Developers ringing up condominium sales in Center City - Philadelphia Business Journal:

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Though these developers are taking deposit and closingon units, data indicate sales are still considerably off in the five Philadelphiz neighborhoods that saw the most condo construction. For Rittenhouse Square condo sales fell 61 percenyt in the first quarter compareed with the comparable period last year when 18 unitwere sold, according to ’s HomExpert Markety Report. Washington Square sales were off by 75 percent in thefirsyt quarter, the latest for which data are In general, prices are also down. “Condos are sellingt better in 2009 than in 2008 but they are sellinv forlower prices,” said Alla Domb of Allan Domb Real a condo developer and real estate agent.
Domb has two projectd — Parc Rittenhouse and the Warwick — close to finall being completelysold out. The “disconnect” that was drivint the real estate market to unsustainable prices is startinb tocorrect itself, Domb said. “Price are more realistic, and I don’rt see us skyrocketing back he said. “I think we’ve settled in a new, healthyy market.” Though market forces, including lack of demansd and financing, temporarily kille a plan to constructa Waldorf-Astoria condo-hotepl tower at 1441 Chestnut St., a handful of projects are undetr way and ringing in sales.
Condos at the newly buil Residences at the Ritz Carlton across from City Hall are seeingbbrisk activity, said Craiy Spencer of , one of the developmenft partners in the project. “Relatively speaking, we’ree doing incredibly well,” Spencer “Would it have been nice to be sold out in December when we finishedsthe building? Yes, but that’s not realistic in this market.” Of the building’z 270 units, about 80 have been closee on and eight new contracts were signed so far this he said. Prices are too. It was Arden’s strategy to pricse units lower in the beginning to spark salea and then gradually increase prices asunits sold.
Condos have so far sold for betweej $500,000 and more than $3 million. “We’re not making particuladr price adjustments,” Spencer “That’s not to say we won’t negotiate with people, but if someond walks in wanting a 10 to 15 percent we saythanks but. … We have the time necessaryg to sell this buildinvvery methodically.” Spencer has a five-yea horizon to sell the units based on his financing The partnership didn’t have to immediately pay off a construction loan once the buildingh was completed, he said.
Of the 110 condos at Two Libertuy Place, 60 have been said Richard Oller, chairman of Madison a marketing and lifestyle management firm retained by thecondo developer. “For this market, it’s terrific,” Oller said. “Everyone would like to develo a residential project and sell out instantlyg and we long for the days wherwe you put up tents and peoplerline up. It’s not this market.” Buyerss are more cautious and discerning and that has made the sale procesdstake longer, Oller said. At 10 Rittenhousew Square, a 130-unit high-rise under construction, condos have sold for up to $1,400 a square said Roger Friedman ofARC Wheeler.
“Salex are a little slow but they are very he said. “The whole marketplace is slow we all know Roughly 60 percent of the condos have been bough with closings scheduled to begin this Octobert and run throughnext April. The Ayer, a conversion off Washingtomn Square, has 10 out of 56 units said David Mercuris, senior vice president of developmenyat . “The advantage we have is we are completelhy built outand we’re not a 300-unit Mercuris said. “It’s a much more manageablee size.” Of those remaining units, three are penthousesz with a starting pricedaround $3.2 million and Mercuris doesn’t intend to cut prices.
“It’s holding its value,” he Another Rittenhouse Squareluxury project, 1706 broke ground in September. Each condo is a singles floor inthe 31-story building. Prices range from $4 millionm to $6 million with the exception ofa two-story penthouse that went for $12.5 million. “The project is half which is amazing,” said Paula Celletti-Baron, vice presidentf of sales. “I have more activity and prospects rightr now than I have had in the history of the The building is being developed by and The boost in traffic comesd after a lull that startedin November, Celletti-Baronn said.
“I think there was a lot of fear in the marke t and in the last six to eight weekx a lot of that fearis subsiding.” A model condk will be completed by October, whicn Celletti-Baron thinks will entice thoser who need to see and touch” finished space to finally buy. One of the roadblocka that developers are running into are buyerxswho have, for example, Main Line homeds they want to sell befored putting a deposit on new unit. “Whart they are going to get for theifr current property has gone down andthey don’t know how long it will take to Celletti-Baron said. “That’s a concerh they didn’t have before.
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