New Colt Gateway apartments in Hartford boost rental conversions. Here’s why and what it would cost to live there. – Hartford Courant
HARTFORD – Two apartment conversions in the Coltsville area of Hartford will add to the hundreds of new rentals created in the neighborhood over the past decade, but the redevelopment also underscores the need for new alternatives for an abundance of office space following the pandemic.
The developer of the former Colt weapons manufacturing complex near the city center – Colt Gateway – is creating apartments in former commercial space which will be located under the existing offices. One is a lower floor of the East Armory, the complex’s most recognizable structure, topped with a blue onion-shaped dome.
The conversion disrupts the traditional approach to housing occupying upper floors above storefronts or offices. The $6.7 million projects at Colt also come as Hartford employers reduce their office leases with a dramatic shift to working from home, full-time or part-time.
In downtown alone, major employers plan to cut hundreds of thousands of square feet of office space, a trend growing in cities across the country, including major metros like New York and Boston.
“With what’s happening with the commercial space, flexibility is going to be the name of the game,” said Larry Dooley, owner of CG Management Co. and co-developer of the former manufacturing complex. “When you start to think about it, the lines have really started to blur here between residential and commercial with working from home.”
Dooley said more residential conversions at Colt may be on the way. The complex is split roughly 50-50 between residential and office space, but this could change if current low commercial lease trends persist.
“I used to get people in all the time, sometimes looking for a bigger space, a smaller space, it really boiled down to next to nothing,” Dooley said.
Colt is also closely monitoring the leases of its current commercial tenants. One of the largest and oldest, Insurity, a software company, now leases 75,000 square feet “and they basically haven’t been there since March 20, so that’s concerning.”
“I think they’re going to take up less space, so we have to be creative at Colt here to make sure we can keep paying all the bills,” Dooley said.
The new Colt projects are a modest start to that creativity, adding 45 rentals at two locations in the resort near downtown. The first of the new apartments should be available by late spring, Dooley said.
Hartford Mayor Luke Bronin said there was no doubt there had been structural and likely long-term change in the commercial real estate market.
[ Large employers in downtown Hartford slash office space as hybrid work schedules take hold: ‘There will be more’ ]
“That means we have to be creative and aggressive to use our space as efficiently as possible,” Bronin said. “And where residential conversions can be done efficiently and economically, they make a lot of sense.”
Bronin said it can be difficult to convert commercial space into housing, however.
“Floor plans, mechanics can make these conversions difficult,” Bronin said. “But where it makes sense, it’s an opportunity to advance one of our key strategic priorities, which is to create more housing opportunity and more residential density while mitigating the downturn in the commercial real estate market. .”
The loss of workers who come to town five days a week is a concern for restaurants and local businesses that depend on these workers for their livelihoods. However, not all downtown employers are downsizing. Hartford HealthCare is investing $14 million in its new headquarters at 100 Pearl St., where it plans to recruit up to 700 employees.
At Colt, where construction is already underway, plans for the East Armory’s second floor call for all but one of the rentals to be one-bedroom units. The average size is said to be 638 square feet, with estimated monthly rents ranging from $1,350 to $1,606.
Commercial tenants on the upper floors include JCJ Architecture and the local offices of US Senator Chris Murphy.
The ground floor of a second building, on the corner of Huyshope Avenue and Sequassen Street, is being converted for live work apartments larger than those in the East Armory.
Named after its shape, the second location on Colt’s campus – the 2-story “L”-shaped building will feature 11 studios, 3 one-bedroom apartments and 2 two-bedroom apartments. Additionally, there will be a collaboration room, breakout rooms, and smaller offices for Zoom calls.
“People are always asking for small spaces,” Dooley said. “You could be a small law firm, any type of office that would be applicable inside an apartment, something quiet. So I think the idea of having a first floor apartment , that could be very cool.
The average unit size is expected to be 909 square feet, with estimated monthly rents ranging from $1,350 to $2,160.
Commercial tenants on the top floor include Tecton Architects and Maier Design Group.
Funding for the two conversions includes $2 million from a line of credit from Liberty Bank and an expected $1.5 million in low-cost taxpayer-backed loans from the quasi-state Capital Region Development Authority. The rest will come from an equity investment by CG Management and its partner, the tax credit investment arm of oil giant Chevron.
The loan was approved by a CRDA committee on Friday and is expected to be approved by the full board later this month. The Government Bonds Commission is still expected to approve.
Rental demand in other conversions of the former manufacturing complex – the South Armory, the North Armory and the “U” shaped building remains strong.
On Tuesday, Dooley said five apartments had been posted and within an hour, 7 applications had been received.
“It’s always very competitive,” Dooley said. “Our [apartments] are always in high demand.
The apartment conversions in Colt are part of a much larger housing push in the city that has added more than 3,000 rentals in and around the city center over the past decade. Almost all have obtained financing—either a loan or an equity investment—through the CRDA.
As of Thursday, there were only two apartments available at Colt out of a total of 205, according to Colt’s rental office.
Rents are about 9% higher than a year ago, Dooley said. Increases for renewing leases increase by approximately 2% to 3%.
Dooley said he applied for the CRDA loan in part because construction costs had risen 18% in the past year alone, compared to what it cost to convert the building into a U rented barely a year ago.
The increase was linked to inflation, rising building material costs, supply chain disruptions and steadily rising interest rates, Dooley said.
Here’s an overview of the three existing apartment buildings in the historic Colt factory complex, the odds of finding an apartment there, and what you might pay:
Address: 140 Huyshope Avenue
Built: 1916 to manufacture machine guns; Apartments opened in 2015.
Number of apartments: 129
Current occupancy: 99%
Rents: Studios: $1,195 to $1,795; One bedroom: $1,645 to $1,985; Two bedrooms: $1,975 to $3,250
Address: 100 Huyshope Avenue
Built: 1916 to manufacture gun barrels; apartments open in 2020.
Number of apartments: 48
Rents: Studio: $1,325; One bedroom: $1,700 to $1,975; Two bedrooms: $2,200 to $2,350
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Address: 17 Van Dyke Ave.
Built: 1942 for the offices of the Colt company; Open as apartments in 2021.
Number of apartments: 28
Rents: Studio: $1,372; One bedroom: $1,405 to $1,895; Two bedrooms: $2,095
THE SOURCE: CGManagement
Kenneth R. Gosselin can be reached at [email protected]
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