CASE STUDY
Veltex Building
Boise, ID
The 60,000-square-foot Veltex Building in Boise, Idaho sits on the site of an old Veltex gas station, showing what can be done on an UST site. Located in the Old Boise Historic District, on the eastern edge of the central business district, this abandoned gas station was adjacent to beautiful historic brownstones and other historic buildings, but was itself a source of blight. Through the work of a private developer, the abandoned and contaminated land became a mixed-use building with urban living, office, and retail space.
Process
When the developers purchased the site, any contamination had already been remediated and underground tanks had been removed by the previous owner. After the clean-up, an environmental survey indicated that the site was clean and ready for redevelopment.
The city was supportive of redevelopment from the beginning. After multiple designs and iterations, developers and architects settled on the design of a mixed-use building that would provide housing near downtown, as well as office and retail space. Rather than using the site for a large building that would build-out the entire site, the corner was designed as a plaza/community gathering area, similar to a space that exists in front of a historic building across the street.
Because of its location in the Old Boise Historic District, the site was the subject of concern from local preservationists, who argued against the demolition of the Veltex Gas Station, particularly because its vintage neon sign was a local landmark. The sign was preserved to become a focal point of the new building’s public plaza. Developers and architects worked to integrate the new building into the historic fabric of the community in other ways as well, including their choice of building materials and the design style.
The historic district zoning imposed some physical requirements on design and construction, such as a height limitations, building materials, and color schemes, challenging the developer to carefully balance economic and programmatic considerations.
The total project cost $7 million and was completed in 2004. Ultimately, the Veltex building showed that a new building could be integrated into the historic fabric of a community and support nearby commercial uses in both the historic district and the central business district two blocks away. The building was entirely occupied within a year of its completion.
The Veltex Building was designed and constructed as a condominium project, whereby all of the retail, office and residential space was built and subdivided so that individual units could be purchased by users, residents and investors. The commercial areas were divided into relatively small spaces, so that they could be combined or reconfigured to meet owners changing needs over time.
Leaders and Partners
Clark Development, a local Boise developer, was the managing partner for Veltex Building LLC. Clark worked with Erstad Architects of Boise to complete design of the project. The Historic Preservation Commission was also involved in the process and helped ensure that the development fit into the surroundings.
Financing
Veltex Building LLC was formed to purchase the gas station site and undertake an appropriate redevelopment project of it. The managing partner of the LLC was BED Investments LLC, of which Bill Clark was the majority partner. The site was purchased entirely with cash. The purchase price per square foot was the highest that had been paid at that time for commercial land in downtown Boise and was reflective of the desirability and visibility of the corner site.
The partners also invested funds for preliminary design and related entitlement work. Based on the preliminary design and its approval by the City of Boise, the owners were able to obtain purchase commitments for several residential condominiums and one entire office floor of the building. Those buyers agreed to substantial deposits that would become non-refundable at the time construction commenced.
Those deposits (and the commitments for the space that they entailed), in combination with the land value and a deferral of development fees were used as equity to obtain a $5.2 M construction loan from a regional bank. Through closings on those and additional sales, the construction loan was paid off shortly after completion of the building. After loan payoff, there was a payback of all equity invested, payment for deferred development fees, and a significant return on invested funds to the partners involved in the development.
Successes
The Veltex building has contributed to a more livable and intimate neighborhood and has spurred urban living in other parts of the city. Proposals for new development frequently compare the intended projects’ scope, design, and intent to those of the Veltex. The building was highly anticipated and almost all the residential units and office space were purchased before it was completed. The City of Boise is very pleased with the project, and the building has won numerous awards for both urban design and historic sensitivity in construction, including the annual Orchid Award by the Idaho State Historic Preservation Council in 2004 and the 2006 Grow Smart Award for mixed use development by Idaho Smart Growth
Contact
Bill Clark
(208) 342-2625
Keywords:
Idaho, UST, neighborhood revitalization
Aerial view of the Veltex Building and surrounding neighborhood.
Reclaiming Communities through Vacant Property Revitalization
Last Updated 05/26/10Copyright 2009