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Vintage Value
by Nancy Isles Nation
When updating one of the city’s older homes or apartment buildings, a landlord may face a dilemma when it comes to preserving period details like bold-statement tiles or quirky fixtures. These can be the features that give a building—inside and out—its unique identity. But they may also be costly and time consuming to restore.
Historic architecture is part of what has lured generation after generation to seek out residence in San Francisco’s Victorians, Queen Annes and Edwardians, as well as its modern flats and apartments. Homeowners and renters are charmed by the flourishes of nineteenth-century architecture, as well as the rustic qualities of Craftsman cottages and the drama of Art Deco high rises.
Throughout its history, San Francisco has embraced its architectural heritage. The city encourages the preservation of period detail and, in some cases, requires it. Building owners, too, value the character of the city’s real estate. They need to take cost into the equation when repairing or renovating a property, but should not lose sight of the overall value of preservation.
“It’s a richer environment when you have buildings from different eras and you have to be careful of what you dispose of,” reports Alan Martinez, of the San Francisco Preservation Commission, noting that the city’s architecture contributes to the local economy because it is a tourist attraction. “But it’s also something people who live here enjoy. It is of great economic value to the city.”
Bill Meyer, of William Meyer Properties Inc. in San Francisco, has an eye for spotting period details worth preserving. The architect and manager of a $25-million property portfolio, Meyer and his clients specialize in apartment buildings dating from 1900 to 1930. Their objective is generally to respect historically significant features and to preserve the past whenever possible.
When renovating a Noe Valley apartment recently, Meyer discovered a brick chimney flue behind paneling in one of the unit’s small kitchens. He had the paneling removed to expose the brick, creating a sense of openness along with a feeling of warmth. There was little cost associated with the removal of the wall and Meyer does not think the alteration added a specific value to the apartment, but it is attractive—something renters appreciate. “It improves the general ambiance of the place because it is richer in texture and color,” Meyer said of the turn-of-the-century structure.
Many older buildings were remodeled during the 1960s and 1970s, when it was common to cover up hardwood floors with carpets, apply paneling over high ceilings and remove elaborate molding. Meyer tends to take out these “modern” additions to return the unit to its original character. Generally, such improvements add to the rental value of a building and can recapture any investment rather quickly, he says. Refinishing a hardwood floor in a small apartment, for example, may cost $1,200 but can add $100 to the value of the monthly rent.
Also, while older buildings may cost more in repair and maintenance, Meyer says they are built with sturdy materials like redwood and fir, and lenders are willing to make loans on them.
Meyer tries to keep any improvements visually compatible with the rest of
the building. He keeps old light fixtures in place as long as they are functional and safe. The same goes for vintage ranges, unless a tenant insists on a new one. Entryways that have survived over the years may need some upkeep, especially if they include such features as marble slabs in exterior foyers. “Usually they are in bad shape and stained and it’s very hard to get them looking good,” Meyer says, noting that there are environmentally friendly methods to remove stains. “The easiest thing to do is paint it, but if you restore the building it looks a lot nicer.”
Meyer also prefers to keep old tile unless it is cracked or unattractive. He chooses wood window frames over vinyl because wood helps to maintain the profile of the building and has the same insulating value as vinyl.
But not all owners have Meyer’s commitment to preservation. Steve Saarman, of Saarman Construction Ltd. in San Francisco, says building owners often take the easy way out when renovating. Despite the current appreciation for items like hardwood floors, they might be tempted to cover worn flooring with carpet rather than spending the money on refinishing. Or, they may choose to replace eight-foot doors on a Victorian with smaller, less costly doors that are more likely to throw off proportional elements of the building.
“From a maintenance perspective it is easier, but it ruins the fabric of the building,” Saarman says. “I do a lot of multifamily rental property and condos throughout the Bay Area. With the older buildings, I like to maintain as much of the history as I can, rather than replacing things.”
He recommends searching architectural salvage businesses that specialize in such things as doors, cabinets, fixtures, lighting, tiles, fabric and ironwork. Ohmega Salvage in Berkeley, for instance, has a vast inventory, much of which can be viewed on its website: ohmegasalvage.com. Saarman advises against integrating modern big-box store fixtures into older buildings. Replacing a clawfoot tub with a built-in tub usually doesn’t work aesthetically, he says, but a lot of people do it because they want a quick return on their investment and easy maintenance.
But owners who go for the quick fix may be losing out in the long run.
Tony Brettkelly, a broker with the Latitude 38 Group of TRI Commercial Real Estate, says renters love historic buildings and classic features such as hardwood floors, high ceilings and steam heat. The market is still primarily location driven, but the thing that renters look for next is the appeal of the property and its amenities, including character, he says, adding, “That’s why people live in San Francisco.”
With the average rent at nearly $2,000 a month in the city, most renters must have an income of at least $72,000 a year to qualify. People at that level can be picky, especially in the current down market. In addition, San Francisco has had a glut of rental properties on the market recently, with the addition of more than 50 buildings that were seized by lenders from the city’s biggest landlord, The Lembi Group.
Brettkelly and his colleagues have spent the last six months preparing upscale Lembi condominium projects, to be sold in bulk and probably reverted to rentals. “Sales have picked up as a result of these properties coming to market,” Brettkelly says. “They are going to be discounted.”
Laura Shields, of MAI Appraising, says the key factors in assessing an apartment building are such things as location, views, parking, size of unit and number of bedrooms. Architectural characteristics are less concrete. “In my experience as an appraiser of multifamily buildings, I have found that, in general, buildings have a greater appeal and may have a higher value if their period detail is preserved,” Shields relays. “However, due to rent control, sometimes the value enhancement may be limited because it is not directly reflected in the income of the property.
Additionally, in some instances, potential rent increases are limited to the
degree that some owners have found that it is not feasible to maintain the
period detail.”
But for owners willing to put in the time and resources, there are a number of specialty businesses in the Bay Area that provide specific services for older homes. For instance, Claire Gray, of Miracle Method of San Francisco, says her company helps landlords preserve many household features by using a proprietary bonding agent to refinish worn fixtures, including tubs, sinks and tiles.
“The objective is to preserve rather than replace,” Gray said, adding that her company will come to a building to assess the condition of fixtures and finishes and let the client know what can be preserved. Bathtubs, whether fiberglass, porcelain over cast iron or fiberglass over metal, are almost always refinishable.
Miracle Method can also refinish floor and wall tile and grout. A typical restoration begins by cleaning with industrial soaps, then repairing visible damage, including nicks and chips, and restoring the surface. “We’re pretty much able to recommend refinishing with just about every estimate,” Gray said. “We let them know what we can do for them and what the price will be, and they can decide for themselves.”
The opinions expressed in this article are those of the author, and do not necessarily reflect the viewpoint of the SFAA or the SF Apartment Magazine. Nancy Isles Nation is a long-time Bay Area journalist and former reporter at the Marin Independent Journal. She has covered commercial and residential real estate, business and a variety of other subjects. Copyright © 2009 by Black Point Press. All rights reserved.