A NEW LEASE ON URBAN LIFE
Project on Pearl Street is part of wave of downtown Hartford apartments
HARTFORD – The mid-century modern office building at the prominent corner of Trumbull and Pearl streets in downtown Hartford has been vacant and dark for more than a decade.
The lights are about to get switched on.
The first tenants are expected to begin moving into the first half of the Spectra Pearl apartment conversion, 101 rentals at 111 Pearl St., in the next two weeks, but most likely sooner as final inspections are winding down. Forty-one units are already leased, and some inaugural tenants have moved in furniture.
The conversion is part of a larger, $50 million project that will later join 111 Pearl to the neighboring, 12-story, 95-101 Pearl to create a total of 258 market-rate apartments.
The apartments are the latest in a
six-year push to add housing downtown to boost vibrancy in a city that has struggled to build foot traffic in the evenings and on weekends. Strong cities also are being increasingly linked to economic expansion and job growth. Studies show the millennial workforce prefers to live and work in urban environments.
Since 2013, the Capital Region Development Authority has helped finance the creation of 1,638 housing units, through tens of millions of dollars in state taxpayer-backed loans and equity investments. Of those, 1,099 are either occupied or available for lease, including 111 Pearl St.
Another 450 are under construction — including 157 at 95-101 Pearl — and 159 are in the works, according to CRDA.
This summer, about 450 units are expected to become available for lease — the largest new wave of rentals since early 2015 when 564 were added — and CRDA says it is closely gauging the pace of leasing.
In 2015, 64 units were leased a month, well exceeding expectations. CRDA says it is watching how the latest wave plays out in downtown. The wave includes 53 apartments along Arch Street, the final phase of Front Street, also in pre-leasing.
“We’re watching it across the downtown market for the new buildings as well as impact on existing rentals,” Michael W. Freimuth, CRDA’s executive director, said.
So far, demand has held up. New apartment projects downtown — the largest being the 777 Main tower — average 95 percent occupancy, with most in the 90s.
Teachers Village Hartford, with 60 rentals at 370 Asylum Ave., is at 50 percent occupancy. The apartments opened May 1.
The developers of the Spectra Pearl project — Girona Ventures and Wonder Works Development and Construction Corp., both of New York — remain as bullish, if not more so, as they were when they first ventured into Hartford in 2011.
The partners’ first project was the conversion of the dilapidated former Sonesta Hotel on Constitution Plaza into 190 apartments in a $24 million project. Like 111 and 95-101 Pearl, it had sat for years, deteriorating. The resulting Spectra Plaza is 96 percent leased, according to recent statistics from CRDA.
“We’ve had this conversation a million times,” Jeffrey D. Ravetz, president of Girona Ventures, said, during a tour of 111 Pearl last week. “I don’t think we have a demand problem. We have have a supply problem. When demand finds out about supply, they come.”
Ravetz points to the 41 leases — “and we’re not even open yet” — secured without most tenants even visiting the units and with no concessions on rent. He notes that 35 of the leases are from tenants relocating from outside the city.
The rents range from $1,009 for a studio to $2,429 for a two-bedroom unit. The size of the living space spans 340 square feet for the smallest studio to 1,050 square feet for the largest twobedroom. Three quarters of the units are studios.
Rents in CRDA-financed projects ran between $1.75 and $1.90 a square foot in 2013. Six years later, those rents are now between $2.45 and
$2.50 a square foot. (Freimuth notes rents would have to reach $3.25 a square foot before public subsidy wouldn’t be required in conversions and $4 a square foot for new construction.)
Last week’s announcement that Farmingtonbased United Technologies Corp will relocate its corporate headquarters to Waltham, Mass., after it merges with Raytheon Co. isn’t a worry for the developers.
“It’s hard to have a reaction to these announcements,” Ravetz said. “If it’s only the executives that are moving, how is that going to affect downtown? None of those people are living downtown.”
Downtown apartment owners do depend on UTC for “short-term” leases for workers who are on time-limited projects. But UTC has said it intends to maintain a hefty presence in the Hartford area with both Pratt & Whitney and Otis elevator.
Ravetz and his partner, Joseph Klaynberg, of Wonder Works, hope to distinguish themselves from competitors in a multiple of ways.
Since 111 Pearl was considered historic, the developers were required to preserve hundreds of windows. Those windows flood units with light and provide views to Trumbull Street, the XL Center and beyond, a selling point, Ravetz said.
Klaynberg said the finishes — engineered wood floors, Caesarstone and imported European cabinetry — are the same as installed in a New York condo project completed by Girona and Wonder Works.
“We’ve done very well with them,” Klaynberg said.
Ravetz adds: “When he says these are condo quality in New York, that means people are paying $2,500 a foot to own their apartments. Here they are paying $30 a foot a year to rent the units. That’s a big deal.”
Young professionals are a key market for the apartments, as well as some empty-nesters.
Ravetz and Klaynberg also envision a broader community for tenants in all Spectra properties downtown, sharing amenities such as the basketball court at Spectra Plaza, and the rooftop deck at Spectra Pearl, atop 95-101, gaining access via a fob.
“We’re designing an app that allows you to reserve the amenity spaces, and that includes the rooftop here,” Ravetz said.
Amenities have emerged as a key competitive flashpoint not only in Hartford but nationwide.
Girona and Wonder Works are also renovating the former Trumbull on the Park nearby that they purchased a year ago. The apartment building has been rechristened Spectra Park because of its nearness to Bushnell Park.
The rentals in 95-101 Pearl are expected to be completed in September, later than first expected. Construction has proved more challenging, particularly since the whole exterior is being replaced, creating floor to ceiling windows.
On Pearl Street, taxpayers have a big stake in the outcome. Together, 111 and 95-101 Pearl have $15.5 million in CRDA loans, $4 million in state brownfield loans and $3 million in historic credits.
Spectra Pearl has yet to see leasing of retail space, including what was once the fabled Sean Patrick’s in the basement of 111 Pearl but with windows at sidewalk level. Prime options are a restaurant, bar, brewery or roastery.
“We want to make sure whatever we sign up adds life in the building, to the area,” Ravetz said.