Hartford Business Journal

8 Hartford Business Journal • February 24, 2020 • www.HartfordBusiness.com By Joe Cooper jcooper@hartfordbusiness.com M ore than 400 new apart- ment units are slated to debut in Hartford this year, continuing a recent wave of vacant offices being converted into downtown living spaces. The new rental units are being added to a downtown apartment mar- ket where occupancy rates and rents have largely been steady in recent years, despite hundreds of new units coming online, according to Michael Freimuth, executive director of the Capital Region Development Author- ity (CRDA), a quasi-public agency charged with revitalizing the city. Occupancy rates at CRDA-backed apartment projects downtown, which include about 1,500 or so units, are currently just north of 90%, and monthly rents range from approxi- mately $900 for studios, $1,475 for one-bedroom, and $2,000 for two- bedroom units, Freimuth said. "There has been and probably will continue to be some flattening of the market rents as new units enter the supply, but this market adjustment is normal and we would expect oc- cupancy to stay in the mid-'90s while rents per- square-foot do remain stable," he said. "Unit sizes are smaller and amenities are increasing, distorting any real comparison between build- ings." The first new 2020 apartments are expected to debut March 1, at a former 11-story office building at 101 Pearl St. The $28.4-million project includes 157 units and abuts the 111 Pearl St. apartments that debuted last year. 101 Pearl was also expected to open in 2019, but it experienced construc- tion delays. In total, the Spectra Pearl apart- ments comprise 258 studio, one- and two-bedroom units and are part of a total $50-million investment led by New York developers Girona Ventures and Wonder Works De- velopment and Construction Corp. A redevelop- ment of the former Colt gunmaking facility adjacent to Interstate 91 on Huyshope Avenue is also nearing comple- tion, and will likely be the second apartment building to debut this year. The so-called North Armory at Colt Gateway complex is expected to open in early April with 48 studio, one- and two-bedroom units. The $14-million apartment conversion is the final piece of a $120-million redevelopment of the historic manufacturing facility. By year-end, would-be Hartford renters will have hundreds more apartment options at 28 High St., 100 Trumbull, 246-250 Lawrence St., Allyn Street and at the long-awaited conver- sion of the top floors of downtown's Red Lion Hotel, according to Freimuth. In total, the seven redevelopment projects in 2020 are being support- ed by roughly $29 million in supple- mental financing from CRDA. Mayor Luke Bronin, a CRDA board member, said private investors are seeing redevelopment opportunities due to recent momentum in the city. But he added that housing conver- sions downtown still need a public subsidy to be profitable ventures. Bronin said CRDA funding, provided by the state Bond Com- mission, has helped to bridge that financing gap in recent years. "I think there were a lot of people who thought that if you put too many apartments on the market that the demand won't be there and that hasn't been the case," he said. "The constraint right now is supply not demand." In 2019, CRDA partially financed the launch of more than 200 apart- ment units in the Capital City's central business district. That includes 101 units at 111 Pearl St., which were 80% leased as of early January, CRDA records show. Another $23-million apartment complex at 81 Arch St. was completed last summer, add- ing a mix of 53 studio, one- and two-bedroom apartments downtown in the final phase of the mixed-use Front Street District. The building is 76% occupied. The last downtown building to welcome new tenants in 2019 was at a long-vacant office building on Asylum Street that reopened in October with 60 studio, one- and two-bedroom apart- ments. The $20-million Teachers Village apartments are nearly fully leased. Freimuth said leasing activity has been carried by Millennials, who prefer smaller studio spaces, and empty nest- ers looking to downsize their living spaces in larger, amenity-laden units. "Those two subsets are up and outpacing the region," he said. "They are really filling the buildings." Deal Roundup A pair of new tenants have leased more than 51,200 square feet of industrial space in Wallingford, brokers say. Consolidated Electrical Distribu- tors, a supplier of electrical and solar products, has leased a 20,000-square- foot piece of the building at 34 Barnes FOCUS: COMMERCIAL DEVELOPMENT THE REAL DEAL 400-plus Hartford apartments coming online in 2020 Construction is nearly complete on a $28.4-million apartment conversion at 101 Pearl St. in downtown Hartford. Tenants are expected to begin moving in March 1. Roughly 100 apartments debuted last year at 111 Pearl St. HBJ PHOTO | JOE COOPER PHOTOS | CONTRIBUTED PHOTOS | CONTRIBUTED

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