AUSTIN | Projects & Construction II

[Mopacs]

This mid-rise condo building should have some great views of downtown and the Barton Creek Greenbelt/canyon. It sits on the closest part of Lamar Blvd to greenbelt, near a bend in the creek that sweeps to the east just a few blocks W of Lamar, featuring a steep drop-off. Here are recent articles from the Austin Business Journal and the Statesman...

From Statesman....

http://www.statesman.com/business/content/business/stories/realestate/02/10/10lamar.html

Green condo project to have greenbelt view

South Lamar Boulevard project part of housing boom around downtown Austin.

By Shonda Novak
AMERICAN-STATESMAN STAFF
Saturday, February 10, 2007

A four-story condominium project on South Lamar Boulevard is set to break ground in June as the downtown building boom sweeps south.

Called the View, the 69-unit development is the first in Austin for Madison Partners, an Austin group formed to build the project. The site, at 3600 South Lamar just north of Ben White Boulevard, is being cleared to make way for the development.
With as many as 17 residential projects planned or under construction downtown and scores more in the pipeline or being built just south and east of downtown, some have asked whether the downtown condo market is at risk of being overbuilt.

But some developers and a local real estate consultant have numbers showing that demand continues to exceed supply. Like virtually all of the housing cropping up in and around downtown, the View's 69 units won't be inexpensive. Prices will range from $260,000 for a 760-square-foot, one-bedroom unit to $850,000 for a 2,280-square-foot, two-bedroom unit.

The condos will have Barton Creek Greenbelt views and balconies, and there will be a pool, meditation garden and cabanas. Developers say the project is one of the first multifamily developments in Austin to seek one of the highestlevelsof local and national certification for energy-efficient and environmentally sensitive design and construction.

The View will join several other condo projects south of downtown as developers seek to meet what they say is substantial demand for close-in housing. Avera Development will start construction soon on two condo projects along South Lamar and one on South Congress Avenue across from Penn Field. Michael Wray, a managing partner with Avera,said the company redesigned its Magnolia condo project on South Lamar to increase the number of units almost 50 percent, to 139 from the original 95.

"We underestimated demand," Wray said. "We contracted for over $2 million of condos this week."

Prices at the Magnolia start at $249,900 for an 818-square-foot, 1-bedroom unit and $299,900 for a 1,197-square-foot, 2-bedroom unit. Prospective buyers, Wray said, include singles and couples ages 28 to 40, second-home buyers and reverse commuters, people who work at Dell Inc. and other companies in the suburbs but want to live downtown. Wray said the Magnolia's lender, Los Angeles-based Fremont Investment & Loan, is so bullish on Austin as a condo market that late last year, when completing the loan for the project, it cut the number of units it required Avera to sell before breaking ground.

Avera needs 25 percent of the units sold instead of 50 percent. Currently, Avera has contracts out on 28 units, 20 percent. Large condo projects usually take three to four years to develop, from land acquisition to approvals, financing and ultimately construction, Wray said. "The reality is we're not meeting the demand because of the delivery times."

He said the numbers back him up.

Four downtown or near-downtown condo projects will open this year with more than 200 units. Gauging demand by the 800 new and existing condos sold last year in the downtown area, "we are dramatically undersupplied for 2007, and we'll only begin to catch up in 2008," Wray said. Next year, four more projects are expected to open, adding 834 units, about a year's worth of demand, Wray said. "Downtown, there is effectively no supply coming on in 2007, meaning we will have two years of pent-up demand in 2008, and that's assuming demand is flat, which we know it's not," Wray said.

"It seems to me that demand is going to continue to be pent-up through 2009, when you'll probably see two other projects come on line, AquaTerra and the Austonian, so we may not reach equilibrium until the end of the decade." Wray also noted that not all the projects will get built. When developers announced the latest proposed downtown project, the 55-story Austonian, whose units are expected to start at $500,000, local real estate consultant Charles Heimsath, said that if all the planned units were started at the same time, "then I think we might be facing an overbuilt high-end market."
"However, every project has its own unique attributes, pricing and market appeal, and that differentiation, along with the fact that the time between project completions is staggered, should keep the market strong," Heimsath said.

Because of the gap in supply and demand, Wray said, he expects downtown-area condo prices to climb anywhere from 10 percent to 15 percent by the end of the year.

[email protected]; 445-3856


The condo outlook


Local real estate developers say they don't foresee the recent spate of condo developments saturating the Austin market anytime soon.

Annual demand for condo units: 800*
New condo units for sale in '07: 218**
New condo units for sale in '08: 834***

*Based on sales in 2006.
** The 54-unit Sycamore, the 32-unit Sage, 104-unit Bridges on the Park and the '04, with 28 units.
***Only 10 units left in the 192-unit Shore. Plus, 240 units at the Spring, 445 units at 360 and 139 at the Magnolia.

Source: Avery Development


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From Business Journal...

http://austin.bizjournals.com/austin/stories/2007/02/12/daily3.html?jst=b_ln_hl

South Lamar site of condos with a view

Austin Business Journal - 12:00 PM CST Monday, February 12, 2007

Developers will break ground in July on a new 69-unit condo project on South Lamar. Austin-based Madison Partners is planning The View at 3600 S. Lamar. The four-story project on the edge of the Barton Creek canyon lands will feature one and two-bedroom units priced from $260,000 to $850,000.

Cristen James with Avenue One, the company marketing the property, says the project is one of the first in the multifamily category in Austin to seek LEED certification. LEED, or Leadership in Energy and Environmental Design, is the U.S. Building Council's green building certification program. The project will feature such environmentally sensitive components as solar energy panels, separate recycling chutes and a water collection system for landscaping.

Unit sizes will range from 760 square feet to 2,280 square feet with 18 different floor plans. The project should be ready for occupancy in fall 2008.

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[wpolom]

Thus anybody live there? The streets look kind of dead, even vehicular traffic is kind of dead. I guess people in Austin do really rush in the rush hour.

[Mopacs]

Originally Posted by wpolom

Thus anybody live there? The streets look kind of dead, even vehicular traffic is kind of dead. I guess people in Austin do really rush in the rush hour.

For what its worth, those pics were taken primarily on a Sunday morning. The kids have too many hangovers to leave their bathrooms at that time of day

[MichaelB]

Originally Posted by Mopacs

For what its worth, those pics were taken primarily on a Sunday morning. The kids have too many hangovers to leave their bathrooms at that time of day

Good answer Mopacs....which leads me to the next question.... and you were just making your way home from where>????

[sakyle04]

A 32-story residential tower planned to go behind Katz's Deli & Bar on West Sixth Street will be the focus of a battle Thursday at the Austin City Council.
The project is up for a rezoning vote on whether to allow CLB Partners to build a 400-foot-tall building at West Seventh and Rio Grande streets. A coalition that includes nearby residents and property owners says the tower would be out of scale with the area, which includes more than 30 historic buildings

We heard the same protests from Mahncke Park residents in San Antonio when The Broadway San Antonio condo project was announced.

I don't think there is too much to worry about, since business seems to be behind the project. The same cicumstances filtered in here and a beautiful (if not generic) 20-story condo tower will rise soon.

[KevinFromTexas]

City council will vote tomorrow on the two Fairfield towers for the south shore of Town Lake. These include two towers that will be up to 200 feet tall. There are also 4 other buildings close to that height planned for south of the river from downtown.

Click on the link below to see the map.

From the Austin American-Statesman
http://www.statesman.com/business/content/business/stories/realestate/02/14/14fairfield.html

Condo towers up for final council vote
Project would be the biggest on Town Lake's southern shore since 1982.

By Kate Miller Morton
AMERICAN-STATESMAN STAFF
Wednesday, February 14, 2007

The Austin City Council could give final approval Thursday for two residential high-rises on Town Lake, greenlighting the most significant development on the south shoreline since the Hyatt Regency Austin was built in 1982.

The condominium towers proposed by Grand Prairie-based Fairfield Residential LLC. would rise up to 200 feet on the south and west parking lots of the 17-story hotel on Barton Springs Road between South First Street and South Congress Avenue.

Current zoning on much of the nearly 10-acre site allows that height but says no more than half of the land can be covered by buildings and other surfaces impenetrable by water.

Fairfield bought the Hyatt property for $50 million in October 2005.

The Hyatt was built before current waterfront setback and impervious-cover regulations were enacted. The new towers would be bound by the requirements.

Fairfield wants more flexible zoning that would allow more impervious cover on part of the site and allow it to spread construction of the two towers over several years.

In exchange, it's offering to reduce the current total impervious cover by 2.3 percentage points to 65.5 percent, allow public access through the property from Barton Springs Road to the lake and comply with green building standards.

With Mayor Will Wynn absent, the City Council voted 6-0 to give preliminary approval in January.

The Bouldin Creek Neighborhood Association, which represents nearby residents, does not oppose the project. The group negotiated with Fairfield for more than a year and won several concessions.

Fairfield backed off its original plans to build about 15 feet closer to Town Lake than city rules allow.

It also agreed to donate money to a yet-to-be-formed community development corporation for affordable housing only if it adds square footage to the hotel or builds higher than 60 feet on small parts of the site where that's the limit under current zoning.

The new Save Town Lake organization, which is trying to stop the city from allowing variances to the setback rules, also doesn't oppose the project.

"It's a concern when you upzone property . . . and you end up having more buildable area than what the original base zoning allowed. But I think that looking at all the factors involved, we ought to be applauding what the Bouldin Creek folks were able to accomplish," Save Town Lake member Jeff Jack said.

Fairfield's plans have some detractors, including environ- mental advocate Mary Arnold and several nearby property owners.

Arnold said allowing more impervious cover would defeat the goals Town Lake advocates tried to achieve when they persuaded the city to create special rules for lakefront development in the 1980s.

"It was a tradeoff (for the) 200 feet in height, and the tradeoff was: if you go that high you don't cover but 50 percent of the tract with your building," she said. "You leave open space. Even if it's concrete open space, at least it gives an opening to the lake and from the lake."

Fairfield isn't the only company seeking approval to build bigger projects along the lake than regulations allow.

CWS Capital Partners is seeking a variance from the setback requirements to build three 18-story residential towers at 222 and 300 E. Riverside Drive.

Developers have won a variance from the Board of Adjustment that will allow them to exceed 50 percent impervious cover with the 20-story AquaTerra condo tower near the Hyatt.

"I think we've gotten something very special to be proud of and to hang on to, and I don't like to see it destroyed piece by piece," Arnold said.

[crewer]

Out of curiosity, could someone explain the current values set by the Travis County Appraisal District for the Milago units? I was trying to work numbers on what payments could be on a downtown condo unit and wanted to figure in the taxes. I assumed they would be high, but the condo values seem extremely low right now. In fact, they're ridiculously low. Any thoughts? Was there something in place by the city/county to keep assessments low temporarily in order to encourage home ownership downtown? Is there going to come a time in the near future when the county "adjusts" the values to current market levels?

[Mopacs]

The New York Times has taken notice of Austin's dramatic construction boom, discussing the pros and cons and its effects on Austin. Check this out from NY Times Online...

http://www.nytimes.com/2007/02/14/realestate/commercial/14austin.html?_r=1&ref=business&oref=slogin

Square Feet

It’s Also the Texas Capital of Construction

By KRISTINA SHEVORY
Published: February 14, 2007

AUSTIN, Tex., Feb. 12 — Construction cranes are dotting the skyline here after a six-year hiatus. Large swaths of downtown, once largely parking lots, low-slung buildings and warehouses, are being demolished to put up glass skyscrapers, and land that had been vacant for years is being cleared for new offices and homes all over town.

Yet while the new jobs tied to the growth have been welcome in a town where the economy is largely tied to state government and technology, critics say the building boom runs the risk of altering the character of the city, a place often prized by residents for its offbeat small-town vibe.

“All the capital is getting sucked into Austin,” said Brewster McCracken, an Austin City Council member. “That not only brings more redevelopment, but it also brings the tensions that come along with them. As we redevelop, we want to make sure we don’t lose the great things that make Austin unique.”

Austin has clearly become the next Texas boomtown.
Lured by a low cost of living, strong job growth and seven universities and colleges, new companies, most of them from California, are opening offices or expanding existing ones. Samsung Electronics is putting billions into a new semiconductor plant, its second in town, and Advanced Micro Devices is building a new 60-acre campus.

In the process, they are bringing 70,000 new jobs, pushing office vacancies to a five-year low and keeping the local housing market strong. Over a million square feet of office space is being built, and 22,000 apartments and condominiums are either being planned or are under construction, the highest number since 2000.

“Austin is on everyone’s radar,” said Brett Arabie, senior vice president at Oxford Commercial, a real estate firm in Austin. “You really don’t have to a do a sales job.”

Real estate investors are banking that the growth will not be short-lived. In the last three years, Equity Office Properties Trust more than doubled its office space here, to 3.3 million square feet, becoming the city’s biggest private landlord.

When the Blackstone Group bought Equity for $39 billion last week, it assumed control of all of the trust’s properties in Austin. Although the private equity firm has already sold some Equity buildings in New York and Seattle, it is unclear what it will do with the ones in Austin.

In September, Equity paid $188 million, or $354 a square foot, for the Frost Bank Tower, making it the most expensive office tower in the state. The race for office space has made Austin the most expensive commercial market in Texas. Sale prices have risen 50 percent since 2002 and now average $181 a square foot here, according to Real Capital Analytics.

Prices in Dallas and Houston average $130 and $129, respectively.
Still, some Austin residents say they are worried that their city will become like any other American metropolis. They have been battling large-scale developments in environmentally sensitive areas, zoning changes for high-rise condo towers and the loss of local stores, music clubs and restaurants. The threatened demolition of Las Manitas Avenue Cafe, a beloved Tex-Mex restaurant downtown here, has become a rallying cry in their fight to “Keep Austin Weird.”

Since opening a quarter-century ago, Las Manitas has become a local institution, attracting musicians, politicians and celebrities, like Quentin Tarantino. In its place, White Lodging Services wants to put up three Marriott hotels, with 1,000 rooms, by the summer of 2009. A child care center and a folk arts and crafts store would also be displaced. The restaurant’s owners, however, have refused to leave unless something can be done to save it. The two sides are still negotiating.

The development battles have focused attention on the city’s lack of a downtown master plan and a program to preserve small local businesses there. A fund to help keep the small businesses is being hammered together, and a portion of the money will probably come from development fees. A development plan should be completed by the middle of 2008, according to city officials.

Downtown development has had its booms and busts. In the late 1990s, the city wanted to turn the area into a “digital downtown” and offered more than $45 million in incentives to lure tech companies. It expanded the convention center, built a new City Hall and persuaded Computer Sciences, Vignette and Intel to move there.

But after the technology industry went into decline six years ago, office vacancies hit a high of 23 percent. Vignette pulled out of a proposed $350 million office complex. Computer Sciences delayed the completion of a three-building campus, and Intel scuttled its 10-story chip design building, leaving a five-story skeleton. After six years, the skeleton is expected to come down later in February to make way for a new federal courthouse.
This time around, the Greater Austin Chamber of Commerce was determined to make sure that the good times lasted. In 2004, the group started a five-year plan to make the economy more diverse.

“There was an outpouring of support from the city, regional government and businesses to get Austin moving,” said Dave Porter, the chamber’s senior vice president for economic development. “They said, ‘We’re sick and tired of going through these cycles. Let’s do something.’ ”

The chamber persuaded local companies to stay, and it wooed out-of-state companies. One such business was CompassLearning. Last March, the company left San Diego to make its educational software here with lower expenses and more high-tech employees. Executives had grown tired of battling for the few programmers in town while trying to persuade others to move to San Diego.

“Recruiting people from Nevada and Texas to move to Southern California is a real problem because of the cost of living and quality-of-life issues,” said Eric Loeffel, president of CompassLearning, which consolidated three offices in Austin. “I don’t have that problem now. Austin is an attraction.”
Low housing prices have also persuaded others to relocate.

Sales of single-family homes climbed 10 percent in 2006, versus 2005, according to the Austin Board of Realtors. The median home price was $174,500, up 6 percent. The median price nationally was $222,000.The housing market has attracted residential developers, and many are pouring into downtown. There are 4,200 apartments and condominiums being planned or under construction there, leading some to wonder if there is enough demand for them. Charles Heimsath, president of Capitol Market Research, estimates there is enough demand to absorb 300 to 400 units a year.

“If all those units are built at the same time, I think we would have a glut,” Mr. Heimsath said. “But it’s extremely unlikely all of these projects will come online at the same time.” The Novare Group, an Atlanta builder that specializes in high-rise condominiums, is betting at least $145 million that the housing market will remain strong. It chose Austin for its first project outside of the Southeast and eventually plans to put up several mixed-use projects here.

Last summer, the developer broke ground on a 44-story downtown tower with 432 condos. Prices will probably range from $190,000 for a one-bedroom to $300,000 for a two-bedroom. Novare is also building two towers with ground-floor stores, 100 hotel rooms and more than 900 condominiums. Several other mixed-use projects are also in the works.
“You see a lot of patents, good population growth and perfect demographics,” said Judd L. Bobilin, Novare’s chief development officer. “Those are all strong indicators things are going to take off.”

[sakyle04]

There are 4,200 apartments and condominiums being planned or under construction there, leading some to wonder if there is enough demand for them. Charles Heimsath, president of Capitol Market Research, estimates there is enough demand to absorb 300 to 400 units a year.

That directly contradicts the earlier estimates...

Local real estate developers say they don't foresee the recent spate of condo developments saturating the Austin market anytime soon.

Annual demand for condo units: 800*
New condo units for sale in '07: 218**
New condo units for sale in '08: 834***

The demand will likely settle in the middle, as the pent-up demand will be unleashed in the early years, causing high sales numbers (800) and then residual demand will take over and a more natural market will cause the sales figures to rest at a more sustainable level (300-500).

Either way, that's still crazy growth and a promise that the skyline will continue to burst. Very cool, Austin.

[GoldenBoot]

I wouldn’t say that it’s a "direct contradiction!" Look at it this way…If, in a given calendar year, there are 800 people who are serious about purchasing a downtown condo. It is plausible that only 300 to 400 of them will actually close during that particular year. The others may end up closing at a later date or never. In any case, I agree that the annual demand will wane over time. The real estate industry is one of cycles and what goes up must come down at some point. However, by no means am I speaking of a “crash,” just a good, solid, annualized growth rate and not an out-of-control “growth spurt.”

[Gallup]

The demand for condos is growing. The city is coming back and before you know it we will have the best urban seen in all of Texas.

[StoOgE]

When did Austin "go away" to begin with?

[AustinGuy]

Does anyone have good information on the 360? It looks like they are going ahead at approx $300/psf for the sales process, but they don't have specific pricing available until you meet with them in person.

The construction on the 360 seems to be coming along nicely, and they are still claiming the first closings will be early 2008.

[LookingUp]

Originally Posted by AustinGuy

Does anyone have good information on the 360? It looks like they are going ahead at approx $300/psf for the sales process, but they don't have specific pricing available until you meet with them in person.

The construction on the 360 seems to be coming along nicely, and they are still claiming the first closings will be early 2008.

Novare 360 prices are $350-450 PSF, just like Spring. Spring raised their prices last month - construction costs, again. They hope to average $400 PSF. They have a few units at 700 SF @ $300 = $210,000. Most are priced over $300,000 for a reasonable space unit.

[actham]

What was the outcome of last Thursday's council meeting on the Wal-Mart project? I did hear that the 7th and Rio Grande tower got approved. Think it will happen? Also, I stopped by the sales center for AquaTerra last weekend. They plan to break ground in 4-6 weeks. They're 40% reserved.

[Strayone]

Earlier my brothers company was called to an emergency banner hanging for the sales office for 360. He called me to say I could take a look at the model for the 1 bedroom. So I dropped everything and headed down there. Sorry I can't post the pics I took, not sure how to use a hosting service, so I'll go over what I saw. In their entry area is a very nice 5 ft. model of the building. It is all silver in finish so it didn't seem like the actual color scheme that the renderings depict. I was surprised that the pool is above the parking area on the 10th floor not up on the higher step (where they have a good sized viewing greenspace, no noticeable spots to sit or any type of bar or construct for formal gatherings. The spire part looked a bit different than what I had seen in renderings, it has a arching overlay that will be visible from further distance than the available shots I've seen. Nice touch. Upon approaching the 1 bdrm I was easily convinced they did a decent job with maximizing the limited space, the hall to the bath was spacious, kitchen was nice had a stone/marble bar, nice stainless appliances, modern wood cabinets and lighting. It felt bigger than a 1bdrm, the bath was quite spacious and had both a glass shower and seperate tub, almost too much space spent in the bath.There was no door on the bathroom, I asked and I guess for model purposes they left it off, I trust this to be accurate otherwise when a person enters the front door and looks to the left they would be able to see the john. Another doorless entry out of the bath leads to the bdrm past a huge walkin closet on the left, the bdrm isn't very big and they have a regular queen bed in the model. A closet on the right just past the walkin has a stacked washer/dryer, kinda a paradox since it shares a common wall with the kitchen,on the far wall of the bdrm is a glass wall that gives about 5 ft of view from the room out. At the end of the common wall for the bd and livingroom right next to the all glass wall is a smallish entry to the livingroom area, I was told it lends a lofted feel. Obviously the focal point of the premises would seem to be the view but it didn't seem to be overwellming, great use of space, of cource it helped that both tv's in the model were wallmounted plasma's. I could't help imagining my furniture in the space. Would love to see the 2bdrm. I'm sure some of you will have a chance to see the model tomorrow as the sales office is scheduled to open tomorrow afternoon. The larger of the 2 banners was not mounted outside the livingroom so I didn't get to see the view, maybe someone will have a chance to post a bunch of pics manana. Later The Strayone

[AustinGuy]

Thanks for the update on the 360. I noticed they also updated their website with a lot of additional info.

Does anyone know if it is possible to get a unit in the 360 with views of the capitol building, downtown, and townlake from the same unit? Or is that just too wide of a spectrum from the location of the 360.

[Texas Tuff]

Does anyone know what proposal is planned for the vacant lot directly across the street from 421 West 3rd Street? (just south of the park). I have seen a few overhead photos of downtown (with models inserted) on this thread that shows a building there but haven't seen any renderings for anything planned for that space.

[GoldenBoot]

Originally Posted by tuffaso

Does anyone know what proposal is planned for the vacant lot directly across the street from 421 West 3rd Street? (just south of the park). I have seen a few overhead photos of downtown (with models inserted) on this thread that shows a building there but haven't seen any renderings for anything planned for that space.

That property is owned by the Austin Museum of Art. They plan to team up with a developer to develop the site. Other than Tom Stacy & Cesar Pelli’s names being thrown around, not much else is known at this time - at least publicly.

[meljoe]

Originally Posted by LookingUp

Novare 360 prices are $350-450 PSF, just like Spring. Spring raised their prices last month - construction costs, again. They hope to average $400 PSF. They have a few units at 700 SF @ $300 = $210,000. Most are priced over $300,000 for a reasonable space unit.

I'm wondering what your source is for pricing at 360. I demon-dialed them all day on Monday but could not get through to make an appointment. I even looked in at the sales center today and was told that they would not give out any docs or pricing until contract appointments. If anyone here was lucky enough to get an appointment for this next week - I'd love you hear about what you learn.
Many Thanks