Small building could be the start of big things for downtown Huntersville

HUNTERSVILLE — It’s only a 17-unit building on a 0.64 acre lot, but it would add apartments to this fast-growing and rental-scarce suburb when multifamily vacancy rates are at historic lows.

And it might even help revive the town of Huntersville‘s desire for a denser and more mixed-use downtown at and around Old Statesville and Gilead roads.

Unlike many apartment projects in Charlotte’s booming multifamily market, the Huntersville Apartment Building, as it now being called, does not need rezoning approval, nor any kind of approval of appointed boards or elected officials, said town planning staffer Brad Priest.

But Mark Skinner of Denver, N.C.-based Artisan Contracting — owner of the existing single-family home at 114 N. Old Statesville Road, the developer of the project, its general contractor and its prospective manager to boot — said there are challenges to his project, which he has been shepherding for 1 ½ years.

“First of all, we have to reach the magic number in terms of financing, and we’re about 75 percent there,” said Skinner, whose build-out cost would be between $1.5 million and $1.7 million. “The numbers have got to work when you sit down in front of bankers.”

And although the zoning of the property, TC or town center, allows for apartment development, Priest said, the site plan still requires town planning staff approval. That means, Skinner said, that because of the smallness of the lot, he is in a literal tight spot when it comes to dealing with minimum parking-place and street setback ordinances.

Town center zoning allows for a variety of different land uses, as attested to by the array of developments within a couple of blocks of the site: offices, government buildings, churches, a children’s museum, a gas station/convenience store, a public school and a public park.

“There’ll be a commuter train stop about a block and a half away, too, if that ever happens,” Skinner said.

Several larger apartment projects have been approved or are pending approval in existing Huntersville subdivisions — including Bryton, Caldwell Station and Vermillion. But Skinner’s project, though small, is the first of its kind in recent history to be planned for Huntersville’s downtown.

“The town’s push to develop the center city kind of stalled during the downturn, so I think the town is pretty jazzed about this project,” Skinner said. “It has the potential to reignite that excitement.”

Priest — who said that the project is not only zoned properly for apartments, it is in keeping with the Huntersville’s Downtown Small Area Plan — couldn’t agree more.

“It definitely meets the vision of the plan,” Priest said. “You want that kind of intensity, that density. But it hasn’t really taken off yet. We’re in a kind of chicken-and-egg situation. Restaurants and retail want to see residential development, and residents want amenities nearby. It’s a Catch-22.”

But with apartment vacancy rates in the Charlotte market at 6.2 percent, it’s the right time to build apartments, said Charles Dalton, president of the Real Data, the Charlotte-based apartment analytics firm that covers the Southeast.

In the farther reaches of north Mecklenburg, Dalton said, most of the recent apartment-building activity has been in Cornelius and Davidson, but not so much in Huntersville, which has seen huge growth within the past two decades in single-family home development whose residents often oppose multifamily projects because they believe they drive down property values.

But there is a demand for apartments in Huntersville — Charlotte’s nearest neighbor to the north — both Skinner and town planner David Peete said, largely driven by two factors.

The first is a population explosion.

Huntersville nearly doubled in population to 53,000 between the 2000 and 2010 U.S. Census surveys, and is expected to double again by 2020, according to a Lake Norman Economic Development Commission forecast.

The second is a lack of supply.

The population boom in Huntersville came at the same time as the single-family housing boom of the early 2000s. So as more people moved into Huntersville, the number of detached homes and townhouses grew along with it, and there was little need for apartments.

Since the financial crisis of 2008, when homebuilding took a sharp downward turn, apartments did not immediately spring up in places like Huntersville, largely because developers who wanted to build rentals had some of the same problems aspiring homeowners still do: Banks wouldn’t finance their projects.

That’s still a problem in Huntersville, as Skinner can testify and Peete can second.

“Huntersville is not well-known for apartments, and banks will see that and wonder if they’re going to get their money back from loans made to apartment developers here,” Peete said.

But that is starting to change as the economy picks up and as occupancy rates in apartment complexes reach 10-year highs. Lenders are getting easier to convince as apartment project after apartment project prove successful.

Skinner’s proposed apartment building would require the demolition of the 1,500-square-foot brick home that the developer now owns on the site, according to Mecklenburg County property records.

The new building will be a three-floor structure built perpendicularly to the street and with a parking lot in back comprising about 1.5 spaces per dwelling unit, or about 26 spots, Skinner said.

Artisan Contracting, which largely concentrates on upper-end homes in the Lake Norman area but has also done office upfits in uptown Charlotte and Myers Park, would put a mix of one- and two-bedroom apartments on the first two floors and three-bedroom, penthouse-style units on the third story.

The apartments will be “mid-level,” Skinner said, “with some tile, all appliances, but no elevator and no marble” finishes. Rents would range from about $850 to $975.