... And The Rentals Downtown Don't Stay Vacant Long
Eight years ago, Alva Greenberg and Michael Joplin converted the upper floors of their lower State Street building into four luxury apartments, the likes of which downtown had never seen. They offered hardwood floors, high ceilings and, in a downtown where sub-$500 rents were typical, asked for more than $1,000.
Fellow downtown property owners thought they were crazy.
”We didn't think we were crazy,” said Greenberg, who is also part-owner of the Crocker House. “People didn't rent an apartment downtown over $1,400, $1,500. We were able to prove if you build it, and make it nice, people will come.”
Due in part to their lead, downtown housing stock nearly doubled in the last decade to about 500 market-rate condos and apartments, excluding the 145 subsidized apartments in the Mohican building. The past five years alone produced about 200 new housing units - a seismic change for a downtown of only 26 blocks. Rough estimates now put downtown residents around 1,000.
The housing boom is perhaps the most significant change to downtown, representing an investment of tens of millions of dollars, much of it to rehabilitate dilapidated buildings.
More residents will presumably create retail demand and expand the market beyond the workday. “Then more retail has just got to come in. Then we have enough foot traffic,” Greenberg said.
The recent boom has proved the wisdom of the longstanding opinion that a demand existed for good-quality downtown housing. In 1985, one report suggested (prematurely, it turned out) that apartments would become the next decade's “largest single market for downtown floor space.”
”Residential uses could have an enormous impact upon some of the vacant upper-story floor space along (State Street) and Bank Street,” the New London Downtown and Waterfront Development Program stated. “It is just a matter of time and urban evolution in attitudes, rehabilitation techniques and creative financing.”
In 2003 the Crocker House provided the largest boost to the number of units when the 1872 former hotel began renting the first phase of its 80 apartments.
That same year, White Plains, N.Y., developer Peter Levine renovated the former SNET building on Washington Street into 28 apartments. Last year Levine opened the final nine loft-style apartments in his mixed-used, 19-unit building at 13 Washington St., which houses the Bean & Leaf coffeehouse.
In 2004 Oaktree Development LLC of Cambridge, Mass., broke ground on downtown's first luxury condos: the 35-unit Shaw's Landing units on Bank Street, where, despite the housing slump, asking prices for a handful of unsold units still exceed $300,000.
Downtown's housing boom proved to property owners they could get a return if they converted upper-floor space into apartments. Owners report full occupancies and even waiting lists for downtown's newer apartments, many of which rent at or above $1,000 a month.
In November 2005, Rich Caruso, owner of Caruso Music, transformed the long-unused, $300-a-month efficiencies above his State Street store into four apartments. His brother and business partner, Larry, was skeptical.
”No way, nobody's going to rent in downtown New London,” Caruso recalled his brother saying. “He said, 'You do it.'”
He did. The two 475-square-foot studios rent for $750; and the two 900-square-foot apartments rent for $950. “People are waiting to get into the apartments,” Caruso said.
Downtown developer William Cornish recently completed his conversion of the 140-year-old Bacon's Marble Block building into 21 apartments: 17 studios, four one-bedrooms and three lofts.
”We're full. It went on line in June, and we filled up by July 1,” said Cornish, whose apartments rent from $800 to $1,000. “I think 10 years ago, nobody was thinking about living downtown. I think circumstances have changed. People want to live downtown.”
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