Roughly half a year ago, we noticed a City violation poster on an old warehouse at 1139 N. 3rd St., which gave us pause because at first we thought it was a zoning notice. Upon closer examination though, we realized that the poster on the building was not an indication of upcoming development, but instead a public service announcement about violations on the property, a vehicle for shaming the owners of the property into making necessary repairs. At the time, we wondered whether these violations might be a precursor for the owners of the property to list their building for sale rather than make the necessary structural repairs, considering the dwindling industrial presence in the neighborhood. And indeed, when we passed by the property the other day, we spied a ‘For Sale’ sign out front.
The building went on the market a few months ago, at a price of $1.4M. Recognizing the impracticality of someone paying market rate for this 3,400 sqft property, the listing appropriately ends with the rhetorical question “tear down and build?” What constitutes market rate for this property is still a matter for debate though, as it’s been available for a little while and nobody has stepped forward at the current asking price. Perhaps a slight price cut would goose interest in the property, though it’s also possible that the calendar flipping to 2019 will have a positive impact on things. When someone finally does come forward to buy this place at whatever price, figure they’ll propose an apartment building, somewhat similar to the upcoming project next door.
Remember, 1143 N. 3rd St. was also an old warehouse, and that building got torn down some time last year. In its place, developers are now working on a 26-unit building with a couple of artist live-work spaces and a half dozen parking spots. This parcel covers roughly 2,000 sqft more than its neighbor to the south, so it can accommodate additional density that wouldn’t be possible next door. When you consider that developers paid $950K for this 5,400 sqft property in 2015, and the neighbors are looking for $1.4M for 3,400 sqft in 2018, it just shows how hot the market has been in the last three years. Again, we don’t expect that $1.4M will be the final price for 1139 N. 3rd St., but we do believe it’ll trade at seven figures. As for whether the rent roll will justify that purchase price, it’ll be up to whoever ultimately buys the property to figure that one out.