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155 apartments planned for Brady Sullivan Plaza in Manchester

  • Updated
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The Brady Sullivan Plaza at 1000 Elm St. opened in 1972 as Hampshire Plaza.

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Eight floors of the 20-story Brady Sullivan Plaza at 1000 Elm St. in Manchester may be developed into residences.

Brady Sullivan Plaza — one of the tallest buildings in the state — is the next commercial building in downtown Manchester set to include high-end apartments.

The company wants to create 155 apartments in the 20-story building at 1000 Elm St. The plan requires a change of use review and conditional use permit from the planning board. Brady-Sullivan representatives are due to meet with the board Jan. 6.

A portion of the building will remain commercial, according to co-owner Arthur Sullivan.

“It is something we’ve been thinking about for a few years,” he said. “With the market being what it is there is less of a need for office space and a greater need for apartments. We just felt it was the right timing to move forward with doing this phase of 155 units.”

The units will feature floor-to-ceiling windows with sweeping views of the city, including City Hall and the Uncanoonuc mountains.

“I think it is going to be one of the best residential buildings in the city,” Sullivan said.

Brady Sullivan also recently added 61 units to the Jefferson Mill on North Commercial Street for a total of about 111 apartments.

“Those units rented as quickly as anything we’ve had on the market in the past,” Sullivan said. “There is a lot of interest in the mill apartments.”

Other developers, including Gamache Properties and Red Oak Apartment Homes, are also converting downtown buildings into homes.

The plan for 1000 Elm St. includes apartments on the second, third, sixth, ninth, 10th, 11th, 12th and 14th floors for a total of 80 units, according to the plans. The ground floor and converted parking garage space will have 75 units.

“We have an abundance of parking,” Sullivan said.

The first-floor units will require a conditional use permit from the planning board. The Central Business District calls for commercial tenants on ground floors.

In all, the plans call for six three-bedroom, 147 two-bedroom and two one-bedroom apartments with an average of 1,000 square feet, according to the project application. The rent for the units have not been determined, Sullivan said.

Brady Sullivan purchased the 1000 Elm St. tower (previously called Hampshire Plaza), its mall and two parking garages for $25.5 million in August 2006. The building was built in 1972 and served as the former headquarters of Public Service of New Hampshire and other prominent businesses.

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12/27/21 Allegra Boverman/Union Leader. The Brady Sullivan Tower, at left, at 1000 Elm Street in Manchester, may be developed into residences.

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12/27/21 Allegra Boverman/Union Leader. The Brady Sullivan Tower at 1000 Elm Street in Manchester may be developed into residences.

The building was about 75% full when Brady Sullivan bought the property, with tenants such as the U.S. Bankruptcy Court, which eventually moved to a federal building in Concord.

In 2008, space was converted to include dorm space for the then-New Hampshire Institute of Art, which is now part of New England College. That space will become part of the market-rate apartments after the lease was not renewed, Sullivan said.

“We tried renting that space and it just remained empty for a long time,” Sullivan said.

The cost of the renovations have yet to be determined.

Shift in demand

The New Hampshire office real estate market remains in a “wait and see” period with a vacancy rate of 11.2%, a 2.7% increase from last year, according to an office market report by Colliers for the third quarter.

“The New Hampshire vacancy rate has steadily grown over the last two years with a more dramatic increase since the pandemic,” the report reads.

This created a shift in demand, according to Manchester developer Dick Anagnost. Companies used to look for about 200 square feet per employee, which in recent years has dropped to about 35-square-feet per employee, he said.

“The need for office space is going down but the need for housing is going up,” Anagnost said.

With the cost of new construction going up, many companies are looking for such adaptive re-use, which Anagnost called the “way to go.”

New Hampshire Housing estimates a need for 20,000 more housing units across the state to meet current demand and stabilize the market. Much of the state has a less than 1% vacancy rate where a balanced rental market has a vacancy rate of about 5%, according to NH Housing’s Residential Rental Cost Survey Report.

Manchester alone needs about 1,800 units, according to a study by the city.

“I don’t think you can build enough to meet the demand,” Anagnost said.

Will Stewart, Ward 2 alderman and executive director of Stay Work Play, said more housing is needed to recruit new workers to the state. Last month, the state had an unemployment rate of 2.7%.

He said the housing and worker shortages go hand in hand.

“We can’t build fast enough,” he said. “This will help with that.”

The new apartments are great for the city, Sullivan said.

“Having half-vacant buildings doesn’t do any good for us as landlords or for the city of Manchester,” he said. “So I think maximizing the building with residential and commercial is a win-win. It keeps people in the city. It keeps people going downtown.”

The customer base for Diz’s Cafe on Elm Street comes from businesses during the day and residents in the evening, said owner Judi Window.

“The more people who live downtown the better,” she said.

She hopes workers will continue to return to downtown in the new year.

“That gives us both lunch and supper during the week,” she said.

Other conversions

Gamache recently converted 21 apartments on Chestnut and Lowell streets and hopes to retrofit another building on Chestnut Street into another 12 units, for a total of 33 units.

Red Oak Apartment Homes received approval from the zoning board to retrofit the Independent Order of Odd Fellows building at 73 Hanover St. across from the Palace Theatre into 43 units.

Red Oak is also building a six-story, 95,288-square-foot building that will have 90 apartments, fitness club, office space, cafe and co-working space.

Two new apartment buildings are also set to be built, one with 249 units at the site of warehouse buildings on Depot and West Auburn streets and another with 77 units at the site of the Athens Restaurant and Central Ale House.

Sullivan said his company is always evaluating its real estate. The company is also converting the former Cigna building in Hooksett into apartments.

Sullivan said he recently spoke to a partner of one of the law firms in the 1000 Elm St. building who heard about the apartments.

“He said, ‘I am thinking about downsizing and selling my house and I think it would be great if I could have the opportunity to live in the building,’” Sullivan said. “I think a lot of people working in the building will want to live in the building.”