The Condo Project Death pool: Who is next on the Auction Block?

Next project on the auction block

  • W Residences

    Votes: 2 8.3%

  • Clarendon

    Votes: 0 0.0%

  • 45 Province

    Votes: 9 37.5%

  • DNA

    Votes: 1 4.2%

  • North Point

    Votes: 8 33.3%

  • Battery Wharf

    Votes: 4 16.7%
  • Total voters
    24
  • Poll closed .
S

sidewalks

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I've been privately speculating for months about the prospects for the supply of condos that have recently come on line. The outlook is very grim. How much longer before these developers are forced to unload units in an auction, as happened with the Natick Mall project?

Who is most at risk? 45 Province, Clarendon, W Residences, Bryant, North Point, Battery Wharf, DNA Lofts, Sumner Hill School House in JP, The Carruth...what am I missing here?

Which, if any, of these projects do you expect to succumb to the debt burden next?
 
Isn't Natick a huge fluke? I mean who would ever want to have a highrise condo attached to a busy suburban mall, and in a bad economy at that? The concept combined all the inconveniences of suburban and city living, all at absurd prices.

The city projects are all way more viable.
 
The auction necessity wasn't a fluke...a lot of these projects are bleeding cash right now. They have enormous debt service obligations that were never envisioned when the projects commenced. Time is very expensive in this business.
 
The W is in a bad location. Nobody wants to live among these heroin addicts in the day and mobs of club-goers at night. The alley next to the W where Rumor and Venu are located is a complete and total shitshow. The W condos are in huge trouble.

But I think 45 Province is in bigger trouble. The marketing has been completely, ass-backwards and wrong for this project, and it's also another b-location for housing.

The Clarendon will do the best, because it was designed as a half rental/half condo building. This means the developer's have less to worry about, since their rentals are doing kick-ass. I believe 25% of the condos are sold, so that means that the building is operating at (shit, high school math... 50% total + 25% of 50%) 62.5% occupied right now. That's enough for the property to cash flow, the developers have deep pockets, so there is no need to panic. They can wait until next year when the market is improved, or just keep waiting it out. This 50% rental structure gives this property the most stability of the ones listed in this poll.
 
pelhamhall said:
The W is in a bad location. Nobody wants to live among these heroin addicts in the day and mobs of club-goers at night. The alley next to the W where Rumor and Venu are located is a complete and total shitshow. The W condos are in huge trouble.

But I think 45 Province is in bigger trouble. The marketing has been completely, ass-backwards and wrong for this project, and it's also another b-location for housing.
Click to expand...

Don't many condos get snapped up by corporations looking for short-stay pads for execs? The W could sell itself pretty well to these people. It's walking distance to the FiDi (yes, I said it), attached to a luxury hotel with amenities, and these guys don't necessarily mind being close to clubs where they can take the mistress or whatever.

45 Province's biggest, stupidest problem is the orientation of the building. If it had been able to market views over the Common it could have made a killing even in this economy. The new Stern building on Central Park West in NYC sold out quickly despite coming online in the midst of foreclosures.
 
For an urban high-rise, 45 Province has very little physical "presence". But that's just a part of it's problem.

The W Hotel will benefit from very strong marketing and branding - it has a clearly defined value proposition. It's still in a tough area I think for the empty nester crowd, which is key to the success of these types of properties.
 
Whats the deal with Battery Wharf? It has been completed for a while now. How has it been selling?

I voted 45 province just because it has also been built for a while now and seems to just not be selling. I think out of all the buildings listed in the poll i would most want to live in 45 province though.
 
I voted for the W but I think it's really going to be 45 Province that goes first. Both the W and 45P have location working against them, in my opinion. The Clarendon is in a great location in the Back bay and it's close to the South End. There's also a grocery store not too far away. 45 Province feels isolated to me and I agree with Pellhamhall about the area around the W.
 
Archtone and Millennium are a stone's throw from the W and they did okay, though obviously in different market conditions. Lots of pro athletes in the Millennum, btw - I think the proximity of the clubs works well for them.
 
Isn't Natick a huge fluke?
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While I agree that the Natick concept was lacking, it wasn't necesary a fluke. The 1850 (South End), Folio (Downtown/Waterfront), and The Bryant (South End/Back Bay) all went to auction in the last couple years. The developers may or may not have been "forced" into auction, but they obviously felt auctions gave them the best chance to maximize their profits.
 
Isn't North Point not built? Are they trying to prelease? If so, I don't see an unbuilt building coming to auction.
 
Does anyone have stats on the percentage of units unsold and absorption rate for each building?
 
I believe that is correct for Washington St..
 
Not sure why there's a residential death pool, but not a generic death pool.

Consider this excerpt, just in:

Friday, December 11, 2009
1 million square ft. floods Hub market in past year
Boston Business Journal - by Eric Convey

Boston is on pace to end the year with 1 million more square feet of commercial real estate available for lease than was available at the beginning of the year, a trend that would make 2009 the worst year for net absorption in almost a decade.
Click to expand...

Are office buildings less susceptible to falling on the auction block?
 
I voted Battery Wharf because I have heard nothing about it recently and haven't seen it advertised anywhere. How is the hotel doing there (Fairmont, I believe)? Like the W, it's got the hotel/ amenities right there, but it's a bit further away from the hubs of activity and public transit. The waterfront location is a plus, but I just don't see Battery Wharf selling in this economy. Especially not without advertising.
 
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