It wasn’t in the market for another residence, but with the first purchase of a commercial building in the Richmond market, the out-of-town real estate investor now has a new place to call home.
Murry Pitts, an active Charlottesville investor, is the new owner of the renovated former Honey Shop building at 405 E. Grace St. After buying it in late September for just over $2 million.
The deal includes the storefront that currently houses the Order Hair Company, and the modernly designed apartment that fills the rest of the building, where Bates has his primary residence.
Bates, whose Charlottesville holdings include a downtown Gleason building and a collection of long-term home rentals, said he was searching online listings for commercial properties in Richmond when he came across the apartment when it was listed for sale over the summer.
While he took on the apartment and rooftop design, Bates said his interest was in purchasing the entire building, including the 2,000-square-foot storefront that was once the old home of health food store The Honey Shop.
“I jumped right on it when I saw it,” he said. “The commercial unit was not for sale. But my bargain was that I wanted the whole building, not just the apartment.”
However, he said, the apartment was a draw.
“It was kind of a plus, the apartment on top, because it supplements some of the overhead costs of the building,” he said. “I don’t know there’s anything like it in Richmond, honestly. It’s amazing.”
Using an LLC, Bates paid $1.6 million for the apartment, just over the list price of $1.59 million, and $440,000 for the commercial space. The city’s most recent valuation put the apartment at $1.4 million and the storefront at $486,000.
Bates worked with One South Realty Group agents Andrea Levine and Angel Papa, who co-listed the apartment for seller Gershon Jones.
Jones, managing director at Richmond-based investment bank Harris Williams & Co., bought the building in 2017 and renovated it the following year, working with Leibertz Construction and Walter Parks Architects. The renovation was completed in 2019, and the storefront was briefly rented to a non-profit organization before moving order last year.
Bates described the renovation and design as first class.
“It is an amazing piece of property. The guy did a really excellent job rehabilitating him,” he said.
“It’s been a gut rip, even on the commercial side, right down to the timber. There’s some utilization of some of the older aspects of the building, and then there’s a lot of new fittings to the whole building, with a stunning staircase as you go to the fourth floor. And the rooftop is something out of New York magazine.” Really cool.”
Measuring a total area of 4,500 square feet, or 5,200 counting the surface, the condo occupies the remainder of the building, filling part of the first floor behind the storefront and all of the upper floors.
Featuring a modern design with skylight high ceilings, refinished hardwoods and other original builder touches, the apartment includes three bedrooms, three bathrooms, and two half baths, plus two kitchens, a master suite with media lounge and walk-in closets, and a kitchen with waterfall-edge island.
The unit includes an elevator, two gas fireplaces, and three dishwashers, and the rooftop deck features a grill, built-in seating, outdoor speakers, and views of downtown. The property also includes two off street parking spaces and a gated entrance with deck driveways.
The original brick building called The Ruelaine was built in 1910 and is listed in the Grace Street Commercial Historic District which is listed on the National Register of Historic Places. Also known as Tompkins House, it was altered in the 1920s when the residence was converted to retail use, according to the area description. A tax deduction that is transferred with the sale of the property.
Levine said she and Baba showed interest from potential buyers who were also intent on the storefront as well as the apartment. She said Jones, who was represented by Papa when he bought the building, initially wanted to stick with the storefront but agreed to include it in the sale.
Levine said they received another offer when they were already in negotiations with Bates. They marketed the listing on social media and through their own networks, she said, and decided to share the listing as they had done on some properties before.
“Due to the nature of the property, the showings required one of us to be present in order to share in-depth knowledge, project history, and architectural/design features,” Levine said in an email.
Bates said the apartment would add to the other homes he maintains in Charlottesville and Grand Rapids, Michigan. He said he might consider offering the apartment for rent.
“With the legislature in town and when they are in session, there may be some opportunities for short-term rental of the property,” he said. “I did this for many years in the Charlottesville market. There is every kind of potential for the building.”
Bates said he honors the Order’s existing lease, which he said still has a few years to go. He said there might be opportunity for improvements to her space, which he described as “almost perfectly adequate” for a salon.
While the building is his first investment in Richmond, Bates said it won’t be his last. He said he’s keeping an eye on more commercial real estate downtown and along the Grace Street corridor specifically.
“I think there’s a lot of potential in downtown Richmond in that area. It’s not as strong as the Charlottesville market on the business side, but it certainly has strong potential long term.
Bates’ purchase adds to other recent investments that have been made along East Grace Street. Two blocks away, the building at 208-212 E. Grace St. Also designed by Walter Parks, it has made way for 10 apartments and storefronts to consulting firms Markham Planning and Sadler & Whitehead.