Plans announced for last pad in Lower Bricktown!

[metro]

Once again Hogan disappoints. 2 stories is not enough for this pad site. He could have easily made it more stories and filled it up.

Lower Bricktown marketing efforts underway for planned Building 7
By Heidi Rambo Centrella - 2/7/2007

Construction is on pace and further development is on its way in Lower Bricktown as developer Randy Hogan, principal partner of Stonegate-Hogan, has plans in place to develop the last remaining pad available north of Interstate-40.


Situated between Toby Keith’s I Love This Bar and Grill and Harkins Theatres, what’s currently dubbed Building 7 will provide approximately 11,000 square feet for retail on the first floor and another 11,000 square feet for office and entertainment space on the second floor.


This, Hogan says, is a combined effort with that of The Centennial mixed-use project, which -- on the retail side -- will provide for a little more than 12,000 square feet.


“A lot of this is about the synergy of the tenant mix, so that space becomes very important as we build a critical mass of entertainment, dining and retail,” Hogan said, adding that developing Building 7 would be predicated to pre-leasing at least 50-percent.


Efforts to recruit retail began just last week, he said, and so far “it looks very encouraging.”


“But we are going to be patient, because we want to get the right mix (of tenants) before we start on this,” Hogan said. “A few groups already are looking at it - a mix of local and regional groups.”


Two businesses scheduled to move in to The Centennial's retail space include Starbucks and King Pin Lanes bowling center. And the residential occupancy has just reached 65 percent.


“Our goal is to bump 70 percent by the end of the month,” Hogan said of the one- and two-bedroom units ranging in price from $300,000 to $600,000 at a blended average of $288 per square foot and includes two underground parking spaces.


Editor's note: An in-depth report on the progress of Lower Bricktown will be included in the Feb. 19 print edition of OKCBusiness.

[fsusurfer]

300 grand for a 1 bedroom condo is just nuts. I can get a one bedroom condo ON THE BEACH in the Destin area for about that much.

[Easy180]

I think the upcoming Starbucks bumped the condo price up another 50 K

[metro]

I agree, for OKC that is nuts. Forget about Destin, FL, 300k can get you a decent one bedroom condo in NYC or South Beach, FL.

[writerranger]

To put the asking price of the condos in perspective, with just a cursory look on the web, I found that several one-bedroom condos in Del Mar, CA (San Diego!) can be had for less than $300,000.00. Not a bad location.....(see below).


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[ksearls]

I've heard 23 of 30 units are spoken for. Somebody out there thinks it's worth it to be in the middle of the Bricktown action.

Kim

[floater]

I think a lot of those are becoming corporate housing. If you have the capital, why rent you can buy? I also think we're underestimating the wealth in the area. There are some people who may have Hollywood-level incomes but with real estate so cheap here, they can afford second homes. All those people with ranches in the outskirts (doctors, lawyers, entrepreneurs, NBA players) probably are looking for an urban address with all that's happening downtown now.

[writerranger]

I think a lot of those are becoming corporate housing. If you have the capital, why rent you can buy? I also think we're underestimating the wealth in the area. There are some people who may have Hollywood-level incomes but with real estate so cheap here, they can afford second homes. All those people with ranches in the outskirts (doctors, lawyers, entrepreneurs, NBA players) probably are looking for an urban address with all that's happening downtown now.

Good points, floater. About corporate housing, some condos have association rules that prohibit that. Are you just speculating or do you know something? Your thoughts on suburbanites with huge incomes wanting an urban outpost is also quite possible.

Kim, Obviously, you are right. I don't understand it at those prices, but you are quite correct.

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[metro]

Yeah, I know a lot of the Centennial and a few other developments have sold condo's for corporate housing. I also know that is the main focus of the 360 on NW Expressway. I know the new Legacy Summit at Arts Central claims to have preleased a bunch of corporate units as well. Good points that are often forgotten about. I'm sure floater is also right about NBA players, CEO's, and other's wanting a second residence. I know a few that are doing it, probably many more that I don't know about.

[Martin]

johnnyboy... i agree that this is an inexpensive city to live in, but i think the point being made is that some of these new condos are not priced consistently with our market. feel free to argue otherwise... but i think you can do so without telling people to 'shut their face' when their opinions don't match yours. -M

[jbrown84]

Aw, spill the beans Kim!

[metro]

Kim might be referring to McDermids newest proposal somewhere around 2nd street in Deep Deuce. He's talked about it publically before but hasn't made an official announcement yet. It would be close to the Maywood Park development in the Triangle. He plans to target them for around 100K or so to the first time homebuyer with a smaller income.

Don't pay any attention to johnnyboy, his posts never make sense and never has any truth to back his claims up.

FSU I feel sorry for you wasting your money in a place I'm guessing is the Deep Deuce apartments. Not sure where you've been but the Harvey Lofts have been open for awhile now and start at around $120K. If you're paying $1000 in rent, a mortgage on that would easily be about what your paying now, and possibly cheaper if you're credit is good. Not to mention the fact you would be building equity.

[fsusurfer]

Kim might be referring to McDermids newest proposal somewhere around 2nd street in Deep Deuce. He's talked about it publically before but hasn't made an official announcement yet. It would be close to the Maywood Park development in the Triangle. He plans to target them for around 100K or so to the first time homebuyer with a smaller income.

Don't pay any attention to johnnyboy, his posts never make sense and never has any truth to back his claims up.

FSU I feel sorry for you wasting your money in a place I'm guessing is the Deep Deuce apartments. Not sure where you've been but the Harvey Lofts have been open for awhile now and start at around $120K. If you're paying $1000 in rent, a mortgage on that would easily be about what your paying now, and possibly cheaper if you're credit is good. Not to mention the fact you would be building equity.

I know your probably right. I moved here 5 years ago thinking I would only be here a couple years. Well, 5 years later I'm still here! Thanks for the info...

[BDP]

300k can get you a decent one bedroom condo in NYC

Really? Where? Do you have a listing? I'm being serious. If you can do that, I might have to consider it.

[metro]

Perhaps not an uber luxury condo in Manhattan but in the NYC area you could get a one bedroom for that easy. Notice how the post said decent, not uber luxury with this ridiculous new developments going up in NYC, Vegas and Miami.

Perhaps you haven't done your homework BDP, the first google search I did for "NYC condo's under 300k" the first link google listed has 43 properties under 300k and the information is within 2 weeks of being new. Surely someone savvy and willing enough to invest in an NYC condo would do a little more research than a 5 second search I did on google.

Manhattan Real Estate: New York City Real Estate Tips

[BDP]

I did 3 searches on real estate sites for 1 bedroom condos in NYC between 250k and 350k and couldn't find one. I thought you meant NYC, not "NYC area" and I thought we were talking about 1 bedroom condos, not one room apts like the ones you linked to. Big difference. Those are 300, 425, and 400 sq ft. all with the simple criteria of "below 96th street". Someone savvy and willing enough to invest in an NYC condo would understand the important differences in these criteria.

These condos are also not just anywhere in OKC, are 1 bedrooms, and will be bigger than 500 sq ft. The article said that there is a $288/sq ft average. At 300k, that's 1041 sq feet, close to or more than 3 times the size of those you linked us to. There is still not much on the market for downtown OKC. It stands to reason that they would at the top end of the OKC condo market and these prices simply reflect that.

So, again, if you find me a comparable 1 bedroom condo in NYC for anywhere near the same price... well, if you find that, you should buy it.

[fsusurfer]

I did 3 searches on real estate sites for 1 bedroom condos in NYC between 250k and 350k and couldn't find one. I thought you meant NYC, not "NYC area" and I thought we were talking about 1 bedroom condos, not one room apts like the ones you linked to. Big difference. Those are 300, 425, and 400 sq ft. all with the simple criteria of "below 96th street". Someone savvy and willing enough to invest in an NYC condo would understand the important differences in these criteria.

These condos are also not just anywhere in OKC, are 1 bedrooms, and will be bigger than 500 sq ft. The article said that there is a $288/sq ft average. At 300k, that's 1041 sq feet, close to or more than 3 times the size of those you linked us to. There is still not much on the market for downtown OKC. It stands to reason that they would at the top end of the OKC condo market and these prices simply reflect that.

So, again, if you find me a comparable 1 bedroom condo in NYC for anywhere near the same price... well, if you find that, you should buy it.

I agree, it would probably be hard if not impossible to find a 1 bedroom condo for 300,000 in NYC, however in many other downtowns it is not. The problem is, is that on average, these other cities with comparable prices on condos have higher average incomes. Yes, OKC is a cheap city to live in, however that is due to fact that the average income for workers is lower than in other major cities.

[AFCM]

Geesh......................chill.................. .out...................johnnyboyokc............... .............

[BDP]

I agree, it would probably be hard if not impossible to find a 1 bedroom condo for 300,000 in NYC, however in many other downtowns it is not. The problem is, is that on average, these other cities with comparable prices on condos have higher average incomes. Yes, OKC is a cheap city to live in, however that is due to fact that the average income for workers is lower than in other major cities.

Those are definitely good points. I do agree that they seem a bit high, but they also seem to be getting interest at those prices. We won't know until these places start closing how much they are really worth. Oklahoma City is a bid down market and it wouldn't surprise me to see these come down as well. These prices are high for Oklahoma City and higher than some other cities' downtowns, but are they higher than most cities high demand low inventory areas? Not really.

Downtown is still a very small and an immature market and what we're seeing now are the first new apartments with new amenities in a very long time. The area is really becoming an attraction and there is a lot of upside speculation going on. Again, I don't think we know the true worth of these properties, but I would be very surprised if any of them were introduced as affordable housing initially. I'm not saying that the prices aren't high, I'm just saying that it seems completely normal to me that they would be.

[fsusurfer]

Those are definitely good points. I do agree that they seem a bit high, but they also seem to be getting interest at those prices. We won't know until these places start closing how much they are really worth. Oklahoma City is a bid down market and it wouldn't surprise me to see these come down as well. These prices are high for Oklahoma City and higher than some other cities' downtowns, but are they higher than most cities high demand low inventory areas? Not really.

Downtown is still a very small and an immature market and what we're seeing now are the first new apartments with new amenities in a very long time. The area is really becoming an attraction and there is a lot of upside speculation going on. Again, I don't think we know the true worth of these properties, but I would be very surprised if any of them were introduced as affordable housing initially. I'm not saying that the prices aren't high, I'm just saying that it seems completely normal to me that they would be.

Good points. One problem I think has happend, is some of the price points were set a year and half to two years ago when 1) the real estate market was in a boomimg and 2) the hornets looked like they might become a permanent fixture which would increase the "value" of living downtown. The thing the perplexes me, is the price points of many of these places are above the amount that many people who are attracted to the bricktown area and who pump money into the area at all hours of the day can afford. (young professionals who are out in bricktown spending the money on the weekends, partying it up every night, shopping in the high end stores, ect.). I mean, I saw one advertisment for Maywood trying to get grandmothers to move in. I love my grandma, but I dont think grandmas are the type to pump money into downtown on a regular basis. Also, if companies are purchasing some of these places for out-of town guests to live in, in the long run does that really help to pump money into the local market. The apartment above me used to be rented out by a company. There was someone there maybe 3 days out of the week at most. They would come in town, go to work, come home and sleep, and then jump on a jet and were out of there a couple days later. Another problem I see is re-sale value. Once the "newness" factor wears off in 5-10 years, is a one bedroom condo really going to be able to sell for 300,000 dollars. I think we can all agree, OKC is growing, but it will be no NYC in the next 50 years. And on top of that, in 10-15 years who knows what sort of direction downtown may have taken. Many entertainment districs have been known to boom, then burn across the country. I know we all hope for the best, but points of interest can shift. Investment wise, I dont think its a smart decision. We'll see what happens, I bet your right that some price points will probably fall over the next year.

[stlokc]

Very good points.

If you want another perspective from a city that doesn't get quite as much attention in OKC as Dallas does:

I live in St. Louis, MO and the downtown here is probably 3-5 years ahead of OKC in terms of residential redevelopment. In the late 1990s as the first projects were getting off the ground, there were many of the same arguments about price points and affordability for young buyers. But the interesting thing is each project kept seling well and kept leading to more projects. Even at high prices. I couldn't understand this but a developer friend of mine said a market like that doesn't always follow what you think you know about supply and demand. The more people flow into a downtown, the more people think it becomes a viable option. So the supply begins to drive the demand, instead of the other way around. Only a few may want to be pioneers, but as more people begin to actually know people that live down there, more people's eyes get opened. There are now 10,000 living in downtown STL.

As for "grandma," I used to think the same thing. But my developer friend said people move to a downtown in waves. The first wave is the twenty something, but once the area gets stabilized, the next wave is empty nesters. A lot of the people buying in Downtown STL now are 55 year old couples whose kids are gone, and they want to be close to theaters, stadiums, etc. and downsize from big houses in the suburbs. And they do have a lot of money to spend in restaurants, way more than your average 28 year old with a $50K job.

Not saying OKC will develop the same way, but the ingredients seem to be getting themselves in place.

[BDP]

Again, solid points and very valid concerns.

the price points of many of these places are above the amount that many people who are attracted to the bricktown area and who pump money into the area at all hours of the day can afford.

Unfortunately, I think this is the case with many areas that have become "hip" and/or gentrified across the country. The young workers, artists, and hip businesses that end up making a once unfavorable area desirable once again, soon find that they can not afford their current digs and have to migrate elsewhere. Places like NYC, San Francisco, and Chicago have all had problems with the creative and young professional classes eventually being priced out of the very areas that they defined and made attractive.

In the case of downtown and bricktown, these prices may prevent the area from becoming the hip place to live that everyone is anticipating and marketing it as. If anything, I think these price points are set based on the idea that all of these projects will eventually create a truly unique and interesting place to live in OKC. Ironically, placing it out of reach of OKC's young workers may prevent what their selling coming to fruition.

Also, if companies are purchasing some of these places for out-of town guests to live in, in the long run does that really help to pump money into the local market. ... They... come in town, go to work, come home and sleep, and then jump on a jet and were out of there a couple days later.

Well, that's actually the best kind of money in terms of the city economy as a whole, because it truly is money coming into the economy instead of simply being reallocated to another sector. In effect, it is a true net gain. However, I think there is a valid concern that the specific district may not get as much of a long term gain form the situation and, in turn, the city's goal of creating a new lifestyle option in OKC is not met. Permanent residency goes much farther towards the vitality and, ultimately, the inherent attractiveness of an urban district. Let's be honest: downtown housing is not about price per square foot, as much of the city real estate is measured. It's about obtaining a lifestyle otherwise not available in the area.

And on top of that, in 10-15 years who knows what sort of direction downtown may have taken. Many entertainment districs have been known to boom, then burn across the country.

This is true. Right now, I think the outlook is good and these developments in and of themselves help with that outlook. In a way, they are justifying their own premiums. But they will have to find that balance for sustainability. That's why it's good for the developers themselves to have long term interests through their retail and office space leases and is why the city should favor mixed use developments. If half a building is leased to businesses, then the developer has an interest to sell all of its residential properties to keep them full to make the lease properties more attractive and, in turn, sustain a better long term cash flow for the property.

I dont think grandmas are the type to pump money into downtown on a regular basis.

It depends on the grandma, obviously, but it probably isn't the right direction to go. However, it does seem that empty nesters is the angle many developers are going after now to sustain their high asking prices that were initially inflated by young professionals. It's kind of funny compared to 10 years ago, but older retirees are becoming an important sector for urban developers.

Another problem I see is re-sale value. Once the "newness" factor wears off in 5-10 years, is a one bedroom condo really going to be able to sell for 300,000 dollars

No one can say for sure. If these places can create a vital downtown residential strict that has 24/7 feel, I think they will hold their value, because, if for nothing else, you won't be able to get that life anywhere else in Oklahoma. If 3% of the housing mix is downtown and 5% of the buyers are interested in urban living, they will hold their value. I don't think those are outrageous numbers for OKC, so it could happen.

Investment wise, I dont think its a smart decision.

I think I agree. This is not a flippers market. I'd look to the Paseo or University Park for that. The truth is that OKC is not going to be a get rich off of your house type market anyway. Downtown housing is mostly a lifestyle choice and these prices reflect the promise of a lifestyle that downtown can not quite offer yet. For these places to hold their value, I'd say your going to need to see more retail, a grocery store, some corner stores/delis, etc. within walking distances or connected by easy public transit very soon. I think if all that stuff was already in place, we wouldn't worry so much about these valuations. Basically, the idea of urban living is built into these prices and the sustained value of the properties completely depends on that vision becoming a reality in the next 2-3 years, imo. Beyond that, if some of the core to shore ideas come to be and MAPS 3 brings some new amenities to the area, we could in fact see some appreciation, but I’m thinking that won’t happen until 2012, when the freeway is moved.

[writerranger]

What a great thread. I wish most could have this kind of give and take without all the anger and pettiness.
[on edit: After reading the thread through again - I realize there was one notable exception]

There have been some things written by several that have helped me understand how this may all play out. A lot of things I hadn't thought about before really made a light bulb go on for me. It was interesting to hear about the St. Louis experience too. Good stuff in this thread.

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[fsusurfer]

Good information BDP. I think we both kind-of see it the same way. At those prices, its sort-of a roll of the dice as to whether downtown will be able to sustain the level of interest that will draw such a high price on housing. One thing about St. Louis is the fact they have a professional baseball team and football team located pretty close to downtown which definatly ups the "value" of living in the area. I think we've already seen one condo (however not directly downtown) that hasn't exactly done as well as intended, the Classen. I believe at the begining they were all meant to be sold, however now they are trying to lease out many of the units and from what I've heard there are still quite a few available.

[stlokc]

FSUsurfer,
You are right about St. Louis having pro football and baseball (and hockey) downtown. However, the most important thing helping the revitalization of downtown St. Louis is the large concentration of offices. I have written about this in other posts - when you have big corporate HQ (AG Edwards, Purina, Anheuser-Busch, AT&T Regional etc.) and dozens of large law firms and banks, not to mention the daily newspaper downtown, than you have a mass of young, educated, relatively affluent people already in the neighborhood ten hours a day.

The things that are going on in downtown OKC and Bricktown are fantastic! But entertainment tastes are fleeting. Ultimately you can't rely on restaurants, retail, ballparks, etc. Downtown has to re-build its business base and the city as a whole has to attract or grow more of the types of companies that employ people who would want/be able to afford to live downtown. I know that's not the topic of this thread, but it is so essential. Everybody talks endlessly about the entertainment aspects of MAPS, etc. but the less sexy corporate offices are what is really going to make a neighborhood work. People like living close to where they work.