Mixed-Use and Urban development and Development/Redevelopment and Real Estate & Retail

Condos offering live/work space are hot

April 9, 2007

The age-old concept of living above your workplace is catching on again in Indianapolis, just as the developers of Douglass Pointe Lofts had hoped.

The $2.65 million project at 25th and Delaware streets already is a landmark in Fall Creek Place thanks to a colorful facade that angles out over the sidewalk. But soon the buildings will also be known for a diverse roster of local businesses: a small grocery, hair salon, title company, advertising agency, wine bar and a new headquarters for Minkis Builders, the company developing the project.

Several of the new owners have opened shops and moved into their homes, and others plan to follow in the coming months. Only two of nine units are still for sale, and they have drawn interest from potential buyers interested in opening a Pilates studio, deli and a dental office.

"It's a beautiful thing," said Minkis President Sherry Minkis. "I think this kind of product is going to take on a life of its own."

In fact, Minkis is preparing to break ground on another live/work project of seven units just north of 16th and Pennsylvania streets as part of the redevelopment of the former Herron School of Art. Another local developer, Pedcor Cos., has built live/work units in downtown Carmel, but Minkis is the first to build new units in Indianapolis.

Veterans of the local market expect more projects will follow.

"People are realizing this is the wave of the future," said Joe Everhart, a real estate agent with locally based The Sycamore Group. "You used to see mom and pop living over the store; we're making that full evolution."

New live/work developments are gaining popularity across the country. After units sell out, developers often look back and wish they had built more, said Thomas Dolan, a California architect and urban planner who founded the Oakland-based Live/Work Institute in 1997.

He calls the latest projects the "second generation" of live/work. The first generation was sparked by artists who colonized abandoned industrial space in urban areas. The new wave is fueled in large part by technology that allows businesses to set up shop just about anywhere, along with a desire to avoid commutes.

"How much sense does it make to have office parks that sit empty all night and houses that sit empty all day?" Dolan said.

The biggest downside of working at home is isolation, he said, but live/work projects can offset that and create a new version of the water cooler, with common entrances or vibrant streetscapes.

The units at Douglass Pointe each have two or three levels plus a basement, small yard and a garage. Some have balconies and rooftop decks. They are geared for businesses with no more than five or six employees, since they offer about 960 square feet of first-floor commercial space.

Prices range from $289,000 to more than $500,000. The price includes six hours of architect design time, a $3,000 allowance for appliances, and a $1,000 allowance for lighting, said Seth Patton, a Minkis sales representative.

A big advantage of live/work units is they allow buyers to finance their purchase with a traditional 30-year residential mortgage. Young professionals and small-business owners in particular have shown interest in the units.

"I like the idea of rolling out of bed and going to work without shaving," said Alan Mayes, who paid $485,000 for the Douglass Pointe Lofts unit where he lives and runs Sterling Title Agency.

Mayes lives upstairs in a two-level apartment, his mom has an apartment in the basement, and Sterling's office is on the main level. Each level is designed differentl-his living space, for example, is painted in darker, more peaceful tones than the office.

Before moving to Douglass Pointe, Mayes ran the company out of his home in the Herron-Morton Place neighborhood. The addition of a storefront adds legitimacy to the business, which had $350,000 in revenue in 2006.

"You can only do so much without space for people to visit you," said Mayes, 34. "I also get a new house out of it."

Other shops planned for Douglass Pointe include an Aveda hair salon, dubbed Salon Orange Moon, a wine bar from longtime Palomino host and architect John E. Suter, and The Goose, a specialty food-and-wine market slated to open in July. The market will feature an on-site butcher and fishmonger; a wine cellar; and artisan breads, olives, cured meats, fresh spices and seasonal produce from local growers. Chicago chef Christopher Eley plans to move here to run the shop and live upstairs.

One of the first companies to move into Douglass Pointe was Trendy Minds, a local advertising firm that had $500,000 in revenue last year. Trevor Yager, the president, previously ran the business out of a carriage house in Herron-Morton Place. The new setup cost about $575,000, plus $75,000 in upgrades, he said.

"I think the live/works fill a great niche," said Yager, 32. "A lot of neighborhoods are pushing for businesses to move in."

Sherry Minkis said the response has been impressive. Without targeting any particular kind of business, the project landed a wide variety of shops. Meanwhile, neighborhood groups around the city have asked Minkis to take the concept to their communities. And other developers have sought tours and details on how it was built.

Minkis has been fielding calls about live/work at Herron Square--the Herron School redevelopment--where units will range from $244,000 to $400,000. Construction on the $2.75 million project is scheduled to begin in late May.

The company also is looking for more locations, including across Delaware Street from Douglass Pointe Lofts, Minkis said. That property is owned by the city and was once home to a dry cleaner, so it would require an environmental cleanup.

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