Turning a Hurdle into an Asset

Once the developers figured out that adding a level of living space three of four steps up from the old floor would give residents the ability to look out the unusually high windows, it became clear they could make the site work as housing.

With that hurdle cleared, developer Central Community Housing Trust (CCHT) could focus on using its extensive historic rehabilitation experience to convert a warehouse in the Lowertown district into 70 affordable apartments. An $11.7 million effort, the Crane Ordway development marks the developer's first housing initiative in St. Paul.

"We have expanded our work throughout the Twin Cities and were looking to do our first St. Paul project," said Alan Arthur, president of CCHT. "This property was on the National Register of Historic Places, and the city wanted something positive to happen with it."

When CCHT announced its proposal to reuse the building as affordable housing in 2003, the turn-of-the-century warehouse had been vacant for 30 years. The redeveloped building, completed in August, now offers 35 units affordable to households earning no more than 50 percent of the area median income (AMI) and 35 units affordable to households earning no more than 30 percent of the AMI.

The Crane and Ordway Co. built the warehouse in 1904. Reed & Stem, the St. Paul architecture firm that designed New York's Grand Central Station, designed the warehouse for the company, which, for a time, was the world's largest manufacturer of pipes, valves, and steam supplies.

Housing humans, not forklifts

Now, 14 of the apartments are set aside for formerly homeless persons. Nonprofit social service provider South Metro Human Services will provide them with case management, mental health counseling, housing retention support, chemical dependency assistance, and employment assistance.

The spaces once piled high with pipes and valves have been scaled back to hold humans instead of forklifts, with the addition of amenities such as a laundry room with a large televsion and lounge-style couches, an exercise room, a conference room that includes a kitchen for use by both residents and the community at large, and another smaller meeting space for residents only.

A patchwork of funding

For CCHT, financing Crane Ordway meant assembling a package of grants, loans, and equity provided through two federal programs.

About half the total development cost was met by $5.85 million in equity from the sale of low-income housing tax credits (LIHTCs). The LIHTCs were awarded by the city and the Minnesota Housing Finance Agency (MHFA) and syndicated by the National Equity Fund (NEF). The project also will tap about $1.8 million in historic tax credit equity; these credits also will be syndicated by NEF. Wells Fargo provided a bridge loan to the project, which will be repaid once the National Park Service releases the historic tax credits.

In addition, the project tapped a number of loans. The city provided a $1.7 million 30-year loan at 1 percent; MHFA provided a $980,000 30-year loan at 1 percent; and Wells Fargo Bank N.A. provided a $600,000 15-year loan at 7 percent. Also, the Federal Home Loan Bank of Des Moines provided a 30-year Affordable Housing Program $250,000 loan at 6 percent through member Wells Fargo; and the Family Housing Fund provided a $200,000 30-year loan at 1 percent.

Other permanent funding included grants from the Bigelow Foundation, Houses of Hope Fund, Mardag Foundation, Metropolitan Council, and the Saint Paul Foundation.

"This was a warehouse building, so very little had been done to the interior," said Arthur. "The building was well-built and fundamentally sound. It was probably the cleanest building we have ever stepped in [to redevelop]--all it had inside was dust."

The warehouse's center-pin awning windows--which rotate from the middle of the window and are difficult to fit with screens--proved the biggest development challenge.

"We preserved as many of the existing historic windows as possible," said Arthur. "For the rest, which either had to have screens or were impossible to save, we selected widows that looked exactly like the old windows but that functioned differently."

The windows' location presented another challenge that actually helped save the building for affordable housing and, ultimately, gave its long and narrow efficiency units more visual interest.

Most of the former warehouse's windows begin seven feet off the ground--a design that once let in light without allowing workers to become distracted by the view.

"A lot of people who looked at this property [before us] wnated to make it into condos," said Arthur, "but they couldn't get past the fact that the bottoms of the windows were actually higher than people's heads."

To qualify as a historic preservation project, the building needed to keep the existing window openings, so architect Cermak Rhoades developed a create workaround--dividing each long narrow unit unto two levels.

"You enter on one level and then step up three or four steps, so you are now at a height where you can look out the windows," explained Arthur. "These are not huge apartments; they're efficiencies. But the levels help break up the entry, which has the kitchen and bathroom, and the space used as the living room or bedroom."

The result is one of Arthur's favorite aspects about working with historic properties. "Many of these problems push you to come up with solutions that create a better product in the end." he said.

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