Difficulty finding Loss Coverage provider for Old Commercial Bldg

[Rich Gabrio]

I recently acquired a small commercial building that was built in 1889. This bldg has essentially been in operation most of its 125 years.  I am not a developer, and therefore have no plans to refurbish this building, but rather hold for the time being and appreciate while I collect the rent.   Due to it's location and simplicity, It is a prime candidate for future development.  There are some minor improvements that I do plan to make, but nothing dramatic. The building is a fairly simple structure in the heart of a thriving historic tourism district north of Seattle, and is currently and was at the time of purchase, 100% occupied.  Every building on the street is 70 plus years old.  Most are also larger than my building is and those that have not been refurbished are in similar condition and most likely still the proud owners of active knob and tube.  Since acquiring the building, I have had all active knob and tube completely disconnected.  I have been working with my Insurance broker for a number of years now, and they are telling me that they are running into difficulty finding a provider that will provide coverage for anything other then liability for this bldg.   This afternoon, he has indicated that he has found one company that would be willing to provide loss coverage on an "ACV basis only", (in short, my understanding is that ACV is Actual Cash Value = Replacement Cost - Depreciation). Due to the age of my building, I am sure you can understand my concern here.   Additionally, they will provide up to an amount that is only 44% of what I have invested into the property (I purchased the property below market), and there would be no coverage for lease loss in the event of a loss. I really only want peace of mind in the event there is a fire, and I can recover my loss.  I find it hard to believe that is this difficult to find loss coverage for a bldg of this type given the # of buildings in similar condition that are still in operation in this country. Any guidance or suggestions are greatly appreciated!