Project Phases

• INTRODUCTION AND OVERVIEW
• GET TO WORK
• • Flowchart of the Artist Space Development Process
  • Key Tasks in Artist Space Development
  • Project Phases
• FORMING A TEAM
• ON LOCATION
• FINANCE

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Photo courtesy of Art Works Downtown.

Similar to all real estate development projects, ASD can be divided into three major phases:

Pre-development

Pre-development is the most important phase in the development process as it determines the feasibility of a facility project and involves all the necessary preparation  for acquiring and/or renovating a property.¹ The Pre-Development phase may last from a just a few months to a number of years.  Given the breadth of activity entailed with the Pre-Development stage, it is often further divided into two sub-phases:

Phase 1 – Focuses on the initial feasibility study and any site-related issues. You may incur costs associated with gaining site control; conduting engineering and environmental studies; soil testing; design work; legal fees; etc.

Phase 2– If the initial study approves the project’s feasibility, further efforts are needed to obtain a commitment for financing from sources that you have identified in the study.  At this point you would also need to obtain various permits for acquisition and construction, architectural design, etc.

The major areas of work that you will need to complete during Pre-Development include but are not limited to:

Legal Matters

• Form agreements with a team of experienced professionals, including a lawyer, to help guide project leadership in the development of the facility.
• Obtain legal status for development with the help of an attorney  
• Obtain certificates, permissions, and other legal documents with the help of an attorney and an architect.
• Decide tenure/ownership structure for building (e.g. condominium, cooperative, etc).

Finance

• Make sure that a financing resource is part of the team of experienced professionals you have selected to work on the project.
• With assistance from each of the other members of your development team, determine financial feasibility. You will likely need to enlist the aid of an architect and/or engineer; financial specialist; attorney; and marketing team to do so.
• Identify and secure funding resources with the help of a financial specialist and supported by legal counsel.

Site, Design, and Construction

• Be sure that your development team includes experienced professionals that can support not only the acquition of your site, but also its design and construction
• Your initial planning and architecture design will likely require one or more of the following resources: a planner, architect, or landscape designer.
• Find and secure a property. Team members and resources like an architect, financial specialist, appraiser, broker, code consultant, etc. will all play important roles in this process.

Partnerships and Marketing

• Just as in the other aspects of your work, be sure that your development team covers the range of work involved, including experienced marketing professionals.
• Whether your project is led by members of the local community in which your facility will be located or not, be sure that you have also accounted for the resources required to enlist a critical mass of your communities' voices in the planning and development processes.
• Ensuring support from your local community also means enrolling the support of local government and representation.
• With the help of a marketing team identify and confirm the future users of your space so that you can develop a sound marketing plan.

Funding

• Pre-development funding can be difficult to obtain from private lenders due to the high risk perceived in investing at this early stage. Costs often need to be covered by developers or artists. Funding is sometimes available from non-profit lending institutions and the public sector, which is extremely valuable for space initiatives. Funding may come from, but not limited to, sources such as: Local HOME or CDBG fund; special programs by your local government; non-profit lenders such as LISC, CEDAC, and Enterprise. Additionally, a list of CDFIs may help you find a lending institution for Pre-development costs. LINC grantee, ArtistLink, has also provided Predevelopment Recoverable Grants for Artist Space in years past.

Acquisition and Construction

The major areas of work that you will need to complete at this stage include but are not limited to:

Site, Design and Construction

• Complete the transfer of the property to the organization (e.g.close the purchase of property; obtain title and property insurance; etc.).You will need an attorney for this step.
• Secure detailed architectural drawings and construction drawings with the help of an architect.
• Hire the contractor/team who will implement the construction of the facility, working closely with your architect.

Marketing & Partnerships

• At this stage you can begin to sell or lease units in your facility.
• You will also want to secure a management company or internal team to manage the facility on-going.

Funding

• Most lending institutions provide acquisition and construction loans. Permanent financing should be secured before seeking acquisition and construction loans, however, as the latter will be repaid by permanent financing.²  See “Construction and Permanent Financing” in Further Reading  for more information.

Management

Once the project is complete, you will now embark on a new wave of tasks and priorities, not only to sustain the facility itself, but to fulfil the purpose of your artist space. At this stage:

• Artists and other tenants can move in.
• Tasks related to ongoing facility management and maintenance will come into play. With sound planning the goal is to maintain long-term affordability for artists to live and/or work in the space that you have created.
• Debt-service begins.
• You will hopefully begin a set of life-long positive interactions with the residential and aritstic community that share a stake in the success of your new artist space!

Further Reading

“Construction and Permanent Financing.” ArtistLink.  Date of Access: Oct 30, 2009.  www.artistlink.org/?q=spacetoolbox/fordevelopers/financingspace/constructionpermanentfinancing

“Loans.” Local Initiatives Support Corporation. Date of Access: Dec 14, 2009. http://www.lisc.org/section/ourwork/products_services/loans

“Housing Development.” Community Economic Development Assistance Corporation. Date of Access: Oct 30, 2009. www.cedac.org/Housing.html#predevelopment

“Acquisition and Predevelopment Lending.”  The Enterprise Community Loan Fund.  Date of Access: Dec 14, 2009. http://www.enterprisecommunity.com/products_and_services/lending.asp

“CDFI State Locator.” Coalition of Community Development Financial Institutions. Date of Access. Dec 14, 2009.  cdfi.org/index.php?page=info-4

“Predevelopment Recoverable Grants for Artist Space.” ArtistLink. Date of Access:  Dec 14, 2009.  www.artistlink.org/?q=spacetoolbox/fordevelopers/financingspace/predevelopmentrecoverablegrants

Sources

Kartes, Cheryl. Creating Space: A Guide to Real Estate Development for Artists. New York: American Council for the Arts, 1993. 

Hecht, Bennett L. Developing Affordable Housing: A Practical Guide for Nonprofit Organizations. New York: Wiley, 1999.