Frederick Douglass Apartments
Frederick Douglass Apartments
Deal Type: Acquisition
Risk Profiles: Value-Add
Property Types: Mixed Use, Multifamily
1645 North Calhoun Street | Baltimore, MD 21217
Opportunity to Acquire a Historic, Mixed-Use Asset with Value-Add Potential
1645 N CALHOUN ST. | BALTIMORE, MD 21217
Harbor Stone Advisors is pleased to present Frederick Douglass Apartments, a historically significant mixed-use property situated in West Baltimore City. Originally constructed in 1924 as Baltimore City's first high school for African Americans, the building was converted into apartments in 1991 and underwent additional renovations in 2013 by a previous owner. The property benefits from its location in a designated Opportunity Zone and qualifies for two significant tax incentives: Low Income Housing Tax Credits (LIHTC) and New Market Tax Credits (NMTC).
The asset includes 83 residential units, comprising a diverse mix of (8) 1 Br-1 Ba, (58) 2 Bedrooms, (11) 3 Bedrooms, (3) 4 Br-2 Ba, and (3) 6 Br-4 Ba. Additionally, the property features three commercial spaces. These spaces are currently leased long-term to a recovery and behavioral health facility and an early childhood development center. Additionally, a letter of intent is in place with a community resource center. The current owner is also negotiating a bulk lease for six residential units in the basement.
Typical apartment finishes include white appliances, wood cabinets, laminate countertops, and a combination of carpet, tile, and LVP flooring. The current ownership has completed various capital improvements, such as roof and gutter/downspout replacement, solar panel installation, elevator enhancements, some unit upgrades, and HVAC replacements.
Frederick Douglass Apartments presents a significant value-add opportunity for a new owner through comprehensive unit modernizations. A proposed renovation scope—including new cabinets, black appliances, resurfaced countertops, updated bathrooms, and plank flooring throughout—is projected to achieve rent increases of at least $169 on average, aligning with comparable area properties.
Further income generation is possible by installing an on-site laundry center. This improvement would qualify the property for an additional $75 increase in voucher rents, a process simplified by the current ownership securing a contract with a laundry service company.
Finally, the building is legally licensed for 97 residential units, allowing for the potential creation of additional apartments. The existing 4 and 6 bedroom units were originally configured to accommodate prior non-profit tenants who bulk-leased space for a recovery center and women's shelter. A new owner can split these larger, more difficult-to-lease units back into smaller configurations, thereby generating additional rental revenue.
INVESTMENT HIGHLIGHTS
Unique Opportunity to Acquire a Historically Designated Mixed-Use Asset in West Baltimore City
• Includes 83 residential units, comprising a diverse mix of (8) 1 Br-1 Ba, (58) 2 Bedrooms, (11) 3 Bedrooms, (3) 4 Br-2 Ba, and (3) 6 Br-4 Ba
• Features 3 commercial spaces leased to long-term tenants and a bulk lease for 6 residential units in the basement is currently in negotiation
• Typical apartment finishes include white appliances, wood cabinets, laminate countertops, and a combination of carpet, tile, and LVP flooring
• Current ownership has completed various capital improvements, such as roof and gutter/downspout replacement, solar panel installation, elevator enhancements, some unit upgrades, and HVAC replacements
Multiple Value Add Possibilities for a New Owner
Located in a Qualified Opportunity Zone
• Property benefits from its location in an Opportunity Zone and qualifies for two significant tax incentives: Low Income Housing Tax Credits (LIHTC) and New Market Tax Credits (NMTC)
• Easy access to Downtown Baltimore and multiple modes of public transportation including bus stops and the the Penn North Metro Station
• Proximity to major redevelopments, including Druid Hill Park and The Village at Mondawmin, prompting economic growth in the area
• Major area employers/colleges nearby: Coppin State University, Baltimore City Community College, Social Security Administration, University of Baltimore, Maryland Institute College of Art (MICA)
Potential to Develop an Additional 80-100 Apartments On-Site
• The existing parking lot presents a significant redevelopment opportunity for a new owner. Initial evaluations suggest the viability of constructing a sizable mixed-use structure, potentially totaling around 105,000 square feet.
• This project is envisioned to feature 80 to 100 apartments situated above ground-floor space suitable for retail or community purposes.
VALUE-ADD OPPORTUNITY
Frederick Douglass Apartments presents a significant value-add opportunity for a new owner through comprehensive unit modernizations. A proposed renovation scope—including new cabinets, black appliances, resurfaced countertops, updated bathrooms, and plank flooring throughout—is projected to achieve rent increases of at least $169 on average, aligning with comparable area properties.
Further income generation is possible by installing an on-site laundry center. This improvement would qualify the property for an additional $75 increase in voucher rents, a process simplified by the current ownership securing a contract with a laundry service company.
Finally, the building is legally licensed for 97 residential units, allowing for the potential creation of additional apartments. The existing 4 and 6 bedroom units were originally configured to accommodate prior non-profit tenants who bulk-leased space for a recovery center and women's shelter. A new owner can split these larger, more difficult-to-lease units back into smaller configurations, thereby generating additional rental revenue.
CURRENT INTERIOR SCOPE:
- White Appliances
- Wood Cabinets
- Laminate Countertops
- LVP/Carpet/Tile Flooring
SUGGESTED UPGRADES:
- Black Appliances
- Resurfaced Countertops
- Updated Cabinets
- Updated Bathrooms
- LVP Flooring Throughout
NEIGHBORHOOD SPOTLIGHT: WEST BALTIMORE CITY
Frederick Douglass Apartments, located at 1645 North Calhoun Street, is in a residential area of Baltimore City, directly adjacent to the historic Bolton Hill and Mount Vernon neighborhoods.
The property is a short walk to several local amenities, including a Metro SubwayLink Station, which provides residents with direct access to Downtown Baltimore and Johns Hopkins Medical Center (Baltimore's largest employer). Carver Technical High School, one of the top ranking public high schools in the city, is also just a few blocks away.
Several major developments are taking place within a short distance of the property. Mondawmin Mall, and Druid Hill Park are both set to undergo multimillion dollar investment in the near future. Nearby university, Coppin State, has also received significant recent investment as part of an on-going revitalization effort.
Ample public transportation exists nearby, and residents of the property are within a short drive of North Avenue, the city's main east-west thoroughfare and a growing retail hub.
Opportunity Zones were put into federal law through the Tax Cuts and Jobs Act of 2017 to incentivize private investmentin distressed communities across the United States. The program provides a federal tax incentive for investors, whoinvest in real estate developments and operating businesses located in designated low-income communities through deferral and partial tax reductions of reinvested capital gains, and forgiveness of tax on new capital gains. Of the 14 Census Tracts in Maryland designated as Opportunity Zones by the U.S. Treasury, 42 are in Baltimore City. The subjectproperty is located in 1 of 6 Opportunity Zones in the surrounding area.
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