Grant Butterfield is waiting for an elevator to be installed.
It’s still the early afternoon, but it’s his fifth trip up the stairs of the five-story, 33-unit, 33,000-square-foot residential building under construction on Maiden Lane, in the heart of downtown St. Albans.
Butterfield, the project’s developer, isn’t just eager for the elevator system to make his trips easier. The installation is essential for a fire safety inspection bringing the project one step closer to completion. Construction is supposed to be completed by April 15, and Butterfield is cautiously optimistic.
It’s the first market-rate housing building in the city of St. Albans in about 50 years.
“It’s a direct answer, I’d say, to the housing crisis that our state has,” said Chip Sawyer, director of planning and development for St. Albans.
The 33 market-rate apartments on Maiden Lane are part of a series of new developments in the city, including 30 newly completed subsidized apartments and a three-story commercial building on Main Street.
Butterfield, who works with Nedde Real Estate, is the developer for the housing and the commercial building, whose modern exterior stands out among the quaint facades of St. Albans’ historic downtown district. The commercial building now houses the local branch of the Community College of Vermont and office space for Northwestern Medical Center.
Three years ago, the property was headed to auction. The lot had become “commercially irrelevant,” according to Dominic Cloud, city manager of St. Albans, with several buildings “teetering on blight.” No private investor seemed willing to invest the cash needed for renovations.
Cloud said the city faced a problem common across Vermont: In small markets, it can be a challenge to make the money work for development projects.
“You either need to do creative public partnerships or altruism, where community members lose money on it,” Cloud said.
The latter wasn’t an option, so the city government stepped in and bought the property for about $500,000. Planners determined that the old buildings would have to go, and envisioned new buildings in their place.
The demolition was paid for via tax increment financing — a tool designed to help cities to pay for infrastructure that can attract private development. A city temporarily incurs debt to finance new construction, and pays off the loan through property tax revenue generated by the new development.
Since 2012, the city of St. Albans has also been pursuing projects to improve the downtown area, such as sidewalks and roadways. Bidding for Kingman Street, the final step in the city’s “Downtown Core” phase, opened last Thursday.
“How could the city say to the private market that it should invest in our downtown if the city isn’t investing in itself?” Sawyer said.
After the city approached a handful of developers, Butterfield, who has lived in St. Albans for 20 years, emerged as the right fit for the project.
“That’s how you have to do it in rural Vermont,” Cloud said. “You have to create the right conditions, and you have to really create the projects yourself and then take it to a private investor.”
As one part of the $20 million plan, the city razed a rundown building with 23 low-income apartments, a building that Cloud said was “just over the line” on the city’s health codes. Then, it partnered with Champlain Housing Trust to create 30 new subsidized apartments.
The city turned again to Butterfield to develop a market-rate apartment building on the land left over. The result: 33 apartments, all with a sleek, open-concept floor plan and modern kitchens. Most of the apartments — 27 of them — are one-bedroom units with a den, or a small nook space that could easily be converted into a home office. Each apartment is outfitted with a washer and dryer.
The units rent for between $1,225 and $1,600 per month, including most utilities, internet and a parking spot.
For Butterfield, there was plenty of risk involved. It was by far the largest project he’d been involved in, and even after lining up investors and a grant from the Vermont Housing and Conservation Board, the cost was still daunting.
And while he couldn’t have predicted the pandemic, the price of building materials has shot up in the past year. For example, Butterfield estimates that the cost of the building’s free-use rooftop terrace has increased by 250% since construction began.
The pandemic has also made it a tough time to start or relocate a business. The commercial building on Main Street has a space outfitted for a trendy restaurant, but it remains empty, along with other spaces.
Butterfield said he’s waiting for the right business to lease the space. He doesn’t want a downtown business to move in, while leaving a vacant space somewhere down the street.
He’s optimistic it will happen soon, in part because of high demand for the apartments. One of the penthouse units was snapped up even before the property’s website went live — or, Butterfield points out, before he had installed a fridge. Upstreetapartments.com, which displays floor plans and includes an application form, is now up and running.
Looking out onto Main Street from one of the commercial building’s tall windows, Butterfield said he feels a marked improvement in the downtown’s “energy and vibe” compared to when he moved to St. Albans in the early 2000s. He’s not intending to lose money, but there’s a touch of altruism in the way he talks about the city.
“I want the whole place to do well. That’s my theory,” Butterfield said. “Because If everyone does well, then it’s a just benefit to the community.”
For Cloud, the overall project is an example of how ambitious development can be pursued, even in smaller communities.
“The first [lesson] is that communities themselves have the tools to drive the development that they want in their downtown,” Cloud said. “Everything that we’re doing comes out of the vision that’s reflected in our community planning and policy documents, and that’s what gives it legitimacy.”
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