Howard Street
310 Howard St, Durham, NC
North of Duke Park
Project Type:
Build-to-Rent
Development Type:
Small Lots & Flag Lots Subdivision
Project Status:
Completed
— KEY METRICS & OUTCOMES
Turning an Empty Lot into a High-Density Win in Durham
Opportunity Overview
Howard St. represents BETTER’s ability to tackle higher-density, long-term rental projects. What started as an unlisted property with a simple for-sale sign became a multifaceted development opportunity just outside Durham’s Colonial Village neighborhood.
Leveraging deep expertise in Durham's Unified Development Ordinance (UDO), BETTER identified the opportunity to build residential housing on a commercially zoned property (a strategy most developers would overlook). By capitalizing on Durham's "Expanding Housing Choices" provisions, BETTER overcame complex site challenges to create a pocket neighborhood that now delivers stable rental income and long-term appreciation potential.
Our Strategy
The Howard St. project required flexibility and bold decision-making:
Zoning & Density: Commercial neighborhood zoning allowed SFRs, duplexes, townhomes, and more. BETTER chose small and flag lots to maximize yield, creating 23 bedrooms across 6 units on 4 lots.
Design & Construction: Site challenges included flood zones, slope, sewer depth, and code requirements (sprinkler systems for quadruplexes). Smart planning and contingencies kept the project on budget.
Pocket Neighborhood Feel: Fencing and landscaping created privacy and a cohesive residential atmosphere despite an urban setting.
Challenges
This project required coordinated execution and problem-solving at every stage:
Design AdjustmentsCorrected issues like stair clearance and garage grading with framing expertise. | Infrastructure SurprisesAdded sewer pumps for rear units due to slope. |
Leasing RealityLease-up took 6 months. Slower than hoped, but acceptable to lenders. |
Qualitative Wins & Investor Returns
High-Density Success: Six thoughtfully built units (23 bedrooms on 0.5 acres) delivered high rental income, demonstrating how zoning flexibility and lot creativity unlock significant density and value.
Budget Discipline: BETTER delivered precisely what was promised.
Decisive Action: Acting decisively on undervalued properties created opportunity even without a perfect plan, proving that quick action and trust in analysis drive profitability.
Strategic Validation: The project reinforced that build-to-rent and flipping can both be profitable strategies when aligned from the front end and executed with precision, whether targeting long-term equity gains through rental income or quick wins through flips.
Project Analysis | |
Market Value | $2,428,000 |
Total Costs | $2,044,000 |
(-) Purchase Costs | $82,000 |
(-) Build Costs | $1,770,000 |
(-) Subdivision/Lot Prep Costs | $37,000 |
(-) Loan Fees | $155,000 |
Net Profit | $384,000 |
Project Return | 18.8% |
Relevant Metrics | |
Total Cash In | $223,000 |
Final Equity | $607,000 |
Return on Equity | 172.2% |
