I want to convert a disused industrial space into a home. Am I crazy?
July 4, 2017 10:50 AM   Subscribe

Talk to me about converting (part of) a warehouse, industrial space, or otherwise non-traditional structure into a home. Logistics, (im)practicalities, things to consider, etc.

Background: I live in the US (Maryland, to be specific). I'm saving up to buy my first home. I'm 40, so I'm getting a pretty late start on this. I really don't want to buy a house in some white-picket-fence suburb: that lifestyle doesn't suit me at all. So I'm thinking about finding a disused warehouse or industrial space, and converting it into a funky loft-type home.

I understand that you probably can't address the financial and legal considerations (zoning, taxes, permits) in much detail, since those will depend mostly on where I buy and the specific building. I guess I'm just looking for anecdotes about your experience with this sort of thing, and a sense for whether this is even practical.

Is this likely to be significantly more expensive than buying a traditional house?

Am I just asking for a neverending list of expenses and hassles: repairs, remediation, heating/cooling costs, assorted inconveniences, etc.?

If you've done this, have you been satisfied with the decision? That is, do you enjoy living in the finished space, and was it worth the effort? Is there anything you would have done differently?

In terms of costs and legal hoops to jump through, what do I need to keep in mind?

Assuming that I'm doing this myself, and not buying an apartment in a building that's being converted by a developer, is there any way around purchasing an entire building? (I guess I could rent out extra space as storage / artist's studios / event space, etc., but that seems like a bit of a hassle/gamble.)

What am I not asking that I should be?

posted by escape from the potato planet to Home & Garden (21 answers total) 6 users marked this as a favorite
This will most likely be considerably more expensive since you will have to bring the entire structure up to habitation code. That includes fire, egress, electrical safety. I would suggest looking for as small a structure as possible, or a small detached home that still exists in an industrial area. Such a structure will be harder to get a loan for, and insure.
posted by nickggully at 11:05 AM on July 4, 2017 [6 favorites]

This will be much more expensive than buying an already built traditional home as you will basically be doing a new build inside the shell of an existing structure.
posted by saradarlin at 11:10 AM on July 4, 2017 [2 favorites]

Depending on where you live, you may find that city authorities are launching major crackdowns on converted industrial spaces after the "Ghost Ship" fire in Oakland. For example, right now in LA, many, many people are losing their living spaces after sudden inspections. The way around this is for every little thing to be up to code and permitted, and that means $$.
posted by BlahLaLa at 11:31 AM on July 4, 2017 [9 favorites]

We are doing this, but in a different country than you. Our building is small enough to be transformed into a house for the two of us plus some workshop space, so we don't need to worry about renters and such. It is not cheaper than just buying a house; we are doing this because this way, we'll get our dream house, exactly the way we want it to be. Also we like the location.

We are lucky enough to have a bathroom (of sorts) that was already usable when we bought the building, and enough room so that it can stay in place while we are building the new bathroom. We will need a temporary kitchen and living room for a while. Think about how you'll live while you are building.

Are you good at building stuff? If you can do a lot yourself, that will save you a whole lot of money, but it will take a whole lot of time. Which do you have more of, money or time?

We've been at it for a couple of years, it'll be another couple of years until we finish. We're looking forward to the result but we also already happily living here.
posted by Too-Ticky at 11:32 AM on July 4, 2017 [2 favorites]

If you were able to purchase an industrial space, getting the zoning changed to
allow habitation might take a year, or several years, and of course you could not occupy the space until zoning would allow it. In most cities, occupying a space like that is a crime. If you were convicted of living in it before you got the zoning changed the zoning committee may look at you as a rogue rule breaker and be less likely to allow the zoning change. And of course, even if you do everything right there's a strong chance your zoning change will be denied. It's easier for the city to keep people areas as people areas and industry areas as industry areas.

I cannot fathom the out of pocket costs to do this. I hope you have deep pockets because you'll never get a traditional home loan and other financing will be hard to come by.
To be most successful with the zoning committee you'll need a lawyer or a lobbyist of sorts to get you though the process. I wouldn't be surprised if that cost $10k-$20k or more.
The renovation costs. Wow that could be anything. But going into a project like that with less than $100k in your pocket is foolhardy. Industrial wiring, plumbing, heating and cooling systems are a different thing and very expensive. A friend owns a small industrial building and complained about her crappy heating system and its frequent repairs but the bid for a new system was $80,000.

Finding a multiuse building that already has a occupancy permit might be the best compromise here.

If your idea were cheap and easy lots of people would do it.
It's in fact very expensive and very difficult.
posted by littlewater at 11:32 AM on July 4, 2017 [6 favorites]

This isn't exactly what you're proposing, but the link in this fpp, about a guy who rebuilds his half-collapsing shed/garage aka grosh is an enormously entertaining and educational read about turning a not-really-usable space into a usable one.
posted by rtha at 11:42 AM on July 4, 2017 [1 favorite]

A former industrial space can have hazardous residue -- as minor as unpleasant smells to major issues like mercury or cyanide that require remediation if the place changes hands.
posted by Jesse the K at 11:45 AM on July 4, 2017 [12 favorites]

Came in to say what Jesse the K said. You need to carefully research the history of any industrial building to make sure you don't wind up with one contaminated in a way that can't be remediated. Also, depending on when it was built, watch out for stuff like asbestos in construction materials or insulation.
posted by gudrun at 11:52 AM on July 4, 2017 [2 favorites]

I've lived in spaces that have done this, have friends who have done this, have done this.

Depending on the construction of your building and your location, heating will be very difficult. If it's an industrial space, you'll probably have a lot of masonry and/or concrete, lots of thermal mass. Expect cold winters, unless you have Modine-esque gas blowers. Electrical heat is expensive.

Hazardous residue (or just annoying residue) is a Thing. Beware of asbestos tiles or insulation or flashing, and try not to make anything friable/flake off into the air. If you have asbestos tiles, entomb it under some sheets of plywood rather than removing anything.

Build on top of things, don't try to reveal things. Don't try to strip paint off brick, or refinish any wood floors. (Don't ask me how I know this.) Build a new subfloor and use new flooring. Maybe even self-leveling concrete?

Consider neighboring buildings and the air quality. If your space is an industrial space, it's probably in an industrial area. I had a friend who built out her living space / studio in the winter, and then moved out in the summer because it turned out there was a nearby factory that produced adhesives and produced a lot of toxic gases. In the summer, smell travels further. Make sure to get some sort of air purifier.

Consider that your standards of living will be different. You're not going to have a fancy residential space in a fancy loft where it's like a private home, but just bigger. You may end up with a space that's not cleanable or vacuumable, because it's so large / messy / with residue. The space will be be better suited to messy, creative work.

One of the things that really struck me while building out and living in such a space was how difficult it can be to make a clean floor. Floors are quite difficult, a lot of square footages, and in industrial spaces, difficult to level and refinish.


If I were to do it again, I would divide the space into three zones: raw, clean, and barefoot.

'Barefoot' would be a small, soundproof box with independent structure (two layers of sheetrock with acoustic gel, insulation, etc) just big enough for a bed and a dresser. The box would be completely neat and cleanable. This would be the first thing I would build, with a new subfloor and new flooring, windows, and a combination window AC/heat pump unit so that it's climate controlled independently of the larger space. (This floor can get so clean, you could eat off of it.)

'Clean' would be a small area that includes bathrooms and kitchen and a tiny lounge area. Reasonably sweepable, moppable, perhaps tiled or poured concrete floors, etc. (You could maybe eat a dropped almond off of this floor under the 5-second rule)

'Raw' would be the rest of the space. The floors and walls would be painted and/or sealed or refinished with plywood. Minimal work would be done. (Any food item that touches this floor would be treated as toxic waste immediately.)
posted by suedehead at 12:48 PM on July 4, 2017 [14 favorites]

If you have to ask, then yes, this will be far more expensive and/or risky. Befriend relevant professionals and they can give you more fine-grained answers.
posted by Sticherbeast at 1:05 PM on July 4, 2017

YMMV as I'm in a different country,but here you can contact the city and ask to see building records - I'd definitely identify similar structures and then track down the paperwork lodged with the city for them.

Everything mentioned above is an issue.

We get lots of complaints about amenity from folks living in semi-industrial areas about the spaces that are still industrial: trucks, early deliveries, no parking, markets and events clogging things up, noise (manufacturing, events), weird smells... proceed thoughtfully! All that said, I don't like the suburbs (and don't live in them) either.
posted by jrobin276 at 2:04 PM on July 4, 2017

Are you an artist? Artist lofts mixed work/living space has been a successful endeavor, from noodling around the corners at open studios it's clear the successful are scrupulous following code. It probably means hunting a community in a currently less than popular area, becoming part of that community and putting in huge sweat equity. and it's probably getting harder as the developers will "find' and renovate entire communities as quick as scuzzy artists can establish a foothold. But it's been done and being an art community provides some justification to the town fathers that it's not a drug den or worse. (note: I'm certain from viewing that some folks have take this path were not "artists" prior, but that's my own personal pejorative aesthetic opinion I guess ;-)
posted by sammyo at 3:19 PM on July 4, 2017 [2 favorites]

I live in an industrial space, with a live-work lease. We put in our bathroom, our kitchen, our laundry from scratch. No central heat, only window AC. If I were to buy a place and do all this again, I would want to make sure I could get homeowner's insurance on top of all the zoning and permitting needed.
posted by Ideefixe at 5:03 PM on July 4, 2017 [2 favorites]

Speaking as a small-business employee whose company has leased or bought a variety of industrial spaces and used them for a not-very-industrial business:

My first question would be, have you even begun to research available buildings and prices? Or are you still in the speculative phase, where you know industrial-to-condo conversions are a thing, and artist live/work spaces are a thing, and are driving by empty warehouses/industrial buildings and wondering if you could maybe DIY something? Because the commercial/industrial real estate market is a different animal than the residential one, with a different set of market pressures and motivations. By which I mean, a house that's sitting empty for months might well mean a seller motivated to let the thing go cheap; but commercial real estate owners are often willing to let a building sit empty for years until the right tenant/buyer comes along. The US may no longer be the manufacturing powerhouse it once was, but there are still tons of businesses that need things like 27,000 square feet of space, and loading docks, and freight elevators, and 3-phase power, and eventually those businesses will find an unused industrial space and move in. (Or, hell, by this point, the owners are holding out for a condo/apartment developer to decide their area is the next Hip Thing.)

TL:DR - Unused commercial building does not mean cheap building and owners desperate to sell. Do some research to see if there's anything even available at a price you could afford before heading much further down this path.
posted by soundguy99 at 5:04 PM on July 4, 2017 [4 favorites]

Find a live/work space - more common in arts communities. They may still be in crap condition and therefore cheaper and in need of your love and care, but will already be zoned appropriately and, god-willing, have things like a shower.
posted by Toddles at 6:00 PM on July 4, 2017 [2 favorites]

I did this and I've known lots and lots of people who did this, mostly in NYC in the 80's and 90's.
Toxic waste.
Insulation/ lack thereof.
Fire violations/ other building code/zoning violations getting you kicked out.
As we all worked at least side jobs in the building trades, building out the space was no big deal and not insanely expensive. Also, we didn't have the misfortune of having a woodworking shop move in above us (like friends of ours) though we had a chinese-food distributor downstairs and the attendant pests.
I would totally do it again as the advantages - a lot of space for a reasonable price - made it worthwhile.
BUT, we had the resources at hand to never have to hire in maintenance help.
posted by From Bklyn at 6:32 AM on July 5, 2017 [1 favorite]

I was recently talking to the CEO of a nonprofit that is rehabbing a 30,000 square foot factory into a school.

Buying the building was around $3 million, and rehabbing will be $7-10 million. The building is in generally good shape for a factory -- it doesn't leak, the windows are mostly intact, there are already two floors of offices that are currently in use. It's in an amazing location on a hill overlooking a massive park, which is the reason they're doing it.

It will take at least 5 years. Lawyers are involved in getting the zoning changed, getting money from investors (the banks won't fund this project), and getting insurance. Specialist contractors are needed to rehab the property.

It would be far cheaper to just build a brand new building. And that's just for a school, not for an apartment (which has much higher standards).

I wouldn't touch this with a 1,000 foot pole.

All of the "artist's lofts" industrial style places I know of are government-funded projects to preserve historic buildings, and would never be financially viable without that subsidy.
posted by miyabo at 6:41 AM on July 5, 2017 [3 favorites]

Many excellent points to consider in the comments above. One thing I haven't seen mentioned is exit strategy. Any unusual changes you make may need to be undone at some point in the future by the next user of the space, rendering it more difficult to sell in the future. You would either have to find someone who is also interested in a non-traditional neighborhood, or a business with enough cash to not care about the cost of renovations. So think carefully about what your financial situation would be if you needed to get out of this property quickly.
posted by vignettist at 7:06 AM on July 5, 2017 [1 favorite]

Industrial areas may be zoned in a way that prohibits living there. You may put in a lot of effort and expense and then be unable to sell or borrow against the building.

Many industrial spaces are not designed to be energy-efficient for living in.

If you are energetic, you could look for a building that could be converted into 2 - 4 units. Then you could live there, provide housing, pay your mortgage. You want a creative environment, and in some cases, when you're the landlord, you can search for tenants who you want as neighbors. (I used to be a landlord. Prioritize responsibility)
posted by theora55 at 7:58 AM on July 5, 2017 [1 favorite]

Or are you still in the speculative phase, where you know industrial-to-condo conversions are a thing, and artist live/work spaces are a thing, and are driving by empty warehouses/industrial buildings and wondering if you could maybe DIY something?
I'm very much in the speculative phase. It'll be a while yet before I have enough saved up to get serious, but I'm naturally wondering about options and possibilities.

It sounds like the answer is "yes, I'm crazy". That's disappointing, but it does answer my question – so, thanks to everyone! I'll focus on other options.
posted by escape from the potato planet at 10:19 AM on July 5, 2017 [1 favorite]

Look up the existing live/work artist studio spaces in your area and talk to those folks. They'll be able to answer more location-specific questions including the scuttlebutt on toxic materials, tolerance of licencing/zoning boards, what kind of buildings are more trouble than they're worth, etc.

Meanwhile, if it'll be "a while yet" before you have saved up enough to get serious, bear in mind that everything you're looking at could change a great deal before you are ready. Today's backwater moldering industrial strip could be adjacent to a high-rise condo in a year or two.
posted by desuetude at 3:14 PM on July 5, 2017

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