I can't find the Westerly thread either...
Westerly project presents a plethora of challenges
Portland Business Journal - May 18, 2007
by Wendy Culverwell
Business Journal staff writer
Charlie Kloppenburg | Portland Business Journal
Real estate brokers Alex Hughes and Debbie Thomas tour the under-construction Westerly.
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As construction sites go, The Westerly condominiums is a doozy.
The 14-story project sits at the edge of a busy parking lot. It overlooks Uptown Shopping Center on one side and the face of a steep cliff on the other. Then there's the parking issue.
The building displaced 57 parking spots, which had to be replaced. So, with construction proceeding on the floors above, 57 parking spots in the building's lower level parking garage are open to the public.
The Westerly presents a tricky balancing act for developer Jack Onder and his contractor, Andersen Construction. But Onder, a veteran builder and principal for Onder Development LLC, said there's nowhere else in Portland that he'd rather build luxury condominiums.
"It's absolutely perfect," he said.
The same goes for timing too. While news about foreclosure rates and a cooling residential market scare off some potential buyers, Onder said he has no concerns about The Westerly, which has been in the works for several years.
"I would start it today in a heartbeat," he said, echoing the stubborn optimism of local developers, who seem intent on keeping Portland's skyline full of cranes.
The Westerly, like its condo neighbors, stands firmly in luxury territory.
Prices begin at $412,000 and rise steeply from there. The asking price for a penthouse is more than $3.6 million. Several have sold.
Nelda Scott Newton, vice president for the real estate group at Wells Fargo, has studied Portland's condominium market. She doesn't doubt Onder when he says he wouldn't hesitate to build a project like The Westerly today, even with the shades of gray clouding the market. The Westerly has the makings of a popular project -- a unique location, desirable neighborhood and just 104 units.
"You're right there with your back against the hill. You have incredible views that won't go away. I'm not surprised that he would say he would start it today," she said. "That project will be a successful project."
While upper-tier projects such as The Westerly press on, a changing market is giving some developers pause.
The ongoing conversion of the former Portland Center apartments into the Harrison Condominiums is Portland's single largest condo conversion project by a long shot. The property consists of more than 500 units, including townhouses, contained within three towers.
The first two towers have been modernized and converted, with "nice steady" progress on sales, according to John Managan, spokesman for the developer, Reliance Development Inc.
Reliance recently began renovations for the third tower, which is on the south side of Southwest Harrison Street.
It remains unclear if the units in the third tower will be put up for sale, or if the entire building will be separated from the other two and sold as a single building, presumably to someone who will operate it as an apartment tower.
That's because apartment occupancy rates -- and rents -- are rising, giving operators a new incentive to keep multifamily properties as income-producing rentals rather than for-sale condos.
"It's not a secret that apartments are coming into favor," said Wells Fargo's Newton.
The phenomenon -- apartments being converted to condominiums and then back to apartments -- has a name: reversion.
Already one major project has succumbed to the lure of rising rents. The 21-story Ladd Tower project at 1300 S.W. Park Ave. was to include 220 luxury condominiums.
In March, Opus Northwest LLC changed its mind. Ladd Tower instead will feature 220 luxury apartments.
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http://portland.bizjournals.com/port...ml?t=printable