Creating their own market
In its heyday, Loray Mill was the largest textile mill in North Carolina. The 600,000-square-foot factory employed more than 3,500 and spurred construction of a 1,000-home mill village. The Loray Mill Village had more homes than the rest of Gastonia in the early 1900s, but as the textile industry declined, so did the village.
Working with private investors and the City of Gastonia, Preservation North Carolina aims to turn that around and restore an important part of North Carolina’s history. Jack Kiser, retired City of Gastonia planning director, is now overseeing the Loray Mill Village project for Preservation North Carolina.
“Over time, those workers moved out or passed on,” Kiser said. “As that happened, a neighborhood, which was vast majority homeowners, went to rental housing over the course of decades. We want to create our own market.”
He estimates there are 400 remaining houses in the village – most ranging from 800 to 1,200 square feet– and Preservation North Carolina is starting the project by buying, renovating and selling about a dozen homes. The ownership/rental ratio is about 30/70, and Kiser said they would like to flip those numbers by spurring private investment.
Preservation North Carolina will buy the homes for $15,000 to $20,000 on average, restore them to their historically accurate appearance, with wood clapboard siding and original windows. The interiors will also be inspired by the history of the village, with pine flooring and bead-board walls, but they will be modernized for today’s market.
Kiser said the houses will sell for around $100,000, and by restoring the houses’ historic appearances, Preservation North Carolina will be able to pass along tax savings to the new homeowner because of the recently restored state historic preservation tax credit, in this case a 15-percent tax credit of the eligible rehabilitation costs.
“We are going to do quality work and upfitting,” Kiser said. “These are small houses, but with today’s housing trends, a huge demographic is going to smaller households. The one person household is by far the largest growing household segment, and we think we can appeal to that market.”
Preservation North Carolina saw great success with similar projects at the Edenton Cotton Mill and Burlington Glencoe Cotton Mill areas. As an added bonus, the village will benefit from its proximity to the Loray Mill itself, which was recently transformed into high-end apartments and commercial space by a private investor.
Firestone Tire and Rubber occupied the Loray Mill from 1935 to 1993. In 1998, Preservation North Carolina assumed ownership until it was sold to a private investor 15 years later.
“These developers stuck with it through thick and thin – the worst recession we’ve seen,” Kiser said. “When the recession hit, I think they picked their best project and stuck with it.”
The investors were set to close on the project with conventional financing, but overnight all credit dried up, and the investors went through a lengthy process to secure funding through a Federal Housing Administration loan.
After completing the largest historic preservation project under one roof, the mill is now open for business once again with 190 apartments on the third through sixth floors and space for retail below. The first commercial tenant is a fitness center, and developers are looking to attract a hair salon, café, brewpub, restaurants and the like. A second phase of the project will add an additional 100 apartments and a 6,000-square-foot memorial hall with mementos, old machines and photos.
The apartments range in rent from $850 to $1,550, which is on the more expensive end of the rent spectrum in Gastonia, but it’s a unique place to live, especially for commuters, who Kiser thinks make up the majority of tenants.
“They can get what they want: something historic, authentic and different than a regular, old two-bedroom garden apartment – you’ve seen one, you’ve seen them all,” he said. “There are a lot of people, particularly in the millennial generation, who do want something different. We think these houses will have something to offer, too. Anyone who can afford to rent at Loray Mill can afford to buy one of these houses.”
The village and mill apartments are easy driving distance to Charlotte. For Charlotte Douglas International Airport employees, Kiser said the commute is probably even shorter from Gastonia than some parts of Charlotte.
In addition to attracting citizens who work throughout the region, Council Member Robert Kellogg said the City of Gastonia is interested in connecting the mill village to its historic downtown and the York Chester Historic District. He said that while the three districts are close to each other, there isn’t anything that holds them together.
“Loray Mill could be the piece of the puzzle that fuses everything together. We’d like to take what’s happened with the revitalization and try to connect that with the redevelopment of our downtown, which is also starting to take off,” Kellogg said. “If we can connect the two, we’ll be able to see some good things happen in downtown Gastonia.”
Kiser said the city has been helpful in terms of infrastructure by replacing sidewalks and hopefully streets, but the city is also moving the western branch of the police department into the Loray Mill. Kiser said it isn’t a particularly high-crime area, but the mere presence of officers, additional law enforcement programs and community policing will be a positive addition.
“It’s been a huge effort with a host of different groups coming together to make it happen. I think it symbolizes our ability to embrace our past and use that past to further economic development,” Kellogg said. “If there’s anything we can do to help spur that, most of us will be on board.”
Preservation North Carolina is funding the project through a revolving fund from the 1772 Foundation, so as they sell homes, the profits go back into another rehabilitation project. Kiser said it could take years to create the new market they envision as the decline in ownership took more than three decades to evolve, but Preservation North Carolina plans to stay as long as it is needed. Homes will be ready in October for an open house ceremony to start showing off the properties.
“The overwhelming majority couldn’t see the Loray Mill for what it could be, but once it was done, it really knocked their socks off. I think a lot of people never imagined what these mill cottages could be until they can see one done,” Kiser said. “All we need to do is keep doing this over and over again, and, over time, we’ve turned the neighborhood around.”
by League Communications Associate Jessica Wells
(NC League of Municipalities, April 2016)