Why Uptown’s first condo project since the recession was doomed

Why Uptown’s first condo project since the recession was doomed
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1Brevard was supposed to be the revival of the condo scene in Charlotte. The stamp on the new wave of development that condos are back (along with office, hotel, retail and apartments). I wrote excitedly about the project slated for the corner of 4th and Brevard streets in Second Ward — but behind the scenes, I knew something was wrong.

I was scared to comment on the absurd pricing and the fact that a pool deck was mostly covered (seriously?). But this project was near doomed the minute it was announced.

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The developer and all involved, Gundolph LLC, The Littlejohn Group, etc, announced last week that the project is being canceled due to the lack of a pre-sale market. They’ve now said they have other plans for the site. What really bothers me about this is it’s a total cop out and a refusal to take some of the blame.

Instead they go on to say how great this project could have been for the city (with its art facility, pocket park and residences) but that the community didn’t respond.

Now before I go into this I am not a real estate expert. I don’t know what goes on behind the scenes. But I know what I see and it seems pretty clear to me that it’s not the market’s fault for not responding.

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The cheapest units here were going for around $580 to $650 per square foot. For those not familiar, these is an absolutely insane per-square-foot price for anywhere in Charlotte. For example, you can get a condo in 230 South Tryon (the building right next to Ruth’s Chris and Romare Bearden) for around $400 per square foot or less. And this is with a Tryon address, located in the heart of Uptown, and walking distance to virtually anywhere.

I found some units in comparable markets (Nashville, Austin) that had center city units with great views that also hovered around $400 per square foot. Sure, there were also units with insanely high per square foot numbers, but they were generally penthouses or located centrally in the city.

1brevard-condo-set-up

1Brevard was asking for their $600-ish per square foot for a location that overlooks the bus station, a giant parking lot (that’s owned by the railroads and will not be developed any time soon) and would block views from Fahrenheit. To me, doesn’t seem worth it to pay this much money if every time I want to go to the heart of Uptown I have to walk past vacant lots, the main bus terminal or the government district.

I must note, before people start ragging on me about trashing the perception of the bus terminal (CTC) I understand that perceptions aren’t everything. The station is very well policed, and is a light rail stop in and of itself. I just mean in general 1Brevard was detached from the heart of it all.

Sure, units on the higher floors would have stellar views but the per-square-foot for these units are even more ridiculous. Could these prices have worked if they built a tower at Trade and Tryon? Perhaps, but I still don’t think Charlotte is a market ready to absorb an entire tower full of ultra high-end condos.

1brevard-pool-patio

Back to the developers blaming the market. If you look at the townhome projects popping up all over the city, they are selling so fast developers can’t build enough of them. People are wanting to buy, renters want to buy where they’ve rented for so many years and have nowhere to do it… nowhere affordable anyway.

The Skye condos (in the building with Fahrenheit in it) is on the same plot of land and those sold relatively okay, but it was a LONG time coming for those (that project was in development hell forever) and weren’t reliant on a pre-sale market.

I don’t mean to completely trash the developers because their hearts were in the right place, just don’t go immediately blaming a market that’s “not there” when clearly it is. There was just some bad info received by the developers on the viability of an ultra high-end condo building at this location.

Photos via Elliot Roth and 1Brevard.

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