New Downtown Housing Study

[metro]

Myron's a good friend and my neighbor.


Study may prompt cheaper housing for downtown Oklahoma City
Journal Record
July 17, 2008

OKLAHOMA CITY – Myron Stout likes living and working in downtown Oklahoma City. He and his wife, Emeline Stout, are young professionals who moved downtown in May 2007 to the Legacy at Arts Quarter apartments. But when the Stouts, fresh out of law school, began looking downtown, renting was the better option, over purchasing a condo that would have greatly eaten into their budget.

The couple was not willing to invest as much as a quarter- to a half-million dollars in a condo.“We’ve got our share of student loans but I don’t consider us poor,” Myron Stout said. “We just work hard.” The couple, and other young professionals who want to live downtown, will likely be the focus of a proposed, updated downtown housing study.

In July 2005 Downtown OKC Inc. published a study by CDS Market Research, Spillette Consulting, that explored the budding residential market downtown and potential demand. That report showed little downtown housing development in 40years. It showed that since 1980 only 492 new units were permitted downtown – most of those in the northwest portion and the Deep Deuce area. At the time, 700residential units were planned downtown with a shift toward units for sale, but the 2005 report also mentioned for-rent units like Legacy. Since then, numerous rental and condo projects have been completed downtown.

The condos, however, have been expensive; now the focus will likely shift to work force housing that costs approximately $100,000 to $150,000. Kim Searls, director of marketing for DOKC, said last year her office budgeted $15,000 to do an updated housing study. Since then, the Greater Oklahoma City Chamber, Urban Renewal Authority and the city have all signed on to partner with DOKC in the project, which will cost about $75,000.“We kind of put this money on the shelf and said let’s see what happens,” Searls said. “And now this opportunity is there and so we’d love to go ahead and commit to them this $15,000 to do this new study.”

Oklahoma City Planning Director Russell Claus said now that a market has been established in downtown housing, the next step will be to look at the depth of the market and focus on work force housing.“We would like to get a better understanding of what that work force housing demographic is and what they’re looking for,” he said. Several condo projects downtown have come online in the past year, like Block 42 and the Centennial, and many of the highest-priced units have sold, with more planned.

Rental units like Legacy and the Park Harvey have also filled with tenants who could be potential buyers if the price is right. The last housing study took about three months to complete. JoeVan Bullard, executive director of Urban Renewal, said a new report would also take about 90 days. Claus said a lot of things have changed since the last study when downtown residents and nonresidents alike were polled to see if they would like to live downtown even though there were few to no options.

Myron Stout said he would welcome a new housing study. In addition to work force housing, he said a new study should also address a downtown grocery store, transportation and recreation facilities for downtown residents. Rather than wait for a more affordable option, the Stouts purchased a home in January on the northwest side of downtown in an area known as the Cottage District. The neighborhood is undergoing a resurgence with renovations and new construction and the house cost substantially less than a new downtown condo.

Myron Stout said he and his wife, and many other couples in their 20s and 30s, like a dense urban setting and would gravitate downtown if there was more affordable housing.“Downtown was just the obvious choice,” Myron Stout said. “We just didn’t want that suburban lifestyle. Not yet.”



The Deep Deuce at Bricktown apartments are shown on Second Street, east of downtown Oklahoma City. (Photo by Chris Albers)

[mecarr]

I agree. There needs to be more affordable housing downtown. That's the only way downtown will ever reach its goals.

[Midtowner]

Yes, the early adopters will likely end up taking a hickey. I don't see how the market can sustain $250-$300 sq. ft. prices in a market where subruban housing can be bought for less than 1/3 that price.

Urban housing does not cost that much more to build, especially when land is being provided on the cheap by OCURA and often, building is subsidized with TIFF and other free money which developers don't have access to in the 'burbs.

I can't blame developers for charging the highest price that the market will bear though. I can blame the banks who loan money on these properties in such an uncertain and obviously inflated market.

I'm waiting for the bubble to burst, then I'll be in the market.

[metro]

Downtown housing market to become more inclusive
Oklahoman
By Steve Lackmeyer
Business Writer

After spending a seven-month stint living and working in downtown Madrid, Spain, Casey Cornett is eager to enjoy a similar experience now that he's working at a downtown Oklahoma City public relations firm.

But the 25-year-old, a 2005 Southern Nazarene University graduate, has so far had to settle on a daily commute while living in northwest Oklahoma City.

"If you have a lot of money, there are a lot of options,” said Cornett, who works at Brenda Jones Public Relations. "But if you're looking for something at an entry level, there are no affordable places to rent.”


Study prompts more building
Oklahoma City Planning Director Russell Claus suspects Cornett isn't alone and is planning to hire a consultant to look at the housing market.
Up to $75,000 will be spent on the study with cooperation from the Urban Renewal Authority, the Greater Oklahoma City Chamber and Downtown Oklahoma City Inc.

"We will gain a much clearer understanding of what the demand demographics are for downtown housing,” Claus said. "Now that we have product on the ground, people have a better understanding of what downtown has to offer ... before it was all theoretical.”

Construction of downtown housing first took off after a 2000 study by Houston-based CDS Market Research indicated as many as 6,000 residents were eager for downtown living and willing to pay more for it.

The study also indicated a pent-up demand for urban living among young professionals living in two- to three-story apartment complexes in northwest Oklahoma City.

A 2005 update predicted growth of between 2,250 and 4,250 housing units — both rental and owner-occupied — through 2010.

Hundreds of apartment units and dozens of for-sale homes have been built since — but have yet to top the 1,000 mark.

Market may be shifting
Claus doesn't think downtown is falling short of expectations. But he suspects the market is shifting from high-end housing to work force housing that would attract buyers such as Cornett.

"We've had a lot of housing starts spread across a number of developers,” Claus said. "We have a lot of people expressing confidence in the market ... it might not be as concentrated on the higher end as we've had.”

Brett Hamm, president of Downtown Oklahoma City Inc., called the early studies "tools” that worked as intended — to generate developer interest in downtown housing.

"I always go back to 1995 when Nick Preftakes did the first downtown housing development in decades with the Garage Lofts and the banks wouldn't lend him money. He had to do it with cash. It's been full ever since.”

Housing options
Brett Hamm, president of Downtown Oklahoma City Inc., cautions against confusing work force housing, which is aimed at recent college graduates and young professionals such as Casey Cornett, with lower end Section 8 housing built for low-income families and people on public assistance.
"We have work force housing now with the Harvey Lofts and with the Lofts at Maywood Park (which are under construction),” Hamm said. "They include units in the low $100s for those looking for an entry into owner-occupied housing.”

More than half of the Lofts at Maywood Park have waiting buyers, and Cornett said in his search he found what's left are the higher-priced units.

"Sales on these developments show demand is greater than the supply,” Hamm said. "And Casey Cornett — he's the demographic we're trying to attract.”

[DelCamino]

What's the point of another downtown housing study to tell us the facts we already know? It seems obvious the market demand is in place for affordable downtown housing. The City is already aware of the demand and need.

The City isn't going into the development business and will not be building the homes, so I wonder: what are they going to do with this study when complete? Wave it in front of developers and say, 'See, people want this type of housing. Please go and build it.' Sophisticated developers already have this kind of information and this study will not provide them information or data that they don't already possess.

I'm the last the be critical of the city's efforts, but it seems to me this will not provide us with any new information, other than something of a 'status report.' Hopefully the report will contain information on what the development community requires (incentives: financial, utilities, street improvemets, etc), if anything, to entice them to build affordable units downtown.

[sroberts24]

ok we need cheaper donwtown housing.... time for a residential highrise to go along with the devon building!!!! please?????

[Luke]

My wife, daughter and I would love to live downtown. Just can't afford it. And those that are currently "affordable" are 600 - 700 sq ft. Not nearly big enough for a growing family.

[OKCMallen]

It'll happen, and we need studies to show how much of them and at what price. I bought a house at 50th and Western, but wanted to move downtown. Simply couldn't afford it, and for what rent is for a grand studio (not even a 1-bedroom) at the Park Harvey, I'm owning a 3-bed house with a 10-minute commute downtown. Not too shabby. Once the market makes it worth my money to be downtown, I will be.

[sroberts24]

It'll happen, and we need studies to show how much of them and at what price. I bought a house at 50th and Western, but wanted to move downtown. Simply couldn't afford it, and for what rent is for a grand studio (not even a 1-bedroom) at the Park Harvey, I'm owning a 3-bed house with a 10-minute commute downtown. Not too shabby. Once the market makes it worth my money to be downtown, I will be.

i think there are thousands of people who are thinking the same thing!!!

[DelCamino]

i think there are thousands of people who are thinking the same thing!!!

Couldn't agree more. And two previous studies (OCURA, late 90's, DOKC study, 2003 or 04) have said the same thing. I'm merely questioning why the City needs to spend this $$ on yet another study, that will provide us with info we already have.

[sroberts24]

yeah thats $75,000 on something we already know!!! put that to something else! And than get some builders looking DT to put a residential highrise in! you know how crazy people would be to live in a 30-40+ tower DT, i sure as hell would

[Pete]

The main reason everything is so expensive right now is that OCURA has consistently chosen the higher-end developments.

I'm all for the study, however, because it will help developers get backing and financing. And perhaps put some pressure on OCURA to select more affordable projects.

[soonerguru]

I shudder to think of the kinds of "affordable" developments OCURA will sign off on. Geez, we need to get some visionary people in position to lead our city and retire the old guardians.

[DelCamino]

yeah, the projects selected have been high end. But OCURA can only select what's in front of them and none of the proposals over the last several years that were submitted for the UR property contained the kind of quality housing were talking about. All of the submissions have been for high end residential units.

(Not even McDermid's, etal, proposal for The Hill. It had some lesser expensive units, similar to what they are now building along 2nd Street, but still not they type of housing we're talking about here).