They preserved some of the school's features and obtained historic tax credits from the federal and state levels.
Abandoned buildings inspire several artists and attract many people who want to renovate them. Similarly, in 2019, Jesse Wig recognized the potential of an abandoned high school in Homestead, Pennsylvania. The 34-year-old real estate agent purchased it for $100,000, despite being uncertain about how to repurpose it. Fast forward three years, it is now known as Bowtie High, a luxury apartment building with 31 units and high-class facilities, reports My Modern Met. When Wig purchased the abandoned high school, he was unsure of how he would utilize the space. But he recognized that the price was reasonable and believed he would eventually conceive a suitable idea.
Wig told CNBC, "I was made aware of the school, and to be very honest, I wasn't sure what made the most sense to do with the building. But for that price, I had to acquire it and hoped we could come up with a good option in the future."
After connecting with fellow real estate investor Adam Colucci, the two deliberated for two years, exploring several options, including a co-working space, wedding venue and beer garden, before ultimately selecting the residential approach. After deciding to convert the building into apartments, Wig and Colucci enlisted the assistance of Dan Spanovich as an additional partner. Spanovich, a full-time developer and multifamily property manager, provided valuable expertise in navigating the challenging conversion process. In addition to creating a comfortable living space, it was essential for the three partners to preserve certain aspects of the building's previous life.
Colucci said, "We had big eyes, and after two years of spinning our wheels, all the professionals told us that all roads lead to residential eventually." Spanovich added, "These old buildings can be very challenging to convert. We were willing to take a risk regardless of what use we would have for it. We knew that at this cost, we would be able to find some use for it that would generate enough return to satisfy everybody."
Later, the old classrooms of the high school were converted into modern apartments equipped with in-unit washers and dryers and the auditorium was transformed into a communal area designed by Chrissy Norman from C Norman Designs. Additionally, a complete gym with a half basketball court, weights and Peloton bikes was installed on the ground floor. Despite the high school's 50,000 square feet, the three partners hoped to create around 60 apartments. However, due to the building's large hallways and staircase, only 25,000 square feet were available for lease, which amounted to only 31 apartments.
Chicago has many, old schools, that are now condos, or apartment buildings.— Nick Plessas (@NickASAVet) December 16, 2022
Millennials bought an abandoned high school for $100,000 and turned it into a 31-unit apartment building—take a look inside https://t.co/DFxZ0iPqqW
Colucci emphasized that preserving some of the school's features was a significant aspect of their vision for the building. He said, "We worked closely with the National Park Services to ensure it kept its historical significance. We went out of our way to ensure the school kept its historical look." The partners obtained historic tax credits from both the federal level and the state of Pennsylvania, although they did not reveal the precise amount. They purchased the school in May 2019 and began construction on the building at the start of 2020, completing it in October 2021.
The building achieved full occupancy within six months of leasing, which started in October 2021. The monthly rent for 1-bedroom units ranged from $1,400, while 2-bedroom units could cost up to $1,650, according to Spanovich. Colucci revealed that the three partners divided all profits and expenses proportionally based on their share of the building.