they continue to be a very important source of financing for the construction of new affordable and housing as well as the preservation of exiting affordable units. We appreciate NH&RA’s commitment to be an important voice for the affordable housing industry and advocates for historic preservation.

Proposed Oklahoma Moratorium Fails to Account for Economic Benefits of Historic Tax Credit

Posted by Albert Rex on Wednesday, February 17, 2016

What is good for the tank, might not be good for the tax credit…

Especially in Oklahoma.

Bill 977 filed in the Oklahoma Senate proposes a two-year moratorium on most of their state tax credit programs, including the state historic tax credit. The bill is a response to a continued drop in energy prices, which according to the Tulsa World, “is affecting all revenue categories, including income-tax and sales-tax revenues.” 

In total 23 tax credits are targeted to be suspended to address a potential $1 billion shortfall.

2.17_Public_Service_of_Oklahoma.jpg| Public Service of Oklahoma Building
Tulsa, OK

The moratorium is slated to begin July 1, 2016 and extend through July 1, 2018. It’s not necessarily a death knell for the historic tax credit program (HTC), but it does raise concern over its future and the impact to current projects.

The Senate bill looked at the fiscal impact of each of the 23 tax credits solely from the perspective of the “cost” to the state of Oklahoma by averaging previous year’s usage and not on the economic benefit the credits produce. Clearly some credits won’t produce any monetary benefit for the state and are there for social purposes, while others, like the historic credit, have a greater impact on the economy of the state. Most analysis of state HTCs shows a positive impact to state coffers and certainly exceed revenue neutral. In addition to creating construction jobs and all the ancillary spending that comes with them, historic tax credits induce and increase the local tax base as the buildings that are rehabilitated are assessed at a higher value when complete.

Additionally, a moratorium would not only directly impact the projects, but also the investor market for the credits. Like developers, investors want some sense of predictability. A starting and stopping of the tax credit can make investments in these historic rehabilitation projects less desirable in the long run.

What the current evaluation of the HTC also misses is that the $1,055,00 of historic credit allocated to projects in 2017 and the $2,110,000 projected for 2018 are also matched by an equal federal historic credit, bringing more outside dollars and stimulating development in the state.

Advocates for the HTC in Oklahoma will certainly use all of these facts to help garner support among state legislators to keep the credit intact. As we have seen in efforts in other states that faced similar battles, a complete analysis of historic tax credit programs offer attractive evidence that the programs are a financial boon, not a financial burden.

Here’s hoping for success in preserving the Oklahoma HTC in its current state for the coming year. And also that maybe gas prices go up just a little…

Historic Rehabs and the Desire for Density

Posted by Albert Rex on Wednesday, January 20, 2016

In an age where baby boomers and millennial are returning to cities, density becomes a very important focus as developers and planners try to find ways to created new real estate where there is none. Allowable floor area ratio (FAR) in some of the densest urban areas in the country is on the rise, and in cities like Boston there is a race to the sky to develop as many units as possible on smaller and smaller parcels.

Many of the cities that are focusing on increased density are those that have historic downtown cores or neighborhoods. In both cases, there is sometimes a push to demolish older structures in order to create opportunities for greater density. In some cases, this is the most reasonable approach while in other cases the site may have more value by rehabbing the existing structure.

But which approach is best?

In historic neighborhoods, building scale is typically much smaller than downtown and FAR is usually capped due to zoning regulations on height. Existing open lots are rare and the only way to increase density on an existing site is to expand horizontally. In some cases this is attainable, but often it requires assembling multiple parcels, which can mean the demolition of non-essential structures and new construction that is out of scale with historic neighborhood. These projects often elicit a visceral response from community advocates.

A better option for attaining more density in an historic neighborhood may be an old factory building or large apartment building that was not required to comply with modern zoning codes or far exceeds allowable FAR. The reuse of this building would likely elicit a different response, especially if the use was compatible with the needs of the neighborhood, such as housing. Rehabilitating these kinds of buildings creates a sense of continuity that is often easier for a neighborhood to accept even if it presents the same issues as new construction, such as traffic or the need to provide services. In this case, density is hidden in plain sight.

Downtowns (or city centers) face issues relative to the decision to preserve historic buildings versus constructing new ones due to the fact most of these projects go vertical. Downtown districts tend to be marketable because of their historic character, and thus create demand for rehabilitated buildings. These are also the sections of a city that are best served by infrastructure, especially public transportation. The combination of historic character and easy access to trains and buses combined with the renewed interest in living in urban spaces has fueled the current wave of development. In this case height is not only about density, but the added value that comes with the view.

Midcentury office buildings, for example, are good candidates for reuse; particularly as housing. These buildings are too large to be economically feasible for demolition, but are no longer desirable as A-class office space. What they may lack in views, they more than make up for in architectural character and location.

ct-old-colony-building-kamin-met-0830-20150828.jpg| ARC at Old Colony (Chicago), an office building that was converted into student housing

In the recent urban growth for both city centers and surrounding neighborhoods, successful density is often achieved by leveraging old and new building stock. In these places, planners and developers have acknowledged that good preservation is part of good planning. Historic buildings not only provide a sense of place, but preserving them is often the most sustainable option and they are exempt from modern zoning codes that would otherwise limit any new construction. They are also ideal candidates for historic tax credits, making their rehabilitation more feasible financially.

With these factors in play, the value of historic preservation for the developer is undeniable.

Topics: Urban Planning, Density