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Want to live in the 'Twinkie factory'? By 2022, the former Hostess plant will be luxury apartments
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Want to live in the 'Twinkie factory'? By 2022, the former Hostess plant will be luxury apartments

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The downtown housing market has changed since builder Dan Dolan bought the old Wonder Bread plant in Davenport seven years ago.

Plans for the nearly block-long bakery and warehouse now are changing too.

A previous emphasis on turning vacant downtown buildings into warehouse-chic apartments for millennials now is evolving, Dolan said, into a demand from an older demographic — empty nesters.

Dolan and his family are partnering with developer Frank Levy and his family. Levy's company, Newbury Living, which built the Bridges Lofts in Bettendorf, among other Quad-City and Des Moines-area projects. The partners plan to transform the so-called Twinkie Factory into higher-rent luxury apartments, dubbed Continental Lofts & Tower (after Continental Baking Co.).

The old Hostess plant is an attractive housing site for several reasons, the partner said: It has the interior square footage to add enough covered parking for every apartment unit; it's close to the downtown without being in the middle of it; the Mississippi River views are some of the best in the region.

An eight-story tower will be built on the southwest side of the historic 100,000 square-foot plant, and an elevated deck between the two buildings will contain a swimming pool. Details on the pre-lease offering can be found at https://www.thecontinentalqc.com.

"Dan's original vision was more of a straight loft-apartment building, but we've elevated the property by increasing the size of the floor plans and condo-quality finishes," Levy said. "It will have a contemporary look and appeal to affluent renters of all ages."

Dolan said he spotted a growing trend in his home-building business.

"Some people buying my retirement homes were saying, 'I wish you rented these,' " he said. "We walked right into this."

The larger units with more expensive finishes and amenities are attractive to retirees, they said, because they can sell the homes in which they raised their kids but still will have space for their furniture and visiting family without having maintenance worries.

"Another competitive advantage is that you can't match the view," Dolan said. "And we'll have at least one indoor parking space for every unit. You won't find retirees who are excited about scraping car windows."

This is not to say all 82 apartments in The Continental are intended for the over-55 set.

"There are no age restrictions," Dolan said. "Older people benefit from having young people around. We're making it appealing to our retired citizens, but it's not exclusive."

One feature that any age will appreciate, the partners said, is large outdoor space to go with what Levy described as the project's "resort look."

While many warehouse rehabs have outdoor balconies — typically large enough for a grill and/or a chair or two — the balconies at The Continental will be large enough to host a dinner party, Levy said, and will be included in every unit of the new tower.

The existing building is too close to River Drive, Dolan said, for the Iowa DOT to grant permission to build balconies so close to the right-of-way, so they were set back into the building as part of the design. Half of the 82 apartments will have the balconies.

To finance the roughly $31 million renovation and expansion, Dolan and Levy are using a combination of funding sources.

The property is eligible for state and federal historic-tax credits, and a brownfield credit (for site cleanup) has been awarded and is awaiting an extension. The property was grandfathered into the now-expired Enterprise Zone and meets criteria for the 2017 Opportunity Zone. It also qualifies for a 10-year tax abatement from the city through its Urban Revitalization Tax Exemption, URTE.

"The various tax-credit proceeds are about $5.5 million; we're raising an equal amount between us and our investors, and we'll have $20 million in debt," Levy said. "Dan already owns the building, and we will increase the equity to begin construction in the spring."

They hope to finish The Continental in the spring of 2022.

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