not sure why this article is coming out this late...but...
Pearl’s Wyatt bails out of condo tower market
Bob Ball’s 15-story project follows the Ladd Tower’s lead and rents as apartments, the latest sign Portland may have more housing than it can sell
POSTED: 06:00 AM PDT Thursday, September 27, 2007
BY TYLER GRAF
When developer Bob Ball decided to downgrade the condominiums in his high-profile, 15-story tower, The Wyatt, to apartments, he believed the market was trying to tell him something simple: There are too many condo units in the Pearl District. The market is too slow.
“It’s always prudent to respond to the market accordingly,” Ball said. “And our goals are to make the place livable and improve the neighborhood.”
Located at 1001 N.W. 14th Ave., the property is rising amid a flush of Pearl District condominiums. Portland developers are pushing urban living as an alternative to the suburbs in the hopes of drawing more dwellers to the urban core.
Current listings for the Pearl District show 173 condo units on the market, with an average listing price of $665,000. The market spectrum is wide, however: The highest listing price is $3.2 million and the lowest is $142,000, according to the Regional Multiple Listing Service.
“We were selling in relation to other projects very well,” Ball said. “But it wasn’t enough.”
The Wyatt is the second major Portland development to convert from condos to apartments in less than a year. The Ladd Tower, developed by Minneapolis-based Opus Northwest LLC, switched to apartments in March.
“We saw what Bob Ball saw, but we may have seen it a little earlier, and we were in a position to make changes,” Opus’ Mark Desbrow said.
Put simply, condos aren’t selling, Desbrow said.
John Bartell, also of Opus Northwest, said market research indicated apartments were a safer market for the Ladd Tower. With a few tweaks – making the floor plates skinnier and lowering the ceilings by a few inches, thus adding floors – the Ladd went from a 220-unit condo building to a 332-unit apartment tower.
Overall, Ball said, would-have-been condo tenants said they supported The Wyatt’s transition from condominiums to apartments, seeing the move as a protection of their investments.
Those who put down money on condos in The Wyatt had their deposits returned, with interest.
But Northwest Portland condominium construction is still going strong: Pacifica Tower, 937, The Encore, The Metropolitan, Waterfront Pearl and The Westerly are going forward.
“Today we have a lot more inventory that hasn’t sold than in the past,” said Patrick H. Kessi, developer of the 937 condominiums in the Pearl District. “What’s happening elsewhere is having a ripple effect on Portland.”
According to the S&P/Case-Shiller home price index released this week, the U.S. housing market in July posted its steepest drop in 16 years. Oregon, however, remained one of five major markets in which housing prices continued to appreciate. For Kessi, one must look at Portland in relation to other West Coast cities like San Diego – cities that are not weathering the housing market downturn quite as well.
Bartell believes the condominium developments currently under construction had the misfortune of breaking ground during a peak in condo performance, when the market looked good. Over the past 24 months – the amount of time it has taken to construct The Wyatt, for example – the market has slowed, but developers are still committed to their condominium towers. “I think they are just finishing what they started,” Bartell said.
Ball said that a priority list exists for The Wyatt’s apartments, and construction is set to finish in early 2008.
http://www.djcoregon.com/articleDeta...d-Towers-lead-
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