Friday, February 26, 2010

Redrawing Their Plans

Architects reflect on careers changed by housing crisis

By Joseph Kellard

Since the 2008 financial collapse, architect Mark Geiselman has had to go back to the drawing board — literally. The Long Beach resident, who has owned the Islip-based firm OCJ Architects for 11 years, had to cut his already small staff a year ago and become reacquainted with a T-square and a drafting pencil.

“I’ve absolutely had to start drawing again,” Geiselman said of blueprints he would otherwise pass off to an apprentice. “And that’s always difficult to do because you’re always trying to run the business and draw up work. I just sit at the drafting table all day.”

Since the nation’s sub-prime mortgage crisis began in 2007 — before which housing prices were generally increasing yearly — architects, the first link in the chain of new construction, have been hit as hard as real estate agents and contractors. Geiselman, whose firm draws an even mix of residential and commercial clients from Suffolk County to Connecticut, started to feel the pain in early 2008, and a year later he began laying off workers.

Today, he said, his firm is seeing a slight uptick on the commercial side, since depressed prices have made leasing space more affordable. But in general, he added, greater restrictions on bank loans have impacted both categories, but especially residential. This is particularly an issue in areas like Nassau County, where architects and contractors deal mostly with developed acreage and existing homes.

During the pre-2007 seller’s market, homeowners capitalized on rising property values and built up substantial equity, while banks lent freely for home additions. Now, with the bursting of the housing bubble, buying a home is no longer seen as a guaranteed investment.

“One reason people are hesitant do anything is the difficulty in getting the financing, and the other is that they’re not sure they’re going to get the equity out of it when it’s all done,” Geiselman said of homeowners looking to build in the current buyer’s market. “People are concerned about their home values, and that’s severely affected us.”

Monte Leeper, an Oceanside architect who has owned a firm for 25 years and writes the Ask the Architect column for the Herald, said he believes the housing crisis has led more homeowners to go forward with work on their houses — usually interior work that can not be seen from outside — without obtaining the necessary permits or hiring licensed engineers and architects, whether to save time, money or taxes. As a result, Leeper said, he and other architects have seen all kinds of defective work and safety issues.

“People go out and buy tools and start to do work or they hire a contractor who really isn’t qualified,” he said. “There’s a lot of people who call themselves licensed and qualified, but they end up using the wrong materials or tools for the problem you’re trying to correct ... We’re not a necessary evil. We’re actually a contributing factor to saving people money, yet the average person doesn’t even know that.”

The Town of Hempstead, which oversees county building and zoning issues, reports a marked downturn in building permit applications, which are issued for any plans from the foundation up as well as variances for existing structures. In 2005, the town received and processed 6,819 building applications. In 2008 there were 5,734. And from October 2008, following the financial collapse, through December 2009, a 15-month span, there were 6,226 applications.

“It would be purely speculative to make guesses as to why applications are down,” said town spokeswoman Susan Trenkle-Pokalsky, “but it’s a reasonable thought that the downturn in the economy has impacted that.”

Architect Robert Hochberg of East Meadow said homeowners have long skirted building permits to keep extensions, dormers and other additions out of town records in order to save on taxes. But with the microscope on assessments this past decade and homeowners trying to sell their houses in a down market, Hochberg said, he does more work drawing plans for additions that homeowners now looking to sell failed to file with the Building Department.

“People think, If I don’t get a permit, the assessors won’t know about it and so my assessment won’t go up,” said Hochberg, who has been in business since 1970. “But that’s not necessarily true.”

For George Bella, who has owned GWB Architect in Long Beach since 2001, and who has seen an increased in business from sellers looking to legalize previous construction, the past 18 months have been mainly about homeowners looking to build out of necessity rather than luxury. “Your family is getting bigger and you need an extra bedroom -- you still have to do those projects,” said Bella, who drafts mostly residential and public projects. “What’s different now is that people aren’t looking to do more than what is minimally required for their own purposes.”

Unlike architects who try to keep an even mix of residential and commercial projects, about 80 percent of the plans Henry Monteverde was drawing before the downturn were residential, and he has since lost about 25 percent of his business. “We’ve been affected because with the mortgages being so tight and no money available, projects aren’t going ahead,” said Monteverde, who opened a firm in Island Park in 1991. “Therefore, everything is curtailed.”

Monteverde added that because he has a small firm, with just two employees, and little overhead, he has been able to weather the financial storm and has been fortunate enough to switch to mostly commercial projects, including offices, medical facilities and retail stores. But that hasn’t necessarily been by design, so to speak.

“That’s just want came in,” he said.

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