Downtown Apartment Market Softening
August 27, 2010 12:53 Filed in: News
Over the next year, the central Austin rental
apartment vacancy rate is expected to jump
significantly from 3.6 percent to 9.4 percent.
This negative trend is in stark contrast to what is happening in the rest of the City, where employment growth and migration are reversing the current apartment supply glut. According to market data from Marcus & Millichap Real Estate Investment Brokerage, citywide apartment vacancy rates are expected to drop 9% this year. In hot areas of the city -- such as the south central area near South Congress Ave, vacancy is expected to drop significantly as more units are absorbed.
Across the city, rents dropped 3% last year as more than 10,000 new units hit the market. This year, rents are expected to increase slightly (2.4%) as only 2,860 new units are expected to hit the market.
In downtown Austin where rents are highest, tight spending is limiting absorption of new units. Central Austin apartment rents average $1,014 -- significantly higher than the citywide average of $864.
According to the firm, "the city is forecast to add 19,100 jobs this year, prompting a rush of new residents and a rise in demand for residential rentals. At the same time, the apartment development pipeline has drastically thinned out, with 2,860 new units expected this year, down from 10,340 in 2009."
With a strong supply of downtown apartments, potential renters will be able to negotiate better rents and more attractive incentives, especially for higher-end units.
This negative trend is in stark contrast to what is happening in the rest of the City, where employment growth and migration are reversing the current apartment supply glut. According to market data from Marcus & Millichap Real Estate Investment Brokerage, citywide apartment vacancy rates are expected to drop 9% this year. In hot areas of the city -- such as the south central area near South Congress Ave, vacancy is expected to drop significantly as more units are absorbed.
Across the city, rents dropped 3% last year as more than 10,000 new units hit the market. This year, rents are expected to increase slightly (2.4%) as only 2,860 new units are expected to hit the market.
In downtown Austin where rents are highest, tight spending is limiting absorption of new units. Central Austin apartment rents average $1,014 -- significantly higher than the citywide average of $864.
According to the firm, "the city is forecast to add 19,100 jobs this year, prompting a rush of new residents and a rise in demand for residential rentals. At the same time, the apartment development pipeline has drastically thinned out, with 2,860 new units expected this year, down from 10,340 in 2009."
With a strong supply of downtown apartments, potential renters will be able to negotiate better rents and more attractive incentives, especially for higher-end units.
Exclusive: Summer Downtown Condo Sales Stay Strong
August 23, 2010 22:48 Filed in: News
We've updated the AustinTowers | urbanspace Downtown Austin Condo
Market Index for June and July, 2010. With
the new results loaded, we are pleased to
announce that year-over-year sales volumes have
increased for the 13th month in a row. In
addition, more expensive units are starting to
sell, prices are rising, and average days on
market is dropping. The downtown Austin condo
market continues to gain strength as it enters
it's second year of growth and recovery.
During June and July -- key summer selling months -- 32 units worth a total of $11.7 million were transacted on the MLS: 12 more than during the same period in 2009. In addition Read More...
|
Month
|
Sales
|
Avg. Price
|
$/SF
|
Avg SF
|
Avg Year
|
% Ask
|
ADOM
|
|
Jun-09
|
8
|
$431,738
|
$292
|
1,400
|
2000
|
87%
|
117
|
|
Jun-10
|
18
|
$387,241
|
$324
|
1,160
|
1999
|
95%
|
100
|
|
Change
|
125%
|
-10%
|
11%
|
-17%
|
-1.00
|
9%
|
-15%
|
|
Month
|
Sales
|
Avg. Price
|
$/SF
|
Avg SF
|
Avg Year
|
% Ask
|
ADOM
|
|
Jul-09
|
12
|
$265,450
|
$265
|
1,021
|
1987
|
97%
|
88
|
|
Jul-10
|
14
|
$338,192
|
$298
|
1,121
|
1999
|
96%
|
74
|
|
Change
|
17%
|
27%
|
12%
|
10%
|
12.00
|
-1%
|
-16%
|
During June and July -- key summer selling months -- 32 units worth a total of $11.7 million were transacted on the MLS: 12 more than during the same period in 2009. In addition Read More...
Swim! Pictures of Downtown Condo Pools
August 15, 2010 23:30 Filed in: News
Ten years ago, if you wanted to live downtown in
Austin in a place with a nice pool, your options were
slim. Now, most of the new projects feature
resort-like pools which are key selling points for
the buildings. In the future, nice pools will likely
be standard on new Austin condo buildings. As the new
generation of resort-like projects comes to fruition,
it's possible that units in buildings without pools
with sell at a discount when compared to units in
buildings with this key amenity.
While resort-like pools are to be expected on high-end projects like the Four Seasons Residences, the Austonian, and the W, the pool scene is equally as important at more reasonable projects like 360 and Spring.
Here are the pictures of the new downtown Austin condo pools:
Spring
See more cool pools! Read More...
While resort-like pools are to be expected on high-end projects like the Four Seasons Residences, the Austonian, and the W, the pool scene is equally as important at more reasonable projects like 360 and Spring.
Here are the pictures of the new downtown Austin condo pools:
Spring
See more cool pools! Read More...
Zilker Park Residences Withdrawn From Market
August 04, 2010 22:58 Filed in: News
As developer prepare for a third iteration of
Zilker Park
Residences, the project has been withdrawn
from the market.
In 2007, developers announced plans for 74 units to be developed on the eastern edge of Zilker Park on Barton Springs Road. With units starting at $300K and topping out near $1.3 million, the 3 building project was to sit on the border of the park with direct access to the hike and bike trails. Although the project featured a unique and highly desirable location, it was marketed at the bottom of the downtown condo market.
As a result, the plan was changed substantially in 2008 when the developers reduced the size of the project from 74 to 40 larger units, added a 65 room boutique hotel, and an announced the expansion of the site through the purchase of an adjacent restaurant (formerly Wanfu Tool).
The 2008 Plan for Zilker Park Residences
With the revised plan, Zilker Park Residences was supposed to include 40 units ranging in size from a 1,515 square foot one bedroom to the largest 3,241 square foot unit. With the larger units came prices ranging from $659,000, one of the highest starting prices of any project in Austin, to $1.4 million.
Now, developers have begun notifying prospects that the project has been withdrawn from the market. According to the developers, they are redesigning the project to better meet market needs. In particular, they now plan to build a 90 room boutique hotel, spa & fitness center along with 15 large residential condo units. Currently, they plan to begin construction and marketing for the redesigned project sometime next year.
In 2007, developers announced plans for 74 units to be developed on the eastern edge of Zilker Park on Barton Springs Road. With units starting at $300K and topping out near $1.3 million, the 3 building project was to sit on the border of the park with direct access to the hike and bike trails. Although the project featured a unique and highly desirable location, it was marketed at the bottom of the downtown condo market.
As a result, the plan was changed substantially in 2008 when the developers reduced the size of the project from 74 to 40 larger units, added a 65 room boutique hotel, and an announced the expansion of the site through the purchase of an adjacent restaurant (formerly Wanfu Tool).
The 2008 Plan for Zilker Park Residences
With the revised plan, Zilker Park Residences was supposed to include 40 units ranging in size from a 1,515 square foot one bedroom to the largest 3,241 square foot unit. With the larger units came prices ranging from $659,000, one of the highest starting prices of any project in Austin, to $1.4 million.
Now, developers have begun notifying prospects that the project has been withdrawn from the market. According to the developers, they are redesigning the project to better meet market needs. In particular, they now plan to build a 90 room boutique hotel, spa & fitness center along with 15 large residential condo units. Currently, they plan to begin construction and marketing for the redesigned project sometime next year.
New Project Listings: 904 West
July 25, 2010 22:25 Filed in: News
We've added listings for 904 West, a new low-rise
condo project on 9th Street and West Avenue. The
new development is close to the Nokonah and
Whole Foods in a corner of downtown that has
seen very little condo development.
904 West is an interesting "green" condo project. It's the only multi-residential property in downtown Austin offering photovoltaic systems for each unit. The project also features tankless water heaters and LED lighting.
Currently, there are 4 units listed on MLS ranging from $193K for a 577 square foot 1/1 to $327K for an 891 square foot 1/1. We're working on a full profile and will have additional details on AustinTowers soon.
904 West is an interesting "green" condo project. It's the only multi-residential property in downtown Austin offering photovoltaic systems for each unit. The project also features tankless water heaters and LED lighting.
Currently, there are 4 units listed on MLS ranging from $193K for a 577 square foot 1/1 to $327K for an 891 square foot 1/1. We're working on a full profile and will have additional details on AustinTowers soon.
La Vista on Lavaca is Dead. Again.
July 17, 2010 23:55 Filed in: News
After a decade of starts and stops, the ill-fated La
Vista on Lavaca condo project appears to be fully
dead.
Now the planned nine-story residential mixed-use tower consisting of 19 condominiums on the top four floors, a three-floor Executive Business Center, and first floor restaurant, has been abandoned mid-construction by its new owners.
Continue reading here: Read More...
Now the planned nine-story residential mixed-use tower consisting of 19 condominiums on the top four floors, a three-floor Executive Business Center, and first floor restaurant, has been abandoned mid-construction by its new owners.
Continue reading here: Read More...
Downtown Austin Condo Sales Soar in May
July 13, 2010 22:48 Filed in: News
We've updated the AustinTowers | urbanspace Downtown Austin Condo
Market Index through May, 2010 and, for the
twelfth month in a row, MLS sales volumes have
increased in comparison to previous year
numbers. On a per square foot basis, however,
year-to-date prices are down about 9% over the
comparable 2009 numbers based on a 12-month
rolling average.
The big news for May is that condo sales volumes soared, breaking the longstanding Austin Towers |urbanspace record of 22 units in a month (set in April, 2008). View the Full Analysis: Read More...
|
Month
|
Sales
|
Avg. Price
|
$/SF
|
Avg SF
|
Avg Year
|
% Ask
|
ADOM
|
|
May-09
|
11
|
$347,045
|
$308
|
1,150
|
1990
|
96%
|
63
|
|
May-10
|
24
|
$258,967
|
$285
|
934
|
1976
|
96%
|
118
|
|
Change
|
118%
|
-25%
|
-8%
|
-19%
|
-13.91
|
0%
|
87%
|
The big news for May is that condo sales volumes soared, breaking the longstanding Austin Towers |urbanspace record of 22 units in a month (set in April, 2008). View the Full Analysis: Read More...
With Downtown Marriott Dead, Land Owners Seek New Hotel Developer
July 06, 2010 22:05 Filed in: News
Last month, the Austin City Council enacted a zoning
change and turned over a public alley in the most
effort to lure a major convention hotel to Block 18
--- the Congress Avenue block that used to house Las
Manitas and which was at one point going to be taken
over by a very large Marriott hotel.
The Congress Avenue Marriott -- a 1,000 room hotel complex on 2nd and Congress avenue -- was one of the most controversial, and one of the least popular downtown projects. The project is best known for displacing Las Manitas and other local businesses. Before being cancelled, the last two versions of the project were criticized for bland institutional architecture and a lack of ground-floor retail on a key block connecting the convention center area to the second street district. The original plan for the project included 1,000 rooms across 3 separate Marriott-branded hotels in one convoluted multi-facted building. The second version of the project included two hotels in one building. Version 3.0 included just one Marriott hotel with 1,000 rooms. The budget at one point reached $250 million before the project was shelved.
Now, the City is trying new tactics to Read More...
The Congress Avenue Marriott -- a 1,000 room hotel complex on 2nd and Congress avenue -- was one of the most controversial, and one of the least popular downtown projects. The project is best known for displacing Las Manitas and other local businesses. Before being cancelled, the last two versions of the project were criticized for bland institutional architecture and a lack of ground-floor retail on a key block connecting the convention center area to the second street district. The original plan for the project included 1,000 rooms across 3 separate Marriott-branded hotels in one convoluted multi-facted building. The second version of the project included two hotels in one building. Version 3.0 included just one Marriott hotel with 1,000 rooms. The budget at one point reached $250 million before the project was shelved.
Now, the City is trying new tactics to Read More...
Shhhh! New Congress Tower Planned
June 29, 2010 22:20 Filed in: News
According to city records, the owners of three vacant
historic buildings on Congress Avenue between 9th and
10th street are planning to build a 16-story, 88,000
square foot office tower on the site. If successful,
the project would commence construction in 2011 and
open by Summer 2012.
According to a statement by Tucker Lynch, a representative of the site owners, in the Austin Business journal, “The owners told us to keep it as quiet as possible,” Lynch said. “We are just doing our feasibility. If it is not feasible, we won’t build.”
According to the Austin Business Journal, "Plans call for eight floors of office space, atop six floors of parking and one basement parking level, plus street retail. According to architecture drawings by Dallas-based HKS, the building will have a glass facade and a terraced set back at the 11th floor. The proposed building bumps right up to the height limit imposed in the Capitol View Corridor. The owner is applying for central urban redevelopment designation, or CURE, which exempts development from some building codes and permits greater heights for the sake of economic benefit. The site is currently zone for “Central Business District,” which allows for 88,000 square feet of development at the site and Lynch said his client is not seeking a density bonus."
The project is one of numerous towers currently in the works. Other projects include:
- A 15-story boutique hotel at 416 Congress Avenue
- Two 40-story Towers by Constructive Ventures on an Austin Energy Site near 2nd and San Antonio
- A 250 unit 28-story condo tower and an adjacent 16-story office tower on the 1.2 acre site bounded by Fifth, Sixth, San Antonio and Nueces streets by Novare, the developer of 360.
- A 15-story office tower with ground floor retail is being proposed for the north east corner of West Cesar Chavez Street and Lamar Boulevard by Capital City Partners
According to a statement by Tucker Lynch, a representative of the site owners, in the Austin Business journal, “The owners told us to keep it as quiet as possible,” Lynch said. “We are just doing our feasibility. If it is not feasible, we won’t build.”
According to the Austin Business Journal, "Plans call for eight floors of office space, atop six floors of parking and one basement parking level, plus street retail. According to architecture drawings by Dallas-based HKS, the building will have a glass facade and a terraced set back at the 11th floor. The proposed building bumps right up to the height limit imposed in the Capitol View Corridor. The owner is applying for central urban redevelopment designation, or CURE, which exempts development from some building codes and permits greater heights for the sake of economic benefit. The site is currently zone for “Central Business District,” which allows for 88,000 square feet of development at the site and Lynch said his client is not seeking a density bonus."
The project is one of numerous towers currently in the works. Other projects include:
- A 15-story boutique hotel at 416 Congress Avenue
- Two 40-story Towers by Constructive Ventures on an Austin Energy Site near 2nd and San Antonio
- A 250 unit 28-story condo tower and an adjacent 16-story office tower on the 1.2 acre site bounded by Fifth, Sixth, San Antonio and Nueces streets by Novare, the developer of 360.
- A 15-story office tower with ground floor retail is being proposed for the north east corner of West Cesar Chavez Street and Lamar Boulevard by Capital City Partners
1155 Barton Springs Condo Project Files for Bankruptcy
June 21, 2010 22:27 Filed in: News
In April of 2008, developers announced a 4-story, 27
unit development on Barton Springs just east of Lamar
adjacent to the train tracks, McDonalds, and Peter
Pan Mini Golf. With pricing
starting at $1,000,000, our
original reaction was that "the project is a very odd
combination of location and pricing that suggests a
lack of experience in residential development." At
the high end, the units were priced at $900 / SF
making this the most expensive development in Austin.
This week, the project, 1155 Barton Springs, filed for bankruptcy. According to the Austin Business Journal, "PPT Development is seeking Chapter 11 protection, filed at the end of May, claiming its assets and debts each range from $1 million to $10 million, according to records that did not include a complete list of creditors. The company’s largest creditor is San Antonio-based Overland Partners, the lead architect on the project, which is owed about $1 million, according to court records. Despite the setback, PPT Development LP principal Steffen Waltz said the $40 million development called 1155 Barton Springs is merely in hibernation, not dead."
While strong projects are finding success South of the river, they are succeeding by combining prime locations with prices far below those of the large downtown high-rises. 1155 Barton Springs attempted to combine ultra-luxury with a low-rise "B" grade location -- a tough sell in any market. While the views are great, top dollar projects need to be perfect, which is not the case with 1155 Barton Springs.
According to the Austin Business Journal, "the 1155 Barton Springs project has been in the works under various names, including The Milan, since at least 2005. In April 2007, developers announced plans to break ground by that year’s end, with tenants moving in by mid-2009. There would be two portions of the project, they said, with one building on the north side of the property on the corner of Barton Springs and Dawson roads and three buildings toward the southern side. The 24 residential units, ranging from 1,600 to 6,200 square feet, would list for $1 million to $6 million each, according to the announcement."
This week, the project, 1155 Barton Springs, filed for bankruptcy. According to the Austin Business Journal, "PPT Development is seeking Chapter 11 protection, filed at the end of May, claiming its assets and debts each range from $1 million to $10 million, according to records that did not include a complete list of creditors. The company’s largest creditor is San Antonio-based Overland Partners, the lead architect on the project, which is owed about $1 million, according to court records. Despite the setback, PPT Development LP principal Steffen Waltz said the $40 million development called 1155 Barton Springs is merely in hibernation, not dead."
While strong projects are finding success South of the river, they are succeeding by combining prime locations with prices far below those of the large downtown high-rises. 1155 Barton Springs attempted to combine ultra-luxury with a low-rise "B" grade location -- a tough sell in any market. While the views are great, top dollar projects need to be perfect, which is not the case with 1155 Barton Springs.
According to the Austin Business Journal, "the 1155 Barton Springs project has been in the works under various names, including The Milan, since at least 2005. In April 2007, developers announced plans to break ground by that year’s end, with tenants moving in by mid-2009. There would be two portions of the project, they said, with one building on the north side of the property on the corner of Barton Springs and Dawson roads and three buildings toward the southern side. The 24 residential units, ranging from 1,600 to 6,200 square feet, would list for $1 million to $6 million each, according to the announcement."
Austonian, Four Seasons Prepare to Open
June 13, 2010 14:02 Filed in: News
In downtown Austin, there are two classes of new
condo projects. There are upscale projects like
360, Austin City Lofts,
Milago, and the Nokonah. About a dozen of
these projects have been completed over the
decade and almost all are sold out at this
point. Only Spring still has new units
left to sell. These projects have sold well
featuring mostly 1-2 bedroom units priced under
$600K.
The second category includes the three super high-end projects now under development: the Austonian, the Four Seasons, and the W Hotel and Residences. These projects typically start around $600K and feature many units priced over $1 million. This is a new market for Austin, and the timing of construction has been difficult for the developers. All three projects are believed to be 40% - 60% sold at this point in time.
This month, two of these projects -- the Austonian and the Four Seasons -- will open and welcome their first residents. The W is scheduled to open in December. Between the three buildings, 501 new high-end units will hit the market this year:
- The Austonian begins welcoming residents next week. The 56-story, $250 million, 188-unit luxury condo tower is the tallest residential building west of the Mississippi.
- The Michael Graves-designed Four Seasons Residences opens later this month. The 32-story project features 148 units and a 32nd floor sundeck, fitness center, party room, catering kitchen, and resident library. The project also includes valet parking, a 24-hour concierge, in-room dining, housekeeping, and daily linen service through the hotel.
- The W will open in December. The $295 million 36-story project will include 252 hotel rooms, 165 condos, 35,000 square feet of office, retail and restaurant space and a new theater to host Austin City Limits on Second Street.
For these projects, the next few months will be essential. With many units yet to sell, developers are hoping that potential-residents will appear now that the projects are ready for occupancy. With the economy and real estate markets improving, sales activity has been picking up at all three projects. While developers have not announced any public discounts, this should be a good time to negotiate, especially for buyers who are willing to consider any of the three projects.
The second category includes the three super high-end projects now under development: the Austonian, the Four Seasons, and the W Hotel and Residences. These projects typically start around $600K and feature many units priced over $1 million. This is a new market for Austin, and the timing of construction has been difficult for the developers. All three projects are believed to be 40% - 60% sold at this point in time.
This month, two of these projects -- the Austonian and the Four Seasons -- will open and welcome their first residents. The W is scheduled to open in December. Between the three buildings, 501 new high-end units will hit the market this year:
- The Austonian begins welcoming residents next week. The 56-story, $250 million, 188-unit luxury condo tower is the tallest residential building west of the Mississippi.
- The Michael Graves-designed Four Seasons Residences opens later this month. The 32-story project features 148 units and a 32nd floor sundeck, fitness center, party room, catering kitchen, and resident library. The project also includes valet parking, a 24-hour concierge, in-room dining, housekeeping, and daily linen service through the hotel.
- The W will open in December. The $295 million 36-story project will include 252 hotel rooms, 165 condos, 35,000 square feet of office, retail and restaurant space and a new theater to host Austin City Limits on Second Street.
For these projects, the next few months will be essential. With many units yet to sell, developers are hoping that potential-residents will appear now that the projects are ready for occupancy. With the economy and real estate markets improving, sales activity has been picking up at all three projects. While developers have not announced any public discounts, this should be a good time to negotiate, especially for buyers who are willing to consider any of the three projects.
The Future of Downtown Austin: A Visual Tour of the Downtown Austin Plan
June 01, 2010 22:58 Filed in: News
This evening, the City of Austin hosted a town hall
meeting to review the Downtown Austin Plan -- the
draft master plan for downtown Austin.
The purpose of the plan is to create a vision -- and policy framework -- for a vibrant downtown that becomes the region's core for work, play, shopping, and living. The 90-page plan and 93-slide summary presentation (they are fascinating -- get them here) include hundreds of ideas to improve downtown Austin. The ideas range from zoning and historical protections to transit solutions to requirements for store glass transparency.
To provide a quick overview of the very rich content, we have assembled a visual walk through of some of the most interesting content:
(1) The core and waterfront district is red -- this is the area analyzed in the Downtown Austin Plan.
(2) Even without active regulation, emerging land use patterns have effectively segmented downtown activity. In this diagram, pink represents the core employment zone; blue is commercial, entertainment and convention; and orange is residential. The dotted areas are pedestrian priority zones and the diagonal hatches represent sites with development opportunities.
(3) This heat map shows likelihood of redevelopment. Pink means that the site is pending redevelopment, green means near-term development is possible, yellow means long-term redevelopment is possible. Red means that development is unlikely. There are 62 properties > 1/4 block that can be redeveloped. These sites total 48 acres.
The Visual Tour Continues Here: Read More...
The purpose of the plan is to create a vision -- and policy framework -- for a vibrant downtown that becomes the region's core for work, play, shopping, and living. The 90-page plan and 93-slide summary presentation (they are fascinating -- get them here) include hundreds of ideas to improve downtown Austin. The ideas range from zoning and historical protections to transit solutions to requirements for store glass transparency.
To provide a quick overview of the very rich content, we have assembled a visual walk through of some of the most interesting content:
(1) The core and waterfront district is red -- this is the area analyzed in the Downtown Austin Plan.
(2) Even without active regulation, emerging land use patterns have effectively segmented downtown activity. In this diagram, pink represents the core employment zone; blue is commercial, entertainment and convention; and orange is residential. The dotted areas are pedestrian priority zones and the diagonal hatches represent sites with development opportunities.
(3) This heat map shows likelihood of redevelopment. Pink means that the site is pending redevelopment, green means near-term development is possible, yellow means long-term redevelopment is possible. Red means that development is unlikely. There are 62 properties > 1/4 block that can be redeveloped. These sites total 48 acres.
The Visual Tour Continues Here: Read More...
Two More Austin Condo Skyscrapers Announced!!!
May 13, 2010 20:26 Filed in: News
This has been a crazy week. First, the developers of
360 announced
plans to develop two new downtown towers. Then,
rumors surfaced that the Aquaterra project may be
revived as a rental tower. Today, Constructive
Ventures announced plans to build 425 new condos
in two 400-500 foot towers on an Austin Energy
site just West of 360 downtown. Together, these
announcements may herald the beginning of a new
downtown condo building boom.
The new project by the developers of Spring would include 425 condo units and 15,000 square feet of retail in two point towers on a 1.7 acre site adjacent to 360 and the decommissioned Green Water Treatment Plant downtown. The project would cost $220 million and construction would begin in 2013.
Here is a summary from the Statesman:
The City Council is set to vote today to authorize the city manager to sign a development agreement with a partnership of Constructive Ventures and Trammell Crow Co. to buy the tract for $14.5 million.
The community benefits from the project would include contributions for public art and $2.7 million for the city's affordable housing fund, the largest proposed payment from a developer for a project to date, said Rodney Gonzales, deputy director of the city's Economic Growth and Redevelopment Services Office.
"This is a really good chance for the city to convert an underutilized piece of downtown property into one that generates property and sales taxes for the city and brings forth a substantial contribution for the affordable housing trust fund," Gonzales said.
In 2008, the city chose a partnership of Trammell Crow, Constructive Ventures and USAA Real Estate Co. over four other teams to redevelop the Austin Energy site and the nearby 6-acre water treatment plant at West Cesar Chavez and San Antonio streets with a hotel, apartments, office and retail space.
Those projects are part of the city's grand plan to transform downtown's southwestern edge, including the former Seaholm Power Plant, into a lively, densely developed district. A new central library is also planned along Cesar Chavez.
The city is still negotiating a development agreement and purchase price on the Green site, Gonzales said.
The agreement says the soonest that Constructive Ventures could purchase the Austin Energy property is March 2013. The city must first relocate the control center, from which the entire Austin Energy electric grid is managed year-round.
Larry Warshaw, a principal with Constructive Ventures, said the condominium buildings would be so-called point towers — slender buildings on a wider base like the Spring condominium high-rise, of which he was a co-developer — and would soar between 400 and 500 feet.
"Financing will be the most likely factor dictating a start date," he said
The new project by the developers of Spring would include 425 condo units and 15,000 square feet of retail in two point towers on a 1.7 acre site adjacent to 360 and the decommissioned Green Water Treatment Plant downtown. The project would cost $220 million and construction would begin in 2013.
Here is a summary from the Statesman:
The City Council is set to vote today to authorize the city manager to sign a development agreement with a partnership of Constructive Ventures and Trammell Crow Co. to buy the tract for $14.5 million.
The community benefits from the project would include contributions for public art and $2.7 million for the city's affordable housing fund, the largest proposed payment from a developer for a project to date, said Rodney Gonzales, deputy director of the city's Economic Growth and Redevelopment Services Office.
"This is a really good chance for the city to convert an underutilized piece of downtown property into one that generates property and sales taxes for the city and brings forth a substantial contribution for the affordable housing trust fund," Gonzales said.
In 2008, the city chose a partnership of Trammell Crow, Constructive Ventures and USAA Real Estate Co. over four other teams to redevelop the Austin Energy site and the nearby 6-acre water treatment plant at West Cesar Chavez and San Antonio streets with a hotel, apartments, office and retail space.
Those projects are part of the city's grand plan to transform downtown's southwestern edge, including the former Seaholm Power Plant, into a lively, densely developed district. A new central library is also planned along Cesar Chavez.
The city is still negotiating a development agreement and purchase price on the Green site, Gonzales said.
The agreement says the soonest that Constructive Ventures could purchase the Austin Energy property is March 2013. The city must first relocate the control center, from which the entire Austin Energy electric grid is managed year-round.
Larry Warshaw, a principal with Constructive Ventures, said the condominium buildings would be so-called point towers — slender buildings on a wider base like the Spring condominium high-rise, of which he was a co-developer — and would soar between 400 and 500 feet.
"Financing will be the most likely factor dictating a start date," he said
Hilton Condo Owners Sue Over Quality Problems
May 11, 2010 20:55 Filed in: News
Seven condo owners in the City-owned Hilton Hotel and
99 unit 5 Fifty Five condo
project are suing the city-backed non-profit
developer for noise problems and water leakage
damage.
The impacted units are located under a catering kitchen that is reportedly loud and susceptible to water leaks into the units below.
According to the Statesman:
The condo owners are suing Austin Convention Enterprises. Tony Ciccone, the lawyer representing three of them, said the problems caught his clients by surprise because they were not allowed to tour sections of the building before their purchases and did not know that hotel plans included putting a banquet kitchen above residences.
Five of the condo owners suing the city say that chronic leaks from the kitchen, plus the noise from a service elevator and heavy carts thunking across the kitchen's tile floors at night, have made their units uninhabitable.
According to court filings, Linda Cartwright bought a unit in August 2006 and soon discovered water leaking in through her smoke alarm. A year later, Cartwright "returned from vacation to find her ceiling open and water openly running onto the floor of her unit," causing severe damage, the lawsuit says.
Gary and Rhonda Golden allege in their lawsuit that leaks and noise have ruined their two units, on the eighth and ninth floors.
The city has acknowledged some of the problems.
"Based on prior investigations ... it is obvious that the kitchen is causing the leaks" into condo units, according to a Jan. 8 letter from Assistant City Manager Rudy Garza to the condominium owners association.
The Hilton was developed by the City through a $110 million1998 bond issue. The convention center hotel was a key part of the City's strategy to strengthen the convention and tourism industries with a large anchor hotel. Such a hotel is required to lure larger events to the city. According to the City, the hotel has been a financial success, paying off its debt obligations at an accelerated rate.
The city owns 74.41 percent of the space inside the building while Condo owners collectively own 22.68 percent of the space. The remaining 2.91 percent is commercial space owned by Neches Street Partners. So far, the majority of complaints are related to the small number of units directly under the kitchen. It is not clear whether the units on upper floors suffer from similar construction issues. The complex ownership structure has made it difficult to address the issues by moving the kitchen.
The Hilton is not the first project to be sued by its condo owners. Last year, Sabine owners sued the developer for a variety of problems including noise and safety issues. The litigation was resolved when the developer agreed to make significant repairs and enhancements to resolve the issues.
The impacted units are located under a catering kitchen that is reportedly loud and susceptible to water leaks into the units below.
According to the Statesman:
The condo owners are suing Austin Convention Enterprises. Tony Ciccone, the lawyer representing three of them, said the problems caught his clients by surprise because they were not allowed to tour sections of the building before their purchases and did not know that hotel plans included putting a banquet kitchen above residences.
Five of the condo owners suing the city say that chronic leaks from the kitchen, plus the noise from a service elevator and heavy carts thunking across the kitchen's tile floors at night, have made their units uninhabitable.
According to court filings, Linda Cartwright bought a unit in August 2006 and soon discovered water leaking in through her smoke alarm. A year later, Cartwright "returned from vacation to find her ceiling open and water openly running onto the floor of her unit," causing severe damage, the lawsuit says.
Gary and Rhonda Golden allege in their lawsuit that leaks and noise have ruined their two units, on the eighth and ninth floors.
The city has acknowledged some of the problems.
"Based on prior investigations ... it is obvious that the kitchen is causing the leaks" into condo units, according to a Jan. 8 letter from Assistant City Manager Rudy Garza to the condominium owners association.
The Hilton was developed by the City through a $110 million1998 bond issue. The convention center hotel was a key part of the City's strategy to strengthen the convention and tourism industries with a large anchor hotel. Such a hotel is required to lure larger events to the city. According to the City, the hotel has been a financial success, paying off its debt obligations at an accelerated rate.
The city owns 74.41 percent of the space inside the building while Condo owners collectively own 22.68 percent of the space. The remaining 2.91 percent is commercial space owned by Neches Street Partners. So far, the majority of complaints are related to the small number of units directly under the kitchen. It is not clear whether the units on upper floors suffer from similar construction issues. The complex ownership structure has made it difficult to address the issues by moving the kitchen.
The Hilton is not the first project to be sued by its condo owners. Last year, Sabine owners sued the developer for a variety of problems including noise and safety issues. The litigation was resolved when the developer agreed to make significant repairs and enhancements to resolve the issues.
360 Developer Planning Two New Austin Buildings!
May 10, 2010 22:41 Filed in: News
Novare, the developer of
360,
has announced preliminary plans for two new towers
to rise one block west of the downtown post
office. The new plans call for construction of a
250 unit 28-story condo tower and an adjacent
16-story office tower on the 1.2 acre site bounded
by Fifth, Sixth, San Antonio and Nueces streets.
The new project, to be called Ovation, replaces earlier plans for a larger 400-unit condo development on the same site. Novare's 360 was one of the largest and most successful downtown projects, selling out 430 units with strong pre-sales and minimal discounting.
One of the things that made 360 so successful was its combination of competitive pricing -- most units were $200K to $500K -- and design: it was desirable tall glass building on a great downtown site. In previous statements, Novare has implied that it plans to follow a similar mode for future downtown condo developments such as Ovation -- aiming to build desirable projects with entry-level pricing.
Since the completion of 360, Novare has flirted with development plans for the site as well as for an adjacent site that currently houses the downtown post office. Novare is currently working on plans to redevelop the post office in another location, allowing the company to purchase the prime and underutilized land and to develop that site as well.
According to the Statesman, the new "residential tower, called Ovation, is for 250 units with ground-level commercial space" and "the office tower would include a restaurant, bank and a parking garage with 567 spaces." In addition to the condo building, the plans call for "a 153,634-square-foot office building, a 5,000-square-foot "high-turnover" restaurant, 14,000 square feet of specialty retail and a 4,000-square-foot drive-through bank."
Novare has been clear that development plans were revised to better adjust to a changing local market and a changing financing market. It is the latter that has delayed the project and which continues to be an obstacle for its completion. However, as markets return to normal, the company is increasingly confident that it will be able to line up the support required to proceed.
The new project, to be called Ovation, replaces earlier plans for a larger 400-unit condo development on the same site. Novare's 360 was one of the largest and most successful downtown projects, selling out 430 units with strong pre-sales and minimal discounting.
One of the things that made 360 so successful was its combination of competitive pricing -- most units were $200K to $500K -- and design: it was desirable tall glass building on a great downtown site. In previous statements, Novare has implied that it plans to follow a similar mode for future downtown condo developments such as Ovation -- aiming to build desirable projects with entry-level pricing.
Since the completion of 360, Novare has flirted with development plans for the site as well as for an adjacent site that currently houses the downtown post office. Novare is currently working on plans to redevelop the post office in another location, allowing the company to purchase the prime and underutilized land and to develop that site as well.
According to the Statesman, the new "residential tower, called Ovation, is for 250 units with ground-level commercial space" and "the office tower would include a restaurant, bank and a parking garage with 567 spaces." In addition to the condo building, the plans call for "a 153,634-square-foot office building, a 5,000-square-foot "high-turnover" restaurant, 14,000 square feet of specialty retail and a 4,000-square-foot drive-through bank."
Novare has been clear that development plans were revised to better adjust to a changing local market and a changing financing market. It is the latter that has delayed the project and which continues to be an obstacle for its completion. However, as markets return to normal, the company is increasingly confident that it will be able to line up the support required to proceed.
Seaholm Development Update
May 03, 2010 21:44 Filed in: News
More than 2 years ago, the city approved a master
plan for the redevelopment of the Seaholm Power Plant
site on Cesar Chavez near Lamar. The $117.2 million
project, a partnership between the city and Southwest
Strategies, is supposed to result in a 22-story
hotel, 60 condo units, and 180,000 square feet of
retail and commercial space.
More than a decade in the works, the original plan was for the new project to begin construction in 2009 and to open in 2011 with the 150,000-square-foot decommissioned power plant as the centerpiece of the 7.8-acre property. Needless to say, the project is delayed.
While the project remains active, a variety of obstacles have prevented development from moving forward. In particular, the City is in prolonged negotiations with Union Pacific over development of portions of the lot which the railroad controls. Apparently, the company is concerned about dense development in the area immediately surrounding active railway lines. With a dramatic increase in pedestrian and bicycle traffic across the tracks, the company is appropriately concerned about safety.
The second issue hindering construction is the slow development of a city-funded 315-space parking garage on an awkward corner of the site. The City, which already allocated $3.8 million for the project, must find a way to fit a large number of spaces into a small irregular site without building high. Since the site is within the Capital View Corridor, the height of the garage is limited to 40 feet.
Once these obstacles are overcome, the lot can be split and the private development of the site may proceed. For the private developers, however, there is another major obstacle: they have not raised the necessary funding to begin the project. In this tough environment -- and with two major proposed office buildings sucking up potential tenants -- financing will be no easy task.
Despite the obstacles, Seaholm remains one of the most desirable and important downtown development projects. While the economy and the difficult commercial financing environment pose serious challenges for any project, Seaholm has a high probability of completion once the obstacles have been resolved and the financing environment improves.
With offices, extensive retail, and more than 3 acres of open space, Seaholm will further shift the heart of downtown to the west once it is completed. While downtown life used to center around 6th street between Congress and red river, the warehouse district, 2nd street district, and Whole Foods have shifted the balance. With Seaholm, the downtown action will increasingly be centered between Congress, Lamar, 5th, and Town Lake.
The most dramatic part of the project is the redevelopment of the Seaholm facility itself. When complete, the historic art deco structure will include nearly 100,000 square feet of retail and restaurants.
More than a decade in the works, the original plan was for the new project to begin construction in 2009 and to open in 2011 with the 150,000-square-foot decommissioned power plant as the centerpiece of the 7.8-acre property. Needless to say, the project is delayed.
While the project remains active, a variety of obstacles have prevented development from moving forward. In particular, the City is in prolonged negotiations with Union Pacific over development of portions of the lot which the railroad controls. Apparently, the company is concerned about dense development in the area immediately surrounding active railway lines. With a dramatic increase in pedestrian and bicycle traffic across the tracks, the company is appropriately concerned about safety.
The second issue hindering construction is the slow development of a city-funded 315-space parking garage on an awkward corner of the site. The City, which already allocated $3.8 million for the project, must find a way to fit a large number of spaces into a small irregular site without building high. Since the site is within the Capital View Corridor, the height of the garage is limited to 40 feet.
Once these obstacles are overcome, the lot can be split and the private development of the site may proceed. For the private developers, however, there is another major obstacle: they have not raised the necessary funding to begin the project. In this tough environment -- and with two major proposed office buildings sucking up potential tenants -- financing will be no easy task.
Despite the obstacles, Seaholm remains one of the most desirable and important downtown development projects. While the economy and the difficult commercial financing environment pose serious challenges for any project, Seaholm has a high probability of completion once the obstacles have been resolved and the financing environment improves.
With offices, extensive retail, and more than 3 acres of open space, Seaholm will further shift the heart of downtown to the west once it is completed. While downtown life used to center around 6th street between Congress and red river, the warehouse district, 2nd street district, and Whole Foods have shifted the balance. With Seaholm, the downtown action will increasingly be centered between Congress, Lamar, 5th, and Town Lake.
The most dramatic part of the project is the redevelopment of the Seaholm facility itself. When complete, the historic art deco structure will include nearly 100,000 square feet of retail and restaurants.
Austonian, W, Four Seasons, & Spring Sales Estimates
April 26, 2010 23:05 Filed in: News
Harold Hunt, a research economist with the Real
Estate Center at Texas A&M University, published
an interesting profile of the downtown Austin
condo market in Tierra Grande.
First, the report calculated that "about 1,500 condominiums have been delivered to the downtown market since 2001 . . .To date, nearly 98 percent of those units are sold and closed" Of the 18 projects completed over the last seven years, all but 18 of 1,544 units have been sold.
Interestingly enough, the report included sales estimates by project for four unfinished projects: The Austonian, the Four Seasons, the W Hotel & Residences, and Spring. These estimates, credited to Capital Market Research and dated March 10, 2010, show the challenges in selling hundreds of million dollar units in the current environment. While anecdotal research shows that sales have increased in recent weeks, many additional units remain unsold.
Sales Estimates for Projects Under Construction
In summary, the article concluded that "More than 400 of the most expensive luxury condos in Texas are coming online in downtown Austin. Some say the timing is disastrous; others believe economic recovery may work in favor of these developments. Upscale buyers hold the key to success for this small niche market."
First, the report calculated that "about 1,500 condominiums have been delivered to the downtown market since 2001 . . .To date, nearly 98 percent of those units are sold and closed" Of the 18 projects completed over the last seven years, all but 18 of 1,544 units have been sold.
Interestingly enough, the report included sales estimates by project for four unfinished projects: The Austonian, the Four Seasons, the W Hotel & Residences, and Spring. These estimates, credited to Capital Market Research and dated March 10, 2010, show the challenges in selling hundreds of million dollar units in the current environment. While anecdotal research shows that sales have increased in recent weeks, many additional units remain unsold.
Sales Estimates for Projects Under Construction
|
Project
|
Year
|
Units
|
Contracts
|
Avail.
|
% Sold
|
Absorption / month
|
Avg Price
|
Avg Size
|
$ / SF
|
| Austonian
|
2010
|
178
|
55
|
123
|
31%
|
1.89
|
$1,516,000
|
2203
|
$688
|
|
Four Seasons
Residences
|
2010
|
148
|
74
|
74
|
50%
|
2.64
|
$1,269,447
|
1969
|
$645
|
|
W Hotel &
Residences
|
2011
|
159
|
82
|
77
|
52%
|
2.49
|
$1,067,352
|
1716
|
$622
|
|
Spring
|
2009
|
248
|
120
|
128
|
48%
|
3.87
|
$521,063
|
969
|
$538
|
In summary, the article concluded that "More than 400 of the most expensive luxury condos in Texas are coming online in downtown Austin. Some say the timing is disastrous; others believe economic recovery may work in favor of these developments. Upscale buyers hold the key to success for this small niche market."
The Four Seasons Residences to Focus on Service
April 20, 2010 21:37 Filed in: News
Lorley Musiol, the new Director of Residences at the
Four Seasons in Austin, captures an important
intangible about downtown condo life when she states
that "this is only a building. It's going to take
personality and a staff I'm hand-picking to make that
building come to life."
One of the things that is hardest to quantify about a new building is the quality of the service. Training staff to connect with residents, to be personable yet professional, and to meet every residents' random and unpredictable needs and desires without disappointing is hard. This is what the Four Seasons is good at -- and something that other projects will have a tough time duplicating.
For example, the Four Seasons Residences will keep a photo database of frequent visitors so they can greet them by name. That is impressive. And of course they will also keep a database on residents to track their preferences.
Lorley Musiol and the Austin Four Seasons were featured in an interesting article in Austin360 which details at length the project's focus on service:
The word "no" does not exist in Lorley Musiol's vocabulary.
As a hotel concierge for 23 years, 16 of them at Four Seasons hotels including Austin's, she has dealt with the most persnickety of guests. Never, she says, has a request gone unfulfilled. She has thrown a birthday party for an 18-year-old Saudi prince at 2 a.m. at the Los Angeles' Beverly Wilshire Hotel on short notice. She has spelled "Marry me" in rocks outside Las Vegas so a skydiving couple could see it. She has enrolled as a student at the University of Las Vegas in order to check out architecture books that Michael Jackson wanted.
"I always find a way," she says over coffee on the terrace outside the hotel's Trio restaurant. "There is no intimidation."
If Musiol, 56, sounds like she has a Superwoman complex, it's because her job has required it. And she'll soon need to ramp up the can-do attitude, if that's possible, because sometime around Memorial Day weekend, Four Seasons Residences will open and she will be its Director of Residences. She'll manage the building and staff and make sure that every resident's wish is granted. Read More...
One of the things that is hardest to quantify about a new building is the quality of the service. Training staff to connect with residents, to be personable yet professional, and to meet every residents' random and unpredictable needs and desires without disappointing is hard. This is what the Four Seasons is good at -- and something that other projects will have a tough time duplicating.
For example, the Four Seasons Residences will keep a photo database of frequent visitors so they can greet them by name. That is impressive. And of course they will also keep a database on residents to track their preferences.
Lorley Musiol and the Austin Four Seasons were featured in an interesting article in Austin360 which details at length the project's focus on service:
The word "no" does not exist in Lorley Musiol's vocabulary.
As a hotel concierge for 23 years, 16 of them at Four Seasons hotels including Austin's, she has dealt with the most persnickety of guests. Never, she says, has a request gone unfulfilled. She has thrown a birthday party for an 18-year-old Saudi prince at 2 a.m. at the Los Angeles' Beverly Wilshire Hotel on short notice. She has spelled "Marry me" in rocks outside Las Vegas so a skydiving couple could see it. She has enrolled as a student at the University of Las Vegas in order to check out architecture books that Michael Jackson wanted.
"I always find a way," she says over coffee on the terrace outside the hotel's Trio restaurant. "There is no intimidation."
If Musiol, 56, sounds like she has a Superwoman complex, it's because her job has required it. And she'll soon need to ramp up the can-do attitude, if that's possible, because sometime around Memorial Day weekend, Four Seasons Residences will open and she will be its Director of Residences. She'll manage the building and staff and make sure that every resident's wish is granted. Read More...
15-Story Downtown Office Tower Proposed
April 18, 2010 22:34 Filed in: News
A 15-story office tower with ground floor retail is
being proposed for the north east corner of West
Cesar Chavez Street and Lamar Boulevard.
The new project, to be located between the Gables apartment and Seaholm, would be the first new office project constructed in the downtown core since the Frost Bank tower was completed in 2001. The developer behind the new project, Capital City Partners LLC, recently completed Capstar Plaza, a 115,000-square-foot, eight-story, office building at the southeast corner of MoPac Expressway and Fifth Street.
The new building, currently named Park Plaza, will only be built if the developer can line-up enough tenants to justify development. If completed, the project would include 189,000 square feet of Class A office space and 10,000 square feet of ground floor retail. The project would be located just West of Seaholm and across the street from Ladybird lake. The 1.8 acre plot is owned by Gables residential which recently completed a large low-rise rental project on an adjacent site.
The new project, to be located between the Gables apartment and Seaholm, would be the first new office project constructed in the downtown core since the Frost Bank tower was completed in 2001. The developer behind the new project, Capital City Partners LLC, recently completed Capstar Plaza, a 115,000-square-foot, eight-story, office building at the southeast corner of MoPac Expressway and Fifth Street.
The new building, currently named Park Plaza, will only be built if the developer can line-up enough tenants to justify development. If completed, the project would include 189,000 square feet of Class A office space and 10,000 square feet of ground floor retail. The project would be located just West of Seaholm and across the street from Ladybird lake. The 1.8 acre plot is owned by Gables residential which recently completed a large low-rise rental project on an adjacent site.
Exclusive: January & February Downtown Condo Sales
March 30, 2010 21:44 Filed in: News
We've updated the AustinTowers | urbanspace Downtown Austin Condo
Market Index for January and February, 2010.
With the new results loaded, we are pleased to
announce that year-over-year sales volumes have
increased for the eighth month in a row. That,
however, is where the good news ends.
During January and February, 14 downtown Austin condo units were transacted on the MLS: 4 more than during the same period in 2009 with the gain spread across both of the months. While volumes are up, prices are headed downward as buyers gravitate towards smaller, older, and cheaper units than they did in the past.
Read the full analysis: Read More...
|
Month
|
Sales
|
Avg. Price
|
$/SF
|
Avg SF
|
Avg Year
|
% Ask
|
ADOM
|
|
Jan-09
|
4
|
$358,225
|
$321
|
1,129
|
1996
|
93%
|
85
|
|
Jan-10
|
6
|
$274,547
|
$291
|
953
|
2005
|
96%
|
127
|
|
Change
|
50%
|
-23%
|
-9%
|
-16%
|
9.00
|
3%
|
49%
|
|
Month
|
Sales
|
Avg. Price
|
$/SF
|
Avg SF
|
Avg Year
|
% Ask
|
ADOM
|
|
Feb-09
|
6
|
$400,833
|
$322
|
1,258
|
1998
|
90%
|
116
|
|
Feb-10
|
8
|
$291,938
|
$292
|
1,002
|
1979
|
94%
|
50
|
|
Change
|
33%
|
-27%
|
-10%
|
-20%
|
-19.00
|
5%
|
-57%
|
During January and February, 14 downtown Austin condo units were transacted on the MLS: 4 more than during the same period in 2009 with the gain spread across both of the months. While volumes are up, prices are headed downward as buyers gravitate towards smaller, older, and cheaper units than they did in the past.
Read the full analysis: Read More...
Coming up: Urbanspace Downtown Q&A
March 30, 2010 21:44 Filed in: News
As we first announced last month, urbanspace has
announced a monthly downtown Q & A that will be
held at the urbanspace office the first Saturday of
every month. It is free to anyone interested in
learning a little bit about downtown Austin and the
development taking place.
The Downtown Q&A was founded by Emily Crawford and developed in conjunction with Bryan Cady. As former first-time buyers and former Downtown Austin newbies themselves, they wanted to provide an interactive forum to help new buyers understand the options in the current Downtown Austin marketplace. Likely questions: Should I lease or buy downtown? What is the Downtown Austin lifestyle all about? What are the best deals out there? Why live downtown?
You can join them this month on April 3rd from 11-noon.
The Downtown Q&A was founded by Emily Crawford and developed in conjunction with Bryan Cady. As former first-time buyers and former Downtown Austin newbies themselves, they wanted to provide an interactive forum to help new buyers understand the options in the current Downtown Austin marketplace. Likely questions: Should I lease or buy downtown? What is the Downtown Austin lifestyle all about? What are the best deals out there? Why live downtown?
You can join them this month on April 3rd from 11-noon.
Top Art Galleries: New York, San Francisco, 360 Tower
March 20, 2010 20:21 Filed in: News
This week, Details magazine published its list of the
ten coolest art galleries in
America. As would be expected, the list was
dominated by galleries in New York (4) and
California (3). Less expected was the inclusion
of Austin's own Lora Reynolds Gallery which is
located in the base of the 360 tower. The remaining two
galleries were located in Chicago and
Minneapolis.
Details claims that the 10 galleries on the list represent "the top places in the country to see contemporary art." In their profile of the Lora Reynolds' Gallery, the author writes that "after seven years toiling in the London and New York art worlds, Reynolds forged a niche in the competitive Austin scene by luring a roster of international talents like British artist Ewan Gibbs to Texas. As she told the Austin American Statesman when the gallery opened in 2005: "Why not bring art here that otherwise wouldn't be shown?" And what she shows doesn't just make you look—it makes you look twice."
Lora Reynolds established the gallery in March 2005 after working with galleries in London and New York. The gallery's mission is to bring national and international contemporary artists in all media to Austin. The gallery organizes 6 – 8 shows annually of emerging, mid-career, and established artists.
While Austin has a strong cultural scene for a mid-size city, it is not known for contemporary art. In addition to the well-respected Arthouse, it is great to see national recognition for Lora Reynolds Gallery. See the full article here.
Lora Reynolds Gallery
Details claims that the 10 galleries on the list represent "the top places in the country to see contemporary art." In their profile of the Lora Reynolds' Gallery, the author writes that "after seven years toiling in the London and New York art worlds, Reynolds forged a niche in the competitive Austin scene by luring a roster of international talents like British artist Ewan Gibbs to Texas. As she told the Austin American Statesman when the gallery opened in 2005: "Why not bring art here that otherwise wouldn't be shown?" And what she shows doesn't just make you look—it makes you look twice."
Lora Reynolds established the gallery in March 2005 after working with galleries in London and New York. The gallery's mission is to bring national and international contemporary artists in all media to Austin. The gallery organizes 6 – 8 shows annually of emerging, mid-career, and established artists.
While Austin has a strong cultural scene for a mid-size city, it is not known for contemporary art. In addition to the well-respected Arthouse, it is great to see national recognition for Lora Reynolds Gallery. See the full article here.
Lora Reynolds Gallery
Forbes: Austin Economy Good
March 18, 2010 22:57 Filed in: News
According to Forbes.com, the Austin-Round Rock area
tied for first on a list of large metropolitan areas
where the recession is easing.
The report listed Austin and Washington D.C. as the two top cities in terms of economic recovery. The report considered a number of factors including local economic output, job growth and real estate industry trends. While the national unemployment rate hovers at 9.7%, the comparable rate in Austin is 7.6% (up from 7% a month ago). Washington D.C. has a 6.2% unemployment rate.
According to Forbes, one thing that Austin and Washington D.C. have in common is a high rate of government job generation. The number of Central Texas jobs increased just shy of 1 percent between 2007 and 2009, more than any other city included in the research. Dallas came in second on the ranking behind Austin. The number of jobs there are expected to increase more than 7 percent in the next three years. San Antonio and Houston also made the top 10 list.
For anyone with a stake in downtown Austin real estate, future downtown home values will be driven by supply, access to lending, migration, and economic growth with job growth being a key factor. Supply for the next few years is highly predictable --- it's growing on the high end and flat in the low and middle price brackets. Access to mortgages remains constrained for conforming loans and highly constrained for jumbo loans. Migration is expected to remain strong. That leaves economic growth remains the biggest unknown.
While the economy is improving, cuts at large local employers or a dip in technology spending could dramatically change the local housing outlook. But so far, as Forbes notes, Austin is doing better than just about every other city in the country.
The report listed Austin and Washington D.C. as the two top cities in terms of economic recovery. The report considered a number of factors including local economic output, job growth and real estate industry trends. While the national unemployment rate hovers at 9.7%, the comparable rate in Austin is 7.6% (up from 7% a month ago). Washington D.C. has a 6.2% unemployment rate.
According to Forbes, one thing that Austin and Washington D.C. have in common is a high rate of government job generation. The number of Central Texas jobs increased just shy of 1 percent between 2007 and 2009, more than any other city included in the research. Dallas came in second on the ranking behind Austin. The number of jobs there are expected to increase more than 7 percent in the next three years. San Antonio and Houston also made the top 10 list.
For anyone with a stake in downtown Austin real estate, future downtown home values will be driven by supply, access to lending, migration, and economic growth with job growth being a key factor. Supply for the next few years is highly predictable --- it's growing on the high end and flat in the low and middle price brackets. Access to mortgages remains constrained for conforming loans and highly constrained for jumbo loans. Migration is expected to remain strong. That leaves economic growth remains the biggest unknown.
While the economy is improving, cuts at large local employers or a dip in technology spending could dramatically change the local housing outlook. But so far, as Forbes notes, Austin is doing better than just about every other city in the country.
Another Downtown Building Boom?
March 05, 2010 20:56 Filed in: News
There should be no doubt: It's a tough time to be a
downtown condo developer in Austin, Texas. While
building costs have slipped from their peak, demand
is soft and it remains a buyer's market. For high-end
projects in particular, supply remains plentiful and
competition among sellers is fierce.
Yet, developers are once again thinking about the next wave of projects. Over the next year, the current non-luxury condo inventory is almost certain to be depleted. With a 2-4 year construction timeline, developers are thinking now about the next wave of demand.
Here is a summary of some of the projects currently on the drawing board:
- Aquaterra (condo): Originally envisioned as a 163 unit 20-floor condo tower at 210 Barton Springs Rd., this was one of the first projects cancelled. Now, the architects have been asked to update the project to be more competitive in the current environment as the developers look for a path to proceed. No funding has been lined up.
- 7Rio (Condo): Originally envisioned as a $50M 34-floor 160 unit condo project, 7Rio is also back on the drawing board and being actively rethought for development. Originally planned for completion in 2009, the building would be on the site of Ranch 616 which will be incorporated into the building. The project has been supported by the neighborhood Association and the developer has already successfully completed two other projects in Austin.
- 800 W 6th St (Office): Austin-based Cypress Real Estate Advisors plans a 120,000-square-foot, six-story, Class A office building on the site.
- Block 51 (Office + Condo): According to the Austin Business Journal, the stalled Ovation development, originally reported to be a 37-story condo tower on Block 51 by Atlanta-based Novare Group Inc. and Austin-based Andrews Urban LLC, is being revamped. It now involves a partnership with International Bank of Commerce and more office space than originally planned. The plan revisions are in the beginning stages, and specifics will be available in mid-2010, he said.
- Schlosser Tower (Office & Condo): Schlosser development plans to construct a new 27-story downtown condo and office tower. The developer is proposing to build a tower of up to 350 feet on the vacant lot between Whole Foods and Austin City Lofts. As proposed, the new building would include street level retail and parking on the lower floors, 16 stories of office space, and 90 condo units on the top seven floors. In addition, a companion building on the 2.7 acre site would include three levels of commercial office space with parking and street-level retail.
- 21c (Apartments): The developers are proposing -- but have not found funding for -- a 31-story 350 unit apartment tower near the corner of Red River and Cesar Chavez. Rents would start at $1.50 per square foot which would mean $1,000 / month for a 700 square foot unit or $1,500 for a 1,000 square foot unit. The goal would be to make the building 70% 1 bedroom / 1 bath units. As many as 10% of the units for be designated as affordable units with controlled rents. A second tower -- which is more precarious in the current environment -- would be a 12-story 200 room hotel, spa, and restaurant. The developers are hoping to put parking underground and include ground retail in the project. Although no specifics have been announced, the third tower could include condos if at some point it does get built.
While almost none of these projects have funding, the investment in new development is a strong sign that when the market stabilizes and commercial financing becomes more common, another building boom is likely. With projected population growth and one of the strongest economies in the country, Austin will likely be an attractive target for development as the markets improve.
7RIo Tower as originally Proposed
Yet, developers are once again thinking about the next wave of projects. Over the next year, the current non-luxury condo inventory is almost certain to be depleted. With a 2-4 year construction timeline, developers are thinking now about the next wave of demand.
Here is a summary of some of the projects currently on the drawing board:
- Aquaterra (condo): Originally envisioned as a 163 unit 20-floor condo tower at 210 Barton Springs Rd., this was one of the first projects cancelled. Now, the architects have been asked to update the project to be more competitive in the current environment as the developers look for a path to proceed. No funding has been lined up.
- 7Rio (Condo): Originally envisioned as a $50M 34-floor 160 unit condo project, 7Rio is also back on the drawing board and being actively rethought for development. Originally planned for completion in 2009, the building would be on the site of Ranch 616 which will be incorporated into the building. The project has been supported by the neighborhood Association and the developer has already successfully completed two other projects in Austin.
- 800 W 6th St (Office): Austin-based Cypress Real Estate Advisors plans a 120,000-square-foot, six-story, Class A office building on the site.
- Block 51 (Office + Condo): According to the Austin Business Journal, the stalled Ovation development, originally reported to be a 37-story condo tower on Block 51 by Atlanta-based Novare Group Inc. and Austin-based Andrews Urban LLC, is being revamped. It now involves a partnership with International Bank of Commerce and more office space than originally planned. The plan revisions are in the beginning stages, and specifics will be available in mid-2010, he said.
- Schlosser Tower (Office & Condo): Schlosser development plans to construct a new 27-story downtown condo and office tower. The developer is proposing to build a tower of up to 350 feet on the vacant lot between Whole Foods and Austin City Lofts. As proposed, the new building would include street level retail and parking on the lower floors, 16 stories of office space, and 90 condo units on the top seven floors. In addition, a companion building on the 2.7 acre site would include three levels of commercial office space with parking and street-level retail.
- 21c (Apartments): The developers are proposing -- but have not found funding for -- a 31-story 350 unit apartment tower near the corner of Red River and Cesar Chavez. Rents would start at $1.50 per square foot which would mean $1,000 / month for a 700 square foot unit or $1,500 for a 1,000 square foot unit. The goal would be to make the building 70% 1 bedroom / 1 bath units. As many as 10% of the units for be designated as affordable units with controlled rents. A second tower -- which is more precarious in the current environment -- would be a 12-story 200 room hotel, spa, and restaurant. The developers are hoping to put parking underground and include ground retail in the project. Although no specifics have been announced, the third tower could include condos if at some point it does get built.
While almost none of these projects have funding, the investment in new development is a strong sign that when the market stabilizes and commercial financing becomes more common, another building boom is likely. With projected population growth and one of the strongest economies in the country, Austin will likely be an attractive target for development as the markets improve.
7RIo Tower as originally Proposed
Sabine Auction Results!
February 28, 2010 21:22 Filed in: News
Today, more than 200 registered bidders showed up to
compete for 31 units in the much anticipated Sabine auction. In the
end, 29 of 31 units sold for an average 30.5%
discount with a final price per square foot of
$228. With strong demand, the developer added
four units into the auction: three just days
before the sale and the fourth unit during the
auction.
Prices were about 19% lower on a price per square foot basis than the recent Brazos Place auction -- the Sabine's closest comparable. The additional discount is appropriate given the problems that have plagued the project. In a recent valuation analysis, Austin Towers estimated that a fair sales price would be a 30% discount and units traded hands for slightly less than that.
Here are the key metrics on the sale:
Sale Prices by Unit Type
* Includes 4% Buyer Premium
Sale Prices by Unit
* Includes 4% Buyer
Premium
Interestingly enough, the developers still own about a dozen units which they plan to sell directly to buyers and through MLS listings. In can be assumed that these units will sell for approximately the same price as the auctioned units which raises the obvious question: why didn't they sell the remaining units in the auction? While it's hard to know what they are waiting for, the developers likely wanted to avoid flooding the auction with too many units and driving prices even further down.
For the developers, the auction is likely a relief. It does go to show that these sorts of auctions do work and that there are many potential downtown Austin condo buyers on the side lines looking for a good deal. The prices of the remaining units -- and the speed with which these units sell -- wlll determine whether the auction prices were in fact a good deal.
Prices were about 19% lower on a price per square foot basis than the recent Brazos Place auction -- the Sabine's closest comparable. The additional discount is appropriate given the problems that have plagued the project. In a recent valuation analysis, Austin Towers estimated that a fair sales price would be a 30% discount and units traded hands for slightly less than that.
Here are the key metrics on the sale:
Sale Prices by Unit Type
|
Unit Type
|
Original Price
|
Sale Price*
|
$/SF
|
Discount
|
| 1/1
|
$252,631
|
$189,120
|
$264
|
25.1%
|
|
1/1 + Study
|
$289,900
|
$196,733
|
$210
|
32.1%
|
|
2/2
|
$464,083
|
$310,007
|
$214
|
33.2%
|
|
All Units
|
$341,697
|
$237,388
|
$228
|
30.5%
|
Sale Prices by Unit
|
Unit #
|
SF
|
Bed/Bath
|
Original Price
|
Starting Bid
|
Sale Price*
|
$/SF
|
|
303
|
693
|
1/1
|
$234,900
|
$85,000
|
$172,640
|
$249
|
| 305
|
1462
|
2/2
|
$409,900
|
$145,000
|
$276,640
|
$189
|
| 308
|
925
|
1/1 + Study
|
$267,900
|
$95,000
|
$193,440
|
$209
|
| 401
|
1461
|
2/2
|
$485,900
|
$165,000
|
$319,280
|
$219
|
| 404
|
728
|
1/1
|
$249,900
|
n/a
|
$194,480
|
$267
|
| 409
|
918
|
1/1 + Study
|
$259,900
|
$95,000
|
$193,440
|
$211
|
| 501
|
1461
|
2/2
|
$485,900
|
$175,000
|
$327,600
|
$224
|
| 502
|
755
|
1/1
|
$239,900
|
$95,000
|
$193,440
|
$256
|
| 504
|
728
|
1/1
|
$249,900
|
$85,000
|
$192,400
|
$264
|
| 508
|
951
|
1/1 + Study
|
$279,900
|
$95,000
|
$188,240
|
$198
|
| 510
|
682
|
1/1
|
$204,900
|
$85,000
|
$166,400
|
$244
|
| 605
|
1467
|
2/2
|
$434,900
|
$155,000
|
$287,040
|
$196
|
| 610
|
682
|
1/1
|
$229,900
|
$85,000
|
$167,440
|
$246
|
| 701
|
1461
|
2/2
|
$469,900
|
n/a
|
$350,480
|
$240
|
| 703
|
695
|
1/1
|
$240,900
|
$95,000
|
$197,600
|
$284
|
| 704
|
728
|
1/1
|
$259,900
|
$85,000
|
$195,520
|
$269
|
| 705
|
1467
|
2/2
|
$449,900
|
n/a
|
$315,120
|
$215
|
| 707
|
1426
|
2/2
|
$409,900
|
$135,000
|
$279,760
|
$196
|
| 801
|
1461
|
2/2
|
$530,000
|
$185,000
|
$357,760
|
$245
|
| 802
|
755
|
1/1
|
$273,400
|
$105,000
|
$205,920
|
$273
|
| 804
|
728
|
1/1
|
$311,900
|
n/a
|
$196,560
|
$270
|
| 805
|
1460
|
2/2
|
$469,900
|
$165,000
|
$309,920
|
$212
|
| 808
|
951
|
1/1 + Study
|
$311,900
|
$95,000
|
$198,640
|
$209
|
| 904
|
728
|
1/1
|
$263,900
|
$85,000
|
$197,600
|
$271
|
| 907
|
1426
|
2/2
|
$434,900
|
$135,000
|
$263,120
|
$185
|
| 909
|
918
|
1/1 + Study
|
$294,900
|
$95,000
|
$195,520
|
$213
|
| 910
|
682
|
1/1
|
$244,900
|
$85,000
|
$180,960
|
$265
|
| 1001
|
1419
|
2/2
|
$550,000
|
$195,000
|
$365,040
|
$257
|
| 1004
|
728
|
1/1
|
$279,900
|
$95,000
|
$197,600
|
$271
|
| 1007
|
1426
|
2/2
|
$437,900
|
$145,000
|
$268,320
|
$188
|
| 1008
|
951
|
1/1 + Study
|
$324,900
|
$105,000
|
$211,120
|
$222
|
|
AVG
|
1,043
|
|
$341,697
|
$117,222
|
$237,388
|
$228
|
Interestingly enough, the developers still own about a dozen units which they plan to sell directly to buyers and through MLS listings. In can be assumed that these units will sell for approximately the same price as the auctioned units which raises the obvious question: why didn't they sell the remaining units in the auction? While it's hard to know what they are waiting for, the developers likely wanted to avoid flooding the auction with too many units and driving prices even further down.
For the developers, the auction is likely a relief. It does go to show that these sorts of auctions do work and that there are many potential downtown Austin condo buyers on the side lines looking for a good deal. The prices of the remaining units -- and the speed with which these units sell -- wlll determine whether the auction prices were in fact a good deal.
UrbanSpace to Hold Monthly Q&A for Downtown Buyers
February 28, 2010 21:22 Filed in: News
In an effort to reach out to new downtown Austin condo buyers, urbanspace has announced a monthly downtown Q & A that will be held at the urbanspace office the first Saturday of every month. It is free to anyone interested in learning a little bit about downtown Austin and the development taking place.
The Downtown Q&A was founded by Emily Crawford and developed in conjunction with Bryan Cady. As former first-time buyers and former Downtown Austin newbies themselves, they wanted to provide an interactive forum to help new buyers understand the options in the current Downtown Austin marketplace. Likely questions: Should I lease or buy downtown? What is the Downtown Austin lifestyle all about? What are the best deals out there? Why live downtown?
You can join them March 6th from 11-noon.
Sabine Auction Pricing Analysis: Looking at MLS Sales
February 21, 2010 20:48 Filed in: News
With one week until the Sabine
auction, it is clear that many potential
buyers are considering participating in the
sale. With starting bids as low as $85,000,
bargain hunters will inevitably emerge looking
for a great deal. The big question, however, is
what is the right price for a Sabine unit.
For a few reasons, valuation of the Sabine units is particularly difficult. First, the building has had real problems with noise complaints, elevator issues, and a tenant lawsuit. The developers claim that the issues have been fixed but the history will still impact the value. A building is a brand, it is part of your identity, and the Sabine brand is damaged.
Second, not a single Sabine unit was transacted on the MLS in 2009. Not one. The most recent comparables are 5 transactions from mid-2008. These show an average price per square foot of $256 for one bedroom units (2 sales) and $352 for two bedroom units (3 sales) -- an unusually large difference between unit types. Since these prices were during the market peak and since they predate the buildings problems, they are just about useless.
Third, the Sabine is a condo conversion project and not a new development. This greatly restricts the comparable units that can be considered in a real analysis. Essentially, it leaves Brazos Place as the primary point of comparison. Since Brazos place also went to auction, it may be a good indicator of where the auction prices will land. But the Brazos Place auction was held during tougher times and the building did not have the problems that have plagued the Sabine. One other possible comparable is the Brown building, but we have seen very few recent MLS transactions.
So, while those are the problems, we had to start somewhere and here is the analysis: we used three valuation methods:
(1) We looked at condo conversion sales on MLS in Brazos Place and the Brown Building over the last 4 months. During this period, the average price was $271 / square feet for transacted units.
(2) We looked at the Brazos Place auction which resulted in an average price of $281 / SF (although not really relevant, the average discount was 29%).
(3) Peak MLS sale price by floor plan from early 2008. Useful information but in no way indicative of the value today.
See the full analysis: Read More...
For a few reasons, valuation of the Sabine units is particularly difficult. First, the building has had real problems with noise complaints, elevator issues, and a tenant lawsuit. The developers claim that the issues have been fixed but the history will still impact the value. A building is a brand, it is part of your identity, and the Sabine brand is damaged.
Second, not a single Sabine unit was transacted on the MLS in 2009. Not one. The most recent comparables are 5 transactions from mid-2008. These show an average price per square foot of $256 for one bedroom units (2 sales) and $352 for two bedroom units (3 sales) -- an unusually large difference between unit types. Since these prices were during the market peak and since they predate the buildings problems, they are just about useless.
Third, the Sabine is a condo conversion project and not a new development. This greatly restricts the comparable units that can be considered in a real analysis. Essentially, it leaves Brazos Place as the primary point of comparison. Since Brazos place also went to auction, it may be a good indicator of where the auction prices will land. But the Brazos Place auction was held during tougher times and the building did not have the problems that have plagued the Sabine. One other possible comparable is the Brown building, but we have seen very few recent MLS transactions.
So, while those are the problems, we had to start somewhere and here is the analysis: we used three valuation methods:
(1) We looked at condo conversion sales on MLS in Brazos Place and the Brown Building over the last 4 months. During this period, the average price was $271 / square feet for transacted units.
(2) We looked at the Brazos Place auction which resulted in an average price of $281 / SF (although not really relevant, the average discount was 29%).
(3) Peak MLS sale price by floor plan from early 2008. Useful information but in no way indicative of the value today.
See the full analysis: Read More...
Austin is Very Very Very Lucky
February 15, 2010 21:39 Filed in: News
2009 was a tough year for job creation in the United
States. Since job creation drives home prices, the
2009 job losses are likely to leave a lasting impact.
How lasting? Economists estimate that it may take the United Stated 125 months (10+ years) to fully recover the jobs lost during the great recession of 2009. In Texas, which had the strongest job growth of any state over the last decade, it is predicted to take 37 months or just over 3 years for the job losses to be recovered.
So, what about Austin? In 2009, Austin lost 2,600 jobs. In a normal recovery, the city would be expected to make up these losses in about two months -- that's 10 years and 3 months faster than the rest of the country. Local economist Angelos Angelou is predicting 26,300 new jobs and a healthy real estate environment through 2011 while warning that Austin’s economic development performance, especially around clean technology, is lagging.
While the future looks bright, we are not out of the woods yet. Technology does not perfectly follow the normal business cycle and Austin remains disproportionately dependent on the technology industry. In new areas like clean technology and biotech, the City is losing ground. Until we see job losses in the tech industry end, we're unlikely to see strong local job growth.
That said, the economic mood in town is definitely improving. One example of this is the local single family home market. In December, Austin home buyers returned in force, increasing sales 5 percent from the same time in 2008. The median price of the 1,373 homes sold in December rose to about $194,000, an increase of 6 percent year over year.
The bottom line is that we are very very very lucky. There is almost no other place in the U.S. that has emerged from 2009 as unscathed as Austin, Texas.
How lasting? Economists estimate that it may take the United Stated 125 months (10+ years) to fully recover the jobs lost during the great recession of 2009. In Texas, which had the strongest job growth of any state over the last decade, it is predicted to take 37 months or just over 3 years for the job losses to be recovered.
So, what about Austin? In 2009, Austin lost 2,600 jobs. In a normal recovery, the city would be expected to make up these losses in about two months -- that's 10 years and 3 months faster than the rest of the country. Local economist Angelos Angelou is predicting 26,300 new jobs and a healthy real estate environment through 2011 while warning that Austin’s economic development performance, especially around clean technology, is lagging.
While the future looks bright, we are not out of the woods yet. Technology does not perfectly follow the normal business cycle and Austin remains disproportionately dependent on the technology industry. In new areas like clean technology and biotech, the City is losing ground. Until we see job losses in the tech industry end, we're unlikely to see strong local job growth.
That said, the economic mood in town is definitely improving. One example of this is the local single family home market. In December, Austin home buyers returned in force, increasing sales 5 percent from the same time in 2008. The median price of the 1,373 homes sold in December rose to about $194,000, an increase of 6 percent year over year.
The bottom line is that we are very very very lucky. There is almost no other place in the U.S. that has emerged from 2009 as unscathed as Austin, Texas.
Sabine Auction Update
February 07, 2010 21:10 Filed in: News
As we reported last month, 27 of the 44 long-vacant
units remaining in the Sabine are finally
headed to auction on February 28th. The auction
is a last hope for the project which is
currently facing foreclosure.
According to the Austin Business Journal, "Beverly Hills-based auctioneer Kennedy Wilson will sell-off 27 of the available 44 units Feb. 28, taking bids as low as $85,000 and $195,000. The apartments were previously listed near $204,900 and $550,000. Condo buyers would receive a one-year Tower Health Club and Spa membership and up to $1,500 in closing costs paid by the seller."
Kennedy Wilson has handled many condo auctions in the last year, including the successful Brazos Place auction in Austin. The auction will be held in February 28th at 1 p.m. at the downtown Hilton. According to the auction firm, potential buyers must register by Feb. 25. The company has set up a Web site specifically for auction information here.
It's always hard to predict what will happen in an Auction like this. In the Brazos Place auction, held during tougher times, all 19 remaining units were sold in less than 90 minutes to a packed room of bidders. In that case, the units sold at a 29% discount to the original listing price. This is, however, is a useless barometer as the units were not selling well at the original prices. More useful is the average price / square foot which at $281/SF is a 9% discount to the 2008 downtown condo average of $308. Unfortunately for the original Brazos Place residents, the units sold for 24% less on a $/SF basis than the $370/SF average of the 12 Brazos Place units sold via MLS in 2008. We'll see what will happen with the Sabine, but discounts of 20 - 35% off original prices are likely.
The Sabine is an 80-unit condo conversion project of a mostly-empty office building on Waller Creek into a new condo project adjoining the Hilton Garden Inn on 5th Street near I-35. The project was completed in 2007 and the majority of units still remain vacant although they have been removed from the market due to pending litigation. Unit plans range from one-bedroom, 682-square-foot units to two-bedrooms with as large as 1,419 square feet.
Get the full details on the auction here.
According to the Austin Business Journal, "Beverly Hills-based auctioneer Kennedy Wilson will sell-off 27 of the available 44 units Feb. 28, taking bids as low as $85,000 and $195,000. The apartments were previously listed near $204,900 and $550,000. Condo buyers would receive a one-year Tower Health Club and Spa membership and up to $1,500 in closing costs paid by the seller."
Kennedy Wilson has handled many condo auctions in the last year, including the successful Brazos Place auction in Austin. The auction will be held in February 28th at 1 p.m. at the downtown Hilton. According to the auction firm, potential buyers must register by Feb. 25. The company has set up a Web site specifically for auction information here.
It's always hard to predict what will happen in an Auction like this. In the Brazos Place auction, held during tougher times, all 19 remaining units were sold in less than 90 minutes to a packed room of bidders. In that case, the units sold at a 29% discount to the original listing price. This is, however, is a useless barometer as the units were not selling well at the original prices. More useful is the average price / square foot which at $281/SF is a 9% discount to the 2008 downtown condo average of $308. Unfortunately for the original Brazos Place residents, the units sold for 24% less on a $/SF basis than the $370/SF average of the 12 Brazos Place units sold via MLS in 2008. We'll see what will happen with the Sabine, but discounts of 20 - 35% off original prices are likely.
The Sabine is an 80-unit condo conversion project of a mostly-empty office building on Waller Creek into a new condo project adjoining the Hilton Garden Inn on 5th Street near I-35. The project was completed in 2007 and the majority of units still remain vacant although they have been removed from the market due to pending litigation. Unit plans range from one-bedroom, 682-square-foot units to two-bedrooms with as large as 1,419 square feet.
Get the full details on the auction here.
Waller Creek Tunnel Project Advances
February 07, 2010 11:20 Filed in: News
On Thursday, City of Austin officials approved
eminent domain proceedings to reclaim a parking lot
between 4th and 5th street that is required to begin
the Waller Creek tunnel project.
The half-block property is essential to development of the mammoth downtown tunnel project. According to officials, it is needed for two tunnel easements, one temporary and one permanent. The approval does not initiate proceedings to claim the property, but allows city officials to do so if they can not reach agreement with property owners.
The Waller Creek Tunnel Project is a storm water bypass tunnel beginning with an inlet structure in Waterloo Park and an outlet structure at Lady Bird Lake near Waller Beach and the Four Seasons Hotel. Nearly, a mile long, the tunnel will vary between 22 and 26 feet in diameter. The project is expected to reduce the size of the 100-year floodplain of the lower Waller Creek watershed by an estimated 28 acres and allow denser development and redevelopment in a very desirable area of downtown Austin. A pump station at Waterloo Park will maintain constant water flow in the creek during the dry season, thus improving water quality and fostering a creek side atmosphere suitable for public venues or natural settings. Creek side inlets located between 4th and 5th streets and 8th and 9th streets will capture and divert additional flood waters south of 12th street.
The tunnel project is comprised of several construction projects, including utility relocation, the tunnel, the inlet, outlet, creek side inlets, and site restoration. The Tunnel project will cost approximately $127 million—an initial estimate based on 2006 dollars. Construction will take place from January 2010 until July 2014.
Waller Creek
According to the Austin Business Journal, "the lot discussed this week is owned by the Strenger Real Estate Holdings Ltd. and is used for paid parking. City technical resource and professional engineer Stan Evans said the temporary easement is needed for staging construction and the permanent section is needed to restore the creek and install draining infrastructure. He said the city and the property owners are currently in negotiations, but if the two do not reach an agreement by an undisclosed deadline, eminent domain will proceed."
The half-block property is essential to development of the mammoth downtown tunnel project. According to officials, it is needed for two tunnel easements, one temporary and one permanent. The approval does not initiate proceedings to claim the property, but allows city officials to do so if they can not reach agreement with property owners.
The Waller Creek Tunnel Project is a storm water bypass tunnel beginning with an inlet structure in Waterloo Park and an outlet structure at Lady Bird Lake near Waller Beach and the Four Seasons Hotel. Nearly, a mile long, the tunnel will vary between 22 and 26 feet in diameter. The project is expected to reduce the size of the 100-year floodplain of the lower Waller Creek watershed by an estimated 28 acres and allow denser development and redevelopment in a very desirable area of downtown Austin. A pump station at Waterloo Park will maintain constant water flow in the creek during the dry season, thus improving water quality and fostering a creek side atmosphere suitable for public venues or natural settings. Creek side inlets located between 4th and 5th streets and 8th and 9th streets will capture and divert additional flood waters south of 12th street.
The tunnel project is comprised of several construction projects, including utility relocation, the tunnel, the inlet, outlet, creek side inlets, and site restoration. The Tunnel project will cost approximately $127 million—an initial estimate based on 2006 dollars. Construction will take place from January 2010 until July 2014.
Waller Creek
According to the Austin Business Journal, "the lot discussed this week is owned by the Strenger Real Estate Holdings Ltd. and is used for paid parking. City technical resource and professional engineer Stan Evans said the temporary easement is needed for staging construction and the permanent section is needed to restore the creek and install draining infrastructure. He said the city and the property owners are currently in negotiations, but if the two do not reach an agreement by an undisclosed deadline, eminent domain will proceed."
Downtown Rail Service to Start in March
January 26, 2010 22:01 Filed in: News
After what seems like endless series of problems and
delays, Cap Metro has announced that light rail
service will begin in March. Service was originally
scheduled to commence on March 30, 2009.
MetroRail will run from downtown to Leaner with stops for Lakeline, Howard, Kramer, Crestview, Highland, MLK, Jr., and Plaza Saltillo. The full 32 mile trip is estimated to take 57 minutes with a maximum speed projected to be as fast as 60 mph. Capital MetroRail will offer service every 35 minutes during morning and afternoon rush hours with fares ranging from $2 to $3 depending on distance. There will also be discounts for monthly passes and certain categories of riders. Senior citizens and children under 6 ride for free.
The trains (shown below) are very attractive. The city's six trains will each have a capacity of 200 passengers with 108 seated and 92 standing. Believe it or not, the train will actually have wifi service on board as well as bicycle racks and work tables. For safety, the vehicles have ten cameras outside and six inside, as well as a sophisticated communications system.
MetroRail was originally approved in 2004 when voters within Capital Metro's territory endorsed MetroRail as part of a long-range mass transit plan, which also includes expanded local and express bus service, as well as a possible streetcar system (modeled after the Portland Streetcar), which would connect downtown Austin, the Texas State Capitol complex and the University of Texas-Austin with the master-planned Mueller Community redevelopment project. Technically, the system is not considered light rail, because it shares the main-line tracks used by freight trains, and because of its infrequent rush hour-focused service.
With a downtown stop in front of the convention center, the train will allow some downtown workers to commute to a limited number of transit friendly city locations. For Austin residents who don't live downtown, the new train will provide a way to bypass rush hour traffic.
With one route, 9 stops, and infrequent service, the train is unlikely to have a dramatic effect on the city when it begins service. In fact, the City is estimating ridership at 2,000 people a day. While a small portion of the population, removing 2,000 cars from downtown and the other destinations on a daily basis would be significant. The important thing to note is that this is the beginning: if it is successful, more trains, routes, and increasingly frequent service may be added in the future.
MetroRail will run from downtown to Leaner with stops for Lakeline, Howard, Kramer, Crestview, Highland, MLK, Jr., and Plaza Saltillo. The full 32 mile trip is estimated to take 57 minutes with a maximum speed projected to be as fast as 60 mph. Capital MetroRail will offer service every 35 minutes during morning and afternoon rush hours with fares ranging from $2 to $3 depending on distance. There will also be discounts for monthly passes and certain categories of riders. Senior citizens and children under 6 ride for free.
The trains (shown below) are very attractive. The city's six trains will each have a capacity of 200 passengers with 108 seated and 92 standing. Believe it or not, the train will actually have wifi service on board as well as bicycle racks and work tables. For safety, the vehicles have ten cameras outside and six inside, as well as a sophisticated communications system.
MetroRail was originally approved in 2004 when voters within Capital Metro's territory endorsed MetroRail as part of a long-range mass transit plan, which also includes expanded local and express bus service, as well as a possible streetcar system (modeled after the Portland Streetcar), which would connect downtown Austin, the Texas State Capitol complex and the University of Texas-Austin with the master-planned Mueller Community redevelopment project. Technically, the system is not considered light rail, because it shares the main-line tracks used by freight trains, and because of its infrequent rush hour-focused service.
With a downtown stop in front of the convention center, the train will allow some downtown workers to commute to a limited number of transit friendly city locations. For Austin residents who don't live downtown, the new train will provide a way to bypass rush hour traffic.
With one route, 9 stops, and infrequent service, the train is unlikely to have a dramatic effect on the city when it begins service. In fact, the City is estimating ridership at 2,000 people a day. While a small portion of the population, removing 2,000 cars from downtown and the other destinations on a daily basis would be significant. The important thing to note is that this is the beginning: if it is successful, more trains, routes, and increasingly frequent service may be added in the future.
Austonian Dismantles Crane, Throws Party
January 24, 2010 21:31 Filed in: News
Over the last few weeks, the Austonian has been slowly
dismantling its crane, signaling the beginning
of the final phase of construction. With the
exterior shell complete and the elevators now
fully functional, the Austonian invited hundreds
of guests to a private party on the the top
three floors of the tower last Friday night.
From floors 54, 55, an 56, I was able to see downtown from a new perspective. Needless to say, the first observation is that the Austonian is really, really, really tall. From the 56th floor, the Monarch looks tiny and the top of the Frost Bank Tower is far below. Even the 44-story 360 tower is much, much smaller. It is so tall that your ears will inevitably pop on the way up and down in the high speed elevators. At night, the city streets stretch out endlessly in almost every direction while the capital glows and the lights of sixth street flash their bright colors.
There will be at least one more opportunity for non-residents to get a look at the amazing view before residents begin moving in June. In May, the Austonian will be the site of the Women's Symphony League of Austin's 2010 Symphony Designer Show house which will be open to the public. It will be a great chance to see what can be done visually with a high end condo.
Photos by blimpphoto.com
From floors 54, 55, an 56, I was able to see downtown from a new perspective. Needless to say, the first observation is that the Austonian is really, really, really tall. From the 56th floor, the Monarch looks tiny and the top of the Frost Bank Tower is far below. Even the 44-story 360 tower is much, much smaller. It is so tall that your ears will inevitably pop on the way up and down in the high speed elevators. At night, the city streets stretch out endlessly in almost every direction while the capital glows and the lights of sixth street flash their bright colors.
There will be at least one more opportunity for non-residents to get a look at the amazing view before residents begin moving in June. In May, the Austonian will be the site of the Women's Symphony League of Austin's 2010 Symphony Designer Show house which will be open to the public. It will be a great chance to see what can be done visually with a high end condo.
Photos by blimpphoto.com
Update: New Central Library Progress
January 17, 2010 22:23 Filed in: News
The City of Austin has more residents than the cities
of Boston (although the Austin MSA is smaller than
the Boston metropolitan area), Seattle and Nashville.
Austin's central library is 110,000 square feet - 1/5
the size of Boston's main library, 1/3 of
Nashville's, and 1/5 of Seattle's. The Austin central
library seats 300 people while Boston's library seats
4,400. Austin has 75 public computers vs. 550 in
Boston and 400 in Seattle.
Right now, the City is actively working on plans for a flagship central library to be located where Shoal Creek crosses Cesar Chavez facing out over Ladybird lake. The project is slated to be designed by top notch Texas architects Lake|Flato. Additional details are scheduled to be released when the proposal goes before the City Council in February.
Lake, who leads the design of Austin's new central library for Lake|Flato, said the design team is currently reconciling wish lists with budgetary realities. Collaborating architectural firm Shepley Bulfinch is leading the programming phase; the work reflects ideas and input gathered from Austinites and library staff at a series of meetings in November.
According to the Chronicle, the design team is also considering how the library will interact with the site and surrounding urban fabric. "We are keen on making this library a gateway to Downtown, Lady Bird Lake, Shoal Creek, and the trail system," said Lake. The building will be sited right on the shore of Shoal Creek, across Cesar Chavez from the lake. "Libraries are becoming more public-spirited buildings – a city living room," he said. "For Austin, it makes perfect sense to engage the creek and the river. Wouldn't it be great if people could sit out on the library's porch?"
The City's pitch for a new central library is based on the argument that a Central Library with a rich collection of materials and a wide range of services is vital for the continued health of the Austin library system. The hope is that a new library would "foster intellectual energy and excitement among its citizens. It would become a community destination, bringing citizens of all ages to the central business district for pursuit of leisure reading, social interaction, lifetime learning experiences, and for the experience of being in a cultural showcase for the arts."
The current list of ideas envisioned for a new Central Library
include:
- A building located in the emerging civic/cultural center of downtown which would be an architecturally and aesthetically important destination for both residents and visitors
- At least 300,000-400,00 square feet of space to accommodate an in-depth and growing collection for current and future needs
- Rooms for community events and meetings, as well as a public auditorium seating up to 300 persons
- Exhibit and display space
- A separate space for children’s programs
- Additional public computers and classrooms for computer-aided instruction and distance learning for the public and library staff
- Connections for customers who bring in their own laptop computers
- Expanded seating space including designated quiet study areas, group study areas, and lounges
- Parking for 350-475 cars
- Coffee shop, gift shop, and book sales areas
- Drive-up window for quick book return and pickup of reserved materials
- Expanded collection of periodicals, journals, and newspapers
- Collections in world languages and services for non- English speakers and new immigrants
We'll continue to track the library's progress as new details emerge over then next month.
Right now, the City is actively working on plans for a flagship central library to be located where Shoal Creek crosses Cesar Chavez facing out over Ladybird lake. The project is slated to be designed by top notch Texas architects Lake|Flato. Additional details are scheduled to be released when the proposal goes before the City Council in February.
Lake, who leads the design of Austin's new central library for Lake|Flato, said the design team is currently reconciling wish lists with budgetary realities. Collaborating architectural firm Shepley Bulfinch is leading the programming phase; the work reflects ideas and input gathered from Austinites and library staff at a series of meetings in November.
According to the Chronicle, the design team is also considering how the library will interact with the site and surrounding urban fabric. "We are keen on making this library a gateway to Downtown, Lady Bird Lake, Shoal Creek, and the trail system," said Lake. The building will be sited right on the shore of Shoal Creek, across Cesar Chavez from the lake. "Libraries are becoming more public-spirited buildings – a city living room," he said. "For Austin, it makes perfect sense to engage the creek and the river. Wouldn't it be great if people could sit out on the library's porch?"
The City's pitch for a new central library is based on the argument that a Central Library with a rich collection of materials and a wide range of services is vital for the continued health of the Austin library system. The hope is that a new library would "foster intellectual energy and excitement among its citizens. It would become a community destination, bringing citizens of all ages to the central business district for pursuit of leisure reading, social interaction, lifetime learning experiences, and for the experience of being in a cultural showcase for the arts."
The current list of ideas envisioned for a new Central Library
include:
- A building located in the emerging civic/cultural center of downtown which would be an architecturally and aesthetically important destination for both residents and visitors
- At least 300,000-400,00 square feet of space to accommodate an in-depth and growing collection for current and future needs
- Rooms for community events and meetings, as well as a public auditorium seating up to 300 persons
- Exhibit and display space
- A separate space for children’s programs
- Additional public computers and classrooms for computer-aided instruction and distance learning for the public and library staff
- Connections for customers who bring in their own laptop computers
- Expanded seating space including designated quiet study areas, group study areas, and lounges
- Parking for 350-475 cars
- Coffee shop, gift shop, and book sales areas
- Drive-up window for quick book return and pickup of reserved materials
- Expanded collection of periodicals, journals, and newspapers
- Collections in world languages and services for non- English speakers and new immigrants
We'll continue to track the library's progress as new details emerge over then next month.
Sabine Auction Planned for February
January 10, 2010 22:09 Filed in: News
After a tenant lawsuit and a recent foreclosure
posting, it looks as if 27 of the 44 long-vacant
remaining units in the Sabine are finally headed to
auction on February 28th.
The Sabine is an 80-unit condo conversion project of a mostly-empty office building on Waller Creek into a new condo project adjoining the Hilton Garden Inn on 5th Street near I-35. The project was completed in 2007 and the majority of units still remain vacant although they have been removed from the market due to pending litigation.
The project has been plagued with problems. A year ago, 35 residents of The Sabine filed suit against the developers for list of problems that the condo owners say have been ongoing for month. The problems included elevator issues (a 12/29/08 elevator inspection exposed 19 code violations including some that were described as serious safety problems), problems with water leaks, window seals, and sound-proofing, and failure to pay property taxes on more than 40 units.
In addition, Compass bank has twice posted the property for foreclosure.
Now, the developer has settled with the tenants and turned control of the HOA over to the current Sabine owners -- an unusual move for a project with so many vacant units. In addition, the developer has committed to major renovations to remedy the issues raised in the lawsuit. With the lawsuit gone, the developers are able to pursue their long-rumored plan to auction off the remaining units. The auction date for 27 of the 44 units has been set for February 28. It is not clear what will be done with the remaining 17 units.
The Brazos Place auctions (as well as the sale of deeply-discounted Shore properties) showed in an even more difficult market that there is strong demand for highly discounted downtown Austin condo units. For potential bidders, auctions like this typically bring a 25-30% discount off the original prices. In the case of the Sabine
The Sabine is an 80-unit condo conversion project of a mostly-empty office building on Waller Creek into a new condo project adjoining the Hilton Garden Inn on 5th Street near I-35. The project was completed in 2007 and the majority of units still remain vacant although they have been removed from the market due to pending litigation.
The project has been plagued with problems. A year ago, 35 residents of The Sabine filed suit against the developers for list of problems that the condo owners say have been ongoing for month. The problems included elevator issues (a 12/29/08 elevator inspection exposed 19 code violations including some that were described as serious safety problems), problems with water leaks, window seals, and sound-proofing, and failure to pay property taxes on more than 40 units.
In addition, Compass bank has twice posted the property for foreclosure.
Now, the developer has settled with the tenants and turned control of the HOA over to the current Sabine owners -- an unusual move for a project with so many vacant units. In addition, the developer has committed to major renovations to remedy the issues raised in the lawsuit. With the lawsuit gone, the developers are able to pursue their long-rumored plan to auction off the remaining units. The auction date for 27 of the 44 units has been set for February 28. It is not clear what will be done with the remaining 17 units.
The Brazos Place auctions (as well as the sale of deeply-discounted Shore properties) showed in an even more difficult market that there is strong demand for highly discounted downtown Austin condo units. For potential bidders, auctions like this typically bring a 25-30% discount off the original prices. In the case of the Sabine
21c Austin: Condos Out, Apartments Possible
January 03, 2010 20:33 Filed in: News
In December, the 21c team returned to Austin to
comment on the Waller Creek plan and to discuss their
future intentions for their prime Waller Creek site
adjoining Red River and Cesar Chavez downtown.
For those of you unfamiliar with the history, the project was originally scoped as a 44-story condo and hotel project on third and Brazos street. In a surprise move, the developers abandoned the planned third and Brazos project in favor of a new multi-building complex to be located a few blocks East on Waller Creek.
The new project, also to be named 21c, was slated to include a 16-story hotel with 243 rooms which would be followed by a 49-story condo tower. The hotel was supposed to break ground in 2009 and the condo tower was supposed to break ground by 2010. Then, the project became a victim of the financing crisis that has scuttled most of the other unbuilt Austin projects.
Fortunately, the developers keep trying to make the project work. In December, the 21c provided a basic overview of their current but unfunded plans for the site. First, the condos have been eliminated. In the current environment, it is simply not possible to fund a new high-end condo project in downtown Austin. Instead, the developers are focusing on a 31-story 350 unit apartment tower near the corner of Red River and Cesar Chavez. Rents would start at $1.50 per square foot which would mean $1,000 / month for a 700 square foot unit or $1,500 for a 1,000 square foot unit if they are able to hit the low-end of the target range. The goal would be to make the building 70% 1 bedroom / 1 bath units. As many as 10% of the units for be designated as affordable units with controlled rents.
The second tower -- which is more precarious in the current environment -- would be a 12-story 200 room hotel, spa, and restaurant. The developers are hoping to put parking underground and include ground retail in the project. Although no specifics have been announced, the third tower could include condos if at some point it does get built.
Since the plan remains unfunded, the project is not likely to rise anytime soon. But the fact that the developers are actively working with the city and still try to line-up funding means that a 21c project may be yet to rise.
For those of you unfamiliar with the history, the project was originally scoped as a 44-story condo and hotel project on third and Brazos street. In a surprise move, the developers abandoned the planned third and Brazos project in favor of a new multi-building complex to be located a few blocks East on Waller Creek.
The new project, also to be named 21c, was slated to include a 16-story hotel with 243 rooms which would be followed by a 49-story condo tower. The hotel was supposed to break ground in 2009 and the condo tower was supposed to break ground by 2010. Then, the project became a victim of the financing crisis that has scuttled most of the other unbuilt Austin projects.
Fortunately, the developers keep trying to make the project work. In December, the 21c provided a basic overview of their current but unfunded plans for the site. First, the condos have been eliminated. In the current environment, it is simply not possible to fund a new high-end condo project in downtown Austin. Instead, the developers are focusing on a 31-story 350 unit apartment tower near the corner of Red River and Cesar Chavez. Rents would start at $1.50 per square foot which would mean $1,000 / month for a 700 square foot unit or $1,500 for a 1,000 square foot unit if they are able to hit the low-end of the target range. The goal would be to make the building 70% 1 bedroom / 1 bath units. As many as 10% of the units for be designated as affordable units with controlled rents.
The second tower -- which is more precarious in the current environment -- would be a 12-story 200 room hotel, spa, and restaurant. The developers are hoping to put parking underground and include ground retail in the project. Although no specifics have been announced, the third tower could include condos if at some point it does get built.
Since the plan remains unfunded, the project is not likely to rise anytime soon. But the fact that the developers are actively working with the city and still try to line-up funding means that a 21c project may be yet to rise.
New 27-Story Condo/Office Project Announced!
December 19, 2009 21:15 Filed in: News
For the first time in a very long time, a developer
has announced plans to construct a new 27-story
downtown condo and office tower. The developer is
proposing to build a tower of up to 350 feet on the
vacant lot between Whole Foods and Austin City Lofts.
The announcement is a clear sign that the downtown
market is stabilizing and expected to improve
dramatically over the next few years.
The building is being proposed by Schlosser Development, a local firm with a significant track record in the 6th and Lamar neighborhood. Schlosser developed the Whole Foods headquarters, the Home Away headquarters across the street, the Officemax building just South of Whole Foods, and the REI / BookPeople building just to the North. This appears to be the company's first tower project.
As proposed, the new building would include:
- Street level retail and parking on the lower floors
- 16 stories of office space
- 90 condo units on the top seven floors
- A companion building on the 2.7 acre site would include three levels of commercial office space with parking and street-level retail. The smaller building allows full utilization of the site which is partially in a protected capital view corridor
Since zoning limits development on the site to 120 feet, a variance would be required to build the project as proposed. The tow buildings would comprise a whopping 600,000 square feet.
The announcement of such a large condo and office project is another sign of a downtown market resurgence. In this case, the developers may have been inspired by the recent leasing of 52,000 square feet of office space on a nearby project to HomeAway. There has been very little new office capacity added downtown over the 5 years: the last large scale office project to be constructed downtown was the Frost Bank Tower which was completed in 2004.
The building is being proposed by Schlosser Development, a local firm with a significant track record in the 6th and Lamar neighborhood. Schlosser developed the Whole Foods headquarters, the Home Away headquarters across the street, the Officemax building just South of Whole Foods, and the REI / BookPeople building just to the North. This appears to be the company's first tower project.
As proposed, the new building would include:
- Street level retail and parking on the lower floors
- 16 stories of office space
- 90 condo units on the top seven floors
- A companion building on the 2.7 acre site would include three levels of commercial office space with parking and street-level retail. The smaller building allows full utilization of the site which is partially in a protected capital view corridor
Since zoning limits development on the site to 120 feet, a variance would be required to build the project as proposed. The tow buildings would comprise a whopping 600,000 square feet.
The announcement of such a large condo and office project is another sign of a downtown market resurgence. In this case, the developers may have been inspired by the recent leasing of 52,000 square feet of office space on a nearby project to HomeAway. There has been very little new office capacity added downtown over the 5 years: the last large scale office project to be constructed downtown was the Frost Bank Tower which was completed in 2004.
$200M Project Approved for South Shore of Ladybird Lake
December 19, 2009 20:30 Filed in: News
The Austin City Council granted final approval for
the $200 million Grayco Lakeshore development on the
South sure of Ladybird Lake just east of I-35. In
exchange for approving the development of the first
four buildings, the Council required the developer to
contribute $3.1 million to support affordable
housing.
The massive project will include as many as 1,200 apartments and nearly 100,000 square feet of retail. Despite the financial crisis which has depressed development in Austin and across the country, Grayco has continued to aggressively push for development of the site. Under the revised plans, Grayco will replace a four building 520-unit apartment complex with as many as 1,200 new apartments.
The most notable element of this project is its scale: Grayco’s plan seems to be to create an entire district, a whole new neighborhood to attract residents to this emerging near-downtown market. While the final plans have not been released -- and the developers have hinted that the final proposal may be less urban -- the scale of the project is certain to remain large.
The massive project will include as many as 1,200 apartments and nearly 100,000 square feet of retail. Despite the financial crisis which has depressed development in Austin and across the country, Grayco has continued to aggressively push for development of the site. Under the revised plans, Grayco will replace a four building 520-unit apartment complex with as many as 1,200 new apartments.
The most notable element of this project is its scale: Grayco’s plan seems to be to create an entire district, a whole new neighborhood to attract residents to this emerging near-downtown market. While the final plans have not been released -- and the developers have hinted that the final proposal may be less urban -- the scale of the project is certain to remain large.
Sabine & Star Riverside Posted for Foreclosure
December 16, 2009 22:15 Filed in: News
Two troubled downtown condo projects -- Sabine & Star Riverside --
have run into financial problems and been posted
for foreclosure.
The failure of these projects is a combination of market conditions and their own troubled history. The Sabine is a troubled 10-story office building conversion project at Sabine and West Fifth streets that was completed in 2007. With 44 of the 80 units unsold and litigation between residents and the developer over sued faulty and unsafe elevators and leaks, sales of units have slowed dramatically. With the current foreclosure, an agreement is apparently underworks that will transfer control of the building to the building's homeowner association. With the majority of units unsold, an auction is a likely next step to raise additional capital to make the lenders whole.
Star Riverside has had an equally difficult time getting off the ground. As an expensive project located on the wrong side of the lake and the wrong side of I-35, Star Riverside has been repeatedly reinvented as the result of changing market conditions and neighborhood concerns. Construction was halted two months ago, with only the parking garage about 80 percent complete. With prices starting at more than $600K, the low-rise project East of I-35 and South of downtown faces tough odds for success. With the economic decline, the project has lost key financial support.
Despite the bad news, both projects claim that deals will be reached before the projects are but up for sale in the January 5 foreclosure auction. For Sabine, the news is another blow to existing residents who will likely see the remaining units sold at a a significant discount. For Star Riverside, it's hard to believe the project can be created without a significant repositioning that better matches pricing and configuration to the location and current market conditions.
The failure of these projects is a combination of market conditions and their own troubled history. The Sabine is a troubled 10-story office building conversion project at Sabine and West Fifth streets that was completed in 2007. With 44 of the 80 units unsold and litigation between residents and the developer over sued faulty and unsafe elevators and leaks, sales of units have slowed dramatically. With the current foreclosure, an agreement is apparently underworks that will transfer control of the building to the building's homeowner association. With the majority of units unsold, an auction is a likely next step to raise additional capital to make the lenders whole.
Star Riverside has had an equally difficult time getting off the ground. As an expensive project located on the wrong side of the lake and the wrong side of I-35, Star Riverside has been repeatedly reinvented as the result of changing market conditions and neighborhood concerns. Construction was halted two months ago, with only the parking garage about 80 percent complete. With prices starting at more than $600K, the low-rise project East of I-35 and South of downtown faces tough odds for success. With the economic decline, the project has lost key financial support.
Despite the bad news, both projects claim that deals will be reached before the projects are but up for sale in the January 5 foreclosure auction. For Sabine, the news is another blow to existing residents who will likely see the remaining units sold at a a significant discount. For Star Riverside, it's hard to believe the project can be created without a significant repositioning that better matches pricing and configuration to the location and current market conditions.
Austin: #1 For Being Ranked on Lists
December 14, 2009 20:18 Filed in: News
Austin is no longer a well-kept secret. It seems that
hardly a week goes by where Austin does make a list
of the top places to live or work or bike or to be
indoors or to be outdoors or just about anything else
that can be listed. So, thanks to Sam Thacker who
created a list of Austin lists in the Austin Business Insight
Examiner.
Here are some of the highlights:
- The Milken Institute ranked the Killeen-Temple-Fort Hood MSA as second in the country behind Austin for overall best performance in creating jobs.
- In October, Business Week and The Brookings Institute ranked Austin #2 out of 100 metro areas with the highest metropolitan growth product (MGP) and employment potential.
- In October, CNN-Money ranked Austin #9 as one of the best places to launch a business.
- In October, Portfolio.com ranked Austin #1 out of 100 of the largest cities in the country for job creation. San Antonio, Houston, and Dallas/Ft. Worth all ranked within the top five.
- In September, The Austin Business Journal and IHC Insight named Austin and San Antonio as the first two most likely large American cities to bounce back to pre-recession employment. Of cities highlighted by IHC 6 of the top 20 are in Texas.
- In August, Forbes ranked Austin as the least stressful city to live in out of 40 it studied. Factors it considered were housing values, traffic congestion and unemployment.
It's no secret that Austin is a great place to live, but it is great to hear that the local economy ranks among the strongest in the country. With high potential for job creation, migration, and economic growth, Austin has the key ingredients to exit the economic downturn and see real estate appreciation ahead of the pack.
Here are some of the highlights:
- The Milken Institute ranked the Killeen-Temple-Fort Hood MSA as second in the country behind Austin for overall best performance in creating jobs.
- In October, Business Week and The Brookings Institute ranked Austin #2 out of 100 metro areas with the highest metropolitan growth product (MGP) and employment potential.
- In October, CNN-Money ranked Austin #9 as one of the best places to launch a business.
- In October, Portfolio.com ranked Austin #1 out of 100 of the largest cities in the country for job creation. San Antonio, Houston, and Dallas/Ft. Worth all ranked within the top five.
- In September, The Austin Business Journal and IHC Insight named Austin and San Antonio as the first two most likely large American cities to bounce back to pre-recession employment. Of cities highlighted by IHC 6 of the top 20 are in Texas.
- In August, Forbes ranked Austin as the least stressful city to live in out of 40 it studied. Factors it considered were housing values, traffic congestion and unemployment.
It's no secret that Austin is a great place to live, but it is great to hear that the local economy ranks among the strongest in the country. With high potential for job creation, migration, and economic growth, Austin has the key ingredients to exit the economic downturn and see real estate appreciation ahead of the pack.
Austin Home Listings Slide by 20%
December 09, 2009 21:08 Filed in: News
The Wall Street Journal is reporting that the number
of homes listed for sale has declined in many U.S.
cities in November, reversing a strongly negative
trend.
In the 27 metropolitan areas covered in the ZipRealty survey, housing inventory dropped by an average of 28% over the last year and 2.4% during the last month. In Austin, the number of home listings slid by 19.8 percent over the last year and 3 percent between October and November.
The slide in inventory is a positive step: it means that supply and demand are returning to a more normal balance after a very difficult year. While seasonal trends will cause inventories to rise again in January, it's the year-over-year trend that is most important.
According to the Journal, the one month change is less significant as "Inventories typically decrease modestly in November compared with the previous month, according to Zelman & Associates, a research firm. Over the past 25 years, the average change has been a decline of 1.8%."
The Journal also notes that the exact level of supply is impossible to pin down, partly because multiple listing services don't include all the foreclosed homes that banks are preparing to put on the market. As of the end of October, banks and mortgage investors had 639,000 foreclosed homes for sale across the U.S., Barclays Capital estimates. That's equivalent to more than 10% of expected U.S. home sales this year. The bank-owned homes are largely concentrated in Florida, California, Arizona and Nevada.
The MLS also excludes newly constructed downtown Austin condo units that are not being sold by realtors. This means that most of the units in the Austonian, Four Seasons, W, Spring, and other projects are excluded from the inventory numbers. Since the same was true last year, the 12 month change does seem to be a significant development.
In the 27 metropolitan areas covered in the ZipRealty survey, housing inventory dropped by an average of 28% over the last year and 2.4% during the last month. In Austin, the number of home listings slid by 19.8 percent over the last year and 3 percent between October and November.
The slide in inventory is a positive step: it means that supply and demand are returning to a more normal balance after a very difficult year. While seasonal trends will cause inventories to rise again in January, it's the year-over-year trend that is most important.
According to the Journal, the one month change is less significant as "Inventories typically decrease modestly in November compared with the previous month, according to Zelman & Associates, a research firm. Over the past 25 years, the average change has been a decline of 1.8%."
The Journal also notes that the exact level of supply is impossible to pin down, partly because multiple listing services don't include all the foreclosed homes that banks are preparing to put on the market. As of the end of October, banks and mortgage investors had 639,000 foreclosed homes for sale across the U.S., Barclays Capital estimates. That's equivalent to more than 10% of expected U.S. home sales this year. The bank-owned homes are largely concentrated in Florida, California, Arizona and Nevada.
The MLS also excludes newly constructed downtown Austin condo units that are not being sold by realtors. This means that most of the units in the Austonian, Four Seasons, W, Spring, and other projects are excluded from the inventory numbers. Since the same was true last year, the 12 month change does seem to be a significant development.
$500B in Home Value Disappears
December 09, 2009 20:51 Filed in: News
According to ZIllow, Total home values in
the United States fell $489 billion in the first
11 months of 2009. A large drop, to be sure, but
it marks a significant improvement from 2008,
when homes lost a total of $3.6 trillion in
values. In addition, about one-third of the
markets we covered (48 of 154) had gains in
total home values. The Boston metropolitan
statistical area (MSA) topped this list, gaining
$23.3 billion. Last year, the Boston MSA lost
$53.4 billion.
On the other end of the spectrum, the Los Angeles MSA’s housing market lost the most dollars in 2009 — $60.8 billion. But even that was a significant improvement from 2008, when the MSA lost $345.8 billion. The LA market has actually performed quite well recently, having seen six consecutive months of monthly gains in home values as of October, but the strong negative performance earlier in the year dug the overall market a large hole early on.
View the full report here.
On the other end of the spectrum, the Los Angeles MSA’s housing market lost the most dollars in 2009 — $60.8 billion. But even that was a significant improvement from 2008, when the MSA lost $345.8 billion. The LA market has actually performed quite well recently, having seen six consecutive months of monthly gains in home values as of October, but the strong negative performance earlier in the year dug the overall market a large hole early on.
View the full report here.
New: Urban Lifestyle and Residential Guide (Free)
December 02, 2009 22:52 Filed in: News
I just received my free copy of urbanspace's most
recent Urban Lifestyle and Residential Guide
(Get it here for
free). The latest edition was released in
October and includes profiles on more than 100
condo and rental projects near Austin's urban
core. It is the most comprehensive list of cool
places to live that we have seen. In addition,
it includes hundreds of great urban spots from
Justine's to Lustre Pearl to East Side Showroom.
Through special arrangement with UrbanSpace, a free copy of the new 44-page guide will be mailed to any AustinTowers reader who requests one. To get your copy of the guide -- click here. It's a great resource -- get one while they last!
You can get your free copy of the Guide here.
Through special arrangement with UrbanSpace, a free copy of the new 44-page guide will be mailed to any AustinTowers reader who requests one. To get your copy of the guide -- click here. It's a great resource -- get one while they last!
You can get your free copy of the Guide here.
21c Austin: New Renderings Magically Appear
November 28, 2009 16:22 Filed in: News
This week, it has been reported that the developers
of 21c are coming back to Austin to provide an update
on the status of the project. Apparently, the plans
are now complete and they are ready to proceed with a
third version of the project on a large site located
at the intersection of Red River and Cesar Chavez
streets.
The history of the 21c project is quite unique. The original 21c project was late to the game, announced just 2 months before the summer meltdown of U.S. credit markets. The project was originally scoped as a 44-story condo and hotel project on third and Brazos street. Although 21c had been actively marketing condo units through a sales office on 6th and Congress, the office was shut and shackled before the developers announced that they had abandoned the planned third and Brazos project in favor of a new multi-building complex to be located a few blocks East on Waller Creek.
The new project, also to be named 21c, was slated to include a 16-story hotel with 243 rooms which would be followed by a 49-story condo tower. The hotel was supposed to break ground in 2009 and the condo tower was supposed to break ground by 2010. Then, the project became a victim of the financing crisis that has scuttled most of the other unbuilt Austin projects.
21c Version One (3rd & Brazos)
21c Version Two (Red River & Cesar Chavez)
And now, the website is showing a third version of the planned project:
According to the Statesman:
The developers of the proposed 21c Museum Hotel are coming to Austin next week to present an update on the stalled downtown project.
Developers Steve Poe and Craig Greenberg will be speaking to the Waller Creek Citizen Advisory Committee at City Hall on Dec. 3.
The proposed project includes a hotel and condominiums at East Caesar Chavez and Red River streets. City leaders had hoped that the tax revenue from the project would kick-start plans to build a flood control tunnel along Waller Creek, helping spur redevelopment in the area.
Michael Bonadies, president and CEO of 21c Museum Hotels, said the project plans are complete, and they’re ready to move forward.
But there is still a major obstacle.
“We continue to work hard on sourcing construction financing in what has proved to be a difficult environment,” Bonadies said in an email. “However, we remain optimistic, encouraged by some of the feedback we have recently received, which leads us to believe that 2010 will bring a more favorable climate for construction financing.”
We'll see what they announce this week!
The history of the 21c project is quite unique. The original 21c project was late to the game, announced just 2 months before the summer meltdown of U.S. credit markets. The project was originally scoped as a 44-story condo and hotel project on third and Brazos street. Although 21c had been actively marketing condo units through a sales office on 6th and Congress, the office was shut and shackled before the developers announced that they had abandoned the planned third and Brazos project in favor of a new multi-building complex to be located a few blocks East on Waller Creek.
The new project, also to be named 21c, was slated to include a 16-story hotel with 243 rooms which would be followed by a 49-story condo tower. The hotel was supposed to break ground in 2009 and the condo tower was supposed to break ground by 2010. Then, the project became a victim of the financing crisis that has scuttled most of the other unbuilt Austin projects.
21c Version One (3rd & Brazos)
21c Version Two (Red River & Cesar Chavez)
And now, the website is showing a third version of the planned project:
According to the Statesman:
The developers of the proposed 21c Museum Hotel are coming to Austin next week to present an update on the stalled downtown project.
Developers Steve Poe and Craig Greenberg will be speaking to the Waller Creek Citizen Advisory Committee at City Hall on Dec. 3.
The proposed project includes a hotel and condominiums at East Caesar Chavez and Red River streets. City leaders had hoped that the tax revenue from the project would kick-start plans to build a flood control tunnel along Waller Creek, helping spur redevelopment in the area.
Michael Bonadies, president and CEO of 21c Museum Hotels, said the project plans are complete, and they’re ready to move forward.
But there is still a major obstacle.
“We continue to work hard on sourcing construction financing in what has proved to be a difficult environment,” Bonadies said in an email. “However, we remain optimistic, encouraged by some of the feedback we have recently received, which leads us to believe that 2010 will bring a more favorable climate for construction financing.”
We'll see what they announce this week!
Austin: 3rd Best City for Development
November 19, 2009 21:42 Filed in: News
From my perspective, it is always great for Austin to
be included in a top five list that includes San
Francisco, New York, Boston, and Washington DC.
This week the Urban Land Institute, a 2,000 member not-for-profit real estate and developer network, released its list of the 5 cities for development in 2010. In order, the Institute's analysis recommends Washington DC, San Francisco, Austin, Boston, and New York.
The report provided the following rational for picking Austin as the #3 city for development:
Austin, Texas: A growth bastion, Austin’s low state taxes and a pro business environment are expected to contribute to future growth and continuing corporate relocations. Austin fits the “brainpower” model with its state capital, large state university, and offshoot tech and software businesses.
While not everybody is looking for another wave of downtown development at this point, the report does bode well for current downtown condo owners. As the institute analyzes major markets, it is clear that Austin's strengths include a dynamic economy, consistent population growth, and a community that attracts businesses and entrepreneurs. And where there is growth and economic strength, home value increases are likely to follow.
This week the Urban Land Institute, a 2,000 member not-for-profit real estate and developer network, released its list of the 5 cities for development in 2010. In order, the Institute's analysis recommends Washington DC, San Francisco, Austin, Boston, and New York.
The report provided the following rational for picking Austin as the #3 city for development:
Austin, Texas: A growth bastion, Austin’s low state taxes and a pro business environment are expected to contribute to future growth and continuing corporate relocations. Austin fits the “brainpower” model with its state capital, large state university, and offshoot tech and software businesses.
While not everybody is looking for another wave of downtown development at this point, the report does bode well for current downtown condo owners. As the institute analyzes major markets, it is clear that Austin's strengths include a dynamic economy, consistent population growth, and a community that attracts businesses and entrepreneurs. And where there is growth and economic strength, home value increases are likely to follow.
October Surprise: Austin Home Sales Surge
November 18, 2009 22:04 Filed in: News
We reported
9 days ago that downtown Austin condo sales were
up 44% year-over-year while prices were down 3%.
This was good news but not necessarily
indicative of the broader Austin market. Today,
newly released MLS numbers show that central
Texas existing home sales soared 38% in October
with 1,823 houses selling compared with 1,322 a
year ago.
While volumes were up, prices were down 5% to $182,000 as a result of a shift in mix to lower priced houses as the demand for inexpensive housing was boosted by the federal tax credit for first-time home buyers.
October sales volumes surpassed October sales in 2008, 2007 and 2006 making this the best October since 2005. The number of homes listed for sale, 8,947, was down 10 percent from a year ago. And pending sales were up 47 percent, with 1,811 contracts waiting to close. Year to date, area home sales are down 11 percent, and the median price was down a very minor 1 percent to $189K.
This is very good news for the Central Texas market and another sign that the worst may be over. That said, the current real estate market remains fragile with low interest rates and tax credits driving mostly low-end demand. For downtown condos, it still remains a buyer's market although the supply of new units priced below $350K is rapidly disappearing. Many reasonable units, however, are still available on the re-sale market.
While volumes were up, prices were down 5% to $182,000 as a result of a shift in mix to lower priced houses as the demand for inexpensive housing was boosted by the federal tax credit for first-time home buyers.
October sales volumes surpassed October sales in 2008, 2007 and 2006 making this the best October since 2005. The number of homes listed for sale, 8,947, was down 10 percent from a year ago. And pending sales were up 47 percent, with 1,811 contracts waiting to close. Year to date, area home sales are down 11 percent, and the median price was down a very minor 1 percent to $189K.
This is very good news for the Central Texas market and another sign that the worst may be over. That said, the current real estate market remains fragile with low interest rates and tax credits driving mostly low-end demand. For downtown condos, it still remains a buyer's market although the supply of new units priced below $350K is rapidly disappearing. Many reasonable units, however, are still available on the re-sale market.
New, Less Restricttive FHA Rules for Condo Loans
November 11, 2009 22:44 Filed in: News
In a dramatic temporary reversal of policy,
the Federal Housing Administration is giving
condo buyers a much-needed break.
Last week, the FHA, the federal agency that insures low-down-payment home loans for private lenders, said it was relaxing its building underwriting guidelines as a way of helping the struggling sector ride out the downturn. The move could help boost sales in condos by making more FHA mortgages available to borrowers.
FHA loans provide qualified buyers an opportunity to purchase units with loans that they would not otherwise qualify for. In particular, FHA loans allow for smaller down payments, often as low as 3% of the purchase price. This month, the rules behind these Federal loans were supposed to change substantially, making many condo projects and buyers ineligible for the first time.
When it comes to downtown Austin, FHA loans are the exception and not the rule. Many new condo developments require deposits and down payments beyond the FHA minimums, diminishing the advantages of an FHA loan. In addition, many units are priced beyond the FHA loan maximum eliminating these loans as a viable financing option. Finally, since the process has always been complex and painful, few projects go through the hassle to be certified.
The new rules - which are temporary - come after more than a year of more stringent standards from lenders, who, after suffering major losses on condos, began vetting and disqualifying condominium projects for purchase loans, regardless of whether home buyers qualified.
The temporary rules are effective for most of the coming year and will help the marketplace transition into a new set of tougher guidelines that bring FHA into closer alignment with the project underwriting practices of Fannie Mae.
Earlier this year, Fannie implemented a slew of new regulations governing condo projects that some claim have strangled the market by stigmatizing condo loans in tough markets such as Florida.
Similar to Fannie regulations, the FHA is also now singling out those markets for special attention by approving projects itself, rather than lenders. Burns said lenders and investors were reluctant and even "scared" to lend money, prompting the agency to step in as a way of calming nerves.
Last week, the FHA, the federal agency that insures low-down-payment home loans for private lenders, said it was relaxing its building underwriting guidelines as a way of helping the struggling sector ride out the downturn. The move could help boost sales in condos by making more FHA mortgages available to borrowers.
FHA loans provide qualified buyers an opportunity to purchase units with loans that they would not otherwise qualify for. In particular, FHA loans allow for smaller down payments, often as low as 3% of the purchase price. This month, the rules behind these Federal loans were supposed to change substantially, making many condo projects and buyers ineligible for the first time.
When it comes to downtown Austin, FHA loans are the exception and not the rule. Many new condo developments require deposits and down payments beyond the FHA minimums, diminishing the advantages of an FHA loan. In addition, many units are priced beyond the FHA loan maximum eliminating these loans as a viable financing option. Finally, since the process has always been complex and painful, few projects go through the hassle to be certified.
The new rules - which are temporary - come after more than a year of more stringent standards from lenders, who, after suffering major losses on condos, began vetting and disqualifying condominium projects for purchase loans, regardless of whether home buyers qualified.
The temporary rules are effective for most of the coming year and will help the marketplace transition into a new set of tougher guidelines that bring FHA into closer alignment with the project underwriting practices of Fannie Mae.
Earlier this year, Fannie implemented a slew of new regulations governing condo projects that some claim have strangled the market by stigmatizing condo loans in tough markets such as Florida.
Similar to Fannie regulations, the FHA is also now singling out those markets for special attention by approving projects itself, rather than lenders. Burns said lenders and investors were reluctant and even "scared" to lend money, prompting the agency to step in as a way of calming nerves.
Exclusive: Strong October & September Downtown Condo Sales
November 02, 2009 22:05 Filed in: News
In the year between the summer of 2008 and the summer
of 2009, a typical month saw 8 downtown condo sales
captured in the Austin MLS. In four of those months,
only 4 units sold. In the best month, 13 units sold.
All of this has changed in the last two months. Between September 1 and October 31 -- a two month period -- 28 downtown condo units ranging in price from $110K (Greenwood Towers) to $1.4M (Nokonah) were sold according to the MLS. In September alone, 15 units sold during the month. This is the second highest number we have seen in the history of the index --- second only to the 22 units sold in April, 2008 during what was probably the market peak.
During the last two months, units have sold in a broad range of existing buildings including Greenwood Towers, 1700 Nueces, Railyard, Milago, Brown Building, 360, Shore, Westgate, Plaza Lofts, Brazos Lofts, Nokonah, 5 Fifty-Five, and Austin City Lofts -- an amazing cross-section of the downtown market.
While a handful of units sold for more than $500K, it should be no surprise that many of the units sold in lower price brackets. In fact, 17 of the 28 units sold for less than $300K and, amazingly, 8 of the units sold for less that $200K.
Here are some of the key statistics on the 28 units sold over the last 2 months:
We'll update the index soon with all of the monthly data through October. . . stay tuned!
All of this has changed in the last two months. Between September 1 and October 31 -- a two month period -- 28 downtown condo units ranging in price from $110K (Greenwood Towers) to $1.4M (Nokonah) were sold according to the MLS. In September alone, 15 units sold during the month. This is the second highest number we have seen in the history of the index --- second only to the 22 units sold in April, 2008 during what was probably the market peak.
During the last two months, units have sold in a broad range of existing buildings including Greenwood Towers, 1700 Nueces, Railyard, Milago, Brown Building, 360, Shore, Westgate, Plaza Lofts, Brazos Lofts, Nokonah, 5 Fifty-Five, and Austin City Lofts -- an amazing cross-section of the downtown market.
While a handful of units sold for more than $500K, it should be no surprise that many of the units sold in lower price brackets. In fact, 17 of the 28 units sold for less than $300K and, amazingly, 8 of the units sold for less that $200K.
Here are some of the key statistics on the 28 units sold over the last 2 months:
|
Statistic
|
SF
|
Listing $/SF
|
Listing Price
|
Sold $/SF
|
Sold Price
|
DOM
|
|
Min
|
472
|
$189.15
|
$115,000
|
$180.92
|
$110,000
|
1
|
|
Max
|
3,025
|
$527.00
|
$1,400,000
|
$452.23
|
$1,368,000
|
600
|
|
Average
|
1,091
|
$320.89
|
$371,836
|
$300.08
|
$344,970
|
11
|
We'll update the index soon with all of the monthly data through October. . . stay tuned!
Free Downtown Austin Guide Book
October 29, 2009 21:41 Filed in: News
UrbanSpace Realtors, a large real estate firm focused
on the downtown residential market, has published a
second version of their comprehensive guide to
downtown neighborhoods and living options as well as
dozens of their favorite dining, entertainment, and
cultural destinations. The guide is amazingly
comprehensive: it profiles a broad range of living
options in and around downtown Austin and shows
nearby Urbanspots -- the cool community destinations
that draw people downtown. The new book provides
greatly expanded coverage of downtown neighborhoods
and hot spots.
The Urban Lifestyle and Residential Guide is the most comprehensive listing of downtown properties -- including buildings just to the East, South, North, and West of the downtown core covered by AustinTowers. Through special arrangement with UrbanSpace, a free copy of the new guide will be mailed for free to any AustinTowers reader who requests one. To get your copy of the guide -- while they last -- click here.
You can get your free copy of the Guide here.
The Urban Lifestyle and Residential Guide is the most comprehensive listing of downtown properties -- including buildings just to the East, South, North, and West of the downtown core covered by AustinTowers. Through special arrangement with UrbanSpace, a free copy of the new guide will be mailed for free to any AustinTowers reader who requests one. To get your copy of the guide -- while they last -- click here.
You can get your free copy of the Guide here.
New Home Buyer Tax Credits in Works
October 29, 2009 21:41 Filed in: News
The U.S. Senate is working on a bill that would
extend the first-time buyer home credit of $8,000 and
add a new credit of $6,500 for homeowners who have
lived in their current home for 5 years or more. The
new provision, if enacted, would go into effect on
December 1, 2009. The new bill is expected to cost
upwards of $10 billion.
The tax credit has been an important driver of real estate transactions over the last quarter and one of the primary reasons that national real estate transaction volumes and prices have begun to show improvement. The new bill would extend these benefits -- and add the new credit — for homes that go under contract as late as August 30, 2010.
The tax credit is disproportionately beneficial to the central Texas markets where real estate values remain moderate compared to major metropolitan areas in the East and West. It is also important to lower cost downtown condo units. The $8,000 credit represents 40% of a 10% deposit or 20% of a 20% deposit on a new $200,000 unit.
Here are additional details on the proposed tax credit extension:
- First-time home buyers are eligible for up to $8,000 on the tax credit, which is the same as the current credit. The Senate version of the bill creates a new credit of up to $6,500 for homeowners who have lived in their homes for five years.
-The credits expire on April 30, 2010, but home buyers under contract by April 30 would be able to qualify as long as they complete the sale within 60 days.
- This is the third and likely last version of the credit. The original credit became available in mid-2008.
- The tax credit isn't available to everyone. It phases out for buyers with incomes above $125,000 for single filers and $225,000 for married couples and homes that cost more than $800,000 aren’t eligible.
- After 500 minors took advantage of the last credit, the new one is restricted to individuals 18 years of age or older.
The tax credit has been an important driver of real estate transactions over the last quarter and one of the primary reasons that national real estate transaction volumes and prices have begun to show improvement. The new bill would extend these benefits -- and add the new credit — for homes that go under contract as late as August 30, 2010.
The tax credit is disproportionately beneficial to the central Texas markets where real estate values remain moderate compared to major metropolitan areas in the East and West. It is also important to lower cost downtown condo units. The $8,000 credit represents 40% of a 10% deposit or 20% of a 20% deposit on a new $200,000 unit.
Here are additional details on the proposed tax credit extension:
- First-time home buyers are eligible for up to $8,000 on the tax credit, which is the same as the current credit. The Senate version of the bill creates a new credit of up to $6,500 for homeowners who have lived in their homes for five years.
-The credits expire on April 30, 2010, but home buyers under contract by April 30 would be able to qualify as long as they complete the sale within 60 days.
- This is the third and likely last version of the credit. The original credit became available in mid-2008.
- The tax credit isn't available to everyone. It phases out for buyers with incomes above $125,000 for single filers and $225,000 for married couples and homes that cost more than $800,000 aren’t eligible.
- After 500 minors took advantage of the last credit, the new one is restricted to individuals 18 years of age or older.
W Receives Financing: Averts Crisis
October 26, 2009 00:23 Filed in: News
The W Austin Hotel and Residences is an important
project for downtown Austin. It's located at the
heart of the emerging Second Street District. It's a
$300 million multi-use project including a
much-needed hotel, a prominent condo project, retail,
and entertainment. It's the home of the new Austin
City Limits studio.
Until this week, the failure of the project's primary lender has put the project in jeopardy. While the 37-story building has continued to rise past 25-floors with the developers investment capital, the project could not have been finished without a new construction loan. Unfortunately, these are tough times to get a construction loan for a condo project that is partially constructed.
This week, Austin-based Stratus Properties Inc., the developer of the W, and the Canyon-Johnson Urban Funds announced the closing of a $120 million replacement construction loan for the W Austin Hotel & Residences project. As part of the deal, the developers were required to add partners to raise an additional $45 million in investment capital. As a result of the financing, the project remains on schedule to open in December of next year with condo units being delivered to buyers through May, 2011.
"Our ability to secure a construction loan in the current economic climate reflects the strength and quality of this project and of the relative strength of the local Austin real estate market," said Beau Armstrong, CEO of Stratus Properties. "Unlike many markets, downtown Austin has a small supply of upper end condominiums - just over 400 units - and is not likely to have any additional new supply in the next five years."
The W Hotel and Residences is located on the City's "Block 21" in the heart of downtown Austin`s 2nd Street District. The building will include 159 residential units, 252 hotel rooms and suites, 18,000 square feet of retail and restaurants, 37,000 square feet of office space and a street-level plaza. Also unique to the project, a state-of-the art, live music venue that will serve as the new home of the world renowned Austin City Limits, the country`s longest running televised music series. The venue will be operated by Live Nation.
W Austin Residences will be located on floors 18 through 37, providing views of Lady Bird Lake, the Hill Country, University of Texas Tower, State Capitol Building and the downtown skyline. Homeowners will have access to all hotel amenities including concierge service, an 8,000-square-foot spa and fitness area, private pool and preferred access to property restaurants and the music venue.
Until this week, the failure of the project's primary lender has put the project in jeopardy. While the 37-story building has continued to rise past 25-floors with the developers investment capital, the project could not have been finished without a new construction loan. Unfortunately, these are tough times to get a construction loan for a condo project that is partially constructed.
This week, Austin-based Stratus Properties Inc., the developer of the W, and the Canyon-Johnson Urban Funds announced the closing of a $120 million replacement construction loan for the W Austin Hotel & Residences project. As part of the deal, the developers were required to add partners to raise an additional $45 million in investment capital. As a result of the financing, the project remains on schedule to open in December of next year with condo units being delivered to buyers through May, 2011.
"Our ability to secure a construction loan in the current economic climate reflects the strength and quality of this project and of the relative strength of the local Austin real estate market," said Beau Armstrong, CEO of Stratus Properties. "Unlike many markets, downtown Austin has a small supply of upper end condominiums - just over 400 units - and is not likely to have any additional new supply in the next five years."
The W Hotel and Residences is located on the City's "Block 21" in the heart of downtown Austin`s 2nd Street District. The building will include 159 residential units, 252 hotel rooms and suites, 18,000 square feet of retail and restaurants, 37,000 square feet of office space and a street-level plaza. Also unique to the project, a state-of-the art, live music venue that will serve as the new home of the world renowned Austin City Limits, the country`s longest running televised music series. The venue will be operated by Live Nation.
W Austin Residences will be located on floors 18 through 37, providing views of Lady Bird Lake, the Hill Country, University of Texas Tower, State Capitol Building and the downtown skyline. Homeowners will have access to all hotel amenities including concierge service, an 8,000-square-foot spa and fitness area, private pool and preferred access to property restaurants and the music venue.
Secret Congress Avenue Town Home on Market
October 18, 2009 22:59 Filed in: News
Although not widely known, there are a small number
of private town homes on Congress Avenue between 8th
street and the Capital. They are well hidden --- when
you walk by you would never know that these buildings
are private residences. If you have $6 million, if
you want to live downtown but need more space than
the largest condos, and if you don't want to share
your rooftop lawn and pool, this is the way to go.
811 North Congress is a 8,425 historic building near the Austin Museum of Art (AMOA) on Congress between 8th and 9th street. Although built in 1873, the building has been completely renovated for residential use with a cool, modern design. And since it is a historic building, the property taxes are discounted. The building is situated on 0.09 acres and contains 4 bedrooms with 5 full baths and 3 1/2 baths.
The pictures say it all:
811 North Congress is a 8,425 historic building near the Austin Museum of Art (AMOA) on Congress between 8th and 9th street. Although built in 1873, the building has been completely renovated for residential use with a cool, modern design. And since it is a historic building, the property taxes are discounted. The building is situated on 0.09 acres and contains 4 bedrooms with 5 full baths and 3 1/2 baths.
The pictures say it all:
Recession Over in Austin: What Will Happen to Housing Prices
October 15, 2009 18:44 Filed in: News
A new report from Moody's shows
that Austin and 78 other metropolitan areas (out
of 384 cities in the U.S.) moved from recession
to recovery during the month of August. The
report labels cities on a four level scale
indicating (1) Expansion, (2) Recovery, (3) At
Risk, (4) In Recession. Austin was rated as (2)
Recovery. No city in the U.S. is rated as being
in expansion mode which would indicate that the
metropolitan area has grown beyond it's
pre-recession peak economy.
In Texas, 7 out of 28 metropolitan areas including Brownsville, Harlingen, Dallas-Plano-Irving, El Paso, Lubbock, and San Antonio are listed as being in recovery. No metropolitan areas in Arizona, California, Connecticut, Florida, Washington DC, Hawaii, Delaware, Maine, Maryland, Nevada, New Mexico, New York, Oklahoma, Oregon, Rhode Island, Vermont or Wyoming showed signs of recovery. The parts of the country that have fared best are areas that experienced less of a housing cycle of boom and bust and that benefit more from relatively strong prices in oil and natural gas. This is certainly true of Texas.
Texas is ranked 6th in the country for economic performance with much better employment numbers and virtually no housing value decline. Austin, amazingly, is ranked 7 out of 392 metropolitan areas in terms of employment growth. The study notes that while housing prices have dropped in Austin, strong population growth supports demographically driven consumer demand and a well-educated labor force attracts high value-added tech businesses. On the negative side, competitive pressure of foreign high-tech manufacturing challenges local industry and the tech cycle adds to cyclical volatility of overall local economy.
The following year-over-year numbers compare Austin to Texas, California, and New York:
So what does this mean for real estate values? Real estate values are driven by a combination of supply and demand factors including migration, employment, financing options, new construction, and general economic health. On the positive side, migration is strong, employment and general economic conditions are improving, and new supply (outside of downtown) remains lower than in the past. On the negative side, financing options are severely constrained, especially for jumbo loans and first time buyers. Also, the high tech industry -- which is a major part of the Austin economy -- continues to feel the effects of the downturn.
In summary, nobody is expecting values to jump in the near term. The worst, however, may be over and with mortgage rates low it may be a good time to buy. In downtown, the large number of unsold units means that buyers should continue to look for good deals resulting from over-supply and competition between developers and seller of existing units. When this supply is gone, however, it will be a while before new units are able to hit the market.
In Texas, 7 out of 28 metropolitan areas including Brownsville, Harlingen, Dallas-Plano-Irving, El Paso, Lubbock, and San Antonio are listed as being in recovery. No metropolitan areas in Arizona, California, Connecticut, Florida, Washington DC, Hawaii, Delaware, Maine, Maryland, Nevada, New Mexico, New York, Oklahoma, Oregon, Rhode Island, Vermont or Wyoming showed signs of recovery. The parts of the country that have fared best are areas that experienced less of a housing cycle of boom and bust and that benefit more from relatively strong prices in oil and natural gas. This is certainly true of Texas.
Texas is ranked 6th in the country for economic performance with much better employment numbers and virtually no housing value decline. Austin, amazingly, is ranked 7 out of 392 metropolitan areas in terms of employment growth. The study notes that while housing prices have dropped in Austin, strong population growth supports demographically driven consumer demand and a well-educated labor force attracts high value-added tech businesses. On the negative side, competitive pressure of foreign high-tech manufacturing challenges local industry and the tech cycle adds to cyclical volatility of overall local economy.
The following year-over-year numbers compare Austin to Texas, California, and New York:
|
|
Austin
|
Texas
|
California
|
New York
|
|
Employment
|
-0.71%
|
-2.43%
|
-5.04%
|
-2.25%
|
|
Single Family
Housing Starts
|
-6.31%
|
-19.11%
|
-21.05%
|
-23.82%
|
|
Industrial
Production
|
-12.61
|
-12.69%
|
-10.09%
|
-12.15%
|
|
Growth Over Last 6
Months
|
+
|
-
|
-
|
-
|
So what does this mean for real estate values? Real estate values are driven by a combination of supply and demand factors including migration, employment, financing options, new construction, and general economic health. On the positive side, migration is strong, employment and general economic conditions are improving, and new supply (outside of downtown) remains lower than in the past. On the negative side, financing options are severely constrained, especially for jumbo loans and first time buyers. Also, the high tech industry -- which is a major part of the Austin economy -- continues to feel the effects of the downturn.
In summary, nobody is expecting values to jump in the near term. The worst, however, may be over and with mortgage rates low it may be a good time to buy. In downtown, the large number of unsold units means that buyers should continue to look for good deals resulting from over-supply and competition between developers and seller of existing units. When this supply is gone, however, it will be a while before new units are able to hit the market.
Ballet Austin Party Held at Austonian
September 17, 2009 21:45 Filed in: News
This past weekend, the Austonian hosted one of Austin
biggest galas --- the Ballet Austin Fete. With dinner
on the 33rd floor, a cabaret on the 10th floor, and a
wild party in the lobby, it was quite an event for an
active construction site. Hundreds of guests moved
between venues on rickety construction elevators as
the real ones aren't yet operable.
New Federal Courthouse to Rise Downtown
September 17, 2009 21:45 Filed in: News
A bold new federal courthouse is set to rise on the
same prime downtown site that Intel abandoned earlier
in the decade. With a recent groundbreaking, the
project will be constructed on the Western edge of
Republic Square Park.
During the tough years of the tech bust, the City lobbied hard for the GSA (Government Services Administration) to build on the Intel site to eliminate a very public eyesore. At this time, there was very little downtown development and few takers for downtown lots. During the peak of the boom, the City changed its mind, lobbying the GSA this time to build on another site and to once again free a very important and valuable piece of downtown real estate.
Federal courthouses come with a few problems. First, they are single-purpose buildings. This means that they do not contain retail, do not engage the street, and are absolutely dead at night and on weekends. In the rapidly expanding second street district, the courthouse will inevitably break the pedestrian-friendly grid. The second big issue is that security requirements will require the City to close the street between the courthouse and Republic park, interrupting the flow of traffic downtown.
The courthouse brings one advantage: bold architecture. Today, Austin is relatively weak when in comes to bold modern architecture. There is city hall and . . . . well . . . .that's about it. Like it or not, the bold brutalist monolithic courthouse soon to rise is adventurous architecture. It will be a strong presence downtown and will add character to an area filled with generic buildings. Over the last few years, the GSA has won praise for investing in innovative architecture, something the government is not expected to do.
Here are the renderings of the project as designed by Mack Scogin Merrill Elam Architects:
For architecture fans, here is the project description from Mack Scogin Merrill Elam Architects:
Read More...
During the tough years of the tech bust, the City lobbied hard for the GSA (Government Services Administration) to build on the Intel site to eliminate a very public eyesore. At this time, there was very little downtown development and few takers for downtown lots. During the peak of the boom, the City changed its mind, lobbying the GSA this time to build on another site and to once again free a very important and valuable piece of downtown real estate.
Federal courthouses come with a few problems. First, they are single-purpose buildings. This means that they do not contain retail, do not engage the street, and are absolutely dead at night and on weekends. In the rapidly expanding second street district, the courthouse will inevitably break the pedestrian-friendly grid. The second big issue is that security requirements will require the City to close the street between the courthouse and Republic park, interrupting the flow of traffic downtown.
The courthouse brings one advantage: bold architecture. Today, Austin is relatively weak when in comes to bold modern architecture. There is city hall and . . . . well . . . .that's about it. Like it or not, the bold brutalist monolithic courthouse soon to rise is adventurous architecture. It will be a strong presence downtown and will add character to an area filled with generic buildings. Over the last few years, the GSA has won praise for investing in innovative architecture, something the government is not expected to do.
Here are the renderings of the project as designed by Mack Scogin Merrill Elam Architects:
For architecture fans, here is the project description from Mack Scogin Merrill Elam Architects:
Read More...
New FHA Rules for Condo Mortgages
September 15, 2009 21:35 Filed in: News
FHA loans provide qualified buyers an opportunity to
purchase units with loans that they would not
otherwise qualify for. In particular, FHA loans allow
for smaller down payments, often as low as 3% of the
purchase price. Next month, the rules behind these
Federal loans will be changed substantially, making
many condo projects and buyers ineligible for the
first time.
When it comes to downtown Austin, FHA loans are the exception and not the rule. Many new condo developments require deposits and down payments beyond the FHA minimums, diminishing the advantages of an FHA loan. In addition, many units are priced beyond the FHA loan maximum eliminating these loans as a viable financing option. Finally, since the process has always been complex and painful, few projects go through the hassle to be certified.
Starting October 1, new FHA rules will be introduced that will make these loans even more difficult for buyers to obtain. Here are the new requirements:
- Projects not deemed to be used primarily as residential real estate will be ineligible.
- Because of noise worries, FHA insurance will be unavailable when properties are within 1,000 feet of a highway, freeway, or heavily traveled road; 3,000 feet of a railroad; one mile of an airport; or five miles of a military airfield. Projects must take action to avoid or mitigate such conditions before completing the loan review process.
- There will be no more FHA loans if the “property has an unobstructed view, or is located within 2,000 feet, of any facility handling or storing explosive or fire-prone materials.”
- FHA loans will bot be available if the property is located within 3,000 feet of a dump, landfill, or super-fund site.
- Not more than 25 percent of the property’s total floor area can be used for commercial purposes.
- No more than 10 percent of the units may be owned by one investor. This will apply to developers/builders that subsequently rent vacant and unsold units. For two and three unit condominium projects, no single entity may own more than one unit within the project; all units, common elements, and facilities within the project must be 100 percent complete; and only one unit can be conveyed to non-owner occupants.
- No more than 15 percent of the total units can be in arrears (more than 30 days past due) of their condominium association fee payment.
- For new developments, at least 50 percent of the total units must be sold prior to endorsement of any mortgage on a unit. Valid presales include an executed sales agreement and evidence that a lender is willing to make the loan.
- At least 50 percent of the units of a project must be owner-occupied or sold to owners who intend to occupy the units. For proposed, under construction or projects still in their initial marketing phase, FHA will allow a minimum owner occupancy amount equal to 50 percent of the number of presold units (the minimum presales requirement of 50 percent still applies).
- Projects in designated wetland and flood zones will not qualify for FHA insurance.
- All current condominium project approvals will be invalid (with the exception of projects approved on or after October 1, 2008) and projects must be re-approved under the new options available. Going forward, all projects will require recertification every two years
It's not clear yet how these new rules will effect the downtown Austin condo market. That said, the fewer available funding options, the more difficult it will be for future condo sales to be completed.
When it comes to downtown Austin, FHA loans are the exception and not the rule. Many new condo developments require deposits and down payments beyond the FHA minimums, diminishing the advantages of an FHA loan. In addition, many units are priced beyond the FHA loan maximum eliminating these loans as a viable financing option. Finally, since the process has always been complex and painful, few projects go through the hassle to be certified.
Starting October 1, new FHA rules will be introduced that will make these loans even more difficult for buyers to obtain. Here are the new requirements:
- Projects not deemed to be used primarily as residential real estate will be ineligible.
- Because of noise worries, FHA insurance will be unavailable when properties are within 1,000 feet of a highway, freeway, or heavily traveled road; 3,000 feet of a railroad; one mile of an airport; or five miles of a military airfield. Projects must take action to avoid or mitigate such conditions before completing the loan review process.
- There will be no more FHA loans if the “property has an unobstructed view, or is located within 2,000 feet, of any facility handling or storing explosive or fire-prone materials.”
- FHA loans will bot be available if the property is located within 3,000 feet of a dump, landfill, or super-fund site.
- Not more than 25 percent of the property’s total floor area can be used for commercial purposes.
- No more than 10 percent of the units may be owned by one investor. This will apply to developers/builders that subsequently rent vacant and unsold units. For two and three unit condominium projects, no single entity may own more than one unit within the project; all units, common elements, and facilities within the project must be 100 percent complete; and only one unit can be conveyed to non-owner occupants.
- No more than 15 percent of the total units can be in arrears (more than 30 days past due) of their condominium association fee payment.
- For new developments, at least 50 percent of the total units must be sold prior to endorsement of any mortgage on a unit. Valid presales include an executed sales agreement and evidence that a lender is willing to make the loan.
- At least 50 percent of the units of a project must be owner-occupied or sold to owners who intend to occupy the units. For proposed, under construction or projects still in their initial marketing phase, FHA will allow a minimum owner occupancy amount equal to 50 percent of the number of presold units (the minimum presales requirement of 50 percent still applies).
- Projects in designated wetland and flood zones will not qualify for FHA insurance.
- All current condominium project approvals will be invalid (with the exception of projects approved on or after October 1, 2008) and projects must be re-approved under the new options available. Going forward, all projects will require recertification every two years
It's not clear yet how these new rules will effect the downtown Austin condo market. That said, the fewer available funding options, the more difficult it will be for future condo sales to be completed.
Starwood "Hotel 1" Concept Proposed for Warehouse District
September 09, 2009 21:26 Filed in: Development
Watch
It's been a long time since a new building was
announced downtown. Today, Starwood announced plans
to build a new 17-story concept hotel called Hotel 1
(Hotel One? One? 1? Hotel1?) on the southwest corner
of 5th and Colorado across Colorado from Kenichi.
The new eco-luxury concept will feature 250 - 275 rooms and will be developed by Woodbine, the Dallas hotel developer that built the Hyatt Lost Pines just outside Austin and the Hyatt Hill Country and Westin Las Cantera in San Antonio.
The 210+ foot building will require a zoning change to allow for additional density. In the past, the City has council has typically approved these requests for non-lake front downtown properties in an effort to drive additional downtown density. The warehouse district, however, is an important low-rise neighborhood that will likely require a more careful review of the project.
The new project is one of the first Hotel 1 hotels to be developed in what will become a new Starwood franchise (Starwood operates W, Westin, Sheraton, Aloft, St. Regis, and a few other brands). Previous Hotel 1 projects have been announced for Washington DC, Seattle, and other markets. Recent reports, however, suggest that these other projects may now be on hold.
While every hotel will likely be uniquely designed, renderings of the planned 11-story Washington DC Hotel 1 provide hints of how they may develop the 5th and Colorado site:
Renderings of the Washington DC Hotel 1
This is the first hotel project to be announced in downtown Austin in two years. During that time, a number of major hotel projects have been put on hold including the much dreaded Congress Avenue Marriott (originally proposed as three hotels), the 290 room Hotel Van Zandt and a planned Westin in the warehouse district.
The new eco-luxury concept will feature 250 - 275 rooms and will be developed by Woodbine, the Dallas hotel developer that built the Hyatt Lost Pines just outside Austin and the Hyatt Hill Country and Westin Las Cantera in San Antonio.
The 210+ foot building will require a zoning change to allow for additional density. In the past, the City has council has typically approved these requests for non-lake front downtown properties in an effort to drive additional downtown density. The warehouse district, however, is an important low-rise neighborhood that will likely require a more careful review of the project.
The new project is one of the first Hotel 1 hotels to be developed in what will become a new Starwood franchise (Starwood operates W, Westin, Sheraton, Aloft, St. Regis, and a few other brands). Previous Hotel 1 projects have been announced for Washington DC, Seattle, and other markets. Recent reports, however, suggest that these other projects may now be on hold.
While every hotel will likely be uniquely designed, renderings of the planned 11-story Washington DC Hotel 1 provide hints of how they may develop the 5th and Colorado site:
Renderings of the Washington DC Hotel 1
This is the first hotel project to be announced in downtown Austin in two years. During that time, a number of major hotel projects have been put on hold including the much dreaded Congress Avenue Marriott (originally proposed as three hotels), the 290 room Hotel Van Zandt and a planned Westin in the warehouse district.
Shore Closeout Promotion
September 07, 2009 21:55 Filed in: News
Since May 2, the Shore has been
aggressively trying to closeout sales on the
last 82 units. Amazingly, the developers
successfully sold 62 units in the first 10 weeks
of the promotion between May 2 and July 23. This
is twice as many sales as were recorded during
the same period for all other DT MLS listings.
This is an amazing success stoiry and shows how
many people are on the sidelines and ready to
move when bargains appear.
As of a few weeks ago, approximately 20 units remained. These units are being offered at 10-25% off list price -- or as little as $206K for a 715 square foot one bedroom apartment.
Here are the most recent details we've been able to uncover for this condo closeout sale:
The Shore Close-Out Promotion: Take 25% off list price
As of a few weeks ago, approximately 20 units remained. These units are being offered at 10-25% off list price -- or as little as $206K for a 715 square foot one bedroom apartment.
Here are the most recent details we've been able to uncover for this condo closeout sale:
The Shore Close-Out Promotion: Take 25% off list price
|
1 Bedroom
|
|
|
|
|
|
|
Type
|
Floorplan
|
Unit #
|
Interior SF
|
Terrace SF
|
List Price
|
|
1 BR
|
A5
|
2005
|
714
|
79
|
$275,000
|
|
1 BR
|
A7
|
2206
|
842
|
103
|
$335,000
|
|
1 BR + Den
|
D9
|
2008
|
923
|
77
|
$355,000
|
|
1 BR + Den
|
D8
|
1807
|
879
|
80
|
$325,000
|
|
1 BR + Den
|
D8
|
2007
|
879
|
80
|
$345,000
|
|
1 BR + Den
|
D8
|
1707
|
879
|
80
|
$315,000
|
|
1 BR + Den
|
D9
|
1708
|
923
|
77
|
$355,000
|
|
1 BR + Den
|
D8
|
1907
|
879
|
80
|
$335,000
|
|
2 Bedroom + 2 Bath
|
|
|
|
|
|
|
2BR
|
B10
|
1610
|
1122
|
186
|
$470,000
|
|
2BR
|
B10
|
1910
|
1122
|
186
|
$500,000
|
|
2BR
|
B10
|
1810
|
1122
|
186
|
$490,000
|
|
2BR
|
B4
|
2105
|
1141
|
347
|
$455,000
|
|
2BR
|
B4
|
2205
|
1141
|
119
|
$465,000
|
|
2BR
|
B3
|
2204
|
1193
|
66
|
$495,000
|
|
2BR
|
B9
|
1809
|
1206
|
204
|
$510,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Close-Out Promotion Take 10% off list price for
a limited time!
|
|
||||
|
Type
|
Floorplan
|
Unit #
|
Interior SF
|
Terrace SF
|
List Price
|
|
1 BR
|
A4
|
802
|
905
|
229
|
$337,000
|
|
2 BR + Den
|
E4
|
2202
|
1513
|
98
|
$725,000
|
|
2 BR + Den
|
E3
|
2203
|
1610
|
111
|
$755,000
|
|
|
|
|
|
|
|
|
Live Work
|
LW1
|
101
|
1674
|
35
|
$450,000
|
Sage Auction Results
August 24, 2009 07:52 Filed in: News
At least 18 of 23 units at the Sage Condos, a new low
rise development on South Lamar near Oltorf, sold in
the third major Austin condo auction of the year. All
23 units received bids and 18 of the bids were
immediately accepted by the developer.
The format of the auction was a first for auction with each bidder competing for the right to choose any remaining unit at the point that they bid. The auction drew a large crowd with approximately 300 people packed into the auction at the Hyatt Regency.
Winning bids ranged from $151K for a 1,262 square foot unit to $253K for an 1,847 square foot unit including the mandatory 10% buyer's premium. Winning bids ranged from $121 to $161 / per square foot with an average of $131 per square foot.
Not surprisingly, the units with downtown views fetched the highest prices. The project is located roughly a mile south of downtown on Lamar, a more central location than the Bel Air, which also sold units via an auction earlier this month.
Read more to view the full results of the auction as well as a video of the auction proceedings: Read More...
The format of the auction was a first for auction with each bidder competing for the right to choose any remaining unit at the point that they bid. The auction drew a large crowd with approximately 300 people packed into the auction at the Hyatt Regency.
Winning bids ranged from $151K for a 1,262 square foot unit to $253K for an 1,847 square foot unit including the mandatory 10% buyer's premium. Winning bids ranged from $121 to $161 / per square foot with an average of $131 per square foot.
Not surprisingly, the units with downtown views fetched the highest prices. The project is located roughly a mile south of downtown on Lamar, a more central location than the Bel Air, which also sold units via an auction earlier this month.
Read more to view the full results of the auction as well as a video of the auction proceedings: Read More...
Texas A&M Expert: I See the Bottom!
August 20, 2009 22:27 Filed in: News
Mark Dotzour, the director of the Real Estate Center
at
Texas A&M University, has announced
that the Texas real estate market has likely reached
bottom.
According to Dotzour: “I feel now is the time to buy a house in most Texas cities. Housing affordability has never been higher, and I never thought I would see 5 percent mortgages in my lifetime. If you plan to live in the house for at least two or three years, now is the time to buy.”
The Texas A&M real estate center is predicting that 2009 will look a lot like 2003 in terms of volumes, listings, and inventory. Prices, however, are definitively higher with the 2009 estimated average price 20% higher than the price in 2003 and lower only than the prices of the last two years. The median price remains at an all time high.
Texas A&M Austin MLS Tracking with 2009 Estimates
According to Dotzour: “I feel now is the time to buy a house in most Texas cities. Housing affordability has never been higher, and I never thought I would see 5 percent mortgages in my lifetime. If you plan to live in the house for at least two or three years, now is the time to buy.”
The Texas A&M real estate center is predicting that 2009 will look a lot like 2003 in terms of volumes, listings, and inventory. Prices, however, are definitively higher with the 2009 estimated average price 20% higher than the price in 2003 and lower only than the prices of the last two years. The median price remains at an all time high.
Texas A&M Austin MLS Tracking with 2009 Estimates
|
Date
|
Sales
|
Dollar Volume
|
Avg. Price
|
Median Price
|
Listings
|
Months Inventory
|
| 2003
|
19,793
|
3,899,018,519
|
197,000
|
154,800
|
10,340
|
6.6
|
| 2004
|
22,567
|
4,487,464,528
|
198,900
|
154,100
|
10,394
|
5.9
|
| 2005
|
26,905
|
5,660,934,916
|
210,400
|
161,300
|
8,965
|
4.3
|
| 2006
|
30,284
|
6,961,725,607
|
229,900
|
172,200
|
8,695
|
3.6
|
| 2007
|
28,048
|
6,910,962,480
|
246,400
|
184,200
|
9,833
|
4
|
| 2008
|
22,439
|
5,470,241,896
|
243,800
|
188,200
|
11,585
|
5.5
|
| 2009 e
|
20,043
|
4,746,392,079
|
236,800
|
188,000
|
11,244
|
6.6
|
It's hard to know how Dotzour's prediction applies to
the downtown Austin condo market. The downtown Austin
market is less established than other markets and
currently faces a surplus of newly constructed and
planned units. This surplus, however, is driving
unprecedented discounting. For buyers, it is a
balancing trick: for how long will prices continue to
go down and at what point will interest rates go
up?
BartonPlace July Construction Update
August 16, 2009 22:48 Filed in: News
After a week of problems in the Austin development
scene it was great to hear from BartonPlace where
construction continues as normal. They even sent
pictures to prove it!
BartonPlace includes 270 units across 6 buildings each of which is 6 stories tall. According to the developers, sales continue to go well and traffic has increased dramatically in the last few weeks.
On buildings 1 and 2, they are already framing the inside as they simultaneously erect the roof steel. In buildings 3 and 4, the roof installation is almost complete and windows are being installed. In buildings 5 and 6, stone installation is nearing completion. Building 6 is the farthest along with tape and float ongoing and the elevators currently being installed.
BartonPlace has updated its virtual tour with new renderings and images that give a good feel for the project. The tour can be accessed here.
Here are the latest construction images:
BartonPlace includes 270 units across 6 buildings each of which is 6 stories tall. According to the developers, sales continue to go well and traffic has increased dramatically in the last few weeks.
On buildings 1 and 2, they are already framing the inside as they simultaneously erect the roof steel. In buildings 3 and 4, the roof installation is almost complete and windows are being installed. In buildings 5 and 6, stone installation is nearing completion. Building 6 is the farthest along with tape and float ongoing and the elevators currently being installed.
BartonPlace has updated its virtual tour with new renderings and images that give a good feel for the project. The tour can be accessed here.
Here are the latest construction images:
Bel Air Auction: More Bad News
August 14, 2009 23:01 Filed in: News
We've received multiple emails from irate
participants in the Bel Air condo auction. The most
recent reports are that as few as two units actually
sold in the auction. The rest of the bids were
supposedly rejected by the seller. As more details
come out, it is becoming clear that the Bel Air condo
auction went very very poorly.
The purpose of an auction is to quickly sell condos at the market price. In the case of Bel Air, the developers didn't like the market price and so they have refused to sell many of the units. When the final bids came in, multiple reports suggest that the average "winning bid" carried a 45% discount off of the original price with the discount ranging from 30 - 60%.
In an unbelievable move, the developer and auction company are now aggressively negotiating with bidders to try to get them to pay more than their winning bids (market price) if they want the units that they won. This is a very problematic tactic and unlikely to succeed. Let's not forget that they must also pay a 4% buyer's premium.
The developers at this point have few choices: they either need to accept market price or take their chances back on the open market. It is hard to believe that they will sell units at above market rates through private marketing efforts or the MLS. With as many as 23 units remaining, the auction is on track to turn out poorly for everyone involved: residents, bidders, the auction company, and the developer will all likely be disappointed when this is over.
The following video shows the last unit to be auctioned and provides an inside look at the auction proceedings. The key words come at the end as the auctioneer clearly states that the unit is sold subject to seller's approval. We'll see if this approval ever comes.
The purpose of an auction is to quickly sell condos at the market price. In the case of Bel Air, the developers didn't like the market price and so they have refused to sell many of the units. When the final bids came in, multiple reports suggest that the average "winning bid" carried a 45% discount off of the original price with the discount ranging from 30 - 60%.
In an unbelievable move, the developer and auction company are now aggressively negotiating with bidders to try to get them to pay more than their winning bids (market price) if they want the units that they won. This is a very problematic tactic and unlikely to succeed. Let's not forget that they must also pay a 4% buyer's premium.
The developers at this point have few choices: they either need to accept market price or take their chances back on the open market. It is hard to believe that they will sell units at above market rates through private marketing efforts or the MLS. With as many as 23 units remaining, the auction is on track to turn out poorly for everyone involved: residents, bidders, the auction company, and the developer will all likely be disappointed when this is over.
The following video shows the last unit to be auctioned and provides an inside look at the auction proceedings. The key words come at the end as the auctioneer clearly states that the unit is sold subject to seller's approval. We'll see if this approval ever comes.
Star Riverside Halts Construction
August 12, 2009 21:34 Filed in: News
Star Riverside, a
high end condo project on the south shore of
Ladybird Lake just east of I-35, announced today
that construction has "temporarily" stopped as a
result of the ongoing economic crisis.
Star Riverside
In an emergency change, the project developers are redesigning the project well into the construction process. Apparently, the original plan to offer units starting at $600,000 for the first phase was not viable. The redesigned project will focus on smaller units starting at $375,000.
Star Riverside's challenge has always been location: it is difficult to sell 201 units -- the first 64 of which were priced starting at $600,000 -- in the shadow of I-35 on East Riverside drive during an economic crisis. While the architecture is compelling and the views of the lake and downtown should be beautiful, the project is priced to compete with the most expensive downtown high rise projects which are much closer to the downtown action, much taller, and much farther from I-35.
From the beginning, the Star Riverside developers have been betting that direct access to the lake and hike and bike trail and unobstructed views of the lake and downtown will lure buyers to the south side of the lake. The drastic construction freeze and mid-project redesign shows that the developers are still searching for just the right combination of price and unit to attract more buyers. The redesign and repositioning is a smart move in this market: it is probably the only path to viability. Still, the project may face a difficult market for the location even with a lower price point.
Star Riverside
In an emergency change, the project developers are redesigning the project well into the construction process. Apparently, the original plan to offer units starting at $600,000 for the first phase was not viable. The redesigned project will focus on smaller units starting at $375,000.
Star Riverside's challenge has always been location: it is difficult to sell 201 units -- the first 64 of which were priced starting at $600,000 -- in the shadow of I-35 on East Riverside drive during an economic crisis. While the architecture is compelling and the views of the lake and downtown should be beautiful, the project is priced to compete with the most expensive downtown high rise projects which are much closer to the downtown action, much taller, and much farther from I-35.
From the beginning, the Star Riverside developers have been betting that direct access to the lake and hike and bike trail and unobstructed views of the lake and downtown will lure buyers to the south side of the lake. The drastic construction freeze and mid-project redesign shows that the developers are still searching for just the right combination of price and unit to attract more buyers. The redesign and repositioning is a smart move in this market: it is probably the only path to viability. Still, the project may face a difficult market for the location even with a lower price point.
Updated: Bel Air Condo Auction Results
August 11, 2009 20:14 Filed in: News
Contradicting our initial report on the Bel Air
auction, it now looks as if the real auction results
differ substantially from initial published reports.
In a very unusual auction development, updated reports on the Bel Air condos suggest that while bids were placed for all of the units, only 2 of the bids have actually been accepted by the developers. Despite a large crowd of more than 300 attendees and "winning" bidders for each of the 25 or so remaining units, small print in the auction rules requires acceptance by the developers.
According to Jude at the Downtown Austin blog, the lowest winning bids were in the 60% of original list price range, far lower than the typical 25% - 30% discount typically seen for closeout sales and auctions. To add insult to injury, it sounds as if the bank is now negotiating with some of the "winners" to try to get their bids raised to meet the minimum selling price.
No matter how you look at it, these seem like bad results for everyone involved. Bidders were misled by artificially and unrealistically high minimum sales prices, the developers will likely have many unsold units that are clearly being offered at above market rates, and the current residents will have a new lower market price AND unsold units to contend with if they try to sell.
There is no transparency at this point so it will be very difficult to get a clear picture of how many units actually sold or what the final sales price was for each unit. We're not even sure of the sizes of the units as the official numbers include garage and roof deck space which should not be counted. The best estimates suggest that the size range is 1,100 to 1,500 square feet.
As we have said, the Bel Air results are only marginally relevant to downtown Austin residents and condo buyers. The Bel Air is a low-rise town house project in far south Austin (South of Ben White). While Green and designed to meet the needs of a more urban buyer, the location limits the price premium. It is entirely possible that the economics don't work: that the developers will not be able to recoup their costs while selling the remaining units.
We'll see how this one falls out . . . the biggest casualty may be the Austin auction seen as the most likely bidders may avoid future auctions fearing similarly opaque processes and results.
Bel Air Interior
In a very unusual auction development, updated reports on the Bel Air condos suggest that while bids were placed for all of the units, only 2 of the bids have actually been accepted by the developers. Despite a large crowd of more than 300 attendees and "winning" bidders for each of the 25 or so remaining units, small print in the auction rules requires acceptance by the developers.
According to Jude at the Downtown Austin blog, the lowest winning bids were in the 60% of original list price range, far lower than the typical 25% - 30% discount typically seen for closeout sales and auctions. To add insult to injury, it sounds as if the bank is now negotiating with some of the "winners" to try to get their bids raised to meet the minimum selling price.
No matter how you look at it, these seem like bad results for everyone involved. Bidders were misled by artificially and unrealistically high minimum sales prices, the developers will likely have many unsold units that are clearly being offered at above market rates, and the current residents will have a new lower market price AND unsold units to contend with if they try to sell.
There is no transparency at this point so it will be very difficult to get a clear picture of how many units actually sold or what the final sales price was for each unit. We're not even sure of the sizes of the units as the official numbers include garage and roof deck space which should not be counted. The best estimates suggest that the size range is 1,100 to 1,500 square feet.
As we have said, the Bel Air results are only marginally relevant to downtown Austin residents and condo buyers. The Bel Air is a low-rise town house project in far south Austin (South of Ben White). While Green and designed to meet the needs of a more urban buyer, the location limits the price premium. It is entirely possible that the economics don't work: that the developers will not be able to recoup their costs while selling the remaining units.
We'll see how this one falls out . . . the biggest casualty may be the Austin auction seen as the most likely bidders may avoid future auctions fearing similarly opaque processes and results.
Bel Air Interior
W Must Replace Troubled Lender to Proceed
August 10, 2009 21:20 Filed in: News
Since long before the 36-Story W Hotel and
Residences began to rise earlier this year,
the developers have faced the unpleasant task of
replacing Corus Bank as their prime lender. Bad
development loans in other markets have squeezed
the bank's liquidity, making it impossible for
Corus to provide the capital required to
complete the W.
What is the impact? It's hard to say. But it is a positive sign that the developers continue to poor their own money into the project (the developers will fund the first $128M and must raise an additional $162M in debt or equity financing to complete the building) with the knowledge that the loan balance remains in limbo. The Corus problems have been known for months: if the developers did not believe that the project would be fully financed, they would likely have paused development already.
The W is an expensive project. At $300 million, the project will include an attractive mix of 252-room W hotel, 165 condo units, 35,000 square feet of office space, retail and restaurant space and a new theater to host KLRU's Austin City Limits. The frame of the project has already reached 14-stories, and the developers say that construction will continue to proceed normally for the time being. The development partnership has invested approximately 2/3 of it's available capital. The project team is currently in discussions with banks to secure a loan to replace the previous Corus obligation.
What is the impact? It's hard to say. But it is a positive sign that the developers continue to poor their own money into the project (the developers will fund the first $128M and must raise an additional $162M in debt or equity financing to complete the building) with the knowledge that the loan balance remains in limbo. The Corus problems have been known for months: if the developers did not believe that the project would be fully financed, they would likely have paused development already.
The W is an expensive project. At $300 million, the project will include an attractive mix of 252-room W hotel, 165 condo units, 35,000 square feet of office space, retail and restaurant space and a new theater to host KLRU's Austin City Limits. The frame of the project has already reached 14-stories, and the developers say that construction will continue to proceed normally for the time being. The development partnership has invested approximately 2/3 of it's available capital. The project team is currently in discussions with banks to secure a loan to replace the previous Corus obligation.
Sage Announces Auction Plan: Here We Go Again
August 03, 2009 22:16 Filed in: News
First Brazos Place. Then Bel Air. Now the Sage.
This week the Sage Condos in South Austin -- 1702 South Lamar -- announced that they will be selling the remaining 23 units through an auction on August 22. This is the third major auction in the Austin market. In May, the Brazos Place auctions saw strong demand. The second auction, for the Bel Air condos in far south Austin, is scheduled for this coming weekend.
While it remains to be seen how the successive two auctions fare, there is a big difference between Brazos Place and the other two projects. In particular, Brazos Place was a moderate high rise in a prime downtown location: the other projects are not downtown condos and not tall. In fact, the Sage is about a mile south of the city on Lamar and the Bel Air is far far south, located on Congress Avenue south of Ben White. While the Sage may likely attract people who want to live close to downtown, far South Lamar living is very different from being downtown. The opportunity for both sites is to attract people who want to live in a centrally located condo at a bargain basement price.
The Sage auction is unique on a couple of dimensions. First, 10 of the 23 units are selling without minimum bids and reserves: the auctioneers will take the highest bid no matter how low. The developers will have a minimum bid for the other 13 units. Prior to the auction, the units were originally priced from $299,000 to $469,900.
According to the Downtown Austin blog, "The auction of the Sage Condos will use a different system than the auction at Brazos Place or the Bel Air. Rather than auction each individual unit, the auctions are for the right to choose which unit you want. Everyone bids and the highest bidder gets to choose the unit he/she wants. The auctioneer repeats this process until 10 units are sold."
This sort of auction is suspicious, it much less straightforward than the typical auction where buyers bid on the unit they would like to purchase. While this auction method may be effective, it's suboptimal for buyers who may be attached to a particular unit, floor plan, or view. For these buyers, the only way to ensure their choice is to be the top bidder. We'll see how it works: it is a very risky move for a struggling mid-rise project on South Lamar.
This week the Sage Condos in South Austin -- 1702 South Lamar -- announced that they will be selling the remaining 23 units through an auction on August 22. This is the third major auction in the Austin market. In May, the Brazos Place auctions saw strong demand. The second auction, for the Bel Air condos in far south Austin, is scheduled for this coming weekend.
While it remains to be seen how the successive two auctions fare, there is a big difference between Brazos Place and the other two projects. In particular, Brazos Place was a moderate high rise in a prime downtown location: the other projects are not downtown condos and not tall. In fact, the Sage is about a mile south of the city on Lamar and the Bel Air is far far south, located on Congress Avenue south of Ben White. While the Sage may likely attract people who want to live close to downtown, far South Lamar living is very different from being downtown. The opportunity for both sites is to attract people who want to live in a centrally located condo at a bargain basement price.
The Sage auction is unique on a couple of dimensions. First, 10 of the 23 units are selling without minimum bids and reserves: the auctioneers will take the highest bid no matter how low. The developers will have a minimum bid for the other 13 units. Prior to the auction, the units were originally priced from $299,000 to $469,900.
According to the Downtown Austin blog, "The auction of the Sage Condos will use a different system than the auction at Brazos Place or the Bel Air. Rather than auction each individual unit, the auctions are for the right to choose which unit you want. Everyone bids and the highest bidder gets to choose the unit he/she wants. The auctioneer repeats this process until 10 units are sold."
This sort of auction is suspicious, it much less straightforward than the typical auction where buyers bid on the unit they would like to purchase. While this auction method may be effective, it's suboptimal for buyers who may be attached to a particular unit, floor plan, or view. For these buyers, the only way to ensure their choice is to be the top bidder. We'll see how it works: it is a very risky move for a struggling mid-rise project on South Lamar.
The New Downtown Street Parking Model: Stay Longer, Pay by Credit Card
July 26, 2009 06:37 Filed in: News
There is a new street parking model for downtown
Austin. New solar powered "pay stations" will soon
replace the City of Austin’s 3,800 single space
parking meters. One of the most significant changes
to customers will be the ability to pay for on-street
parking with credit or debit cards, in addition to
coins. The first new pay stations will be rolled out
on North Congress Ave. on July 22, with the remaining
meter replacement complete by Thanksgiving.
The new pay stations are accompanied by a new parking ordinance which includes an incentive to reduce carbon emissions of motorists in the urban core. Now two-wheeled vehicles, including motorcycles, mopeds and scooters will be allowed to park for free for up to 12 hours per day in parking areas at all City of Austin meters and pay stations.
To use the new pay stations, simply insert coins are a credit/debit card and choose the amount of time you want to park. Print a sticker and affix it to the inside of your windshield on the side closest to the street. The pay stations operate in multiple languages.
According to the city, the new pay stations will offer multiple benefits:
- Payment flexibility – Stations accept Master Card, Visa, and debit cards or coins
- Instructions in multiple languages – English, Spanish and Chinese
- Printed receipts provide a convenient record of expenses for business purposes
- Receipt can multi-task - allows the user to take the remaining time on the ticket to another parking spot with City of Austin meters
- Longer parking time – customers can pay for up to three hours at most locations and up to five hours at other locations versus the current two-hour limit
- Credit card safety – the built-in security features provide for an instantaneous credit card transaction and does not store the card information to prevent fraud
- Increased parking availability - parallel parking spaces will not need to be defined so cars can squeeze into a block as space allows. Cities normally see a 10-15% increase in parking availability.
- No more broken meters – customers can obtain a parking receipt from any pay station. The City will save time on repairs and have a predictable revenue stream.
Like every change, this one also has a few negatives:
- The new pay stations will eventually allow the city to more easily raise the price for street parking. With meters, it is difficult to go beyond the current price of $0.25 per 15 minute interval.
- Longer parking intervals, 3 hours v. 2 hours and up to 12 hours for 2 wheeled vehicles, means that fewer spots will be available at any one time
- 3,800 Fewer places to lock up bicycles downtown although the city plans to compensate with the installation of new bicycle racks downtown.
Why the change? An Austin Transportation Department analysis of the current Parking Meter System in Summer 2008 found the system to be in failing condition. Approximately 3,800 single space meters, with expected operational life of 10 years, had been in service 13 plus years. More than 18,000 meter failures were predicted for 2008-2009, increasing city staff labor costs to repair meters and forfeiting hundreds of thousands of dollars in revenue to the City.
The City Council on March 5 approved the replacement of 3,800 single-space meters with pay-and-display (Pay Stations) and authorized a purchase of up to 750 stations for $8,399,743. The City will use parking revenue from the Pay Stations to pay off the purchase in approximately eight years. The new pay stations have an expected operational life of 15 years.
The Parking ordinance passed by the City Council on June 11 maintains the existing fees and hours of operation previously established. Free parking privileges are continued for former Prisoners or War, Pearl Harbor survivors, and Purple Heart recipients. (State law provides free meter parking privileges for persons with a disability.)
The new pay stations are accompanied by a new parking ordinance which includes an incentive to reduce carbon emissions of motorists in the urban core. Now two-wheeled vehicles, including motorcycles, mopeds and scooters will be allowed to park for free for up to 12 hours per day in parking areas at all City of Austin meters and pay stations.
To use the new pay stations, simply insert coins are a credit/debit card and choose the amount of time you want to park. Print a sticker and affix it to the inside of your windshield on the side closest to the street. The pay stations operate in multiple languages.
According to the city, the new pay stations will offer multiple benefits:
- Payment flexibility – Stations accept Master Card, Visa, and debit cards or coins
- Instructions in multiple languages – English, Spanish and Chinese
- Printed receipts provide a convenient record of expenses for business purposes
- Receipt can multi-task - allows the user to take the remaining time on the ticket to another parking spot with City of Austin meters
- Longer parking time – customers can pay for up to three hours at most locations and up to five hours at other locations versus the current two-hour limit
- Credit card safety – the built-in security features provide for an instantaneous credit card transaction and does not store the card information to prevent fraud
- Increased parking availability - parallel parking spaces will not need to be defined so cars can squeeze into a block as space allows. Cities normally see a 10-15% increase in parking availability.
- No more broken meters – customers can obtain a parking receipt from any pay station. The City will save time on repairs and have a predictable revenue stream.
Like every change, this one also has a few negatives:
- The new pay stations will eventually allow the city to more easily raise the price for street parking. With meters, it is difficult to go beyond the current price of $0.25 per 15 minute interval.
- Longer parking intervals, 3 hours v. 2 hours and up to 12 hours for 2 wheeled vehicles, means that fewer spots will be available at any one time
- 3,800 Fewer places to lock up bicycles downtown although the city plans to compensate with the installation of new bicycle racks downtown.
Why the change? An Austin Transportation Department analysis of the current Parking Meter System in Summer 2008 found the system to be in failing condition. Approximately 3,800 single space meters, with expected operational life of 10 years, had been in service 13 plus years. More than 18,000 meter failures were predicted for 2008-2009, increasing city staff labor costs to repair meters and forfeiting hundreds of thousands of dollars in revenue to the City.
The City Council on March 5 approved the replacement of 3,800 single-space meters with pay-and-display (Pay Stations) and authorized a purchase of up to 750 stations for $8,399,743. The City will use parking revenue from the Pay Stations to pay off the purchase in approximately eight years. The new pay stations have an expected operational life of 15 years.
The Parking ordinance passed by the City Council on June 11 maintains the existing fees and hours of operation previously established. Free parking privileges are continued for former Prisoners or War, Pearl Harbor survivors, and Purple Heart recipients. (State law provides free meter parking privileges for persons with a disability.)
Enfield Condos To be Completed After 2-Year Pause
July 16, 2009 16:45 Filed in: News
For the last two years, a modern condo project on
Enfield between Mopac and Lamar has been sitting idle
as the result of a dispute between
former designer-builder of the project, QMET Building
Co. LLC, and the former owner, Bolter Corp.
Now, the bank has foreclosed and, in an unusual move, hired a construction manager to continue the project on its own. While the shell of the attractive modern project is nearly complete, the bank is looking at demolishing the building and replacing it with a much larger and uglier traditionally designed complex on the same site.
The bank is hoping for construction to restart within 90-days and for the project to be completed within the next 18 months. Neigbors who are relieved to see construction proceed are concerned that the bank will over-develop the lot with a large structure and minimal setbacks. For interesting modern building such as the original project on Enfield, a change in architects can be disastrous as the resulting building leverages the original frame but "tones down" the interesting modern elements to meet the needs of the new owner and developer. .
Now, the bank has foreclosed and, in an unusual move, hired a construction manager to continue the project on its own. While the shell of the attractive modern project is nearly complete, the bank is looking at demolishing the building and replacing it with a much larger and uglier traditionally designed complex on the same site.
The bank is hoping for construction to restart within 90-days and for the project to be completed within the next 18 months. Neigbors who are relieved to see construction proceed are concerned that the bank will over-develop the lot with a large structure and minimal setbacks. For interesting modern building such as the original project on Enfield, a change in architects can be disastrous as the resulting building leverages the original frame but "tones down" the interesting modern elements to meet the needs of the new owner and developer. .
25 Bel Air Loft Condo Units to Be Auctioned
July 11, 2009 10:01 Filed in: News
A second Austin condo project has announced plans to
close out its condo inventory through a one-day
auction. Bel Air, an 83-unit condo project that
opened on South Congress Avenue more than two years
ago, has announced plans to sell the remaining 25
units on August 9. This is the second large condo
auction in the Austin market after 20 units were sold
in Brazos Place in a packed 90-minute auction on May
17.
Bidding for Bel Air units will start at $90,000 for the least expensive unit, originally priced at $273,000, and will rise to $130,000 for a unit that was previously priced at $399,900. The auction will be run by Kennedy Wilson -- the same firm that completed the Brazos Place Auction. The opening bid does not mean that units will be sold at those prices, there is often a separate higher minimum bid which must be met for a unit to sell.
For the Bel Air auction, bidders will need to bring a $2,500 cashier's check in order to participate. Winning bidders will need to submit a personal check for 3 percent of the purchase price.
While potentially good for buyers, condo fire sale auctions like these infuriate existing owners who paid much more for their units and will likely see the value of their units reset to the auction price. While the auction is painful for existing owners, the large developer inventory of 25 unsold units is equally problematic as a large new inventory makes the resale of existing units difficult. The sale of remaining units and elimination of inventory could help by pulling inventory off the market. While the auction will be public record, the sales will likely not be recorded in MLS and will not appear in realtor comparables. As with the unfounded worries about the Brazos Place auction, the biggest worry for residents should be a failed auction: it would be bad if a large number of units went unsold, especially if some units sold at prices far below recent comparables.
Bel Air Lofts is located far south on Congress Avenue, close to Ben White. With original prices starting at $273,000, the project was charging downtown-like prices for a far south Austin location. The auction will provide a much clearer picture of demand and price sensitivity for condo projects located outside of downtown.
Bel Air Lofts
Bidding for Bel Air units will start at $90,000 for the least expensive unit, originally priced at $273,000, and will rise to $130,000 for a unit that was previously priced at $399,900. The auction will be run by Kennedy Wilson -- the same firm that completed the Brazos Place Auction. The opening bid does not mean that units will be sold at those prices, there is often a separate higher minimum bid which must be met for a unit to sell.
For the Bel Air auction, bidders will need to bring a $2,500 cashier's check in order to participate. Winning bidders will need to submit a personal check for 3 percent of the purchase price.
While potentially good for buyers, condo fire sale auctions like these infuriate existing owners who paid much more for their units and will likely see the value of their units reset to the auction price. While the auction is painful for existing owners, the large developer inventory of 25 unsold units is equally problematic as a large new inventory makes the resale of existing units difficult. The sale of remaining units and elimination of inventory could help by pulling inventory off the market. While the auction will be public record, the sales will likely not be recorded in MLS and will not appear in realtor comparables. As with the unfounded worries about the Brazos Place auction, the biggest worry for residents should be a failed auction: it would be bad if a large number of units went unsold, especially if some units sold at prices far below recent comparables.
Bel Air Lofts is located far south on Congress Avenue, close to Ben White. With original prices starting at $273,000, the project was charging downtown-like prices for a far south Austin location. The auction will provide a much clearer picture of demand and price sensitivity for condo projects located outside of downtown.
Bel Air Lofts
Austonian Now Tallest Building in Austin
June 29, 2009 22:12 Filed in: News
According to the Austonian,
after 640 days of construction, tonight The Austonian
will become the tallest structure in Austin at 571
feet. The next milestone comes in December when The
Austonian's glass crown is installed. The 56-story
building will reach 683 feet at that point making it
the tallest residential building in the western
United States. Amazingly -- for those who have looked
up at the tower recently -- the building still has
112 feet to go. The picture below shows the pouring
of the 51st floor. When completed, the tower will be
56 stories tall.
Austonian: Sweet Services for Visiting Guests
June 24, 2009 20:39 Filed in: News
The
Austonian
is already the tallest building in Austin. It will
have great views and a perfect location on second and
Congress.While the project is somewhat pretentious,
the Austonian team is working hard to differentiate
the project through services. In their latest update,
the project team has announced a unique catalog of
services and amenities for hosting and entertaining
guests.
First, formal dinners may be arranged in home or at the 55th-floor Austonian Club, which offers 360-degree views of downtown Austin, the Colorado River and the Texas Hill Country from the tallest building in the city. The Austonian Club has a private dining room for smaller affairs and a flexible space accommodating up to 200 people.
Rendering: The Austonian Club
In addition, there are additional outdoor entertaining options on the 10th floor Lawn, including outdoor kitchens, swanky private cabanas with flat-screen televisions and in-pool lounging areas. Indoor entertainment-geared amenities on the 10th floor include a billiard and game room outfitted and a 12-seat screening room.
Rendering: Austonian Cabana & Pool
One of the great things about high-end downtown projects is that many include rooms for overnight guests. This is huge: it allows residents to purchase smaller units but to still host guests when they need to. In the case of the Austonian, four guest suites on the 10th floor have feature custom bedding, Egyptian cotton sheets, a flat-panel television, a refrigerator and both wired and wireless Internet access. Four separate private terraces offer views of the city and nearby Lady Bird Lake. The guest suites, like the other residences of the building, are supported by a team of Austonian Assistants providing personal service 24 hours a day, seven days a week. Suites may be reserved in advance; the only fee is a per-suite cleaning fee.
I am sure there will be more to come as the building nears completion . . .
Austonian Construction Progress
First, formal dinners may be arranged in home or at the 55th-floor Austonian Club, which offers 360-degree views of downtown Austin, the Colorado River and the Texas Hill Country from the tallest building in the city. The Austonian Club has a private dining room for smaller affairs and a flexible space accommodating up to 200 people.
Rendering: The Austonian Club
In addition, there are additional outdoor entertaining options on the 10th floor Lawn, including outdoor kitchens, swanky private cabanas with flat-screen televisions and in-pool lounging areas. Indoor entertainment-geared amenities on the 10th floor include a billiard and game room outfitted and a 12-seat screening room.
Rendering: Austonian Cabana & Pool
One of the great things about high-end downtown projects is that many include rooms for overnight guests. This is huge: it allows residents to purchase smaller units but to still host guests when they need to. In the case of the Austonian, four guest suites on the 10th floor have feature custom bedding, Egyptian cotton sheets, a flat-panel television, a refrigerator and both wired and wireless Internet access. Four separate private terraces offer views of the city and nearby Lady Bird Lake. The guest suites, like the other residences of the building, are supported by a team of Austonian Assistants providing personal service 24 hours a day, seven days a week. Suites may be reserved in advance; the only fee is a per-suite cleaning fee.
I am sure there will be more to come as the building nears completion . . .
Austonian Construction Progress
EXCLUSIVE: Downtown Condo Market Surges
June 18, 2009 22:05 Filed in: News
Over the last 8 weeks, the downtown condo market has
taken a dramatic positive turn. After 20 tough
months, buyers have begun snapping up units at a
surprisingly strong pace.
While the MLS data shows 11 units having sold during May -- 2 less than last year -- the real story is much more dramatic. Since May 1, bargain hunters have put more than 40 units under contract at the Shore and another 20 in the Brazos Place auction. In addition, pre-sale units continue to move at the W and Spring. In fact, inventory numbers have dropped over the last month. If this rate continues, there could be a shortage of mid-price inventory by the end of the year.
As for the May MLS data, which does not include the Brazos Place transactions and does not yet include the Shore contracts, there was a 1% year-over-year increase in price per square foot and a 31% decrease in average days on market.
May sales represented a surprisingly broad set of transactions with sales in Austin City Lofts, the Brown Building, Cambridge Condos, Milago, the Nokonah, Railyard condos, and three units in 360. The average price per square foot for the May 360 units was $360 per square foot.
While the 1-month data is inevitably a small sample, our 12-month rolling index echoes the trend, showing the lowest Average Days on Market reading of the year.
See the full AustinTowers | urbanspace Downtown Condo Market Index -- including the monthly sales and inventory reports and the 12-month rolling index here.
While the MLS data shows 11 units having sold during May -- 2 less than last year -- the real story is much more dramatic. Since May 1, bargain hunters have put more than 40 units under contract at the Shore and another 20 in the Brazos Place auction. In addition, pre-sale units continue to move at the W and Spring. In fact, inventory numbers have dropped over the last month. If this rate continues, there could be a shortage of mid-price inventory by the end of the year.
As for the May MLS data, which does not include the Brazos Place transactions and does not yet include the Shore contracts, there was a 1% year-over-year increase in price per square foot and a 31% decrease in average days on market.
|
One-Month Sales Report
|
|
|
|
|
|
|
|
|
Month
|
Sales
|
Avg. Price
|
$/SF
|
Avg SF
|
Avg Year
|
% Ask
|
ADOM
|
|
May-08
|
13
|
$297,792
|
$304
|
995
|
1969
|
95%
|
91
|
|
May-09
|
11
|
$347,045
|
$308
|
1,150
|
1989
|
96%
|
63
|
|
Change
|
-15%
|
17%
|
1%
|
16%
|
20.91
|
1%
|
-31%
|
May sales represented a surprisingly broad set of transactions with sales in Austin City Lofts, the Brown Building, Cambridge Condos, Milago, the Nokonah, Railyard condos, and three units in 360. The average price per square foot for the May 360 units was $360 per square foot.
While the 1-month data is inevitably a small sample, our 12-month rolling index echoes the trend, showing the lowest Average Days on Market reading of the year.
See the full AustinTowers | urbanspace Downtown Condo Market Index -- including the monthly sales and inventory reports and the 12-month rolling index here.
The Worst Condo Project Ever?
June 15, 2009 21:42 Filed in: News
Some condo projects are better than others. After
reading a story in the New York Times, I can safely
say that the worst condo project in the country is
not in Austin.
For the bargain price of $1,300 per square foot, you could own a piece of the Sheffield57, a 50-story condo conversion project on the west side of manhattan. At more than $400m, the original building purchase (prior to conversion) is supposedly the most expensive residential building sale ever. With the completion partially complete, you could own a $7M unit with $6,000 in monthly taxes and fees in what may be the worst condo project in the country.
How bad can a condo project be? Here are some facts about the project:
- One of the developers is accused of siphoning off $50m in development funds for personal use
- In retaliation, another developer hit the first developer in the head with a metal ice bucket during "a rather intense business meeting". He was arrested and charged for harassment and pleaded guilty. He was sentenced to community service.
- After 2 years of marketing, only 40% of it's 597 units have been sold
- The condo owners are suing the developers
- Rental tenants (who have lived in the building since before it was converted) are suing claiming improper eviction and failure to maintain the building
- The developers are suing each other
- Unpaid contractors have placed liens against the individual units.
- The State Attorney General has halted future sales in the building
- The developers are in default on $100 million in loans
- The lenders are preparing to foreclose on the developers
- The developers failed to pay $5.4 million in common charges for the hundreds of units that they still own
- Tenants have reported severe structural defects including collapsed ceilings, extensive water leaks and damage, and asbestos contamination
While no project is perfect, Sheffield57 offers an important lesson to condo buyers. Condo projects are not always completed as marketed. The track record of the developers, their ability to meet their commitments, and the ability to deliver a quality product will determine the final value of a condo unit. While most projects turn out well, it's important to complete due diligence on the developers and commercial lenders. However, like any other speculative project, condo developments come with speculative risks that are difficult to completely eliminate.
For the bargain price of $1,300 per square foot, you could own a piece of the Sheffield57, a 50-story condo conversion project on the west side of manhattan. At more than $400m, the original building purchase (prior to conversion) is supposedly the most expensive residential building sale ever. With the completion partially complete, you could own a $7M unit with $6,000 in monthly taxes and fees in what may be the worst condo project in the country.
How bad can a condo project be? Here are some facts about the project:
- One of the developers is accused of siphoning off $50m in development funds for personal use
- In retaliation, another developer hit the first developer in the head with a metal ice bucket during "a rather intense business meeting". He was arrested and charged for harassment and pleaded guilty. He was sentenced to community service.
- After 2 years of marketing, only 40% of it's 597 units have been sold
- The condo owners are suing the developers
- Rental tenants (who have lived in the building since before it was converted) are suing claiming improper eviction and failure to maintain the building
- The developers are suing each other
- Unpaid contractors have placed liens against the individual units.
- The State Attorney General has halted future sales in the building
- The developers are in default on $100 million in loans
- The lenders are preparing to foreclose on the developers
- The developers failed to pay $5.4 million in common charges for the hundreds of units that they still own
- Tenants have reported severe structural defects including collapsed ceilings, extensive water leaks and damage, and asbestos contamination
While no project is perfect, Sheffield57 offers an important lesson to condo buyers. Condo projects are not always completed as marketed. The track record of the developers, their ability to meet their commitments, and the ability to deliver a quality product will determine the final value of a condo unit. While most projects turn out well, it's important to complete due diligence on the developers and commercial lenders. However, like any other speculative project, condo developments come with speculative risks that are difficult to completely eliminate.
3 Dead in UT-Area Apartment Construction Accident
June 10, 2009 20:44 Filed in: News
In a very sad accident, three men died after
scaffolding collapsed on the 11th floor of 21 Rio, a
21-story rental apartment complex rising in the West
Campus neighborhood near UT.
The three men were standing on the scaffolding when part of the platform collapsed. The luxury student apartment complex is scheduled to open later this month.
The three men were standing on the scaffolding when part of the platform collapsed. The luxury student apartment complex is scheduled to open later this month.
Episcopal Church to Develop Downtown Block
June 09, 2009 19:50 Filed in: News
The Episcopal Church has purchased the downtown block
bounded by Seventh, Eighth, Trinity and Neches
streets for $9.5 million. The national church
organization plans to spend an additional $40 million
to create a new complex to house its national
archives.
When completed, the building will be as tall as 5 stories with 70,000 square feet of archive space, a garage, some public spaces, and limited ground floor retail. Since the block is in a capital view corridor, development is limited to no more than 75-feet. Because of the capital view restrictions, it was never a prime candidate for high-rise or condo development.
Here is a summary from the Statesman:
The Episcopal Church has bought a block in downtown Austin where it plans to build a facility to house its national archives and provide space for meetings, exhibits, research and other purposes.
The church purchased the block, now a parking lot bounded by Seventh, Eighth, Trinity and Neches streets, from Jimmy Nassour, an Austin real estate attorney. The purchase price was $9.5 million, said Mark Duffy, director of the Archives of the Episcopal Church.
The church, which borrowed against its endowment to buy the land, plans to launch a capital campaign next year to raise money to repay that loan and pay for the new facility. The cost of the project, which is in the "very preliminary" planning stages, will be almost $40 million, Duffy said.
The building probably will be five stories, with up to 70,000 square feet and a garage with some public spaces. Duffy said the start of construction is at least two years away.
In addition to archives and meeting space, the building will be a place "for Episcopalians nationally to gather and to study, reflect on and feel proud of their heritage," Duffy said.
"The idea is to build something that will be a visible presence for the Episcopal Church in the community, as well as a place where church members and the public can explore issues of vital importance to the church today," Duffy said.
When completed, the building will be as tall as 5 stories with 70,000 square feet of archive space, a garage, some public spaces, and limited ground floor retail. Since the block is in a capital view corridor, development is limited to no more than 75-feet. Because of the capital view restrictions, it was never a prime candidate for high-rise or condo development.
Here is a summary from the Statesman:
The Episcopal Church has bought a block in downtown Austin where it plans to build a facility to house its national archives and provide space for meetings, exhibits, research and other purposes.
The church purchased the block, now a parking lot bounded by Seventh, Eighth, Trinity and Neches streets, from Jimmy Nassour, an Austin real estate attorney. The purchase price was $9.5 million, said Mark Duffy, director of the Archives of the Episcopal Church.
The church, which borrowed against its endowment to buy the land, plans to launch a capital campaign next year to raise money to repay that loan and pay for the new facility. The cost of the project, which is in the "very preliminary" planning stages, will be almost $40 million, Duffy said.
The building probably will be five stories, with up to 70,000 square feet and a garage with some public spaces. Duffy said the start of construction is at least two years away.
In addition to archives and meeting space, the building will be a place "for Episcopalians nationally to gather and to study, reflect on and feel proud of their heritage," Duffy said.
"The idea is to build something that will be a visible presence for the Episcopal Church in the community, as well as a place where church members and the public can explore issues of vital importance to the church today," Duffy said.
Austin Leads Nation in Job Growth - AGAIN!
June 03, 2009 21:02 Filed in: News
This just in: Austin led the nation's big city job
markets for the third month in a row. In fact, Austin
was the ONLY large metropolitan area to add jobs
between April 2008 and April 2009. With 3,400 new
jobs, Austin employment grew at 0.4% during the
period.
Since job growth is one of the strongest drivers of real estate values, it is a positive development for Austin's downtown condo market and for broader home sales and prices.
Here is a summary from the Statesman:
By adding 3,400 jobs, Austin was not only ranked #1 but the only metropolitan area
The Austin area was the nation’s strongest big-city job market last month, according to a new report from the Bureau of Labor Statistics.
Among the 38 metro areas with a workforce of at least 750,000, Austin was the only one that gained jobs from April 2008 to April 2009, the bureau said. It was the third month in a row that Austin had earned that distinction.
Austin added 3,400 jobs in that period, a 0.4 percent gain, during that period.
Among other technology hubs, the Silicon Valley area lost jobs at a 4.4 percent annual rate in April. Portland, Ore., was down 4.7 percent, Seattle was down 3.4 percent and Raleigh, N.C., was down 3.3 percent.
Some smaller cities also racked up gains, including Midland, up 2.2 percent, and Odessa, up 2.9 percent.
Since job growth is one of the strongest drivers of real estate values, it is a positive development for Austin's downtown condo market and for broader home sales and prices.
Here is a summary from the Statesman:
By adding 3,400 jobs, Austin was not only ranked #1 but the only metropolitan area
The Austin area was the nation’s strongest big-city job market last month, according to a new report from the Bureau of Labor Statistics.
Among the 38 metro areas with a workforce of at least 750,000, Austin was the only one that gained jobs from April 2008 to April 2009, the bureau said. It was the third month in a row that Austin had earned that distinction.
Austin added 3,400 jobs in that period, a 0.4 percent gain, during that period.
Among other technology hubs, the Silicon Valley area lost jobs at a 4.4 percent annual rate in April. Portland, Ore., was down 4.7 percent, Seattle was down 3.4 percent and Raleigh, N.C., was down 3.3 percent.
Some smaller cities also racked up gains, including Midland, up 2.2 percent, and Odessa, up 2.9 percent.
The Ugly Side of Downtown Austin
June 02, 2009 21:31 Filed in: News
The shooting of 8 people last Thursday night outside
a downtown nightclub was an anomaly for Austin. The
terrible incident at Spiros nightclub, however,
brought to light the problems that come with the
vibrant alcohol-driven nightlife on sixth street and
the surrounding blocks.
After the incident, the Austin Police Department released an amazing set of statistics on Spiros nightclub:
- Since 2008, the police have responded to calls at Spiros 172 times
- Since November 2007, there have been 115 known thefts within 500 feet of the club
- During the same period, there have been 47 reported burglaries within 500 feet
- There have been 25 aggravated assaults in the immediate vicinity of the club
- There have been 7 assaults on a peace officer at the club
- APD reports 95 instances of possession of controlled substances, dangerous drugs, and marijuana
While Spiros may be one of the worst offenders -- the City is now trying to shut the club down -- it is an example of the ugly side of downtown. While the live music scene is one of the City's cultural crown jewels, the best clubs are joined by more problematic venues. As in New Orleans and San Diego and Nashville, the combination of music, youth, and alcohol means that nightlife and crime often go hand in hand. That said, it is worth noting that no major downtown condo projects are in the immediate vicinity of Spiros and the worst 6th street crime.
After the incident, the Austin Police Department released an amazing set of statistics on Spiros nightclub:
- Since 2008, the police have responded to calls at Spiros 172 times
- Since November 2007, there have been 115 known thefts within 500 feet of the club
- During the same period, there have been 47 reported burglaries within 500 feet
- There have been 25 aggravated assaults in the immediate vicinity of the club
- There have been 7 assaults on a peace officer at the club
- APD reports 95 instances of possession of controlled substances, dangerous drugs, and marijuana
While Spiros may be one of the worst offenders -- the City is now trying to shut the club down -- it is an example of the ugly side of downtown. While the live music scene is one of the City's cultural crown jewels, the best clubs are joined by more problematic venues. As in New Orleans and San Diego and Nashville, the combination of music, youth, and alcohol means that nightlife and crime often go hand in hand. That said, it is worth noting that no major downtown condo projects are in the immediate vicinity of Spiros and the worst 6th street crime.
WOW! Austin Home Prices Rising!
May 27, 2009 21:30 Filed in: News
Across the country, most major metropolitan areas are
seeing home prices continue to drop. In fact, housing
values are down 20% from their peak nationwide.
Housing prices in Austin, however, never experienced
the same loss of value. While inventory remains high
and sales volumes have dropped -- April 2009 sales
were down 33% from the peak April 2007 volume --
prices have remained amazingly stable.
Today, one major index of home values reported that Austin home prices actually increased by 2.2% in March, 2009 over the year ago period -- a very positive development for the Austin market. In the same index, nationwide prices were down by 11.5% during the same period.
Why has Austin stayed strong? There are three reasons:
(1) Austin never experienced bubble-like run up in values during 2006-2007 that many other markets experienced
(2) Austin continues to see strong net inbound migration which helps stabilize values
(3) Austin employment has remained strong. Amazingly, the most recent data shows a decrease in the local unemployment rate.
As a result, Austin continues to be one of the strongest real estate markets in the country.
Here is a summary from the Austin Business Journal:
According to First American CoreLogic’s Home Price Index, 33 states saw home prices decline at a faster rate in March. However in the major Texas cities, including the Austin-Round Rock metro area, prices increased. In the local area prices rose 2.2 percent in March compared with March 2008. That’s down slightly from the region’s February home price increase of 3.2 percent compared to the previous February.
Housing price declines are slowing in states that have seen the highest declines in the past three years, but prices are dropping faster in states that have seen only moderate decreases in that time period, the research found.
Nationally, housing prices fell 11.5 percent in March compared with the same month last year, down from an 11.7 percent annual decline in February.
The number of states with double-digit annual declines has doubled in the last year, according to the index, from seven states in March 2008 to 14 states this March.
Nevada remained the top-ranked state for annual price depreciation in March, with an average home price decline of 26 percent. California followed close behind with a housing price decline of 25 percent compared with the same month last year. Rhode Island, Florida and Arizona round out the top five.
Today, one major index of home values reported that Austin home prices actually increased by 2.2% in March, 2009 over the year ago period -- a very positive development for the Austin market. In the same index, nationwide prices were down by 11.5% during the same period.
Why has Austin stayed strong? There are three reasons:
(1) Austin never experienced bubble-like run up in values during 2006-2007 that many other markets experienced
(2) Austin continues to see strong net inbound migration which helps stabilize values
(3) Austin employment has remained strong. Amazingly, the most recent data shows a decrease in the local unemployment rate.
As a result, Austin continues to be one of the strongest real estate markets in the country.
Here is a summary from the Austin Business Journal:
According to First American CoreLogic’s Home Price Index, 33 states saw home prices decline at a faster rate in March. However in the major Texas cities, including the Austin-Round Rock metro area, prices increased. In the local area prices rose 2.2 percent in March compared with March 2008. That’s down slightly from the region’s February home price increase of 3.2 percent compared to the previous February.
Housing price declines are slowing in states that have seen the highest declines in the past three years, but prices are dropping faster in states that have seen only moderate decreases in that time period, the research found.
Nationally, housing prices fell 11.5 percent in March compared with the same month last year, down from an 11.7 percent annual decline in February.
The number of states with double-digit annual declines has doubled in the last year, according to the index, from seven states in March 2008 to 14 states this March.
Nevada remained the top-ranked state for annual price depreciation in March, with an average home price decline of 26 percent. California followed close behind with a housing price decline of 25 percent compared with the same month last year. Rhode Island, Florida and Arizona round out the top five.
W Hotel & Residences Developer Faces Delisting
May 22, 2009 20:56 Filed in: News
Stratus Properties, the developer of the W Hotel &
Residences in the 2nd street district, is
facing delisting from the NASDAQ for failure to
promptly file financial reports.
While this sounds bad, the event alone should not jeopardize the project. However, the developer's accounting irregularities and delinquent financial reports will limit financial flexibility until the issue is resolved. This is an especially important issue for the W as one of it major lenders is in precarious financial shape. It could also violate covenants of the project's bank financing.
The best indicator of the situation is the fact that the stock continues to trade at a healthy value, signaling the market's belief that the issues will be resolved. While stock in Stratus is down 50% from it's 2009 high set on January 2nd, it's more than 50% above its March 9 low.
Article Continues: Read More...
While this sounds bad, the event alone should not jeopardize the project. However, the developer's accounting irregularities and delinquent financial reports will limit financial flexibility until the issue is resolved. This is an especially important issue for the W as one of it major lenders is in precarious financial shape. It could also violate covenants of the project's bank financing.
The best indicator of the situation is the fact that the stock continues to trade at a healthy value, signaling the market's belief that the issues will be resolved. While stock in Stratus is down 50% from it's 2009 high set on January 2nd, it's more than 50% above its March 9 low.
Article Continues: Read More...
New Downtown Restrictions to Limit Lakeside Skyscrapers
May 22, 2009 20:51 Filed in: News
The most contentious Austin zoning battles relate to
development close to Ladybird Lake. The prime
downtown lake is considered one of the city's most
important natural assets. As a result, the City has
been closely examining proposals to protect the lake
from future development. Essentially, the City
Council would like to limit the height of development
on sites directly adjacent to the lake.
Essentially, the City has two goals: first, to control development around the lake. Second, to ensure access to the lake. The appropriate policy action becomes complicated with an important hypothetical: where there are gaps in the hike and bike trail, should the city provide height variances in exchange for trail extension or improved public access to the lake? It's this very real example that been the focus of City Council debate.
Last night, after much discussion, the Council gave the second of three required approvals that limit building heights around the lake to either 60 or 96 feet depending on location. To address the above example the council decided that developers could be allowed to exceed 96 feet "if they can prove doing so would be substantially better for the community." This is a fair compromise that will provide the City with the appropriate zoning tools to protect the lake in the future.
Article Continues: Read More...
Essentially, the City has two goals: first, to control development around the lake. Second, to ensure access to the lake. The appropriate policy action becomes complicated with an important hypothetical: where there are gaps in the hike and bike trail, should the city provide height variances in exchange for trail extension or improved public access to the lake? It's this very real example that been the focus of City Council debate.
Last night, after much discussion, the Council gave the second of three required approvals that limit building heights around the lake to either 60 or 96 feet depending on location. To address the above example the council decided that developers could be allowed to exceed 96 feet "if they can prove doing so would be substantially better for the community." This is a fair compromise that will provide the City with the appropriate zoning tools to protect the lake in the future.
Article Continues: Read More...
Brazos Place Auction Results: All Units Sell, 29% Discount
May 17, 2009 16:11 Filed in: News
Today was a big day for Brazos
Place as all 19 remaining units were sold in
less than 90 minutes to a packed room of
bidders.
On average, the units sold at a 29% discount to the original listing price. This is, however, a useless barometer as the units were not selling well at the original prices. More useful is the average price / square foot which at $281/SF is a 9% discount to the 2008 downtown condo average of $308. Unfortunately for current Brazos Place residents, the units sold for 24% less on a $/SF basis than the $370/SF average of the 12 Brazos Place units sold via MLS in 2008.
Here is the complete auction data:
On average, the units sold at a 29% discount to the original listing price. This is, however, a useless barometer as the units were not selling well at the original prices. More useful is the average price / square foot which at $281/SF is a 9% discount to the 2008 downtown condo average of $308. Unfortunately for current Brazos Place residents, the units sold for 24% less on a $/SF basis than the $370/SF average of the 12 Brazos Place units sold via MLS in 2008.
Here is the complete auction data:
|
Unit
|
Plan
|
SF
|
Listing
|
Opening Bid
|
Sold (incl. 4% Fee)
|
$/SF
|
Discount
|
|
709
|
1 Bedroom / 1 Bath
|
1272
|
$414,900
|
$170,000
|
$288,080
|
$226
|
31%
|
|
1007
|
2 Bedrooms / 2
Baths
|
1399
|
$479,900
|
$190,000
|
$339,040
|
$242
|
29%
|
|
708
|
2 Bedrooms / 2
Baths
|
1358
|
$519,900
|
$210,000
|
$329,680
|
$243
|
37%
|
|
1008
|
2 Bedrooms / 2
Baths
|
1324
|
$494,900
|
$190,000
|
$326,560
|
$247
|
34%
|
|
1108
|
2 Bedrooms / 2
Baths
|
1324
|
$504,900
|
$200,000
|
$329,680
|
$249
|
35%
|
|
705
|
1 Bedroom / 1 Bath
|
891
|
$304,900
|
$120,000
|
$229,840
|
$258
|
25%
|
|
1208
|
2 Bedrooms / 2
Baths
|
1324
|
$514,900
|
$210,000
|
$346,320
|
$262
|
33%
|
|
710
|
1 Bedroom / 1 Bath
|
623
|
$199,900
|
$80,000
|
$168,480
|
$270
|
16%
|
|
1103
|
1 Bedroom / 1 Bath
|
832
|
$324,900
|
$130,000
|
$229,840
|
$276
|
29%
|
|
808
|
2 Bedrooms / 2
Baths
|
1324
|
$519,900
|
$210,000
|
$374,400
|
$283
|
28%
|
|
1107
|
2 Bedrooms / 2
Baths
|
1399
|
$489,900
|
$200,000
|
$399,360
|
$285
|
18%
|
|
1109
|
1 Bedroom / 1 Bath
|
884
|
$359,900
|
$140,000
|
$255,840
|
$289
|
29%
|
|
908
|
2 Bedrooms / 2
Baths
|
1324
|
$484,900
|
$190,000
|
$385,840
|
$291
|
20%
|
|
1203
|
1 Bedroom / 1 Bath
|
832
|
$332,400
|
$130,000
|
$244,400
|
$294
|
26%
|
|
1207
|
2 Bedrooms / 2
Baths
|
1399
|
$499,900
|
$200,000
|
$418,080
|
$299
|
16%
|
|
707
|
2 Bedrooms / 2
Baths
|
1399
|
$519,900
|
$210,000
|
$422,240
|
$302
|
19%
|
|
706
|
1 Bedroom / 1 Bath
|
812
|
$339,900
|
$140,000
|
$250,640
|
$309
|
26% |