Many of the suburban towns of Chicago feature quaint downtown, historic districts where century old homes and their unique craftsmanship line cobblestone sidewalks. The attraction to these houses has risen in the commercial market as retailers and office users seek alternative real estate sites. These charming homes provide a different aesthetic that better suits certain users, and sometimes can be a lot more cost effective than traditional commercial sites. However, there can also be numerous drawbacks to converted homes.
Throughout Geneva, Illinois, Third Street is lined with retailers setting up shop in old homes featuring original millwork and trim. For home and clothing shops, this can be an ideal backdrop to feature products…rather than having to display their trinkets and treasures with the standard fluorescent lights and linoleum floors. A variety of rooms that the home already has provides for various themes (and “departments” of the store), as well as less build out cost. Additionally, bathrooms and kitchens are readily available in homes.
These historic homes can also be budget conscious. Many times they are less expensive than traditional commercial spaces and can be a mix use concept for owners. While the main floor can house the commercial need, the upper floor can used for personal residence or rental purposes. Again, since the space is most likely already built out, minor changes are the only thing that need to be made as compared to office buildings that are in shell condition and need major tenant improvements.
The obvious pitfalls to converted homes are the same ones basic homeowners face, maintenance and upkeep. Although the charm of these homes is appealing, keeping that charm can come at a pretty penny, especially when you are dealing with “ancient” fixtures and equipment.
Other negatives that need to be considered is the visibility and accessibility of these homes. Many times zoning regulations over advertising and signage on the property are put in place to keep the “quaintness” of the historic district. Attracting clients with minimal signage can be difficult when compared to strip centers with neon lights and “Grand Opening” banners. Accessibility, including parking needs, are also more challenging. Usually a driveway is all these homes come with, so street parking is a must for such converted homes. Handicap accessibility should be considered for most tenants, as stairs, hallways, and bathrooms in century old homes were not made for today’s wheelchair.
When all is said and done, converted homes can be great commercial real estate options for certain tenants, but all the pros and cons should be weighed before making a decision. O’Donnell Commercial Real Estate is happy tenants weigh out these concerns and help them through the commercial real estate process.