by Catarina Ferreira, AIA
Some projects seem too good to be true. I’m sure many architects out there can relate to this. After all, my firm had already designed two other buildings for that block and half, both of which are currently under construction. Three buildings within 1.5 blocks? No way, I thought. No way was correct.
A few months ago, I was asked to prepare a conceptual design for a 40-unit multi-unit apartment building to be located on 1322 9th NW. The site has been a parking lot for as long as anyone can remember. Various projects have been proposed for that site and one by one they were all abandoned. This one was charmed, though, or so it seemed.
When a hotel was proposed for the site a couple of years ago, there was strong opposition from the neighborhood; everyone wanted more housing. There were also several zoning relief requests associated with that proposal. So, we gave them more housing, with no need for zoning relief. There was no neighborhood opposition to the proposed building, no ANC opposition, and we were slated for HPRB concept approval this past April in the consent calendar, postponed to May due an adjoining neighbor’s expressing some concerns regarding the view of his historic courtyard being blocked from the parking lot, street and alley by the proposed building. Well, no offense, but the beauty of courtyards is that they are intimate, mostly enclosed exterior spaces and they are best experienced by being in them, not from the outside. How about giving private tours? Just saying… I would have enjoyed attending that hearing for sure, but the application was withdrawn before the hearing date.
So, how exactly did this project get derailed after such a promising start, you may wonder…
Interest rates rose between the time the purchase deal was made and the concept (almost) approved. Current interest rates have had an enormous impact on developers’ ability to bring projects from concept to reality. Construction loans are often interest only, variable rate loans. With current interest rates, developers (and borrowers in general) are paying twice as much in interest on any loan. When you need a few million to get a project built, twice as much is a lot. In addition, when the cost of money is so high and construction costs are also high, it’s a double obstacle: paying twice as much at twice the cost of money. Given those obstacles, a lower purchase price was needed in order for the project to be viable, so the original purchase deal fell through.
Luckily, the HPRB’s position towards the proposed design does not change regardless of who the buyer is, and we, as architects, own the design concept, not the previous would-be purchaser. The concept can be re-presented to the board if a new buyer appears with the intent of building the same project type.
