Rental Property Investor · San Antonio, TX · Member since 2016 · 87 posts · 31 votes
Hello BP family,
My team and I are constantly looking at potential small multifamily deals and every now and then something pop ups in the Historic Districts, with the buildings being 1940s and older.
Any suggestions on what to look for when inspecting apartment properties like these other than the typical aluminum wire, cast iron pipes, etc? Anything in particular about what the Historic and Design Review Commission (HDRC) might look for, specifically in San Antonio TX?
Specialist · Washington, DC · Member since 2019 · 177 posts · 150 votes
7y
@Mauricio Ramos
Aside from the obvious wear and tear of older buildings, you said it. Historic Review Boards can be the devil incarnate. Depending on how stringent they are it could definately increase your CAPEX for the property. Aside from that any exterior improvements you do must be approved. Like HOAs they typically have preapproved companies and products that you must use...and they arent the cheapest either.
I can tell you from experience in dealing with the HRB in Georgetown DC, it was an absolute nightmare.
Most of the properties that exist there are horrendously outdated due to the headache and the amount of money required for up-keep. For example: an investor that I was working with wanted to polish up the exterior of one of his properties by redoing the exterior architecture and replacing 12 windows. For any other building elsewhere it would have cost him roughly $15k-$20k to do so. However, considering the HRB had a preapproved list of contractors and products, the windows alone were over $24k due to the architectural requirements. To redo the rest was close to $52k because he wasnt allowed to replace anything, only restore.
Your HRB may not be as nightmarish but just be sure you do your homework.
Flipper/Rehabber · San Antonio, TX · Member since 2016 · 17 posts · 9 votes
7y
We work primarily in the historic districts, with single family homes, so are very familiar with HDRC. Their main focus is to make sure the exterior remains historically accurate. Things like siding and roof, windows and doors, porches and fence. Each historical neighborhood has it's own set of guidelines as to exterior paint colors and landscaping, but those can easily be navigated with proper paperwork to receive an approval letter.
Other things to look for are foundation, water damage to sub floor in kitchen and bath areas, lack of insulation, etc. You're right on plumbing and electrical and that is typically two of the biggest areas of concern. We work with investors on flips, so the level of rehab detail is more than what you would need for buy and hold.
My wife and I are investors, but also work with the investing community on historical design projects. Feel free to message me if you want to discuss further.