Photo by Brett Nachtigall/Fall River County Herald-Star
A pair of Governor’s Homes, on left, and a pair of retirement duplexes, on right, now sit on Canton Avenue in Hot Springs, which is the former site of the city’s waterfill station.
By Brett Nachtigall
HOT SPRINGS – If there is a problem or a challenge, the solution usually doesn’t involve breaking something.
That is, unless you’re talking about ‘breaking’ ground.
Based on the results of a 2016 Housing Study commissioned by the City of Hot Springs, it was determined that the community had a housing problem – specifically, there was a great need for homes in the price range of $140,000 to $190,000 for young workers with families who were beginning their careers.
With that challenge identified, the city, led by then-Mayor George Kotti, pushed forward with a plan to make it easier for developers to build that kind of housing, which ultimately led to a RFP process (Request For Proposals) to develop five city-owned lots located on the site of the former water-fill station on Canton Avenue.
Hult Homes of Rapid City earned the bid from the city, and on June 27, 2019, a ceremonial groundbreaking was held at the site.
And late last month – just over one year from when ground was first broken – the second of two Governor’s Homes were placed on the site, which represent two big steps forward to solving the city’s housing issues.
According to Dean Hedrick with Hult Homes, the three-bedroom, 1,200 sq. ft. Governor’s Home is already sold and will have an owner living in it this month. He said that home sold for $174,900 and included several upgrades due to the purchaser’s requests prior to it being placed on the foundation, which includes an unfinished basement.
The other Governor’s Home is a 1,008 sq. ft. two-bedroom on a crawl space and is priced at $147,900. That house is yet to be sold, but Hedrick said he is confident it will sell soon after it is completed, inspected and put on the market.
In addition to the lots where the two Governor’s Homes are located, Hult Homes also owns the three other adjoining former city lots, which Hedrick said they plan to develop once the other house sells. He said they will likely place homes on those three lots all at the same time, as it provides some efficiencies within their company to do them together.
But the Governor’s Homes weren’t the only workforce housing-related construction projects that took place in the last year on that block of Canton Avenue.
In a landswap for property adjacent to the former Armory building near Butler Park, Don Olstad acquired two city-owned lots at the corner of Canton Avenue and 21st Street where he constructed a pair of one-level duplexes for retirement housing. Each side features one bedroom, one bath, an office and a one-stall garage, along with some handicap accessible features as well.
Olstad owns the four residences and leases them out, which he said were filled well in advance of him completing them earlier this spring. One of the tenants is his mom, along with a few of her long time friends in the others.
“What those places did is put four homes on the market for growing families to buy,” Olstad said, in regards to how building retirement housing has an indirect effect on creating more workforce-based housing.
Olstad did much of the work on the duplexes himself on weekends and in his spare time, which is why he said it took him longer than the three to four months a project like that would normally take, if done full-time. Most all others involved in the construction of the duplexes were Hot Springs contractors as well, including James Forbord of Custom Construction along with several others.
Olstad is no stranger to building homes in the Hot Springs area. He began building homes while still a student in Hot Springs High School back in the 1970s. Since that time, he has been involved in numerous projects including homes to large commercial jobs like the Baymont Inn.
While he recognizes there is a great need for more retirement-type housing like the duplexes he recently completed, he said there are not many of the right kind of city lots available for that kind of construction. He does not have any current plans to build another, but he’s also not necessarily ruling it out either.
Hedrick, who is based out of Rapid City, is also a Hot Springs High School alumnus and said he is proud to have Hult Homes involved in placing Governor’s Homes to his hometown. to help with its workforce-related housing needs.
According to the SDHDA website, both nonprofit and for-profit builders may purchase Governor’s Houses to develop and resell to qualified buyers. Developers may earn a profit of no more than 10 percent of the total project cost.
In 1996, the Governor’s House program was created as a way to provide reasonably sized, affordable homes to income-qualified individuals and families.
The Program puts prison inmates to work which teaches them valuable skills, the SDHDA website states. The simplified home design, in conjunction with the Governor’s Inmate Training Program, keeps the cost of these homes affordable. This benefits many inmates by teaching them important skills to better prepare them for life outside of prison.
Qualifications to purchase a Governor’s House include a household income that does not exceed $52,710 for couples or individuals and $60,240 for families of three or more. The house must also be used as the homebuyer’s only residence.
Hedrick said being involved with the planning and construction phases is what he does, “but the greatest treat for me is coming back to the job site in six months and seeing it become a neighborhood.”