For decades, much of Salem’s historic downtown had the musty whiff of underuse.
Developers and historic-property owners alike complained that the city’s regulations for making changes to historic properties in the capital city’s central core were too onerous, cost prohibitive and regulatory.
All that changed in 2014, when the McGilchrist & Roth project reopened on the northwest corner of State and Liberty streets. Revitalization of the two buildings, which date to 1916, opened people’s eyes to the possibilities of period-sensitive reuse in Salem’s formerly moribund historic district.
“Pigeons were living up there,” says Kimberli Fitzgerald, the city’s historic preservation officer and cultural resources planner. Fitzgerald features the McGilchrist & Roth project in a slideshow she uses to teach people about the possibilities of adaptive development in Salem.
The 40,000-square-foot building is home to Archive Coffee and Bar and several other retailers on the ground floor, as well as the CPA firm, Doty Pruett Wilson. There are nine upper-level apartments, including one owned by Doug Doty and his wife, Gayle Caldarazzo-Doty, the couple who developed the building.
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The project was the first in Salem’s Downtown National Register District to use federal historic tax credits, Fitzgerald says. The Dotys invested about $7.5 million in rehabilitating the buildings. And the city kicked in incentives as well, starting with a $60,000 grant from the Toolbox fund, a program for business owners who want to enhance a historic property.
More importantly, though, it was the first big project in a historic district after the city revamped its historic review process. Staffers found several flaws in their programs, including the requirement that the city’s Historic Landmarks Commission had to review nearly everything that happened in the historic districts.
Property owners told the city they felt as though they were being regulated but didn’t know why, says Fitzgerald, who started working for the city in 2009. There also were no financial incentives to help property owners with renovations or upgrades.
“Our goal is not to be the preservation police, but to manage the change of historic resources.” — Kimberli Fitzgerald
So Salem cut its historic-review process to 45 days and exempted some categories from the Historic Landmarks Commission review. Officials added a grant program. They amped up outreach to property owners who had been avoiding filing building permits under the assumption they would be denied in the regulatory process, or that it would take too long.
“Codes sound really wonderful until you get to the place where they need to be used, and that’s where these incongruences can kind of rear their ugly heads,” says Nick Williams, CEO of the Salem Chamber of Commerce.
One of the most challenging expenses owners of historic properties face is how to pay for seismic upgrades, he says. Until recently, it hadn’t made much economic sense in some historic properties in Salem.
“Seismic retrofitting is the biggest expense, and financing and dollars to line up around that are a bit difficult,” Williams says. “Someone has to have some pretty significant financial wherewithal to be able to make that kind of an investment. And we’re starting to see some of that.”
The historic review changes had measurable results: From 2011 to 2012, the number of building permits issued in the historic zones doubled, says Fitzgerald.
“Our goal is not to be the preservation police, but to manage the change of historic resources,” she says.
“We don’t have a goal to have a bunch of house museums in our community. Instead, we recognize that on the one hand, these resources do contribute to the sense of place and fabric. On the other hand, we also recognize how important it is that the community engage and use the buildings so that they’re part of our lives.”
Twelve downtown properties changed hands last year. A former dorm on the state hospital grounds, which is within a historic district as well, will be converted to 50 units of affordable housing with rents averaging $600 a month.
“There’s a fine line you walk not trying to imitate, not trying to create that false historic feeling.” — Josh Scott
The state is also seeking to develop housing on another 25 acres at the hospital.
That energy is among the reasons Cathy Reines of Koz Development was drawn to Salem. Reines, whose Snohomish, Wash.-based company specializes in student housing and what are known as micro-housing units, zeroed in on an empty lot in Salem’s historic downtown for a 140-unit apartment building with ground-floor retail.
“You can feel that energy already, which was what was attractive to us about the city,” Reines says. “You can feel it really start to take on this energy to individuals who want to live in an urban environment but still has that hometown feeling.”
The location, at the corner of State and Commercial streets in downtown Salem, was ideal for Reines, who looks for places where there are large student populations or hospital workers, with access to outdoor amenities. Salem Hospital and Willamette University both fit her parameters, along with a walkable riverfront that gives people access to outdoor recreation.
“We’re looking at demographics, we’re looking at current supply and demand, we’re looking at the cities themselves,” she says. “All of those factors are what brought us back to Salem.”
Reines’ partner, Josh Scott, says that infill construction in a historic neighborhood has special considerations, including meeting the city’s design guidelines. Salem, unsurprisingly, didn’t want a flashy or modern “look-at-me” building as infill, Scott says.
His work started at street level, making sure there was a consistent main-floor height with other downtown buildings. Adjacent buildings and those across the street can offer good cues, he says.
“There’s a fine line you walk not trying to imitate, not trying to create that false historic feeling, using proportions and general forms that are found in historic neighborhoods, and letting the modern building be what they are,” says Scott.
They think their project reinforces the historic environment and adds something even more crucial, Scott said: “That vitality that comes with density.”
“That’s what we feel downtown Salem needs: more people,” he says. “It’s a great opportunity to provide some of that.”
A version of this article appears in the February issue of Oregon Business.