Upper Floor Feasibility Study

300 Adams Street, Springfield IL

Project Summary

This project is a combination of two different buildings that have been combined into a single parcel. The first floor of 4 OSC is a separate commercial condominium. The property was converted to office use in the 1980s including all new systems, finishes. A elevator and fire suppression system were also installed at that time. The building was vacant for several years and suffered from serious structural damage to the rear portion of 3 OSC which has been stabilized with new second floor structure.

The proposed project will create nine new residential units including one on the rear of the first floor. The commercial storefront will be maintained as the residential lobby to provide access to the elevator and front means of egress. A new egress stairs will be needed at the rear of 4 OSC. The 1980s renovation removed virtually any contributing historic features. The front windows in both buildings were changed in the previous renovations. The building has a very narrow and deep floor plate, so the residential units are designed with lower interior walls to allow ”borrowed light and air” into the interior rooms. The building will maintain the full fire suppression system. There in an interior light well that also provides some additional natural light and air into the units.

Real Estate Development Pro Forma

3 & 4 Old Capitol Plaza Assumptions

Rental rates of $1.25 per square foot

Property management by management firm at 5% of gross revenue Operating expenses at 39%

Sources and Uses

Owner capital of 10%.

First position financing at 3.5% interest with a 25-year amortization.

Hard construction costs $95 p.s.f. based on pricing from contractor/owner.

Soft costs $20 p.s.f. due to contractor forgoing usual overhead fees and simple transaction costs but added cost to form LLC to make use of Federal tax credits.

Gap financing in the form of a CDFI loan with interest only payments for seven years at 1.5% interest allows for shorter term first mortgage (15 years) to pay down debt faster.

Refinancing in year eight to pay-oﬀ original first position loan and CDFI loan . Federal historic tax credit enables lower owner equity less debt.

Gap financing in the form of Federal Tax Credits purchased by CDFI at closing valued at 12% of total capitalized costs net present value.

see other feasibility studies