Sometimes you've just got to have faith. How else could you successfully turn a church into student housing on a tight 3-acre site in less than 18 months? The developers of Sanctuary Lofts in San Marcos, Texas, did just that, thanks to a little bit of belief in their vision and a whole lot of planning.

For Terry Mitchell, principal of Austin-based Momark Development, such faith wasn't hard to find. As soon as he saw the site of the First Baptist Church of San Marcos, he knew the location was ideal for student housing. (Mitchell had visited the site at the request of the church, whose congregation had outgrown the space and was looking for a buyer.

“I walked through the neighborhood and counted five frats and sororities within two blocks, 25,000 students a half a block away, and an H-EB [grocery store],” says Mitchell. “I said, ‘Man, what a great place to live.'”

ILLUMINATING PRESENCE: Panes of stained glass windows adorn the lobby of Sanctuary Lofts, a church–turned–student housing community in San Marcos, Texas. The developer was a partnership between Tekoa Partners and Momark Development.
Scott Van Osdol ILLUMINATING PRESENCE: Panes of stained glass windows adorn the lobby of Sanctuary Lofts, a church–turned–student housing community in San Marcos, Texas. The developer was a partnership between Tekoa Partners and Momark Development.

With Texas State University's San Marcos campus just blocks away, Mitchell was certain that students would agree. So he purchased the property for $1.5 million. He also agreed to maintain the building's 1900s façade, even though he was not legally required to preserve any components of the building. “I said, ‘I am not going to do this project if I have to tear down the building,'” says Mitchell. “We really have to stop destroying the heritage of our cities.”

The developer proved true to his word. Now known as Sanctuary Lofts, the building features 44 units of housing within the church's original shell, plus 158 additional units in two new connecting buildings. The refurbished building sparkles with panes of stained glass windows, which radiantly adorn not only the common areas but eight units. The original church pews reappear as seating in the leasing office, and a small chapel now serves as meeting space for various university groups.

HOLY GROUND Momark Development, together with Austin-based Tekoa Partners, had to work fast to get the project off the ground. They closed the deal in February 2005, broke ground two months later, and delivered the first building in August 2006. “We really had to scramble to keep on schedule,” says Mitchell. “But it's student housing. If you don't open it in August, you might as well wait a year.”

The project's biggest challenge? Maneuvering construction workers and their building materials around a small site with no staging area in an old town with narrow streets unequipped to handle big trucks.

Terry Mitchell

The situation forced the team to conserve space at the construction site. Contractors stored items off site until they needed them; one contracting firm handled both the rehab and new construction work to minimize the number of workers; and the crew was often bused to the site to minimize traffic congestion. “It was a logistical ballet of trying to get what we needed there when we needed it, but no more,” says Bill Lee, a partner at Tekoa Partners. “You really couldn't put anything down unless you picked something else up.” The biggest space saver: Crews built the parking garage last, allowing the big, empty lot planned for the garage to be used for storage space during nine months of the project's construction.

MIRACLE MARKETING

Despite all of Sanctuary Lofts' advantages, leasing turned out to be surprisingly taxing. Staff didn't have a finished building to show prospects, and—to make matters worse—students even doubted that the project would open in time for the school year. (They had cause for concern: In 2005, a student housing property missed its opening day delivery deadline.)

So developers showed prospects as much of the project as possible during the construction process. They built an off-site leasing office a mile from the community and displayed a suite of the furniture planned for the units. In April 2006, the development team convinced the city to allow limited access to the project on Saturdays and took prospects (via limo, no less) from the leasing office to the site, which helped persuade students that the project would open on time.

As promised, Sanctuary Lofts opened in August 2006, offering all of today's must-haves: furnished units with washers and dryers, a game room, clubroom, business center, coffee shop, fitness center, pool, and even tanning beds. Rents range from $450 to $950. “We leased up to 87 percent without a model to show,” says Mitchell. “I consider it a miracle.”

COMPARISON
COMPARISON

 ACTION ITEMS

  • Flaunt what you've got. Sanctuary Lofts' marketing campaign promotes its unique two-block proximity to campus.
  • Be resourceful. The developers purchased a house next to the project's site to get the 20 extra feet needed to build the city's required number of parking spots.
  • Honor the past and future. The project's two new buildings feature some historical elements of the church, but they aren't designed to be carbon copies.

PROPERTY: Sanctuary Lofts


DEVELOPER: Sanctuary Lofts


LOCATION: San Marcos, Texas


RENOVATION COST: $27.5 million


LENGTH OF RENOVATION: 16 months


SCOPE OF PROJECT: Adaptive reuse of a church into student housing
Scott Van Osdol PROPERTY: Sanctuary Lofts DEVELOPER: Sanctuary Lofts LOCATION: San Marcos, Texas RENOVATION COST: $27.5 million LENGTH OF RENOVATION: 16 months SCOPE OF PROJECT: Adaptive reuse of a church into student housing