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Interesting to see Superman owner pull a permit for work estimated at $25 million. The cost of the work is a meaningful investment in a property valued by a 2014 appraisal at zero.
Last week, the federal government announced a plan to pour $45 billion into office to residential conversions. The $35 billion described in the press release is on top of $10 billion of federal Department of Transportation funding.
Looking at the details, the Superman building could qualify for the subsidies because it is - by a few feet - within a half mile of a train station.
Interesting to see Superman owner pull a permit for work estimated at $25 million. The cost of the work is a meaningful investment in a property valued by a 2014 appraisal at zero.
Last week, the federal government announced a plan to pour $45 billion into office to residential conversions. The $35 billion described in the press release is on top of $10 billion of federal Department of Transportation funding.
Looking at the details, the Superman building could qualify for the subsidies because it is - by a few feet - within a half mile of a train station.
Permits are great, but the fact that they have received some financing and commenced work is even better. Receiving additional subsidies (in addition to the breaks they're getting from RI) would be great. But I wonder if they'd be eligible since the project is already underway? I'd imagine those funds would be use to incentivize the start of conversions rather than assist with conversions underway (I could be wrong).
Permits are great, but the fact that they have received some financing and commenced work is even better. Receiving additional subsidies (in addition to the breaks they're getting from RI) would be great. But I wonder if they'd be eligible since the project is already underway? I'd imagine those funds would be use to incentivize the start of conversions rather than assist with conversions underway (I could be wrong).
Very likely true. Plus I'm sure their whole renovation plan is based on getting certain projected rental rates. That would also be better for the continued revival of downtown than an all subsidized housing demographic.
On another note, that 2014 appraisal was baloney- probably a ploy to get permits to tear the building down.
Permits are great, but the fact that they have received some financing and commenced work is even better. Receiving additional subsidies (in addition to the breaks they're getting from RI) would be great. But I wonder if they'd be eligible since the project is already underway? I'd imagine those funds would be use to incentivize the start of conversions rather than assist with conversions underway (I could be wrong).
Yes, all good news. Nothing should prohibit additional subsidies along the way, as long as the end result meets the subsidy criteria.
On another note, that 2014 appraisal was baloney- probably a ploy to get permits to tear the building down.
Yeah, I think the argument was that the cost of renovations negated any potential return so it "wasn't worth anything." But that ignores all sorts of variables like the historic/landmark value, the cost of demolition/building something new, etc.
The one thing that still gives me a little pause is that most of the current work would be necessary for demolition too (you can't just implode a building without gutting it and doing asbestos mitigation). So from the developer's perspective, this doesn't necessarily lock them into completing the renovation.
Quote:
Originally Posted by independent man
Yes, all good news. Nothing should prohibit additional subsidies along the way, as long as the end result meets the subsidy criteria.
That's what I'd hope, I'm just know sure what the specific criteria would be.
That's what I'd hope, I'm just know sure what the specific criteria would be.
Perhaps some specific social benefit or public good. These can cover a lot of territory. Especially, the economic boost to downtown & the many benefits that alone brings.
The appraisal report states the appraisal's purpose is to assist a tax appeal.
I read the appraisal and the valuation of $0 reflects a realistic view of market conditions in the early 2010s.
Why conclude the appraisal is, "baloney?" What is your view of the Superman building's market value?
While this question isn't posed to me, here's my opinion: Given the huge cost of making the building viable for ANY use, it is worth much less than $0. But, negative market valuation is not part of most appraisal processes. The passage of time usually is no valuation friend to such a deteriorating building, regardless of what increases may occur in the general real estate market around it.
Further, with the enormous cost of demolishing such a building, its market value as a downtown vacant lot, is also less than $0. None of this is to say the necessary subsidy isn't worth it for the reinvention of this important signature building. It is.
Last edited by independent man; 11-09-2023 at 05:03 AM..
While this question isn't posed to me, here's my opinion: Given the huge cost of making the building viable for ANY use, it is worth much less than $0. But, negative market valuation is not part of most appraisal processes. The passage of time usually is no valuation friend to such a deteriorating building, regardless of what increases may occur in the general real estate market around it.
Further, with the enormous cost of demolishing such a building, its market value as a downtown vacant lot, is also less than $0. None of this is to say the necessary subsidy isn't worth it for the reinvention of this important signature building. It is.
I agree. $0 is an optimistic valuation. The Providence office market is dead. The cost to renovate to apartments - $800,000 per unit - is too much. The logical use for the land is surface parking, but the cost to demolish is too high to make a parking lot.
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