Marcy Building, Watertown, New York

H.H. Richardson Community Landmark Award

Neighbors of Watertown, Inc. engages in work often ignored by many commercial developers – the renovation of historic inner city buildings. They choose well-built buildings in critical locations, architecturally worthy of major refurbishment. Most importantly, they ensure the project’s on-going success by creating project plans that incorporate solid redevelopment practices with smart property management strategies.

The Marcy Building, circa 1910, is a stellar example of the successful work of Neighbors of Watertown, Inc. Located at 235-255 State Street, the Marcy Building was a light industrial building that sat vacant for over 5 years. Renovation has preserved its historical character while creating 58,000 square feet of Class A, wired commercial space. The building pro-forma shows the project to be viable at 71% occupancy, allowing for some vacancy and turn over without jeopardizing the long-term viability of the project. Neighboring building owners are now looking for redevelopment help from Neighbors of Watertown.

The Marcy project presented significant redevelopment challenges. Many see National Historic designation as a burden, not an advantage to the redevelopment of our historic buildings. It is often viewed as the cause of continuing decay, an albatross to downtown development. Rather than resist the burden of a historic rehab, Neighbors sought ways to use the location of the Marcy in the National Historic District to their advantage. For instance, a limited partnership was formed and investors were admitted that could use the Historic Tax Credits and would pay for them. This raised $650,000, offsetting the cost of the historic treatment more than threefold. (Neighbors is working with others to share this model.)

Neighbors also sought partnerships with public agencies that shared the goal of redeveloped downtown. Predevelopment design and legal work were funded by a $100,000 grant from the Empire State Development Corporation. Primary lenders to the project are the Community Preservation Corporation ($1,585,000) and the Watertown Local Development Corporation ($600,000). In light of the need for “turn-key” space to attract tenants back to downtown, build-out financing was provided by the Development Authority of the North Country and Jefferson County Industrial Development Agency in the amounts of $158,000 each. The Empire State Development Corporation allocated another $75,000 if needed to reduce the debt service burden in the first year or two.

The combination of grants, Historic Tax Credit equity investments and 20 to 30 year financing terms made this project economically viable.

Creating Class A, Wired Office space in an old but historic structure was the developer’s second hurdle. The project demanded respect for historic rehabilitation standards while meeting building codes and achieving energy efficiencies. Certified Historic Tax Credit renovation of the outer shell and all of the windows and storefronts needed to be accomplished. Windows alone – the building contained over 3,200 panes of glass – would have given any developer pause to reconsider the wisdom of such a project. Neighbors, however, was not dissuaded.

The historic, steel, multi-pane industrial windows were preserved and made energy efficient by restoring the windows and welding all operable panes closed. Custom made, inside fixed pane storm windows were then installed. From street side the building appearance was not changed but the reduction in fuel usage was significant. The result was historic and energy efficient.

Creative reuse of historic attributes was also considered as compliments of interior space needs. During the pre-development stage of the project many prospective tenants identified a large conference room as a need for occasional use. The Marcy featured a historic skylight, centrally located above the top floor level. This area was redeveloped as a beautiful 45-seat conference room, incorporating the historic skylight. The area is available to all tenants on a shared use basis. Upon complete rent up of the building, video teleconferencing capabilities will be installed.

New systems had to be efficiently incorporated into attractive, usable office space. A new passenger elevator was centrally located with new hallways connecting it to the end stair towers. Computerized central heat and air conditioning was installed for total climate control and fiber optic lines and other modern utilities were brought to the building. A 100-car parking lot replaced the vacant warehouse thus opening up the rear façade to become the new main entrance and additional storefronts. Each office or retail space was then built to suit each prospective tenant.

The neighboring Lyng’s Office Supply Store donated property to the City of Watertown. This donation enabled the city to widen Polk Street, the new main entrance to the Marcy site. Widening of the street has made access to the Marcy Building and adjacent parking lot much safer.

As of July 2001, 4 new businesses have located in the building, including a vibrant call center, providing over 200 new jobs to the City of Watertown. The call center chose the Marcy due to the availability of fiber optics for their large phone and computer needs. Two area businesses relocated the Marcy, bringing jobs back to the core of the city downtown.

The project has also stimulated an adjacent property owner to investigate ways of working with Neighbors of Watertown to reinvest and improve their building. CRM management, owners of two mixed use buildings, are looking forward to creating a partnership that will allow them to provide substantial improvements to the buildings they own. When all completed, the seed planted with the renovation of the Marcy Building will result in a rehabilitated, revitalized historic city block, and the thoughtful redevelopment of downtown Watertown.