LYNN — The former Daily Item building has been sold again.
Two brothers plan to transform the iconic flatiron structure on Exchange Street into a mixed-use development with a mix of market-rate and luxury apartments and ground-floor commercial and retail space. The historic downtown building has been vacant since 2015.
Hourmat Abdul Rauf and Hashmat Rauf, co-owners of Lynn-based Buildar Group, purchased the former Item building at 38 Exchange St. for $1.4 million earlier this month from Be Developer Group, an Atlanta firm that bought the property at an auction last year for $945,000.
The Atlanta firm had a similar vision for the 118-year-old building, with plans for 31 condominiums or apartments upstairs with commercial space on the first floor.
The Rauf brothers bought the 35,000 square-foot building under the entity, ARC Realty Management, which was organized in November to invest and develop real estate.
“Lynn is an up and coming city,” said Hourmat. “This city is progressively moving forward. With the new developments being approved, older buildings being renovated and brought back to life shows that the city is on a great path.
“The reason why we were interested in purchasing this building was because we have buildings in Lynn and surrounding areas and we want to see this city prosper. This is an iconic building and we respect Lynn’s history associated with this building. We believe in Lynn and we made this significant investment in the city.”
Sitting at their Western Avenue office on Wednesday, the Raufs laid out a plan for a mixed use development, a 10-month project they plan to start in February. They plan to invest $3 million to $3.5 million in renovations, which will include a full gut rehabilitation with mainly interior work.
The pair have plans for 35 to 40 modern apartments on the second to fifth floors. Three of those floors would have market-rate units with a mix of one- and two bedrooms and studios. The fifth floor would have five luxury lofts. Rents would start at between $1,900 and $2,100, but would depend on what the market dictates, according to Hourmat.
The 10,000 square feet of ground floor commercial space would be used for either high-end retail or a restaurant and bar.
Hashmat said there’s a high demand for a mixed-use development and cited their interest in the desirable location across the street from the MBTA’s commuter rail station and short train ride to Boston.
The development plans are similar to what the brothers have done with other properties they own in Lynn, Revere, Everett and Chelsea, but on a larger scale. With their redevelopments, the Raufs like to have more modern aesthetics to their properties, which they say is aimed at attracting younger generations and couples.
Built in 1900, the building served as the paper’s headquarters on Exchange Street, housing the newspaper’s printing production, executive suites, sales and operations until 2014.