Union House update: Hopefully ready to rent apartments by fall

By Bob Steenson, bsteenson@charlescitypress.com

Passersby can begin to see a little of what’s been going on inside the Union House on Charles City’s Main Street, as metal panels are replaced with panes of glass.

Still, most of the real action is taking place upstairs, on the second and third floors that are being readied as one-, two- and three-bedroom apartments that should be available for rent by fall.

Kurt Herbrechtsmeyer, president and CEO of First Security Bank and manager of Four Keys LLC, gave an update on the progress of completing construction on the building as the program for the Charles City Rotary Club’s weekly meeting this week.

Four Keys is a company created by the same bank holding company that owns First Security Bank & Trust. First Security held the construction mortgage on the property, and Four Keys purchased the former McQuillen Place project assets in bankruptcy court and changed the name to Union House.

Herbrechtsmeyer said he wanted to stay away from talking about the lawsuits that are still swirling around the project, although he did say that the bankruptcy case is mostly settled.

There is still a lawsuit on copyright regarding the architect lingering, he said. “That could have an impact.”

Herbrechtsmeyer said the basics of the project have stayed the same.

“It’s a three-level mixed-use project on the corner of Clark Street and Main,” he said. The ground level is unfinished retail and the upper levels have 33 apartments, mixed from one to three bedrooms.

“There are four ADA-compliant apartments that are being finished out — two one-bedrooms and two two-bedrooms at this point,” he said.

On the ground floor there are three small retail units that are already walled in, that border an open arcade that runs through the middle of the building and is the main entrance for the upstairs apartments.

“The three smaller places lining the arcade range from about 700 feet squared, to 900 feet, and there’s a fourth one that can be finished that won’t be probably until we determine what the rest of the retail space is going to be,” Herbrechtsmeyer said.

Other retail spaces include a large 8,550 square-foot area that can be carved up into smaller units, and other spaces of 1,700, 2,450 and 3,100 square feet.

“So lots and lots of room,” he said.

Most of the work since Four Keys started completing the project has been going on upstairs, in the apartments and common areas.

“Walls have been moved. Extraneous bathrooms have been removed. Doorways have been installed. It’s top to bottom been completely redone,” Herbrechtsmeyer said, adding that ceilings are completely new, all the walls have been retextured and repainted and the flooring has been replaced with luxury vinyl and carpeting.

“There are new countertops in the bathrooms and kitchens, new light fixtures, mirrors, everything top to bottom,” he said. “If you’ve been in it before and saw it in the state it was in maybe two years ago when the work had stopped on it, and then you viewed it today I think you would be very, very, very pleased at what’s been done.”

The apartments, particularly on the second floor, are nearly completed, he said.

“What we’re missing still are appliances. Appliances are hard to get right now, but they’re on the way. Those will probably be the last things going into these apartments,” he said.

Herbrechtsmeyer explained some of the history of the project, and how Four Keys purchased it from the bankruptcy trustee and a decision had to be made on what to do with the project.

“Are we going to put a bunch of money into this and make this thing work? Are we going to sit tight and wait for the legal process to get to resolution, maybe a couple of years from now? Or is it time to knock the thing down? And that sounded like about the saddest thing that could possibly happen, to see something get that close and then to see it absolutely fail,” he said.

When the decision was made to go ahead, Four Keys hired Dean Snyder Construction of Clear Lake as the general contractor.

“It has been a gratifying project to work with people like Dean Snyder, Mick Gage, Perry Novak, Brian Young — people who wanted this to be a higher quality product than they found it to be. A lot of the work that’s gone into this is tearing out things that we didn’t think were done right and doing them the right way,” Herbrechtsmeyer said.

“We’re almost completely redoing the exterior because the EFIS (a type of exterior surfacing) is already started to deteriorate. It will be redone, then the whole thing will be repainted,” he said.

“I got news yesterday that the elevator is coming about the third week of May,” Herbrechtsmeyer said at the Monday club meeting. “Then we can get everybody up to the second and third floors to look around. The apartments will be for the most part completed by then.”

Asked when the apartments will be ready to lease, Herbrechtsmeyer said, “I’m really hesitant to give dates. The apartment work will be done short of appliances by mid-summer, but obviously the common areas need to be done and we need to get ready to lease up apartments. The building also needs to clear inspections and get a certificate of occupancy.

“I’m sure hoping by the first of September at the latest, but I’m not promising. I’m waiting for the city to say ‘good’ before we tell anybody to start packing. There’s just too many things to be found and fixed between now and then, I’m sure,” he said.

Herbrechtsmeyer noted that some of the sheet metal panels on the ground level that replaced the former plywood panels are now being removed and windows are being installed.

“I think once that steel gets off of there and people can see inside everything will feel a lot more like it’s really happening,” he said.

“The overwhelming response I’ve had since fall, since we began, has been positive,” he said.

Herbrechtsmeyer said the goal from the beginning has been to get the property in a position where it can be sold to a developer or someone who can take over managing and leasing it.

“I did not want to manage this building. Not another day if I could avoid it,” he said.

Herbrechtsmeyer was asked what kind of target market he saw for the apartments.

He said the quality of the units will be high, and they are sufficiently large, but there isn’t a lot of storage space and the kitchens are small.

“I see it as a great transitional kind of apartment. Meaning you just got out of college, you want simple. You’ve just got your first job here in Charles City and you don’t have a lot of stuff,” he said. “I also see that opportunity for snowbirds, who don’t want to have a big footprint in Charles City but want to see their families. I see this as a great place for that.”

Several of the Rotary Club members talked about the need for higher quality rental options for professionals who are moving to the community, to work at businesses like Cambrex or Zoetis, for example, and who want to rent for awhile while they decide where in town they would like to eventually buy a home.

Mark Wicks, a Rotary Club member who is also the city development director, said, “I don’t think people realize how good it’s going to be to have people living downtown. People living downtown are going to bring things in. More activity means more businesses and services. People want to be where people are.”