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“I’m hooked on the ADU concept. There’s no reason to waste space in the city. It can be pretty and charming. There’s no reason to pack people in like sardines. You can make elegant use of the space you have. It’s about using what you have. I had a little space I’d loved from the moment I set eyes on it, and knew that it could be something more.” –Kathleen Pequeño
Kathleen Pequeño first learned about ADUs because she went looking for them. When she purchased her home in 1992 there weren’t many permitted ADUs in Portland, OR. However, as soon as she saw the detached garage, which had been used as a wood shop by the previous owner, she knew she wanted to convert it into a living space.
“When I first saw the wood shop it was clear that the previous owner had really used the space. It was a place for garden tools and fishing supplies. It had a sense of being useful and thought ‘I want to turn that into a studio!’ –Kathleen Pequeño
Kathleen’s friend Mario Espinosa did the drawings as she developed a livable floor plan for the old garage, which would retain its charming 1930s features while bringing it up to code. Because the garage was located in a corner of the lot within a foot of two property lines, two of the walls had to be firewalls, with no openings. This made it difficult to light the spaces inside. Kathleen’s priority became letting in as much light as possible by adding skylights and French doors. She was also determined to take advantage of the available floor space. The structure is relatively short with a gable roof, which presented some design challenges with regard to usable vertical space.
“The thing about retrofitting is that the second floor of the garage house was superbly designed for someone four feet tall to live there. The big design challenge was ‘how can we keep the charm of it and keep it an open space?’” –Kathleen Pequeño
One side of the ADU has two ten-foot by eight-foot sliding doors, which Kathleen was committed to keeping operable, so that the house can open onto the patio (though Kathleen notes this only happens a couple times each year because they are so heavy!) The doors were one of Kathleen’s favorite features of the garage when she first saw it and she felt they were worth preserving because they add so much character.
Kathleen funded her garage to ADU conversion by borrowing on a home equity line of credit (HELOC). However, she was not aware of the System Development Charges (SDCs) that were in place at the time. (Fortunately, the City of Portland has waived most System Development Charges for ADUs until 2016.) She ended up borrowing money from friends to help cover the unexpected surge in costs.
“I’d penciled it out and figured the ADU could pay for itself in 6 years, but I anticipated fees would be 10% of the budget. I didn’t realize it was going to cost $15,000 in fees — including $6,000 in SDCs, and $6,000 to upgrade the water meter. The SDCs were not apparent. There was very little information about that at the time. And, of course, I didn’t really count on the collapse of the economy right after I finished it. But I will be able to pay it off. It’s a cute little house and people want to live in it.” –Kathleen Pequeño
Like many homeowners who developed their ADUs prior to the waiver of System Development Charges in 2010, Kathleen is pleased that Portland has revised its policy – at least temporarily.(Fortunately, the SDC waiver has been extended though July 2016.) However, she is frustrated that as one of the early adopters she paid such a large portion of the total project cost in fees.
“My concern about ADU fees is that a lot of these systems are not set up for people with moderate incomes. The city and utilities should be able to offer accurate estimates of the fees in advance. These systems are set up for developers, not homeowners. They are set up for people who want to profit from housing, not people who want to provide their own housing. Developers get a break. I nearly blew a kidney.” –Kathleen Pequeño
As an example, Kathleen explained that she had to increase power supply to the property for the ADU and when the electrician had Pacific Power come out, she learned that there is a limit on the number of houses that can use a transformer on a specific block. Kathleen was told that if another transformer was required she would be responsible for the $2,000 cost of its installation.
“That was a bleak 24 hours. Fortunately, I didn’t have to put in the new transformer, which was great news. The lot across the street was an empty lot and the developer who constructed the building there now probably had to pay for a new transformer, which is fine because they put in three-story building.” –Kathleen Pequeño
On the other hand, Kathleen found staff at Portland’s Bureau of Development services very willing to help her as a homeowner developing an ADU on her property.
“The City used to do Homeowner Nights. They were patient and answered all of my questions. They appreciate a homeowner who wants to do it right. Unfortunately, that doesn’t mean they can reduce the fees. I was becoming best friends with the permit folks because I was there all the time. I grew to love them and I totally came to appreciate the value of the permit process. The permit rules are there for a reason. They’re not just hoops to jump through. Even if you don’t appreciate them now you will probably appreciate them later.” –Kathleen Pequeño
Kathleen acted as her own general contractor and hired a series of subcontractors to do various components that were outside her skill set. She especially liked working with Leo Hernandez who did the carpentry and was her main subcontractor. Kathleen also organized her friends and family into work parties for tasks as varied as painting, assembling/hanging the kitchen cabinetry, and laying the second-floor flooring. Throughout the construction process she tried to balance three components: the challenges presented by retrofitting, the cost of the project, and a commitment to sustainability.
She sought environmentally-friendly materials, including recycled denim insulation batting, low VOC paints, Forest Stewardship Council (FSC) lumber, and energy-efficient appliances. Unfortunately, because of the garage’s location and orientation on site, there was no way to help the ADU take better advantage of passive solar heating. The existing structure also presented challenges with regard to air sealing and energy efficiency. Kathleen says if she had it to do over again she would have tried to make the ADU more “energy tight.”
“The moral of my story is that retrofitting is so much harder than tearing something down and starting over. I did the insulation myself and the studs were variable: generally either 19” or 20” apart, so I had to buy a combination of 16” and 24” batts and trim them to match each section of the wall. And speaking of random things that add a few thousand dollars to the project, I didn’t expect to redo the exterior, but I had to in order to meet code requirements. I would have kept the original siding, but the building needed structural reinforcement so that it would be earthquake proof, and the best way to do it in this case was to add sheer panels to the exterior. We covered it with lap siding that matches the original but looks nicer. So we joke that if there’s an earthquake the people in the main house will run to the little house.” –Kathleen Pequeño
Once the ADU was finished, Kathleen rented it out to begin recouping the construction costs. She was intentional about creating a sense of community, so she and the tenants of the ADU shared the yard and the laundry room in the main house basement. Kathleen hopes there will always be someone living in the ADU, which she lovingly refers to as La Casita. (The big house is La Casota.) Kathleen is currently living in New York and renting out both her primary dwelling and her ADU. (Portland is one of the few cities that allows homeowners to rent out both units.) She intends to return to her home in Portland someday. She feels that her ADU was a good investment of money, blood, sweat, and tears.
So what advice does Kathleen have for homeowners considering creating an ADU on their own property?
“It was such a bear and there were days I was exhausted but needed to finish things. But it was really satisfying. If you’re not really changing the way you use the space, why are you spending the time and money? I liked the process of being my own general contractor, but I know it’s not for everyone. Weigh the benefits of retrofit vs. new construction. If you don’t love it, love it, tear it down and start over. There’s no way I would have torn down that garage, so I’m glad I retrofitted it, but it took an extra-careful engineering review. Know that retrofitting may mean it’s going to take twice as long as it would otherwise.” –Kathleen Pequeño
Those doors sound incredible, I’d love to see them!
This project sounds very similar to my own ADU — a garage conversion near property lines, necessitating firewalls and a loft, done before the SDC waiver. I agree with a lot that she said — conversion can be more complicated and troublesome than building new, and those SDC fees were a shock. Still it’s been worth it, and one fun thing about a converted dwelling is you can feel a bit of the places’ history.
Thanks to Kathleen for sharing her story.