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Preserving Historic Buildings Has Handsome Payoff

Hartford Courant Editorial

May 04, 2012

Few people ever regret saving a historic building. A preserved and reused structure maintains a tangible tie with local history, retains the aesthetic quality of an area and contributes to our connection with the community, our sense of place.

In addition, it turns out, historic preservation makes good economic sense.

That was the conclusion of two studies by real estate and economic development consultant Donovan Rypkema, a leading expert in the economics of historic preservation.

How Historic Tax Credits Pay Back

In the first study, for the State Historic Preservation Office of the Connecticut Department of Economic and Community Development, Mr. Rypkema studied the effects of the state's historic preservation incentives from 2000 to 2010 and concluded they made a substantial contribution, despite the recession.

In projects completed under the state's three tax-credit programs for historic properties, $32 million in credits triggered nearly $160 million in private investment creating 560 jobs and nearly $30 million in wages and generating more than $12 million in state and local taxes.

All of the state and federal incentive programs together generated $450 million in private investment and created about 6,400 direct and indirect jobs in the state, he found.

The effects are greater if the staggering costs of demolition are thrown in. For example, if the building at 410 Asylum St. in Hartford had been torn down, as first planned, it would have required the energy equivalent of almost 10,000 gallons of gasoline to tear it down and haul it away. The waste would have been the equivalent of 21 days of trash for the entire city, and would have wiped out the benefit of the last 21 million aluminum cans that were recycled. Fortunately the building was saved and turned into affordable housing by the nonprofit group Common Ground.

Thus, saving a historic building is perhaps the ultimate recycling program.

Property Values Go Up

Mr. Rypkema's second study, for the Connecticut Trust for Historic Preservation, looked at the effects on property values of being in a local historic district. He looked at six historic districts in four communities: Milford, Canton, Windsor and Norwich.

In none did being in a historic district reduce property values, and in three of the four, properties within the historic districts increased in value faster than those in the surrounding community. The outlier was Norwich, which has a good number of commercial and multifamily buildings in its two historic districts, particularly the Little Plain district, along with a lower median household income and a lower rate of homeownership.

But Mr. Rypkema sees a silver lining in the Rose City. The city's historic districts are providing good, affordable, value-for-money housing for persons with modest incomes.

And in Norwich as in all the other communities, the rate of foreclosure was lower in the historic districts than elsewhere. Mr. Rypkema concluded that there appeared to be a 2 to 4 percent value premium for properties located in historic districts.

The reason appears to be stability. Owners inside the district must get approval from a historic district commission before making alterations that would be visible from a public right of way. Character of the neighborhood is important, and the assurance that character will be maintained has an economic value.

However, only a small fraction of historic structures in the state are protected by local historic districts. In the four towns Mr. Rypkema studied, between 75 and 95 percent of homes that are at least 100 years old lie outside local historic districts. (Some are listed on the National Register of Historic Places, a nice honor that affords almost no protection for properties.)

Though we've lost so many, Connecticut still has a trove of historic buildings. Saving them is not only good for the spirit and for tourism, it is good for the pocketbook.

Reprinted with permission of the Hartford Courant. To view other stories on this topic, search the Hartford Courant Archives at http://www.courant.com/archives.
| Last update: September 25, 2012 |
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