Attic Renovation: Return on Investment?

Attic Renovation: Return on Investment?

San Jose, CA · Member since 2013 · 1 post · 0 votes

San Jose, CA. THinking of adding a 2br/1b attic bedroom. For this area, what kind of return on investment is typical?

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David NilesBusiness Member
Property Manager · DeLand FL · Member since 2012 · 860 posts · 243 votes
13y

What kills most attic remodels is the fire code egress, I would check on that before I went any further.

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  • Dallas, TX · Member since 2012 · 37 posts · 2 votes
    13y

    Georgina- I'm no expert and I'm sure not in San Jose. But to help out those that will be answer him I think most people will want to know- how many square feet, how will this compare to the comps, what is your $sf for your ARV and comps?

  • David NilesBusiness Member
    Property Manager · DeLand FL · Member since 2012 · 860 posts · 243 votes
    13y

    What kills most attic remodels is the fire code egress, I would check on that before I went any further.

  • Investor · Rochester Area, NY · Member since 2012 · 79 posts · 17 votes
    13y

    David, I'm in Rochester...what would be the issue with a true walk-up attic? I have a multi that has a 600sq foot unfinished walk-up attic that would make a nice extra room down the road.

  • Mechanicsburg, PA · Member since 2013 · 3k+ posts · 2k+ votes
    13y

    Building codes would be the first thing to look at. In some codes 3rd floors require 2nd means of egress, which normally means a fire escape. Not all codes require that, but many do and more are adopting that all the time. Often times existing 3rd finished areas are grandfathered, but all new building and remodeling require code compliance.

    There may be other code issues besides egress, including ceiling height, size of windows, materials used, fire retardant substances, etc. We did a 2nd floor remodel where the bathroom window is almost a picture window because it was required to be large enough for a very large adult to escape and for a fire fighter carrying a tank to enter.

    We did a remodel of a 3rd floor unfinished walk up space that did not require a fire escape. But we did use fire rated drywall and fire rated doors. In 1 area we eliminated two side by side windows and replace with 1 larger window for egress.

    After code compliance the second item to look at is the cost of such a remodel and whether it is cost effective in either increased value to the building or increased rents. In the 3rd floor conversion that we did one unit the rent increased by 47% and in another unit by 27%. The increased value of the building was about 17%. Your mileage may vary.

    And another consideration is the design feasible for the space available without an addition or puncturing the roof structure. If you have to break through the roof or make an addition to the building the costs escalate tremendously.

    I had an occasion where I was building a new house from scratch at the exact same time as doing an extensive remodeling more than doubling the original size of another house and having additions on 2 sides and the rear. The price per square foot for the additions was double the price of a new build.

    Why you may ask? There are several reasons, even though done in the same area and material and labor costs were relatively similar. First there is the demo factor. When doing a remodel and particularly an addition there is a certain amount of time and money spent on demolition. Secondly there is a cost to match the existing structure to the new addition so that it doesn't look like it is some amateur graft. And thirdly splice the old and the new requires more time and some times more or costlier materials. In the big additions we needed both a custom steel I beam and a custom lam beam, both of which were expensive and were not needed at the new build.

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