Benefits of Historic Preservation for Real Estate Professionals
A presentation to area real estate professionals by The Landmarks Society of Greater Utica Hosted by Bonacci Architectswww.uticalandmarks.org June 2012 This presentation does not provide legal, tax or accounting advice; the information provided is intended to be general in nature. Interested parties are strongly encouraged to consult their own professional tax, accounting and legal advisors on individual tax matters, or consult the NYS Department of Taxation and Finance or the Internal Revenue Service (IRS). The presenters are not responsible for the information or advice provided here as it may affect specific tax consequences.
What Makes a Property “Historic”?¨ Age: 50 years or more, or exceptional significance¨ Designation or location in a district: - National Historic Landmark - National Register of Historic Places - State Register of Historic Places "When you preserve historic properties, - Local Historic District youre not just saving a building or plot of land, youre protecting¨ Integrity: materials, design, setting part of your communitys character and giving buyers a reason to want¨ Significance: association with individuals; distinctive style or to live there. And for a architect; can yield unique info about REAL ESTATE PROFESSIONAL, our shared past thats just good business.” -Realtor Magazine Online
Benefits of Historic PreservationHISTORY/ SENSE OF PLACE / QUALITY OF LIFE• Authentic and unique sense of place, creating increased connection to our shared cultural heritage, stimulating community renewal, building pride, providing hands-on educational experiences, and generating tourism• Historic Preservation spurs revitalization of traditional downtowns, which results in millions of dollars of public and private investment, rehabilitated buildings stay on the tax roles, and businesses (usually smaller or independent merchants) locate in the rehabbed spots because they are generally of a smaller scale• Heritage Tourism results in millions in revenue annually for New York and provides thousands of jobs• Value to local history & school curriculums, with programs such as the “Teaching with Historic Places” program, introduces our children (and their parents) to local, state and national history
Benefits of Historic PreservationINCREASED VALUE/ SAVINGS FOR OWNERS• Properties located within locally designated historic districts are statistically worth more, appreciate faster, and retain more of their value, thus increasing resale and market values and enlarging the tax base• Preservation creates more jobs through construction, real estate sales, heritage tourism than new construction• Potential of decreased taxes for owners through use of credits and incentives• Potential cost savings to renovate rather than to build new• Leverage small private investment through grants, loans and tax credits for qualifying properties
Benefits of Historic PreservationSUSTAINABILITY/ “GREEN”/ ENERGY SAVINGS• Restoration is the ultimate recycling; the “greenest” building is one that is already built• Save money and time through the reuse of durable, high quality building materials (some may not be available anymore), plus less debris in landfills from demolition and construction is good for the environment and budgets• Reuse of municipal infrastructure; anti-sprawl; savings to municipalities result in lower tax rates• Energy savings (none used for demo, construction, plus the reuse of embodied energy in existing buildings)• Life span of new buildings (20-35 years) vs. historic (100-200+)• Best sight locations and orientation, natural light and ventilation yield ongoing energy savings and comfort
Did You Know?There are about 300 billion square feet of space in the United States today. The Brookings Institution predictsthat we will demolish nearly 1/3 of our building stock in the next 20-25 years, or about 82 billion square feet ofexisting space. It will take as much energy to demolish and reconstruct that 82 billion square feet of space as itwould to power the entire state of California (the 10th largest economy in the world, population 36 million) for10 years. Demolishing 82 billion square feet of space will create enough debris to fill 2,500 NFL stadiums. If wewere to rehab even 10% of this, we would save enough energy to power the state of NY for well over a year.• Construction debris accounts for 25% of the waste in the municipal waste stream each year.• The average embodied energy in existing buildings is 5-15 gallons of gasoline per square foot. The average embodied energy in a 250,000 square-foot office building is 3.75 million gallons of gasoline.• Recent calculations indicate that it takes about 65 years for an energy efficient new building to save the amount of energy lost in demolishing an existing building.• Far from being "energy hogs," some historic buildings are as energy efficient - or more so - than buildings constructed in later decades. Data from the U.S. Energy Information Agency finds that buildings constructed before 1920 are actually more energy-efficient than those built at any time afterwards (except those built after 2000).• In 1999, the General Services Administration examined its building inventory and found that utility costs for historic buildings were 27% less than for more modern buildings.• It takes a lot of energy to construct a building - for example, building a 50,000 square foot commercial building requires the same amount of energy needed to drive a car 20,000 miles a year for 730 years.From the National Trust for Historic Preservationhttp://www.preservationnation.org/information-center/sustainable-communities/sustainability/green-lab/
Scenic & Historic District“A historic district is a group of buildings, properties, or sites that have been designated by one of severalentities on different levels as historically or architecturally significant. Buildings, structures, objects and siteswithin a historic district are normally divided into two categories, contributing and non-contributing. Districtsgreatly vary in size: some have hundreds of structures, while others have just a few.” (from Wikipedia)• Residential property values increased by 5-35% per decade in historic districts over the values in similar but undesignated neighborhoods; Higher property values and rates of appreciation raise the value of investments, promoting increased levels of home ownership and longer span of residence• Local districts protect the investments of owners and residents through design and zoning laws, and buyers know that the aspects that make a particular area attractive will be protected over time• Real estate agents in many cities use historic district status as a marketing tool to sell properties• Local districts encourage better design, a sense of community and greater investment appeal• Historic districts provide a glimpse into the past, provide educational benefit and boost civic pride• A local district can result in heritage tourism and can be a communitys most important asset and attraction• Historic districts enhance the business climate, since companies locate where there is good quality of life• Designated historic districts tend to have higher rates of participation in neighborhood associations and improvement projects, which protects neighborhoods from decline and disinvestment• In Utica, properties are protected by “Design Review Guidelines” and the Scenic & Historic Commission