Commercial Architecture March 2018 - 13

historic buildings

FEATURE

"There's certain PSI we have to hit. We can't raise the grain; we

ble terraces on upper-floor spaces. All of a sudden, many units had

can't fuzz out the wood. If we raise the grain too much, the preser-

sweeping outdoor views of the New York City skyline, which added

vation office can come in and say, 'Well, no, you damaged that

tremendous value for the developer," said CetraRuddy's John Cetra.

wood too much. You're not going to get these tax credits.' So we're

Tax credits are an important factor in working with historic

always walking that fine line between what we need to do, compared

buildings. "Financial incentives and tax programs are crucial.

to what needs to be done for the preservation tax credits," he said.

While changes to historic tax credits (HTCs) may impact some
investment decisions, these programs are so important in many

INCENTIVES AND REWARDS

markets that we think they'll continue to play a significant role,"

Given the added complexity and difficulties, there are nevertheless

Cetra said.

substantial benefits and rewards in dealing with historic properties.

"Federal historic tax credits (HTC) have had a significant im-

"More and more, the development community is recognizing

pact on incentivizing reuse and preservation of historic sites.

how much hidden value can be unlocked in historic properties.

Tax-credit rehabilitation projects boost local economies and bring

From a developer's perspective, former commercial or industrial

communities together. Under the recently passed tax overhaul, a

buildings often have the bones for great residential conversions.

major tax-incentive program remains, and continues to provide

Maintaining those buildings' historical character-through strict

20% income tax credits for buildings eligible to be listed in the

preservation or renovation with contextual and sensitive additions-

National Register of Historic Places, and rehabilitated in compli-

can increase market appeal by preserving and utilizing desirable

ance with the Secretary of the Interior's Standards. Sadly, the 10%

features and finishes. Plus, working with an existing structure allows

HTC for buildings considered non-historic (but constructed prior

the freedom to leverage elements one might not be able to include

to 1936) is gone. Also, the remaining 20% HTC has been made

in a new building in the same location. In the residential conversion

more challenging to qualify for: there is less room for flexibility

of a historic former telephone-exchange building in New York City,

and negotiation, and the process is more complicated," said Lada

Walker Tower, we used the original setbacks to create large, accessi-

Kocherovsky of Page & Turnbull.

Originally constructed in the 1840s,
Counting House Lofts 71 is the adaptive
reuse of a historic industrial warehouse
in Lowell, MA. The 170+-year-old building
suffered considerable subsurface deterioration, requiring the removal of large portions of the structure to reconstruct and
stabilize the foundation. Photo: © Andy
Ryan, courtesy The Architectural Team

continued on p. 14
commercialarchitecturemagazine.com

MARCH 2018

COMMERCI A L A RCHI T EC T URE

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