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Updated: May 18, 2020 The Real Deal

Hartford apartment leasing slowed by COVID-19 crisis

Photo | Contributed Hartford welcomed 300 new apartments at 101 Pearl St. and the North Armory at Colt Gateway (pictured) in early April. Leasing at both facilities, landlords say, has been slower than expected due to the coronavirus pandemic.
Colt, 101 Pearl apartment rents 
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A pair of long-awaited apartment conversion projects in downtown Hartford wrapped up in recent weeks, adding more than 300 new living units to the center city’s steadily growing residential market.

However, the early April debuts of Spectra Pearl at 101 Pearl St. and the North Armory at Colt Gateway were overshadowed as COVID-19-related business closings caused financial uncertainty for some prospective renters and marketing challenges for building operators.

Leasing at both properties has been slower than initially projected this spring, landlords say, as a handful of potential deals with residential and commercial tenants fell through due to the public health emergency.

HBJ Photo | Joe Cooper
Spectra Pearl at 101 Pearl St. in downtown Hartford.

“The challenge is it’s still a secret. A lot of people don’t know it’s done because there aren’t feet on the street now,” said Jeffrey D. Ravetz, principal of New York City developer Girona Ventures, referring to the completion of the 101 Pearl St. apartments.

Girona partnered with Wonder Works Development and Construction Corp. in the $50-million conversion of the former office buildings at 101 and 111 Pearl St. into apartments. They also own hundreds of other apartments downtown on Trumbull Street and Constitution Plaza, all under the Spectra banner.

It only took six months to lease up the 101 studio, one- and two-bedroom units at 111 Pearl St., which debuted just over a year ago.

Because that building leased quicker than anticipated, Ravetz said he expected the 157 units at 11-story 101 Pearl St. to be fully occupied by this fall. But that likely won’t happen since it has 20 apartments, or 13% of all units leased.

“When we leased 111 Pearl St. we leased it during what we viewed to be a challenging period,” Ravetz said of disruptions on-site caused by ongoing construction at neighboring 101 Pearl. “101 should have at least been able to lease up at the same rate of six months.”

Photo | Contributed
A lobby at 101 Pearl St.

Ravetz said three prospective commercial tenants, including at least one food-oriented business, were negotiating lease terms to occupy most of the 15,400 square feet of retail space at 101 and 111 Pearl, but those deals have been put on ice.

“We had three tenants that had other locations and wanted to be in the epicenter of downtown Hartford and our projects were going to have 258 tenants right on top of their heads,” Ravetz said, noting that he’s still bullish on future leasing. “At some point this will be further and further in our rear-view mirrors and we will be in better times.”

Colt Gateway, the final piece of a $120-million redevelopment of the former Colt gunmaking facility adjacent to Interstate 91 on Huyshope Avenue, has experienced similar leasing challenges.

Ashley Percy, a leasing manager at Colt Gateway, says the property has leased 26 of the 48 studio, one- and two-bedroom units at the five-story North Armory building. That hasn’t met leasing goals, but Percy said she’s still pleased with the level of inquiries for space at the North Armory, converted for $14 million by the development team of Hartford-based CG Management Co. and majority partner Chevron Corp.

“Without COVID-19 we were hoping to be 90% leased by June,” she said. “But it really hasn’t impacted us the way I thought it would. We’ve been able to lease a couple units a week, and we are still getting good traffic.”

Photos | Contributed
The North Armory at Colt Gateway apartments debuted in early April.

Leasing, marketing during a pandemic

Colt Gateway and Spectra Pearl are turning to virtual marketing strategies to promote available apartments via social media, email, videoconferencing and other online marketing tools. In-person tours, at a safe social distance, are also provided upon request.

Colt’s North Armory, which compliments 129 apartment units at the complex’s South Armory, has implemented new maintenance protocols that involve regular deep cleanings of the property. Other rule changes include staggering move-in dates to ensure incoming residents are not sharing common areas, stairwells or elevators, Percy said.

The Colt complex is usually busy this time of year with commercial tenants that include insurance-software and services provider Insurity and Hooker Brewery. But the property is much quieter now that nonessential businesses there are either closed or working remotely.

“I definitely think things are slower around our community,” Percy said. “There’s definitely a different vibe around the property but still good.”

At 101 Pearl, Spectra is also adopting new rules for cleaning common areas, a two-floor fitness center and a 6,000-square-foot rooftop lounge that houses outdoor and indoor seating, a kitchen and outdoor theater area. Other common area amenities being maintained include a bocce court, art studio, pet spa, meditation room, yoga studio and virtual golf/hockey/baseball simulator.

Amenity spaces at Spectra apartments, now equipped with hand sanitizer stations and wall signs announcing maximum capacity rules, are expected to be available again the same day Connecticut plans to gradually reopen the state — May 20.

“I know that my cleaning expense is going way up,” Ravetz joked. “Amenity spaces used to be a big attraction. Now it’s a little complicated.”

Spectra also continues to rely on virtual, self-guided tours, which it typically only used for tenants coming from overseas or out of state, said senior property manager Laurie Waddell.

Although leasing at 101 Pearl has been more modest than expected, Waddell said overall inquiries are up, in part, because people are hoping they will get a discount on rent during the pandemic. Spectra is also fielding numerous calls from New York City residents looking for three-month leases to flee Manhattan until the COVID-19 crisis subsides.

Waddell said several New York residents have signed leases at Spectra properties downtown, including at least one healthcare worker.

“We are seeing more leads than we did at the same time last year,” she said, adding that lease renewals are also up year-over-year. “We definitely see people wanting a deal.”

Joe Cooper is HBJ’s web editor and real estate writer. He pens “The Real Deal” column about commercial real estate.

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