It's one thing to condo-convert a just-opened luxury apartment building. Recently completed, the property likely boasts all the latest technology features, from WiFi to cable. As the condo conversion phenomenon has continued, though, there are fewer and fewer of these brand-new buildings to convert, and now multifamily owners and condo converters are frequently turning to older apartment properties for conversion.
But there's a catch to this popular and profitable endeavor. "The only challenge would be if the physical building itself can handle the wiring," says Robert Kaplan, senior managing director for the Miami division of Holliday Fenoglio Fowler, a large real estate intermediary firm. The company's New Jersey division is set to do a condo conversion for Beacon Gardens, a 108-unit multifamily community in Point Pleasant Beach, N.J
And upgrading that wiring can be a big job. Talk to any condo converter, and they'll tell you it's not easy wiring up aging buildings to transform them into modern, high-tech friendly condos. Structures made of pure concrete are especially problematic. With no crawl space available, converters and wiring contractors seemingly have no place to put the wiring necessary for high-speed Internet, cable TV, or satellite dish connections.
Yet converters can't afford to accept that. "You can't sell a unit that doesn't have cable or multiple phone lines," says Rocky Stubbs, vice president of Comvest Capital Advisors, a Stuart, Fla.-based real estate management and development firm. "It's like selling a car without power windows."
After all, offering multiple phone lines, cable TV wiring, and high-speed Internet are no longer considered options or upgrades, but standard features in today's condo market. "If we didn't offer these features, it would take a hit on our prices," says Stubbs. "You can't sell a unit that's incomplete and not competitive to the marketplace–you have to meet the expectations of the market."
Remember the days of just one phone jack in a room? John Stuhrenberg does. And, as vice president at BellSouth Community Technologies, which handles both multifamily and residential property owner technology services, he sees a fair amount of these technology singletons today. Units in older structures tend to have only one phone jack or one cable outlet per room, he says, but most condo buyers prefer multiple media connections in their units.
But adding those multiple media connections can be a serious challenge.
"For residences in Florida that were built in the 1960s and '70s–most of those buildings never had cable TV hookups," Comvest's Stubbs says. "One of the projects we're slated to renovate, located in Satellite Beach, Florida, is built entirely of concrete. The building was constructed in 1964. It will be very difficult to retrofit the building to accommodate new technology. Unlike wood-frame structures, solid, all-concrete structures have no air space to accommodate the wiring that's needed for cable TV and high-speed Internet."
Other properties aren't as problematic. The Stoltz Cos. recently scooped up an $8 million renovation project for Mizner Court at Broken Sound, located in Boca Raton, Fla. The property, built in 1987, features 450 condo residences and townhomes in 47 two-story buildings. The renovation project, which is underway, will be completed by the end of 2006 and shouldn't be too hard to wire up: The units already have cable wirings in place, mostly because the structure isn't that old.
Archie Stoltz, vice president of the Stoltz Cos., a commercial and residential real estate firm in Boca Raton, Fla., believes that wiring up a condo conversion isn't so difficult in more developed communities because those areas are already equipped with Internet and phone hookups.
Condo converters faced with a tough tech upgrade do have a number of options available, though, from hiding the wiring within certain structures in the building to tearing down walls to make room for the wires. Others, such as Tracy Prince, suggest taking an undercover route via siding or molding. "We can run the wiring underneath the siding, so that you can't tell it's there," says Prince, a construction supervisor for Atlanta-based Cox Communications. "Or, we can place the wiring in molding or ... disguise it or run it inside the building's eaves."
Such approaches can work even with historical properties such as the Classen Building in Oklahoma City. Modeled after a Frank Lloyd Wright skyscraper, this former office building was gutted to make way for high-end condos. While the antiquity of the building was preserved, Cox was able to wire the structure for phone, high-speed Internet and cable TV.
Another strategy is to choose a common signal or one common wire that can handle voice, data, and video transmissions at the property. This results in only having to accommodate one physical path for the wiring that must be done and less time spent coordinating with multiple service providers all needing to run their own wiring into the building.
Regardless, though, converters and their contractors should prepare themselves for some tight spaces. Wiring might need to go inside the walls, through floors, into the molding, or through attics and basements.
And whatever you do, don't pick your contractor based on the lowest bid alone. "You have to make sure the contractors are experienced to do the work," Stubbs says. "You're retrofitting something that's existing–it's entirely different, and usually more difficult from completely starting from scratch."
–Abby Garcia Telleria is a freelance writer in Costa Mesa, Calif.