The next installment in the “Building Strange Weather Blog” series by producer/engineer and studio owner Marc Alan Goodman. Click to start at Step 1: Finding A New Home; Step 2: Design; Step 3-4: Waiting For Permits (Part 1) and (Part 2)
WILLIAMSBURG, BROOKLYN: The last three months have been a series of stops and gos unlike anything I could have imagined. I look back to a year ago, just before I became a property owner myself, and I can remember walking past vacant storefronts and wondering “how in god’s name can anyone afford to have a space remain vacant in this city?”
Little did I know that 10 months and seven days later I’d still only be imagining work on my own place. I’ve had to do some serious soul searching to figure out if there’s anything I could have, or rather should have done better, but when I look back on all the details I’m ultimately happy with how far we’ve come. The fact that we’re starting construction this week certainly helped…
Building a recording studio in Brooklyn…I knew going into it that there are certain things that would take longer than anticipated. I was told by a number of respected friends to plan for the build-out to take 3x as long as I would have expected. It turns out that I needed to double that — I’ve been delayed twice that long just getting started.
Everyone knows Brooklyn’s bureaucracy is like a black hole, so I understood that permits would take a long time. Contractors notoriously run behind schedule. But what’s really dictated the speed of work has been organization — more specifically any organization or lack of organization that I’ve been responsible for myself.
Communication seems to be the variable that’s both most critical and most time consuming. It only took a few months to get the plans for the ground floor, but I had to wait until I had them in my hand to take them to the structural engineer and other architect so they could begin work. As soon as the architects got working I left them to themselves and focused on the next most pressing problem: funding.
If I’d been in a rush, having someone around to manage the architects would have helped a great deal. As it turns out months later, when the money was finally in place, I had to get everyone to match each others’ plans. There goes another three months.
Actually getting that money in place was a mission in itself. I got a good deal on the building because I was able to make it happen fast, which meant dealing in cash and getting a mortgage retroactively. Every banker I spoke to prior to the purchase told me that this wouldn’t be a problem so I went ahead with the deal. However when I went back to those same bankers to start the procedure they all told me that there is a Fannie Mae / Freddie Mac restriction preventing them from backing a mortgage until the property has been “seasoned,” or simply owned for six months.
Once again I was told “Come back in six months and this will be easy!” Six months later I get a lot of “Great, let’s start the paperwork” responses. But once the paperwork started there were more holdups.
Due to the recent falling out of the American mortgage industry all of the major banks have closed up their mixed-use property departments. So the residential specialists would say they can’t deal with it and send me to commercial. Then the commercial specialists would try to send me back to residential. After going through this two or three times I got smart and asked what was going on.
They weren’t authorized to work on a loan for me, but the mixed-use department didn’t exist anymore and there was nowhere to send me! On the occasion when I did speak to someone who seemed interested, the current status of the property would come up.
The big backers have no interest in a building that is partially vacant as collateral. In order to fix up a vacant property one would need a construction loan, which few banks still consider for businesses looking for less than three million.
After all of this my contractor directed me to a local mortgage broker who has financed a number of mixed-use loans in the neighborhood. He too was absolutely sure that a loan wouldn’t be a problem but in the end was unable to follow through.
I ended up taking a short-term small business loan at a far higher rate than I initially anticipated in order to get things moving. Theoretically I should be able to get a mortgage after the building is complete to pay off my short-term loans. I’ve been assured it won’t be a problem. I won’t pretend that I’m not nervous about it but logic dictates that if they’re going to give a loan to anyone, giving it to someone with an existing, cash-earning, finished property in Brooklyn as collateral should be a pretty safe bet.
The next major holdup was outside of my control but certainly could have been predicted, and could be considered even a tad pun-ish: the weather. This year, snow has basically brought NYC to a halt, freezing all kinds of developments and building in its tracks for months.
The first work we needed to do was outside, and there was no easy way to do it in the snow. On top of that, all of the local crews had plenty of work doing expensive repair jobs and no one seemed interested in settling into a long project before the spring. Although people were happy to talk about getting started in the snow everyone seemed to drag their feet a bit, and at this point I have to assume for good reason. I wouldn’t want to be working outside through the last few months, plus the roof and concrete wouldn’t dry. The whole thing would probably have been a nightmare
To wrap up: it’s a hell of a big project that I’ve gotten myself in to, but I’m excited to finally start getting down to the details. Next time I’ll have some pictures (at last!) to share and we can start getting our hands dirty.