New apartments are expected to hit the market next year in Midtown Harrisburg as WCI Partners LP continues to redevelop a string of vacant and blighted properties in the 900 block of North Third Street, a few blocks north of the state Capitol.
The 40,000-square-foot project, expected to cost more than $8 million, spans four buildings at 916-922 N. Third St., including a former charter school property.
“This has been a vacant block that has been downtrodden. Putting it back into useful service is going to be a big draw,” said J. Alex Hartzler, managing partner and founder of Harrisburg-based WCI.
The plan is to have 41 one-bedroom apartments ready by next spring, plus multiple first-floor commercial suites. Harrisburg-based JEM Group LLC is overseeing construction.
Startup Harrisburg, the city’s first co-working space, will be the building’s first tenant, occupying about 6,500 square feet within the next month, said Dave Butcher, WCI’s president. The new spot is more than twice as big as Startup’s old space near HACC’s Midtown campus.
Startup growing up
For Startup Harrisburg, the move to 922 N. Third St. takes an idea born on a bar napkin to the next level.
Co-owner Adam Porter said the bigger co-working space will have capacity for 60 to 80 clients. Startup currently has about 20 people using its nearby space.
“We’ll probably double (immediately),” he said of the new space, which blends an open area for daily patrons with a row of 25 dedicated desk spaces, plus private offices and conference space.
The goal is to provide young entrepreneurs with more flexible office space to start businesses and to help existing businesses grow and spread their wings. In co-working spaces, turnover is actually a good thing because it usually means someone has outgrown the space.
“The funding from the commonwealth will help this project be completed and will assist small businesses who use the space in getting their properties to market,” Gov. Tom Wolf said during today’s visit. “But most importantly, this project is about new opportunities for the businesses that grow here, and continued hope for a neighborhood, and city, on the upswing.”
Based on previous residential projects WCI has undertaken in the city, Butcher said he’s optimistic that the apartments will lease up fairly quickly once marketing efforts begin. Lease rates have not yet been finalized, though WCI hinted at rates of $950 per month when it bought the properties last year.
Hartzler called the stretch of North Third a “key block” and a strong connection between the downtown and Midtown areas of the city. It’s not far from the state Capitol complex and is within a short walk of the Broad Street Market, the Millworks restaurant and other Midtown amenities.
“We’re always hopeful our investment will inspire others to do similar things,” Hartzler said of the project.
Gov. Tom Wolf visited the site between Boas and Union streets this afternoon. WCI has secured a $3.5 million grant from the Office of the Budget’s Redevelopment Assistance Capital Program, or RACP.
RACP is a grant program used largely by businesses for the acquisition and construction of regional economic, cultural, civic, recreational and historical improvement projects.
Grant announcements have been delayed because of the lengthy 2015-16 budget stalemate that carried into March. So there were no announcements last year. However, the administration promised more RACP announcements “in the next couple days.”
WCI has a RACP history
WCI Partners has now received RACP grants three times in its history, President Dave Butcher said.
The developer received a total of $5.5 million over two grant cycles earlier this decade. That funding helped leverage about $20 million in total investments to support redevelopment efforts in Midtown’s Olde Uptown neighborhood.
WCI’s investments impacted more than 100 neighborhood properties, most of them much smaller than the company’s current mixed-use effort.
Since it was founded in 2005, WCI has invested between $40 million and $50 million in real estate between downtown and Midtown. The company is known for helping to revive the Olde Uptown neighborhood.
WCI has recently converted buildings on Locust and Walnut streets in downtown Harrisburg to luxury apartments, part of a growing city trend.
“This is our first big investment in this area (of Harrisburg),” Hartzler said. “This is the next step in an ongoing (redevelopment) process.”