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9/20/23
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The Perpetual Housing Fund of Utah, in partnership with Rocky Mountain Homes Fund, purchased 515 Tower, a 171.2k sf office building at 515 East 100 South in Salt Lake City. The property was sold by Nearon Enterprises, a privately held real estate investment company out of Walnut Creek, CA.
The buyer plans to convert the building to a variety of uses including 100 units comprised of low-income housing tax credit (LIHTC) affordable housing and moderate-income condos, impact-focused co-working space, and street-activating uses such as a locally operated coffee shop or a boutique restaurant. A future inline-addition phase of the project is planned to include a daycare and additional low- and moderate-income housing units including both apartments and condos.
Additionally, renters will have an opportunity to participate in ownership based on their time of rentership, providing an opportunity to earn a healthy down payment for the purchase of a home. This unique approach seeks to encourage future home ownership, the one determining factor for generational wealth.
Investments from Salt Lake City, Intermountain Health, and other investors have made the project possible. Further leverage of the development opportunity is achieved with the current parking garage that will be razed providing for additional apartments and condos in a second phase.
Located near downtown Salt Lake City, tenants will have convenient access by walking, biking or riding TRAX light rail to employment, restaurants, entertainment options and retail centers. The historical Capital District, the unique Avenues District, the Salt Lake City CBD, and The University of Utah campus, make it a uniquely desirable place to live and work.
Patrick Bodnar and Eric Smith of CBRE represented the seller in the transaction.
“When a tenant occupying nearly 50% of the building vacated in 2022, and with the office market conditions deteriorating, Nearon directed it efforts at an adaptive reuse conversion of 515 Tower to a multifamily asset,” said Bodnar. “Fortunately, the building possessed several key attributes that are favorable to resident, mixed-use conversion. As a result, there was considerable interest by several well-qualified bidders.”
Despite the anticipation of next year’s historical peak deliveries in Salt Lake County of apartment units totaling 7,404 units, affordable rental options remain in short supply according to CBRE Research. This project will be the first of its kind providing are more dedicated affordable option that is structured to empower renters to become future homeowners.
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