Nearly a century after it was built, the Wilson Building’s potential has piqued the interest of a Cedar Rapids investment group enough to spend $7.45 million on the six-story structure.
Frantz-Hobart, an investment group headed by three Iowa men, is working with the city of Clinton to bring high-end, market-rate housing and more commercial development to downtown Clinton by creating 30 apartments and retail space in the Fifth Avenue South centerpiece.
“This is what we do, historic renovations of downtown buildings,” Jim Hobart said. “We go into communities like Clinton where the downtown urban areas are aging and not being utilized. What we do is come in and utilize historic tax credits, both state and federal, plus any other incentives that are available to complete top-end renovations.”
The company does not use tax credits or incentives that would restrict the income of the tenants of the building. Since 2010, they have completed several other market-rate historic housing renovations throughout Iowa and Illinois including towns like Dubuque, Fort Madison and Monmouth, Ill.
Hobart and partner Mike Frantz on Tuesday presented some of their plans to the Clinton City Council in a room that was overflowing with people in favor of the renovation.
Frantz-Hobart plans to create up to 30 one and two bedroom apartments in the upper floors and lease the first floor as commercial space. A one bedroom will be between 700 and 900 square feet and will cost $800 a month. Those looking for a two bedroom will pay around $1,000 a month for 900 to 1,200 square feet. Inside the apartments, tenants will find hardwood floors, granite counter tops, a marble show shower, a fridge with an ice-maker, a washer and dryer and many other amenities. They also plan to provide an outdoor deck on the third floor for all tenants to enjoy. Accessing the residential units will only be possible using a security code.
Hobart said the other buildings his company has renovated are 98 percent full. The Wilson Building apartments, he said, would be no different.
“If it doesn’t cash flow, I wouldn’t be standing in front of you right now,” Hobart said. “We investigate our properties to the fullest to make sure they’re going to work. We investigate the cities to make sure there’s a demand.”
Downtown business owners, Erin George and Emily Steenhard of the Painted Rooster, as well as Pat Lonergan, who owns the former Patrick Steakhouse and Brewery building on Sixth Avenue South, urged the council to work with Frantz-Hobart on the renovation, which they said would fill a void in the Clinton housing market.
“I think this could be the tipping point to making downtown what it once was. Young, urban professionals need to have a place that is nice,” Steenhard said.
If the project were to progress, it likely wouldn’t be the last Clinton residents would hear of Frantz-Hobart.
“When we come into a town, we typically don’t stop with one building. We try to get a large enough footprint to open an office,” Hobart said. “I think your downtown is right on top of the teetering edge. You just need a couple buildings to get things started to get people living downtown and once you get people living downtown, that will bring in the commercial.”
The project received a 7-0 vote in support from the City Council. The next step will be to hash out a development deal with city leaders. While Frantz and Hobart are savvy of state and federal historic tax credits, they have also received local funding for their prior projects.
In Monmouth, they received between $250,000 and $300,000 from a combination of city TIF funds and a private donation to renovate six buildings spanning nearly a block in downtown. The two-story buildings will be converted into eight apartment units on the second floors with retail space on the first.
“We wanted to work with a business like theirs because of their history doing this type of adaptive projects like this and their knowledge of federal and state tax credits,” Monmouth Community Development Director Paul Schuytema said. “You have to step up in some way to help the developer out.”
Among the nearly block-long section Franz-Hobart is renovating is downtown Monmouth’s most prominent building.
“The building was literally falling apart,” Schuytema said. “Now you can see the downtown becoming what it once was. These guys coming in with the knowledge and focus on putting residential in downtown has really helped with our revitalization project. They realize they’ve got to be good citizens and partners in the community they’re in.”
They’ve also allowed their books to be open to skirt any mystery behind the project.
“It’s almost impossible not to see the upside,” Schuytema said.
In the downtown Dubuque TIF district they rent 21 loft-style units in the historic Cooper Wagon Apartments. They rent the first floor of the building to Italian restaurant, Crust. All apartments are full. Frantz-Hobart was eligible to receive $245,000 in grants from the city of Dubuque to renovate the building, according to Economic Development Director David Heiar. They also own another apartment building and are scouting more renovation ready locations.
“They are as fine a developer as you will find,” Greater Dubuque Development Corporation President and CEO Rick Dickinson said. “The city ought to beat a path to their door. They’re professional and Clinton is lucky to have them.”
Hobart said if all goes according to plan, construction would begin around May. An aggressive renovation schedule would allow the first tenants to move in at the end of the year.
“If they say they can do it in seven months, they’ll do it in six,” Dickinson said.
Because they use historic credits, Frantz-Hobart is required to adhere to a set of standards. Beyond the legal requirements, they have personal standards in place to make sure the buildings retain their glory.
“We want to leave anything of historical significance. We’re proud of our buildings,” Hobart said.
Ideally, they would be able to see old photographs of the building in its prime and be able to emulate the same kind of atmosphere. They would also like to display the old photographs in the hallways so tenants are reminded of the building’s roots as they head to their unit.
Hobart said they hope to have a plan established with the city in the next few weeks and close on the building by March 15. While city leaders remain tight-lipped on what kind of development deal could emerge, they are publicly intrigued.
“The downtown has needed something to kickstart development. We need to bring people into downtown who have spendable money,” Mayor Mark Vulich said. “It should become a showplace in downtown. The city is very willing to work with them.”