Victory Lofts: From a commercial building to apartments…to condos | Richmond Neighborhoods
The three-story, red-brick building at 407 South Cherry St. in Richmond’s Oregon Hill neighborhood doesn’t draw a lot of attention to itself. It sits on a narrow street on the western edge of the neighborhood. People walking or driving by it are more likely to notice to the picturesque chapel and original entrance of Hollywood Cemetery, which stand nearby.
But the 15,800-square-foot property, which housed the Victory Rug Cleaning Co. for more than a century, is at the forefront of a resurgent trend. Two years ago, it was converted into 12 condominiums and renamed Victory Lofts.
From the 1980s to the economic downturn in 2008, condo conversions had been fairly popular throughout the city. But the number of conversions dropped precipitously during the Great Recession as residential construction came to a virtual standstill nationally.
“Victory Lofts is the first large conversion we’ve had in a while,” said Patrick Sullivan, a real estate agent with the reRVA team at One South Realty.
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Another recent project brought eight condos to the Church Hill property that once housed Church Hill’s 2300 Club. “Condos are coming back to life because there’s a huge need for them in the city,” Sullivan said. “And we’ll see more in the future because housing inventory is so low.”
Many of the people turning to condos today are first-time homebuyers who have grown tired of living in apartments but want to stay in the city. Empty nesters looking for an urban lifestyle are also buying them.
“We’re seeing a lot of apartment construction in the city, but there’s a huge demand for more buying options,” Sullivan said.
This isn’t the first adaptive reuse for the Victory Rug Cleaning Co. building, which was built in two phases. (The northern half was constructed in 1890, and the southern half followed circa 1906, when the rug cleaning company expanded. The halves are architecturally similar, but the earlier one has a little more detailing in the brick front.)
The building was first converted to 12 apartments by CMB Development in 2014.
“It was a full-gut rehab,” Sullivan said.
The project wasn’t an unmitigated financial success, though, because the apartments’ ample square footage – a response to neighborhood concerns during the planning stages – didn’t translate into substantially higher rents, Sullivan said.
“The prices for good-sized rentals doesn’t go up as much as it does for condos,” he said. “So it was a perfect project for a condo conversion.”
The units ranged from 726 to 1,733 square feet.
Because the developer used federal and state historic tax credits for the apartment project, he couldn’t sell the property for five years. As the deadline approached, Sullivan and Lory Markham, an agent in his brokerage, presented the building’s owners with a condo conversion proposal. The development company accepted it.
“To maximize profits and reduce redundancies in transfer fees, etc., we worked together with Guy Blundon of CMB Development as a team on the conversion process, and my real estate team at reRVA handled the marketing and sales,” Sullivan said.
Think of Victory Lofts as Adaptive Reuse 2.0.
Retrofitting the units as condos didn’t take long.
“We did some minor upgrades in finishes to bring them up to condo-level, but the general layouts stayed the same,” Sullivan said.
Working with the existing tenants’ leases took a little longer. “You can’t break the leases, so the units don’t sell at the same time,” Sullivan said.
Once the units began going on the market, they sold quickly at or above asking price, with prices ranging from $160,000 to $400,000. Two tenants bought their units and stayed in the building.
“That location is why sales went well – 100 percent,” Sullivan said. “There’s not a lot of for-sale, simple products like that in the middle of the city. A lot of people want a simple, flat-style lifestyle, but they don’t want to be in an apartment.”
Sullivan’s now turning his attention to another condo conversion project, this time in Church Hill.
“I’m working with developer Zac Frederick of Crescent Development and 510 Architects to convert the former car dealership at East Broad and 21st streets into condos, with new townhomes around it,” he said.