Downtown Condos – How Many Vacant New Ones?

[lindismith]

Not sure if we’ve already covered this, but do we know how many vacant new condos there are downtown?

New condos are not in the MLS right?

It occurred to me on my run tonight that a lot of buildings I was running past were 75% dark. There wasn’t even that blue flicker of the tv shining out.

I’m thinking most likely we’re very close to 23,000 if we count them.

Mr. Brightside, do you know? Anyone else?

[PerryChase]

I see plenty of resale downtown condos on the MLS. But most of the new projects are sold through builders sales centers.

I too am very interested in downtown. I wonder who’s going to line up to buy those new projects coming down the pike. I suspect a few projects will get cancelled.

My friend’s building downtown is mostly empty. Lots of flippers still holding on.

[Mr_Brightside]

There are some new, unfinished condos listed in the MLS. The various sales offices do this to drive traffic to their office. I doubt that they are putting their entire inventory on the MLS. Back in 2001 it was normal to get a printup of every single condo, the size, view and price that was remaining in the building. I have one of these from Discovery on Cortez Hill. It’s interesting.

As far as the big new wave of condos coming in 2007 I have a thread going on my blog that discussed ICON which is likely the first of the towers to close next year. Based on what I’m reading even the Phase 1 people are sitting on fairly unstimulating contract prices. I am wondering how “sticky” the escrows are for all these condos next year.

http://sandiegomarketmonitor.blogspot.com/2006/08/icon-new-condo-development-near-petco.html

[PerryChase]

So Mr. Brightside, in a few years, after the new projects are completed, what prices do you think downtown condos will settle at? Say for a 1 bedroom.

My gut feeling about SD downtown condos is that they are selling a sleek minimalist urban lifestyle. However, as people move in they’ll find the space too cramped and will want to return to the suburbs. Afterall, this is not Manhattan or SF where people are stuck on an island/peninsula.

What is your take on the viability of downtown SD?

[Mr_Brightside]

I live downtown and love it. That said I think the turnover of people is fairly high as it’s pretty normal for people to move into the city, have a lot of fun but move out after awhile.

As far as prices go I think they’re heading to a more normal rent vs. payment ratio. I can see condos going back to 2002/2003 prices.

[PerryChase]

I’d like to live downtown also, that’s why I asked. I was just wondering if downtown will have the critical mass to be a real city.

What do you think of Smart Corner? It’ll have the trolley station right in front and the office building will house the San Diego Housing Commission. Will that corner be full of transcients who urinate everywhere? I walked downtown near there last week and the smell of urine wasn’t pleasant.

[Anonymous]

I don’t see any long term viability to downtown. Let’s face it, San Diego is a beach town period. People don’t move here to be cramped up in urban high rises. If you enjoy that lifestyle, you go to San Francisco or New York.

Additionally, downtown San Diego has no energy, no vibe compared to a real city. When I drive downtown to Padres games after work the place is practically a ghost town until you get near the stadium. You can see how dead the place is by observing how few lights are turned on in the various high rise condos at night, very few people actually live down there full time.

All it has is the gaslamp which is nothing more than a tourist trap by day and bar hopping circuit for drunk 20 somethings by night. Oh, but you do get to enjoy one aspect of traditional urban downtowns, plenty of bums and homeless people wandering the streets.

I wouldn’t consider liveing downtown no matter how cheap the condos get. I know many people on this board like the idea, and I know some friends who also are interested in living there but I just don’t get it.

[lindismith]

I agree Dead. I think it does appeal to a lot of transplants who come from big cities though.

[Mr_Brightside]

Downtown is awesome however I think that Cortez Hill and Little Italy are better places to live than Gaslamp, EV or Marina.

Being able to park your car and walk everywhere is very nice. If you like to have a few drinks once in awhile that makes it even better.

It’s not for everyone though.

All that said the prices are too high for regular people to buy which is why the market is correcting.

[unbiasedobserver]

Downtown SD is the same place is was 10 yrs ago, yet back then NO ONE wanted to live there. They built cityfront as the 2nd major condo development downtown (after harborview) and NO ONE would buy, so they turned cityfront into a rental. I rented there for a year, and sure it was a very nice place to live if you didn’t stray south past the gaslamp. Fast forward 10 years, same place with 1000’s and 1000’s ridiculously overpriced condos. What gives? BTW When Harborview was built in the early 90’s, it remained virtually unoccupied judging by the lights on any given night (<15%), evidentally it was owned by vacation dwellers.

[PerryChase]

unbiasedobserver, I’ve thought about moving downtown for a while now. However, I always hesitated for the reason you mentioned. 10 years ago, no one wanted to live there.
In my view, living in an apartment should be less expensive than living in a house. A two-bedroom apartment for the price of a spacious house always seemed ridiculous to me.

I’ll wait and see how things turn out in the next few years.

Mr. Brightside, I agree that Cortez and Little Italy have more life than other parts of downtown. However, I hate the architecture of Little Italy. And what about that hideous new tall tower in the middle of Cortez? What kind of architecture is that supposed to be?

[Anonymous]

I was at Icon today and told them they are overpriced. In June a fair price was $550psf, but now I estimate it’s closer to $500 or under. CortezBlu dropped their prices on 2 bedrms by $100K a couple of weeks ago, 1 bedrms by $40K. Same for Gaslamp Square. Nexus dropped to under $300K for 1 bedrms and under $400K for 2 bdrms. When Icon and Park Terrace open there might be some bargains (a relative term); at least for those of us who are looking for “lock and leave” types of places.

[barnaby33]

Downtown has two sets of forces, the progressive and regressive. On the one side, alot of money has been invested in downtown, both in the ballpark, and in all the condos being built. On the other is the low end element that has been there all along. I think what we are seeing is that downtown is balancing on a fulcrum. It doesn’t really have a draw for most yet, but it could. The question seems to be two fold. What would be the fulcrum for a large enough group to keep the condos from all reverting to low end rentals. The second part is that since we are most likely coming into recession, will those forces align to break the downtown out of the mold in which is currently locked?

As an aside I don’t see myself really living down there either. Its too cramped most places and even if things do get cheaper there, they will probably be cheaper in places I would rather live. I have too much a San Diego lifestyle. 5 dollar gas might get me there though!

Josh

[powayseller]

Downtown living is for people without kids, IMO. So for me, it holds no appeal at this point in my life. I live on a cul-de-sac, in a townhouse, with a dozen kids around me, of various ages. Right now, my boys are riding their bikes with the neighbor kids, who just stopped by while we ate dinner, and the dog is running around behind them. I could never have this kind of close and spontaneous playtime for my kids in most San Diego neighborhoods, and definitely not downtown. Yet we live close enough to shops that my son rides his bike to the gym, and my kids can walk to Robeks juice or the movies. So I feel I have the density of downtown, but without the noise. I have the trees, the quiet, the large park w/ pool and tennis courts and dog park nearby, the trails to go running…What does downtown have over this? Perhaps it has proximity to the airport, the freeways, but that is just noise and pollution. It doesn’t have the city feel of German cities, because the Gaslamp is just a bunch of restaurants; very boring if you just ate and want something to do.

So my first question, what do you like about downtown living?

What it is missing right now…what downtown SD needs to be a vibrant place where you can do more than go barhopping, and dining.

It seems if more of the condo owners actually lived in their condos, a critical mass of people would be reached, which would draw in shopping, theaters, art galleries, book stores, coffee houses…

Encouraging employers to move there would help too. In Germany, there is a very cute style of shops/businesses on the first floor, condos above. Why didn’t the condo developers develop their buildings with this in mind? Or did they? I have never set foot in a downtown SD condo.

[rankandfile]

From what I understand, San Diego, and many other California cities, were more or less designed around the automobile as being the main mode of transportation. In contrast, European cities and many older east coast cities like Boston, and Portland, Maine, were developed with foot travel and other slower methods (e.g. horse) of transportation in mind. They tend to be more compact and have cozy, narrow streets with shops on the first floor and housing above. If you look at maps of many European and older American cities, you might notice that they have a rather distinct circular pattern to their property and road layouts.

The automobile changed everything in terms of city design after WW2. Many cities in the west became places where you commuted to for work or to attend cultural or other events. People stopped living there because they could afford to purchase a good-sized home with a yard and all within a reasonable drive time.

Fast forward to 2006 and what you have are external pressures pushing the system back in the other direction. Copious traffic has eliminated the reasonable commute times and home prices in the ‘burbs are no longer the steal that they once were…unless you are willing to live in Blythe or commute 2-3 hours or more one way. Many cities in California (e.g. Riverside, La Mesa) are also pushing to become more “walkable”, whereby people can get the majority of their daily activities done by walking rather than driving.

Cities like New York and those in Europe tend to also have more mixed zoning at the NEIGHBORHOOD level than those in California. In other words, neighborhoods will have residential, retail, office, etc, space that promote foot traffic. How many of us can do all of their daily activities on foot here in SoCal? Chances are that we have to drive a number of miles in between work, the grocery store, post office, etc. Mass transportation also plays an important role, but I will not ramble on. You get the point.

[Author]

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