Value add construction at SCIO; adding value while maintaining occupancy

17 September 2020

Value-add construction is a proven method to reinvigorate outdated or un-usable properties in order to increase rents and an asset’s overall value. As was the case at Evanston Place Apartments and 1926 West Harrison in Chicago, many value-add projects involve the re-purposing of uninhabited buildings to breathe new life into the spaces before bringing them back to market. However, some value-add projects occur while the building is still occupied and being actively leased, like at Focus’ Medical District apartment project, SCIO.

Located along Ashland Avenue between Polk and Taylor streets, the Scio at the Medical District sits on over five acres of property. The two, 12 -story towers include an existing 410-unit rental community with a mix of studios, one- and two-bedroom apartments. Focus renovated the existing residences by installing new flooring, appliances and by upgrading the kitchens and bathrooms with new cabinets, fixtures, etc... The originally apartment tower did not offer the modern amenities tenants have become accustom so to add additional value, Focus built a new amenity pavilion connecting the two residential towers. The all glass pavilion housed a new fitness center, business center, bike storage, lobby with concierge and complimentary wi-fi all located beside a new outdoor pool and sundeck. All the renovation and construction work was executed in such a way that the building was able to maintain occupancy and the property management team could actively lease the newly renovated spaces as they became available.

Building during occupancy

Renovating an occupied building complicates the standard construction process, typically extending the construction schedule because there are additional considerations and fewer working hours. Work must be scheduled well in advance, has to be as quiet as possible, clean, and usually done outside of the typical working hours in order to disturb tenants least. To best manage this, the Focus construction staff was in constant communication with the property management team to ensure the existing tenants were kept informed about construction progress and the schedule for completion.

Teams also established procedures for moving through the building systematically, working in certain sections of the building which were vacant or less occupied than others. All construction was structured in phases. Working from the top floor down, the Focus team renovated one floor, or 18 units, every eight weeks with a short overlap between floors. This meant that only two floors were ever under construction at a time which helped to reduce the impact on tenants. Additionally, by keeping the spaces as clean as possible, and by creating a separate construction entrance, the team effectively reduced the number of times tenants even encountered construction staff.

Added value through new amenities

Adding an entirely new structure and outdoor pool between two existing apartment towers presented challenges of its own. For instance, all the MEP systems were stored in the South tower and fed to the North tower through the ceiling of the existing lobby space between the two. In order to safely demolish the existing space without damaging the MEP systems which needed to be maintained for the two occupied apartment towers, the Focus construction team brought in scaffolding where they supported the MEP lines. Carefully, teams demolished the building around the scaffolding and removed the waste materials. Once demolished, the team maintained this protection system for the MEP lines which ran through the middle of the constructionsite for the new amenity space. As the structure developed around the existing lines the MEP systems were slowly integrated into the new structure.

Success at SCIO

The entire renovation lasted 24 months - during which, through a careful approach and strong collaboration with the leasing team, SCIO maintained occupancy and increased leasing activity. After the renovation, rents grew by and average of 36% and the occupancy level of the building increased by 15% in the year following the end of construction.

To learn more about how Focus and how its team of experienced developers and builders can add value to your projects, reach out today.

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