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New lease on life for Cold Storage plant

Al Harris May 13, 2009 1

coldstorageloftsThings are heating up at the old Richmond Cold Storage complex in Shockoe Bottom.

The first of five turn-of-the-century industrial buildings to be turned into apartments is six weeks away from completion and will soon begin leasing. The development is a $50 million project of Historic Housing, the same group that developed 17th Street Lofts and The Lofts at Canal Walk.

The apartment building will add 37 units to the area, which Historic Housing co-manager Brian White said will target MCV students.

“We welcome everyone,” White said. “We just think that’s where the demand is, and the units are designed with that resident in mind.”

White is also president of Main Street Realty, which shares the same owners as Historic Housing, as well as SWA Construction, which is working on the project.

Construction started about eight months ago in what was once the ice producing facility for the cold storage warehouses for a total investment of $6.3 million. Apartment units will range from 500 to 1,000 square feet and be outfitted with granite countertops, electric fireplaces and flat-screen TVs. Rent, including all utilities, is expected to start at $875 a month.

There is also a sky-lit courtyard in the middle of the building that White says will be decked out with fountains and benches to provide a common area for residents.

The building, at 17th and Marshall streets, has a direct sightline to the proposed Shockoe Center complex, for which plans include a baseball stadium and retail, office, hotel and residential space.

White said there are no plans for commercial space at the cold storage apartments except for a brewpub by David Napier, president of the Shockoe Bottom Neighborhood Association and owner of the Old City Bar, which will be part of the last phase of development.

“We have found that the Shockoe Bottom apartments are great,  but there is very little other commercial development viable in the neighborhood in its current condition,” White said. “If Shockoe Center goes forward, that could be the magic bullet to change that.”

White said that Shockoe Center, estimated to cost well above $300 million, would address many of the flood plain issues that have been an obstacle to growing the neighborhood. That project was the subject of a Times-Dispatch-hosted debate last night.

“The flood plain is what is behind the vacancy and the substandard buildings. Fix the flood plain and you fix the issue,” White said.

Renovating the rest of the cold storage buildings will happen on a rolling basis, proceeding next with the building on the northwest corner of 18th and Marshall streets.

“With the economic conditions the way they are, we wouldn’t want to bring 200 units to the market at once,” White said.

White said construction on the next building will start soon and should be finished sometime next spring with more than 60 units. It will also feature a swimming pool and a fitness center.

The last portion to be developed is the two buildings on the northeast corner of 18th and Marshall, one of which will include the restaurant on the first floor.

The sealed railroad tunnel that ran underneath Church Hill is immediately adjacent to the property, and the old tracks extend across it. White said they plan to emphasize the railroad history of the site and want to place refurbished rail cars there that offer some sort of amenities to tenants.

The project is partially financed by state and federal historical tax credits. An investor has made a capital investment for the estimated value of the credits. In all, the development is projected to qualify for about $17 million worth of tax credits.

White expects the entire project to be finished by 2012.

The property was acquired five years ago for $2.4 million from Richmond Cold Storage Company. That company was recently acquired by a private equity group in Atlanta. You can read about that here.

Al Harris covers commercial real estate for BizSense. Please send story tips to Al@richmondbizsense.com.

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