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Pulse Articles November 2002, Pulse Article (reprinted with permission of Downtown Danville Inc. "That Renaissance Danville thing, I still don't get it" It would be easy to argue against spending twice as much on a renovation project than one could possibly expect to realize in return on a sale. That is certainly a fair statement to make. Many people are mumbling the title of this article even now as you read it. In order to start to "get it" one has to step back and look at the larger picture. There are many ingredients that go into the mix of City, Downtown, neighborhood and image revitalization. Among the efforts it takes are: The achievement of market viability issue is the most difficult of the above concepts to grasp. Take into consideration the impact that properly renovated home sales can have on the neighborhood. With the sale of the Clipson House in the 400 block of Oak Street we have established that the market will, at this point in history, pay $40,000 for a renovated single family home in this area. While maybe not as much as we would like to see, that is still the highest price paid for a single family home in the Renaissance District for quite a few years. This sale can now be used by the appraisal community when considering any subsequent area home sale or the sale of another renovated property. This also brings the benefit of raising all the home values in the neighborhood. This renovated home along with the confidence that the Renaissance Danville will continue to do more projects in the neighborhood does indeed add value to the other homes in the area. This confidence allows the existing residents to move forward with fix up projects of their own. In the four years from 1996 through 1999 in the 400 block of Oak Street, thirteen (13) building permits were issued for home improvements. That is an average of 3.25 permits per year. The average home improvement value for those 13 permits was $1,182 each. After the start of the Clipson House project in 2000 ten permits were issued for the same block with an average permit value of $4,300. So far this year 4 permits have been issued with an average improvement value of $3,140. It is easy to consider that 3-4-5 years ago, looking at a decaying neighborhood, those owners would only consider spending the minimum on absolutely necessary repairs. That is if they spent any money on repairs at all. Their view of their own properties saw the economic value peak many years ago and the remaining economic life with a "do not revive" order. They saw little value in and had no interest in spending improvement money on their devalued properties. With the positive activity in the neighborhood by the City, by the police department, by the neighborhood association, by Renaissance, these owners have a renewed interest in fixing up their homes and cleaning up the neighborhood. They see the economic life of their property shoot out into the future. The value of their neighborhood and their home has been given a big boost. They are now developing the confidence that their neighborhood is on the up swing, the confidence to spend money on their own homes. Stopping a multi-decade trend, the equalized assessed valuation for residential properties in the Renaissance District turned the corner from steady decline to growth between 1999 and 2000. A $44,000 EAV upswing was calculated for the District?s residential properties. This is just another part of the pay back. With continued growth in the initial Renaissance District we will start to again see the District support its self from a tax base perspective. With the elimination of 2 or 3 more derelict homes in this neighborhood through renovation by Renaissance Danville, more positive results will ensue. Escalating property values, increasing EAVs. The neighborhood becomes attractive to a broader mix of socio-economic people. More new owners, a swing to owner occupied multifamily properties. Maybe it will be the proximity to downtown. Maybe it will be the prospect of purchasing an architectural/historic "jewel in the rough" for pennies on the dollar. Maybe it is the newly recognized economic stability of the neighborhood. The point is the formula works. The Danville program is patterned after a successful ten-year effort in Rock Island, Illinois. A program that has completed over 100 projects ranging from neighborhood renovations like ours to new construction on vacant neighborhood lots to downtown second and third floor apartment development. With continuing efforts our Renaissance District will become stronger. It will be no longer necessary to spend $100,000 on a project hoping to see a sale of $50,000. The derelict houses will be eliminated. The private home owners and developers will see the opportunity for sound investments in the Renaissance District of today and in those districts to be established in the future. With the gap between investment and equity removed, the free market place will take over the renovations and development. This will only happen if those who consider investing in the District are able to maintain the confidence that the City of Danville and the Renaissance Danville will be able to continue the work they have started. We have seen what happens to neighborhoods with neglect. There are other areas of the City that need this same attention. With this big picture view of an improving neighborhood and the positive impact it has on the whole city your ability to "get it" should be improving. The costs to the economic viability of our community for neglect of our neighborhoods are far greater than the fix up losses of a few derelict houses. Strong healthy neighborhoods are the foundation of a strong healthy city. Return to Articles
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