Initial Roadmap: McDowell Rd.
Initial roadmap for acquiring 1310 E McDowell Rd (Phoenix) and building a craftsmanship-facilitation business.
The property is the former Berkshire Retirement Hotel: a 3-story, ~24,700–24,820 SF Class B building (1970) on a 0.57-acre lot in the Coronado neighborhood (ZIP 85006). It is vacant due to prior fire damage. Recent listings show asking prices in the $1.175M–$1.4M range (roughly $47/SF). Zoning is C-1/C-2. There are prior City of Phoenix approvals for reconstruction as a 144-bed assisted-living facility (43 rooms); a buyer would need to reinstate those or pursue a different path. Parking is limited (~17 spaces). Broker contact listed in public sources is Alexandra Loye at Cushman & Wakefield (602-625-4220).
For adaptive reuse and capital flexibility. The core idea—creating a place that elevates and sustains craftsmanship (studios, shared tools, training, incubation, retail of handmade work)—fits the economic reality you described: custom work is often undervalued, so the business model must deliberately solve for visibility, fair pricing, community, and recurring revenue rather than pure one-off commissions.
Phase 0: Immediate Due Diligence (next 2–6 weeks)
Contact the listing broker for the offering memorandum, full condition reports, fire-damage details, environmental reports (if any), and current status of prior permits.
Order or review a current property condition assessment, structural engineer report, Phase I environmental, and asbestos/lead survey (1970 building + fire history make these non-negotiable).
Confirm exact zoning (C-1/C-2), parking requirements, and whether artisan/light fabrication, multi-tenant workshops, educational uses, or gallery/retail are permitted by right or need a use permit/special permit. C-2 allows a range of commercial and some custom fabrication (cabinet makers, carpenters’ shops, sheet-metal custom work, upholstery, sign shops, etc.), but heavier or noisy industrial activity is limited. Phoenix has precedents for makerspaces and artisan uses; early contact with Planning & Development and the Office of Customer Advocacy is useful.
Walk the site and neighborhood. Assess access, visibility on McDowell, proximity to Banner University Medical Center and downtown, transit, and potential conflicts with nearby uses.
Rough-order-of-magnitude cost estimate for making the building safe and code-compliant (fire restoration, structural, MEP, elevators, accessibility, sprinklers, etc.). Fire-damaged mid-century commercial buildings often require substantial capital beyond purchase price.
Review your personal portfolio liquidity, tax situation, and risk tolerance. Model best/base/worst-case total project cost (acquisition + hard costs + soft costs + contingency + 12–24 months operating reserves).
Phase 1: Acquisition Strategy
Decide structure: personal, LLC, or partnership. An LLC is typical for liability and future tenancy.
Financing options: conventional commercial loan (higher rates/down payments for value-add/distressed), SBA 504/7(a) if you occupy a significant portion and create jobs, private capital from your portfolio or partners, or seller financing if available.
Negotiate: fire damage and vacancy create leverage. Aim for a longer due-diligence period, price adjustment for known deficiencies, and assignment of any existing plans/permits. Target closing only after you have a clear path on use and rough costs.
Title, survey, and insurance (including builder’s risk later) must be clean.
Phase 2: Refine the Business Model (parallel with acquisition)
Define “facilitate craftsmanship on many levels” into concrete, revenue-generating layers that address the under-valuation problem:
Shared makerspace / tool library (memberships, day rates) — metalworking, wood, fabrication, architecture-scale prototyping.
Individual or small-team studios / workshop leases (monthly or longer-term).
Education & skill transmission (workshops, apprenticeships, short courses) — this creates pipeline and community.
Retail / gallery / showroom for handmade work with transparent pricing and maker stories.
Light production / custom work incubation (you or resident makers taking commissions, with the space providing credibility and infrastructure).
Events, pop-ups, or collaboration with design/architecture firms.
Revenue mix should lean toward recurring (memberships, studio rent, classes) rather than pure project-based custom work. Benchmark against existing Phoenix makerspaces (e.g., Phoenix Forge) for pricing, equipment, and membership models while differentiating on architecture/metallurgy depth and adaptive-reuse character.
Create a simple 3–5 year pro forma: occupancy ramp, membership targets, studio rents, class revenue, operating expenses (utilities, insurance, maintenance, staff), and debt service. Stress-test against slower lease-up and higher construction costs.
Phase 3: Entitlements, Design & Permitting
Engage a local land-use attorney or zoning consultant early and the City’s Planning & Development Department (fact-finding meetings and Office of Customer Advocacy are practical first steps).
Decide whether to pursue the prior assisted-living path (unlikely to fit your goal), a pure commercial/makerspace adaptive reuse, or a mixed concept. Lead schematic design or collaborate tightly with a licensed architect of record.
Key issues: change of use/occupancy classification, parking adequacy (17 spaces is tight for multi-tenant + public programs), accessibility, fire/life safety (critical post-fire), noise/vibration from fabrication, and any outdoor storage or crafting.
Phased approach is realistic: stabilize and occupy ground floor or a portion first while upper floors are brought online.
Phase 4: Renovation & Fit-Out (phased)
Priority 1: safety, structure, envelope, core MEP, elevators, and code compliance so the building can be occupied.
Priority 2: flexible workshop and studio fit-outs (power, ventilation, dust/fume control for metal and wood, robust floors, tool storage).
Priority 3: public-facing gallery/retail, classroom, and community spaces.
Leverage your ability to “build anything” for owner-performed or directed work where codes and insurance allow, but use licensed contractors for structural, electrical, mechanical, and life-safety systems.
Budget heavy contingency (20–30%+) for a fire-damaged 1970 building.
Phase 5: Launch & Operations
Soft launch with a core group of makers and early members while finishing spaces.
Build community deliberately: open houses, skill-share nights, partnerships with architecture/engineering schools, local design firms, and makers who already struggle with under-valuation.
Pricing and marketing should educate clients on the real cost of custom work and the value of durable, well-made objects.
Track unit economics closely (cost per member/studio, utilization rates, class margins).
Insurance, liability waivers, tool training/certification, and clear house rules are essential for a shared fabrication environment.
Phase 6: Long-Term Income & Scaling
Once stabilized, the property itself becomes a long-term income asset (studio rents + memberships). Equity built through renovation and cash flow can support expansion (second location, specialized equipment, online marketplace for resident makers, or related services).
Critical success factors: realistic capital stack and timeline (this is a multi-year project, not a quick flip); zoning and life-safety path clarity before heavy spending; a business model that generates recurring revenue while elevating the perceived value of craftsmanship; and phased occupancy so cash flow starts before the entire building is perfect.
Next concrete actions:
Call the listing broker this week for the full package and condition info.
Schedule a property tour with a contractor or structural engineer experienced in adaptive reuse/fire restoration.
Request a zoning verification or fact-finding meeting with the City of Phoenix.
Sketch a one-page vision + high-level pro forma using your portfolio numbers so you know your personal risk ceiling.
