The six-story Hotel Berry sits next to the Greyhound bus station on L Street.
The budget for rehabbing the building is $24 million…a lot more expensive than new construction.
Sacramento Business Journal Editor Jack Robinson points out - that figure includes the cost of buying the property and moving residents out while the work goes on…
"Even if you factor those costs out though, this will end up costing something like $400 a square-foot. A new apartment building, sort of a bare bones apartment building would cost half of that. Part of the extra expense is there's work that wouldn't have been required if you were building a building from scratch - there's structural reinforcement work and there's getting rid of lead paint and asbestos."
The Hotel Berry make-over is the first project in the city's downtown redevelopment area to start construction this year.
It's part of the city's goal to provide more than 700 single-resident occupancy units to low income people.