In the current economy, the value of non-residential space is generally disregarded in determining financial feasibility. Thus, the Silk Mill price can be considered perhaps $3.5 million divided by 35 potential units, or $100,000 per unit.
How does the number work in the marketplace? It’s comparable to per unit bare land prices in San Francisco. But in Petaluma, current appraisals on bare land multi-family sites are more in the $25,000 to $30,000 per unit range.
But perhaps you note that the Silk Mill isn’t bare land. It already has a fine building in place. That’s true, but restoration can often be as expensive as new construction. And restoration under historic preservation standards can be even more expensive. The comparisons to bare land value are reasonable and perhaps even optimistic.