Renovations have begun at the historic Babcock Building in the BullStreet District after developer and building owner Clachan Properties secured federal funding to help finance the landmark’s $55 million transformation into luxury apartments.
Richmond, Va.-based Clachan Properties closed on a long-term, low-interest U.S. Housing and Urban Development loan last week, according to a BullStreet news release, as well as on a tax credit equity with partners PNC Bank Tax Credit Solutions and Foss & Co. The HUD loan, facilitated by Berkadia Commercial Mortgage LLC, will finance $39 million of the project. The balance will be funded by tax credits and developer equity.
“Closing on our HUD loan is a watershed moment for Babcock and Columbia,” Hugh Shytle, president of Clachan Properties, said in the release. “It is the culmination of three years of working with local, state and federal agencies, who were meticulous in ensuring that this grand building beloved by so many people could be brought back to life in a way that preserves its unique character. As the developer, we are fortunate to have great architects, engineers and contractors who worked long and hard for this day, and we had tremendous support from the city and county.”
The iconic cupola of the Babcock Building, which once housed S.C. State Hospital patients, was destroyed in a September fire. It will be replicated as part of plans to transform the 254,000-square-foot structure, listed on the National Register of Historic Places, into 208 luxury apartments ranging from one to three bedrooms.
The residential complex will include a pool, dog park, grilling garden and exercise facilities. The first of five phases is expected to be ready for occupancy in early 2022, according to the release, with the entire project slated for completion in three years.
Total project costs are expected to be $55 million, of which $39 million will be funded by the HUD Loan. The balance will be funded by tax credits and developer equity.
“This announcement is a tremendous Christmas gift to all of the Midlands,” Columbia Mayor Steve Benjamin said in the release. “The ability to get the HUD loan was essential because of the complexities involved in renovating such a massive, deteriorating building to the highest standards.”
The Babcock Building, designed in 1858 and completed in 1885 as the South Carolina Lunatic Asylum, has been empty since the last patients left around 1991. After minor repairs and a cupola repainting in 1994, the building deteriorated. A 2018 fire in one of its wings caused minor damage before a major blaze in September heavily damaged the center section and destroyed the cupola and much of the building’s interior.
Immediately after the fire, Clachan Properties said in a statement that the renovations would continue.
“After determining that no one was hurt in the fire, our biggest concern was the eligibility of the project for federal historic tax credits, which are a major source of capital for the project, as well as the added costs and scope of work that were unanticipated,” Shytle said in Thursday’s release. “But we worked our way through the process with the National Park Service, State Historic Preservation Office and HUD and everyone concluded that, thanks to the (Columbia) Fire Department’s heroic work, the essential historical elements of the building were left intact and the project could be salvaged.”
Project plans were presented to the Columbia City Council’s Bull Street Commission in October 2019.
The renovated Babcock Building is the centerpiece of the ongoing development of the 181-acre BullStreet District. The site of the Spirit Communications Park, home of the Columbia Fireflies, and the First Base Building, which houses several local businesses, BullStreet is anticipating the opening of a Starbucks next spring and Iron Hill Brewery & Restaurant next summer.
REI Co-op, the district’s first national retailer, opened this summer. Senior living facility Merrill Gardens began accepting residents earlier this year, and the second phase of TownPark townhomes is underway.
“We have made the renovation of Babcock a top priority for BullStreet, as its significance to the overall success of the district cannot be overstated,” Robert Hughes, president of BullStreet District master developer Hughes Development Corp., said Thursday. “The three years getting to this point have been arduous and exhausting. There were times when renovation did not seem possible, but Clachan Properties persisted. Their dedication to this project has been incredible.”