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Week of May 10, 2001 |
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| Everglades Building under renovation for affordable housing By Paola Iuspa A trend of transforming obsolete offices into residential housing in downtown Miami is adding affordable rental units to a market that previously offered few choices. After almost a decade of empty offices, the Everglades Building, 282 NE Second St. is being turned into affordable apartments, said Rafael Kapustin, owner and developer. In about two months, he said, 42 units will be ready for occupancy. Efficiencies and one-bedroom units will range from 700 to 900 square feet, Mr. Kapustin said, and would have a bay view. Rental rates, he said, should be between $350 and $450 a month. He said the Trust Group is managing the apartments. About 300 residents live in the business district, compared to almost 4,500 in East Brickell, 5,200 in West Brickell and 2,500 in Overtown, according to a report prepared by the Downtown Development Authority. The nonprofit group works in partnership with the City of Miami to promote development. The Everglades renovations are the result of a joint venture between Kapustin and Rok Enterprises Inc., headed by Sergio Rok. "The offices were vacant for the past eight years," Mr. Kapustin said of the three-story building. "Because we could not compete with modern buildings" for office tenants, he said, "we had to find another use for it." Many downtown observers have said it was Mr. Kapustin's partnership that gave birth less than a decade ago to an office-to-residential transformation in the business district. The area is sandwiched between Biscayne Bay on the east and the Miami Government Center to the west. Northwest Fifth Street bounds it to the north and the Miami River and the Brickell area, the city's financial district, are to the south. The venture's first Miami conversion was the 24-unit Cologne building, 231 NE Second Ave. That project was followed by the development of the 30-unit Metropol, 213 NE Second Ave. according to Downtown Development Authority documents. Other developers have joined the movement. The Related Group converted the Congress building, 111 NE Second Ave., into a 130-unit rental housing building. The City of Miami worked with a private developer to convert an office building into a combination 80-unit Olympia residential project in the Gusman theater complex at 25 SE Second Ave. Mr. Kapustin said downtown tenants are a combination of students, singles and some small families. Patti Allen, director of the Downtown Development Authority, said many of the historic buildings built in the 1920s and renovated between 1994-2000 lost their appeal when high-rise offices started towering over Brickell in the late 1960s. "The old ones started losing value," she said. "Other people came and bought them just to use the ground floor for retail stores. But the rest of the building remained empty. All of a sudden the land had more value than what was built on it." Mr. Kapustin, who estimated the Everglades recycling cost at about $45,000 per unit, said the city has been very supportive during the permitting process and had no problem granting his company the change of zoning, from commercial to residential. He said he was able to get some federal and state money to complete his projects, he said. Private financing for renovating downtown buildings doesn't exist, he said. "The only way you can do these projects and maintain the rent low is with help from the federal, state and local governments," Mr. Kapustin said. "How do you think South Beach and Lincoln Road got to be what they are today? Miami Beach spent almost $30 million to fix Lincoln Road." Beatriz Barberio, executive director of the Downtown Miami Community Development Corp., the Downtown Development Authority's subsidiary in charge of housing, said private financing is hard to get because downtown lacks other comparable projects developers and lenders could look at to compare costs. "Comparables would show them how much units sell or rent for and whether the price per unit will cover construction cost," she said. "Lenders and developers are a little bit apprehensive." But things could change soon, Ms. Barberio said, because "developers will start converting old buildings into market-rate housing soon," making it more attractive to investors. Josie Correa, executive director of the Downtown Miami Partnership, a nonprofit group pressing to improve the look of the business district to attract draw businesses, said this trend has brought and will continue to bring people downtown to live. Merchants in the area, Ms. Correa said, applaud the movement because more people living downtown means more business. Now the district gets deserted after 6 p.m. and businesses are forced to close, Ms. Correa said. Ms. Allen said what is affecting negatively downtown is that after working hours people leave the area - and with them goes their purchasing power. "They work here," she said, "but when it is time to go shopping, dining or for drinks, they spend their money somewhere else." Mr. Kapustin said the city needed to invest money in improving the district's infrastructure. "The city has to be the catalyst for things to happen. Then things will change," he said. Ms. Allen said the city, together with the county and the state, has allocated $15 million to re-do the sidewalks on Flagler Street, Northeast First Street and Southeast First Street. City officials plan to add more landscaping, repave the roads and install colonial lamps alongside the streets, she said. Ms. Correa said those improvements were scheduled to start at the end of the year. Details: Everglades, (305) 374-1515. |
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