That was the case with the Metropolitan Center project on the 100 block of Michigan Avenue in downtown Kalamazoo, a project that is in the final stages of construction.
The roughly $12 million project was strung together in an intricate web of 14 financing levels to the keep the historic undertaking in the black for developer Mavcon Inc.
All of the 28 new residential units are leased and one major tenant has signed a lease for roughly one third of the first floor storefront retail. Two storefront properties remain, although behind the scenes, sources said they have negotiated with several interested parties, some restaurants and some local retailers.
Because the cost of rehabbing the buildings is well over what the rents charged for the commercial and residential space would cover, Mavcon had to work closely with federal, state and local entities to shore up the capital cost with tax credits, grants and loans. The company weaved together a combination of enhanced historic preservation tax credits, redevelopment grants and tax increment financing.
Joe Agostinelli, VP of governmental affairs and economic development for the Mavcon Business Advisory Group, said putting together the package was a constant balancing act as there are number of strings attached with each piece.
"It would have been much less expensive to just tear the buildings down," Agostinelli said. "But there was a desire in the community to save them. These buildings are some of the last remaining historical fabric in the downtown."
While the financing was one aspect, the actual construction was a whole different beast, said James Dally, president of Mavcon Inc. Building One was close to falling down and 147 years worth of remodels and deterioration had to be torn out, sorted and replaced to maintain historical accuracy, he said.
"This was not a remodel project. This was a historical preservation project where every discipline had to be in strict compliance with the Secretary of Interior guidelines," Dally said. "What's different about this is you can't just go in and gut the building and rebuild it the way you want to."
Dally said the company poured over hundreds of historical photos and worked closely with the Kalamzoo Valley Community College Museum, Western Michigan University Archives, the Kalamazoo Public Library and private collectors to identify important architectural features — many of which had to be custom fabricated.
Dally said he found himself driving to Lowell and other cities, asking building owners if he could "borrow" their buildings' small ornamental features so they could be casted and replicated for the Metropolitan Center buildings.
"You can't (begin to) explain the complexity," Dally said.
The four buildings in the 100 block of Michigan Avenue date to the 1860s and had largely sat vacant for the last four decades. Just one tenant, a Subway franchise, remains in the first-floor retail space, while the upper floors of the building were in rough shape.
The project has also been a lengthy undertaking. Dally has been working for more than three years to pull financing together.
"It's not a project for the faint of heart," Dally told MiBiz a year ago.
Dally said instead of hiring different subcontractor companies to come in and do the masonry and carpentry, Mavcon hired unemployed tradesman directly so it could control man-hours. Had the company hired firms, Dally said the project would have eaten their lunch. He said at times the process took a lot of coordination and cheerleading.
Not only did Mavcon restore the buildings to their former glory, but the buildings were also given a number of energy efficiencies and consultants for Mavcon said they could expect to achieve LEED platinum status in a number of categories too.
The project wasn't without its highlights either. Over the course of the project several historical artifacts were found, including everything from old medical cocaine bottles to period coins. When crews began peeling back the decking on the second floor of building four, they found the cracks packed full of tobacco — remnants from former a former cigar factory that once was.