Buying Time for Heritage: How to Save an Endangered Historic Property

Buying Time for Heritage

Buying Time for Heritage

How to Save an Endangered Historic Property

Revised and Expanded Edition

J. Myrick Howard

THE UNIVERSITY OF NORTH CAROLINA PRESS

Chapel Hill

This book was published with the assistance of the Richard Hampton Jenrette Fund of the University of North Carolina Press.

© 2023 The Historic Preservation Foundation of North Carolina, Inc.

Originally published by The Historic Preservation Foundation of North Carolina, Inc., in 2007.

All photographs were taken by the staff, board, or volunteers of Preservation North Carolina unless otherwise noted.

All rights reserved

Designed by Jamison Cockerham

Set in Scala and Sentinel

By Jamie McKee, MacKey Composition

Manufactured in the United States of America

Cover art: Left: House no. 14, Glencoe Mill Village, Alamance County. Photograph by Preservation North Carolina, 1997.

Right: House no. 26, Glencoe Mill Village, Alamance County. Photograph by Paul Hungerford, 2008.

LIBRARY OF CONGRESS CATALOGING-IN-PUBLICATION DATA

Names: Howard, J. Myrick, 1953– author.

Title: Buying time for heritage : how to save an endangered historic property / J. Myrick Howard.

Description: Revised and expanded edition. | Chapel Hill : The University of North Carolina Press, 2023. | Includes bibliographical references and index.

Identifiers: LCCN 2023004207 | ISBN 9781469677002 (cloth ; alk. paper) | ISBN 9781469677019 (ebook)

Subjects: LCSH: Preservation North Carolina (Organization) | Historic buildings—Conservation and restoration—United States. | Historic buildings—Conservation and restoration—North Carolina. | Historic preservation—United States. | Historic preservation—North Carolina.

Classification: LCC NA111 .H69 2023 | DDC 363.6/9—dc23/eng/20230217

LC record available at https://lccn.loc.gov/2023004207

Contents

Foreword

Preface

Introduction

1 Historic Preservation Matters

Making the Case for Historic Preservation

2 Real Estate Is the Name of the Game

Preservationists Need to Know and Understand Real Estate

3 Working with Endangered Properties

How Preservation North Carolina Works with Property

4 Alternatives to Outright Acquisition

Using Others’ Time and Money to Do Your Work

5 Going to the Mat for a Property

When Acquisition Is the Only Alternative

6 The Architectural Animal Shelter

How to Market That Poor Pitiful Pup

7 Closing the Deal

Getting from the Ideal to the Achievable

8 Staying True to the Building

Finding a Balance between Purity and Flexibility

9 Armstrong Hotel Apartments

Weaving Together Tools and Partners

10 Mills and Mill Villages

Larger, More Complex Projects

11 Neighborhoods

Using Real Estate Skills for Revitalization

12 Protection without Ownership

Using Easements to Protect Properties

13 Building Relocation

Move It or Lose It

14 Partnerships for Preservation

Playing Well with Others to Save Important Places

15 Working with Community Institutions

Leveraging Your Knowledge and Contacts

16 Museums and Stewardship Properties

They’re Real Estate, Too

17 When Success Is Elusive

Dealing with Disasters and Near-Misses

18 The Functional Nonprofit Preservation Organization

Strong Staff and a Supportive Board

19 The People of Preservation

Preservationists as Social Capital

Acknowledgments

Appendix A: A Sampling of Other Revolving Fund Programs

Appendix B: Sample Historic Preservation Agreement (with Annotations)

Appendix C: Sample Waiver of Right of First Refusal

Index

Foreword

Some of America’s favorite cities weren’t always much loved. By the middle of the twentieth century, places like Charleston, Providence, Pittsburgh, Galveston, and Savannah were considered places to pass on by. Now, they routinely appear on best of lists.

Historic preservation transformed these places. Local organizations—headed by such fearless preservation legends as Frances Edmonds, Clark Schoettle, Arthur Ziegler, Peter Brink, and Lee Adler—were deeply involved in finding preservation solutions for real estate problems. Each of these city heroes became, in a sense, a preservation developer, operating revolving funds to gain site control over troubled properties and put them back into beneficial use through sales, favorable loans, or full development.

The legacy of these preservation leaders is well worth understanding in the twenty-first century. This book tells how Preservation North Carolina has used its revolving fund to save many hundreds of buildings all across the state for posterity. Avoiding the usual real estate jargon, the author translates the complicated world of real estate development into concepts we can all understand and embrace.

To the above list of legendary preservation leaders, I would add my colleague and friend, Myrick Howard. As president of Preservation North Carolina, Myrick has spent more than forty years catalyzing the transformation of vacant and underutilized historic real estate into a wide range of uses, including private homes, affordable housing, nonprofit hubs, and business incubators, to name but a few. For decades he’s also been teaching other preservationists, both fellow professionals and university students, how to do the same. One of the most popular sessions at the national preservation conference for more than two decades, Real Estate Is the Name of the Game, featured Myrick with other preservation notables.

Historic preservation—and the use of real estate tools to achieve it—makes more sense in the twenty-first century than ever.

Older buildings, when retrofitted, can be just as energy efficient—or more—as their newer cousins. Reusing existing buildings is fundamentally green: by not wastefully sending materials to the landfill, and by reducing the manufacture and use of huge amounts of new materials. In short, preservation is climate action.

Preserving our older buildings also helps tell the stories of all Americans—from the schools we attended, to our places of worship, to where we make a living. This book helps communities, both large and small, rural and urban, Black and white, successfully turn endangered or neglected historic buildings into financial, ecological, and community assets. Myrick provides inspirational stories as well as practical advice to that end.

Adapting historic resources to effectively meet current needs and modern uses creates more economically robust, sustainable, and equitable communities. This book guides us all on how to use real estate knowledge to help reach that attainable future.

Read it and be inspired.

Paul W. Edmondson

President and CEO

National Trust for Historic Preservation

Preface

You should write a book. I can’t tell you how many people have told me that, even after I wrote the first edition of this book! Having worked with endangered historic properties at Preservation North Carolina (PNC) for more than forty years, I can tell innumerable stories of both hurry-up (agonizing cliffhangers) and wait (projects that seem to take forever). I’ve visited fascinating places down back roads throughout North Carolina and worked with a wide spectrum of humanity.

The stories that I tell in this book belong to many people. Through the years, I have been the beneficiary of the ooohhhs and aaaahhhs of audiences who see photos of properties that have been transformed from dilapidated wrecks into pristine jewels. The accolades should additionally go to the local contact who let us know about the property, the purchaser who took the risk of buying and renovating it, the craftspeople who did the work, the lender who provided capital despite the building’s condition, and a host of others.

Historically speaking, we at Preservation North Carolina are in the picture for only a fleeting moment with each endangered property. It’s a critical moment, when the property (and its stories) might otherwise be lost to posterity.

Together, we are indeed buying time for heritage.

Buying Time for Heritage

Bingham School, Orange County. Photograph by Jim Lamb, 2019.

Introduction

In 1974, when noted Savannah, Georgia, preservationist Lee Adler spoke to a gathering of the North Carolina Society for the Preservation of Antiquities about the Historic Savannah Foundation’s pioneering preservation revolving fund, the thirty-five-year-old Antiquities Society was in generational crisis.

On the eve of the American bicentennial, the society’s old guard was passing the torch. The Antiquities Society had been founded in 1939, mainly by ladies of status or wealth, to encourage preservation of North Carolina’s most prominent historic sites. Through its work the Antiquities Society had founded or assisted dozens of museums. After three decades of devoted advocacy, the society had successfully led the effort to reconstruct Tryon Palace in New Bern, the state’s colonial seat of government. North Carolina would no longer have to play second fiddle to neighboring Virginia and its colonial capital, Williamsburg. While no one else seemed interested in historic preservation, the Antiquities Society persisted and persevered with its righteous message—with real achievements to show for its efforts.

But by 1974, the times had caught up with the Antiquities Society. Its founders were aging out; those still alive were in their seventies and eighties. The group had been no match for the federal urban renewal and interstate highway programs of the 1950s and 1960s. A well-intentioned decision to grant life memberships for fifty dollars had decimated the budget; the group had hundreds of life members who felt no obligation to pay dues. The Antiquities Society was in deep trouble.

In 1974, a new generation was coming to the fore. Younger and more assertive, these preservationists were smitten by Lee Adler’s tales of blocks of Savannah buildings being saved by an aggressive preservation organization. Museums were no longer the preservation solution of choice. These new preservationists talked of economic impact, community revitalization, revolving funds, tax laws, zoning, and even lawsuits.

This booklet illustrates the disheartened spirit of preservationists in the 1970s when North Carolina’s new statewide revolving fund was established. The building on its cover, the Dodd-Hinsdale House in Raleigh, was sold for rehabilitation by Preservation North Carolina with protective covenants nearly two decades later.

Adler encouraged the group to consider creating a statewide revolving fund for historic preservation. No other state had done it, but the idea had appeal. It might just work in North Carolina, a state of small cities and rural areas. Unlike Virginia (where Williamsburg and Richmond dominated preservation) and South Carolina (which had Charleston), North Carolina had no towering giant in preservation. For centuries the state had been called—sometimes with pride, sometimes with derision—the vale of humility between two mountains of conceit. Its built heritage was relatively modest and spread widely across the state.

But the banner of the Antiquities Society was too tattered to lead this bold new initiative to success. For starters, the society had a board with more than one hundred directors who gathered only once a year for a breakfast meeting. For work with real estate, which often requires immediate action, such a board would be a disaster. Further, the volunteer-driven society would have a difficult time raising the funds necessary to launch the effort.

A series of organizational changes resolved the generational impasse. The Antiquities Society updated itself with a more modern name, the Historic Preservation Society of North Carolina; and it adopted a bundle of new initiatives, such as a regular newsletter, annual conference, and broadened awards program. A smaller executive committee would govern the organization.

In 1974, a separate organization was spun off to carry out the creation of a new statewide revolving fund. In 1976, a little more than a year later, the new fund (the first of its kind in the nation) was launched with a $35,000 grant from the Mary Reynolds Babcock Foundation to hire its first full-time director, Jim Gray of Winston-Salem, and get started.

The Evolution of the Fund

Since its first property transaction in 1977, Preservation North Carolina (PNC) has operated its singularly successful statewide Endangered Properties Program (aka revolving fund) in North Carolina. The premise is simple: Preservation NC acquires endangered historic properties and then finds purchasers willing and able to rehabilitate them. In every case, as a condition of purchase, covenants are placed on the property to ensure its protection in the future. Over time, the scale and complexity of PNC’s projects have grown.

Small. At the beginning, Preservation North Carolina’s Endangered Properties Program worked to find buyers for rural and small-town historic houses. These abandoned properties were often deemed to have little or no value in the marketplace. Yet when PNC advertised these properties, hundreds of potential buyers emerged to inspect each one, and PNC often found itself having to choose between competing offers. These properties have brought new blood, new energy, and new investment to previously moribund communities. The economic impact is unmistakable; numerous properties that sold for $25,000–50,000 before restoration are now on the private market for hundreds of thousands of dollars … or more. Individual houses in rural towns bring with them institutional risk in the range of only a few thousand dollars, making them good prospects for a properties program that is just getting started.

Bigger. As PNC got comfortable with working with property, it set its sights a little higher. In the early 1980s, Preservation North Carolina targeted endangered historic downtown buildings, working in close collaboration with the North Carolina Main Street Center. Leading by example, Preservation NC’s work resulted in some of the first major downtown rehabilitation projects in several Main Street communities. In the mid-1980s, PNC’s work with the historic Egyptian Revival–style Masonic Temple in downtown Shelby resulted in one of the state’s first examples of downtown residential development. Folks were incredulous that so many people wanted to live downtown, and the project’s immediate success in attracting residents was broadcast statewide.

Bigger still. Success with downtown projects gave the organization the confidence to work with more demanding projects: schools. In the late 1980s, Preservation North Carolina shifted its focus to the adaptive use of historic school buildings. Throughout the state, public school buildings were being vacated as infeasible for continued use. Rather than see them destroyed, PNC developed a comprehensive program to encourage their rehabilitation for new uses.

The Endangered Properties Program has placed numerous school buildings into new ownership, resulting in a wide variety of new uses, both private and public. PNC’s work with schools has had numerous community benefits. Neighborhoods have not experienced the decline resulting from having a vacant white elephant in their midst. Local tax bases have been enhanced. The public’s investment in school buildings has not been wasted, as many school boards now have active interest from private buyers for vacated schools.

A feasibility study for the Egyptian Revival–style Masonic Temple Building in Shelby suggested that the property could be renovated for a mixed use of offices and residences. One of the first downtown buildings in North Carolina in modern times to be renovated for apartments, its quick lease-up surprised many and inspired others.

Many historic schools now have new public uses, such as city halls and arts centers. A number of historically African American schools have assumed new lives, often as community centers. Thousands of units of affordable housing have been developed in former classrooms. Several former public school buildings are now serving new educational purposes as charter schools and private religious schools. Many private developers and local governments now view former school buildings as opportunities rather than millstones.

Laboratory Cotton Mill, sited on the South Fork of the Catawba River near Lincolnton, has been adapted into a special events venue. Its name derives from the mill’s use during the Civil War as a laboratory for the production of medicines for Confederate troops. Sitting vacant, it was donated to Preservation North Carolina and sold for reuse.

Very large and very challenging. Since the mid-1990s, Preservation North Carolina has been working to preserve the state’s historic industrial buildings (such as mills, warehouses, and mill villages). Due to changes in the global economy, North Carolina’s industrial landscape dramatically changed in the 1990s, leaving behind dozens of giant turn-of-the-century historic factories. These buildings present both challenges and opportunities to a local community. A large vacant mill can be a cancer if it remains empty and unused. Surrounding neighborhoods and commercial districts will deteriorate, and crime will increase. The building itself will be subject to vandalism, vagrancy, and arson. Businesses and individuals looking for relocation opportunities will perceive the town as dying, feeding the downward spiral. Alternatively, renovated for new adaptive uses or for new industrial or business uses, a large old factory or mill can provide an outsized economic boost. Apartments (both market-rate and affordable) and condos have proved popular in renovated historic mills, partly because of the wonderful expansive interior spaces and partly because of the mills’ walkable downtown locations. An incubator or business development center in a mill can offer inexpensive space for new job development. Developed for mixed uses, an old building may attract tourists and stimulate new economic growth, creating housing and new businesses without sprawl.

In those rare instances where they remain intact, mill villages surrounding the factories have become a signature success story for Preservation NC. Usually, the mills provided worker housing for their employees who were often moving into town from the farm. Those mill villages had scores, if not hundreds, of modest well-built houses as well as the mill office, store, and recreation facilities. Preservation NC has covenants on more than 100 houses and associated buildings in historic mill villages. That story will be told later.

Preservation NC has undertaken several important industrial heritage projects. These challenging projects are much larger than any previously undertaken by PNC, and they have resulted in much greater community benefits.

What’s in a Name?

We used to say that Preservation North Carolina operates a revolving fund; now we talk about our Endangered Properties Program. The classic definition of a preservation revolving fund is a pool of capital created and reserved for preservation, with the condition that the money be returned to the fund to be reused for similar activities. That definition no longer reflects the reality of nonprofit preservation property work, as this book will repeatedly illustrate.

Real estate expertise is much more important than readily available capital in working to save endangered properties.

The Rewarding Results of Decades of Property Work

Nearly fifty years after Lee Adler spoke at that meeting of the Antiquities Society, the accomplishment record of the succeeding organization, Preservation North Carolina, no doubt exceeds its founders’ wildest dreams. The organization has saved more than 500 endangered historic properties, many of which would otherwise have been lost, and protected another 300-plus with preservation easements. These properties represent considerably more than $500 million in private investment for purchase and historic rehabilitation.

Direct property work confers special credibility on preservation organizations. Preservation North Carolina can be a stronger advocate for reusing school buildings because it has purchased and resold more than two dozen schools, such as the Mayworth School in Cramerton, now affordable housing for the elderly.

Many of these properties are true community landmarks. They have ranged from small eighteenth-century houses to large twentieth-century schools, factories, and hospitals. Buyers have put these properties to a multitude of new uses, adding hundreds of millions of dollars to local tax rolls and creating numerous jobs. Properties have been adapted into more than 2,000 new units of affordable housing. Thousands of acres of open space have been placed under protective covenants, perpetually restricting their development. Today, the organization employs four full-time professionals who work exclusively on saving the state’s endangered historic places, not counting support staff.

Preservation North Carolina, with its direct real estate experience, has been an able advocate for preservation incentives. Key elements of North Carolina’s historic rehabilitation tax credit program, initiated in 1993, were created in direct response to PNC’s own projects. Those incentives have generated more than $3.25 billion in historic rehabilitation (as of 2022) and have been extended through 2030.

This book attempts to explain why PNC’s pioneering effort has succeeded when others have faltered and to provide insights and inspiration from the organization’s decades of direct preservation action.

Before a preservation organization launches into a program to work directly with endangered properties, it needs to reach a consensus about what it is trying to achieve. The goals vary. They may include preserving history, architecture, individual landmarks, and landscapes; revitalizing downtowns; renewing neighborhoods; building community; increasing the stock of affordable housing; and promoting racial equity. Each requires specialized tools and focused efforts.

The field of historic preservation is important for a veritable host of reasons. That’s one of its joys—and one of its challenges.

A Few Salient Conclusions about Preservation North Carolina’s Work

Buying time is usually the most important thing that a preservation organization can do to save an endangered historic property. If you can stop the clock on demolition, vacancy, or disuse, even for a few months, you make it more likely a preservation solution can be found. Our temporary intervention enables an already historic building to continue to enrich lives for many decades to come.

Unlike the efforts of most preservation organizations, Preservation North Carolina’s revolving fund was launched with a single purpose. Unencumbered initially by membership events, conferences, newsletters, and the like, in its early years the fund focused exclusively on saving endangered historic properties (i.e., real estate). That focus, which has endured despite broadened activities, has brought financial support, credibility, and an enviable record of tangible achievement.

Preservation North Carolina has usually avoided the temptation to renovate its endangered properties or to make long-term loans to buyers. By using options and selling properties in as-is condition, PNC can work with more properties and perform more nimbly, since it has less money invested in any single property.

When other options are not available, Preservation North Carolina judiciously borrows funds to acquire or stabilize endangered properties of significance. Most folks don’t buy their homes with cash, especially on short notice; why should a nonprofit be any different?

Preservation North Carolina has achieved surprising continuity in its human resources. Many of its professional staff members have stayed with the organization for years, and its board is populated by a mix of old-timers and newcomers. (The organization’s bylaws contain term limits, so the composition of the board is ever changing.) Continuity has deepened institutional memory, enhanced donor confidence, and supplied political credibility.

The organization has generally reached a workable balance between board responsibilities and staff empowerment. Working with real estate requires quick decisions. Without the capacity to act quickly and decisively, an organization working to save historic buildings is doomed.

Preservation North Carolina works with properties (no matter how raw or complicated) that offer some prospect for success. If it’s clear that we’re not going to be able to save a property, PNC moves on to other properties that are in need.

Although many preservationists are quick to engage in a public squabble to save a property, PNC has found that fighting is seldom good for a real estate-oriented preservation organization.

The distinctive woodwork in Woodside, the Caleb Richmond House in Caswell County, came from the shop of Thomas Day, a free Black cabinetmaker. Based in nearby Milton, Day is believed to have been North Carolina’s leading maker of furniture and architectural woodwork prior to the Civil War. His life story is remarkable. Preservation North Carolina holds an easement on the property with extensive protection of interior elements. Photograph by Tim Buchman, 1988.

1

Historic Preservation Matters

Making the Case for Historic Preservation

Historic preservation makes for strange bedfellows. Under the same tent, one can find Colonial Dames, environmental activists, Civil War reenactors, downtown advocates, artists, city planners, African Americans, gay people, ardent conservatives, and any combination thereof! The reason they can fit under the same tent is that historic preservation signifies different values for different people.

Architecture and History

Preservation can be about preserving a community’s architectural legacy. Whether working to save a fine eighteenth-century Georgian courthouse, a flamboyant Victorian storefront, or an inventive 1950s Modernist home, many preservationists can articulate the value of architecture as the most public form of visual art. These buildings bring beauty, variety, continuity, identity, and richness to a community. Where historical value is added to architectural significance, preservationists can make their best case.

History certainly has its own credentials in preservation. When historical significance has to stand on its own, making the case for preservation becomes more challenging. A different set of preservationists may be inspired by a modest or architecturally undistinguished home or school that is significant solely because of its connection to a person, event, or time. As the movement evolves, discussions abound about whose history is being told and whether a site has sufficient integrity to convey its significance. Diverse preservationists and diverse properties convey new and distinctive stories. The movement must continue to find new ways to think and talk about why buildings matter. The language used by connoisseurs of historic architecture often doesn’t apply. A one-room schoolhouse or a Black Masonic lodge is important for reasons other than architectural details or economic development. Their suitability for adaptive use may be limited, but their value as community anchors may be enormous.

Years ago, preservation broadened beyond individual buildings to historic districts and downtown areas. The numerous success stories about neighborhood and downtown revitalization have spawned a series of economic impact statements for historic preservation. Quantifiably, historic preservation is a good tool for encouraging sustainable community reinvestment. Now preservationists are invited into discussions about a wide gamut of community issues, from affordable housing to containing sprawl, from downtown revitalization to heritage tourism, from highway beautification to adaptive use. Even political candidates have learned that historic preservation can be a powerful platform with the electorate.

Environment and Sustainability

Some preservationists come to the tent through environmental interests. Reduce, reuse, recycle (the mantra of environmentalists) would be a sensible slogan for preservationists. Preservation has been called the ultimate recycling. Notably, it is also about reducing and reusing as well as recycling. The vast amount of energy and nonrenewable materials consumed in the construction of a new building, and the farmlands and forests lost as sprawl advances, should give any citizen pause.

Much has been written in recent years about sustainability. Sustainable development is about not just environmental sustainability but also economic and social responsibility. Historic preservation contributes to all three: environmental, economic, and social responsibility.

Others adhere to the old saying, They don’t build them like they used to—and with good reason. Anyone who’s owned a historic house for several years can attest to how quickly modern materials fail, especially in comparison with older materials. Modern additions to historic buildings often exhibit more structural and material failures than their historic counterparts. Our ancestors did not build with the idea that their structures would have a life expectancy of twenty or fewer years; they built with the expectation that their children and grandchildren would continue to benefit from their efforts. A recent syndicated column recounted—without irony—the life expectancies for various building components: twenty years for roofs, fifteen for windows, ten for certain siding products and mechanical systems, and much shorter durations for electronic gadgetry. It was downright depressing.

When all is said and done, rehabilitating a building that’s in good structural condition is generally going to be less expensive than constructing a new building of similar size and quality. Reduced efficiencies of use with a renovated historic building are often offset by lower construction costs, better materials, and more character. Project after project demonstrates that a judicious full renovation of a building costs less than a similar-sized replacement.

When I’m told that rehabilitation is more expensive, I respond with pointed questions. Are the contractor and architect experienced in renovation? Just as you wouldn’t want a brain surgeon to do open-heart surgery, you don’t want to entrust a historic rehabilitation project to professionals whose primary business is new construction. It’s a different set of skills. Is plaster being torn out for replacement with drywall? If so, is it necessary? Or is the contractor being lazy by not finding craftspeople who can repair the plaster at a much lower expense? Anyone who has lived with both plaster and drywall will probably confirm that plaster is the superior building material. Are the windows and doors being replaced? If so, why? Is replacement a good investment? How long is the replacement apt to function properly? North Carolina has numerous buildings with double-glazed windows whose vacuum seals have failed after less than a decade, thereby eliminating any energy advantage over historic windows simply retrofitted with storm windows. Usually, excess expense is a sign that too much is being done to the building, often stripping the historic building of its integrity and character.

The Rev. Plummer T. Hall House (left) and the Willis and Eleanor Graves House (right) are two of a small number of surviving landmarks from the freedmen’s village of Oberlin,