Why does OKC have such a lack of condos and townhouses?

[Pete]

We have tons of 2-story homes, condos, townhomes, patio homes, apartments of all types...

What specifically are we lacking and where?

[Spartan]

Everything and everywhere.

I don't see how this is even up for debate.

[Pete]

Everything and everywhere.

I don't see how this is even up for debate.

There is nothing to debate if you can't be specific.

[Spartan]

http://www.condo.com/StateLawDownloads/Oklahoma.pdf

I don't know, I'm not an expert on state law. But if you are to believe what several developers are saying, who would otherwise develop condo properties, then the answer lies in the text of this law.

Unless you're looking for more specifics on what real estate OKC does and doesn't have? We both know that OKC is the land of the ranch house. Arguing otherwise is like pleading that the glass is a quarter full.

[Pete]

I am quite sure that what McKown was saying is that the math of inexpensive condos won't work downtown; or even inexpensive apartments. I don't recall anyone ever saying there was something about Oklahoma law that would make such projects too difficult -- that doesn't even make sense, especially since there are hundreds of condo developments in OKC and Tulsa.


As for the bigger issue, I think these "it all sucks but I don't want to get into specifics" discussions are pointless and was therefore trying to lead things away from sweeping generalities.

[Spartan]

Nope. The math thing is a canard because as has been correctly pointed out, condos seemingly exist in other land-locked cities. The local home-building establishment doesn't build nice multi-family. That's just a truth...perhaps because until lately the Oklahoma economy has never produced a great deal of transplants, who typically rent for the first year or two (like myself).

We build great ranch houses. That's what we do. We even come up for alternate typologies for them like "Dallas-style" lol

[Pete]

There are plenty of nice multi-family projects all over OKC, including condos.

[adaniel]

We have them but I definitely would not say that OKC has "plenty."

http://www.naisullivangroup.com/OKNe...ghborhoods.pdf

Meeting housing demand over the next 20 years, he said, will require different kinds of
building. He said 90 percent of housing being built now is designed for families with
children, but that demographic represents just 34 percent of the population and is in
decline.

More condos will be needed, Claus said. A city survey showed 9 percent of respondents
wanting to live in a condo or town house, but those kind of homes make up less than 1
percent of the housing supply in Oklahoma City.

[Pete]

^

Yet, the existing condos/townhouses on the market now are going super-cheap, showing very little appreciation over the years -- far less than single family homes.

And the new construction projects have been very slow to sell.


I'm very sure that if demand picks up, there will be plenty of developers who will be happy to build and make money. We are seeing that now in the apartment market.

[bchris02]

All of the huge, extravagant condo towers built in other cities during the 2000s were a prime example of the real estate bubble and the excesses of the era. They were based on speculation and not market reality. Yes, it would have been great for the OKC skyline if the market had waited a couple more years to go bust, but like in many other cities, they probably would have sat dark and empty, ended up foreclosed on, and then re-purposed as apartments. Some in Charlotte simply halted construction and sat unfinished and still do to this day.

It sure would be nice to have something like the Austonian in OKC though.

[DenverPoke]

http://www.condo.com/StateLawDownloads/Oklahoma.pdf

I don't know, I'm not an expert on state law. But if you are to believe what several developers are saying, who would otherwise develop condo properties, then the answer lies in the text of this law.

Unless you're looking for more specifics on what real estate OKC does and doesn't have? We both know that OKC is the land of the ranch house. Arguing otherwise is like pleading that the glass is a quarter full.

Denver is dealing with similar construction defect law issues. There is HUGE demand for downtown condo development, but developers aren't willing to take the risk involved. From what I understand, court rulings have allowed HOAs to pool money together on the behalf of individual unit owners to file a claim, thus there is virtually no cost/risk involved to the plaintiff so lawsuits increase exponentially. I've also heard that obtaining insurance is very difficult for developers, so much so that each unit requires $10-$15k in insurance, thus increasing the unit cost to a point where it makes less sense to build.

[tomokc]

Condos were overbuilt here in the 1970s and 1980s, including condo conversions from apartments. Many of the "premiere" condominiums were built by a developer known more for his eyewash than quality. The bust hit, that developer went away, and those well-heeled owners were left having to fix structural problems arising from shoddy construction. Today those people and their children remember this, and are justifiably reluctant to buy condominiums.

There is demand for quality condominiums and small lot patio homes, at least in my part of town. There are wealthy boomer empty nesters wanting to downsize, but Chesapeake has bought virtually all of the submarket condo stock (even if available the units would all be 30+ years old, so consider these obsolete). One group recently bought a parcel of land on which they are attempting to sell lots for patio homes, but the lots are priced at $350,000 (on average) - build 3,500 sf at $200/sf and you're looking at $1 million. They haven't sold one in a year because there are too many nearby houses available for less than that, and are easier to finance. (My thought is that high rise condominiums should have been built on that parcel.)

I think the market is ready for condominiums, but buyers will have to get past their memories of the bad products built the 1980s, the market will have to digest Chesapeake's condominiums when they are sold, and a developer will have to step up to the plate.

By the way, I sold one condominium in OKC last year, but own one in another market.

[Rover]

Don't know what part of town you are looking at, but there are a bunch of condo/town home/duplex/foreplex in north OKC. Then, there are a several good zero lot line home developments too.

[Plutonic Panda]

All of the huge, extravagant condo towers built in other cities during the 2000s were a prime example of the real estate bubble and the excesses of the era. They were based on speculation and not market reality. Yes, it would have been great for the OKC skyline if the market had waited a couple more years to go bust, but like in many other cities, they probably would have sat dark and empty, ended up foreclosed on, and then re-purposed as apartments. Some in Charlotte simply halted construction and sat unfinished and still do to this day.

It sure would be nice to have something like the Austonian in OKC though.

It's still going HAM in Miami.

This was to be built back in 2010 I think and it should be completed by now or still u/c but very close.



I don't want to Hijack this thread, but here is one more

62 stories tall.

Here is a website listing all of Miami's condo wether they're done or currently under construction. It is worth looking at as there are extremely impressive ones in there.
http://themiamicondocollection.com


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As for OKC, I think it just has to do with lack of interest at this point. Garden homes are apparently becoming very popular Edmond and I know there is a new condo development in Edmond on BLVD. and Covell. It is only 2 or 3 stories, nothing at all special. I think OKC will get some in the near future as the market expands.

[bchris02]

If there is another boom where these types of developments take off, especially speculatively, I would expect OKC would be in on it this time. Such a boom would be a fast way to transform the skyline of OKC as well, much moreso than waiting for office towers to be built/announced. It will take out of state money to make it happen. The national economy, six years after going into recession, is still not firing on all cylinders but if/when it does I expect these types of developments to start being announced again.

[Plutonic Panda]

OKC will never experience a condo high-rise boom like Miami's, but we could definitely support a couple significant towers in the future I bet.

[adaniel]

Don't know what part of town you are looking at, but there are a bunch of condo/town home/duplex/foreplex in north OKC. Then, there are a several good zero lot line home developments too.

There are some very nice albeit a bit older patio homes off of 122nd and Meridian that are really nice. I went to a party there last year and was really impressed by the area; this person's home was right off a pond. I am a creature of downtown though and it would be tough for me to go north of 63rd, but I would be open to it. Like I said before I am personally just scoping out the market at this point and wondering if its even worth my time/money.

Condos were overbuilt here in the 1970s and 1980s, including condo conversions from apartments. Many of the "premiere" condominiums were built by a developer known more for his eyewash than quality. The bust hit, that developer went away, and those well-heeled owners were left having to fix structural problems arising from shoddy construction. Today those people and their children remember this, and are justifiably reluctant to buy condominiums....I think the market is ready for condominiums, but buyers will have to get past their memories of the bad products built the 1980s, the market will have to digest Chesapeake's condominiums when they are sold, and a developer will have to step up to the plate.

By the way, I sold one condominium in OKC last year, but own one in another market.

Did not think of this. The few condos on the market here look no different that a typical run down apartment complex from the same era (1970s/80s). Of course nobody will buy that. It doesn't mean there is no market for them, just no market for crappy built ones. Developers here are just so conservative...if it ain't an "okie chateau" on a quarter acre out in Arcadia it won't sell. I hate this attitude...God help you if you want something *gasp* different. If we want to get a quality multifamily development in this city, either in the core or the suburbs, its probably going to take an out of state company. Who wants to start lobbying ?!?

Also I am curious as to your experience in selling you old condo. Did you have a hard time? Di you receive what you though you did price wise?

[bchris02]

OKC will never experience a condo high-rise boom like Miami's, but we could definitely support a couple significant towers in the future I bet.

Agree. Many cities much smaller than OKC, Little Rock for instance, got a few in the 2000s.

[Rover]

The problem with aging condo developments is that few have strong proactive associations who invest in common area improvement. As a redeveloper, it is hard and expensive to aggregate the units and do an overall rehab and improvement. A few bad owners can ruin the whole development if there aren't strong covenants that are vigilantly enforced.

[Just the facts]

Here is my take on it. For decades in OKC there was nothing for condo development to center around and serve as anchor/attractor. Very few places in the world are more spread out than Jacksonville, FL - and that includes OKC, but Jax has lots of mid-rise and high-rise condos. They are all either waterfront or in high-density walkable neighborhoods. OKC really has neither of those two things yet. The Centennial is canal-front and it sold quickly and at premium prices, but Randy Hogan didn't make any more condos on the canal. If he had lined the canal with 3 to 5 story condos he could have sold them all - but we all know he had zero urban building experience (and still doesn't). Likewise with the Oklahoma River. For some reason the city chooses not to urbanize it and instead dedicate the river banks strictly to parks and bike paths. Some section of the river should be walled and development built right to the waters edge.

In downtown Orlando there is Lake Eola Park which rapidly filled up with mid-rise and high-rise condos. Where is OKC's 'Lake Eola Park' that will induce demand for condos? Answer, we don't have one. The canal was our best attempt at it but we know how that went. Then we had the river and we know how that went. Then we had MBG and decided to surround it with a convention center, an old convention center, a single use office tower, plus whatever Stage Center becomes. That leaves Core to Shore but the new central park is being made as suburban as can be so is there any doubt how that is going to turn out.

Condo towers aren't just going to appear out of low density suburban sprawl.

[tomokc]

Also I am curious as to your experience in selling you old condo. Did you have a hard time? Di you receive what you though you did price wise?

It was older, lower-priced, in an area with little upside, and a rental property. The sales price wasn't great, but neither was the ROI. Leverage wouldn't affect the cash-on-cash return. Rather than have the money sitting in something that was doing nothing, I decided to put it to work elsewhere. I performed a little market analysis, picked an eager sales rep, priced it to sell and got it done.

[Pete]

Keep in mind that Founders Tower and The Classen are two recent high-quality, high-rise condo conversions that are still largely rental units because they could not sell them as condos.

Did not think of this. The few condos on the market here look no different that a typical run down apartment complex from the same era (1970s/80s). Of course nobody will buy that. It doesn't mean there is no market for them, just no market for crappy built ones. Developers here are just so conservative...if it ain't an "okie chateau" on a quarter acre out in Arcadia it won't sell. I hate this attitude...God help you if you want something *gasp* different. If we want to get a quality multifamily development in this city, either in the core or the suburbs, its probably going to take an out of state company. Who wants to start lobbying ?!?

Again, I disagree with this assessment and I could link to a bunch of properties currently for sale downtown, in the NH area, Quail Springs, 63rd & May and elsewhere that are of quality at reasonable prices.

If you want something new, nice and located in the central core there are plenty of options, it's just going to cost good money.

[warreng88]

Does anyone think in five years we will have some apartments converted to condos for sale, specifically in DD? I know the DD apartments have been discussed, but I could also see Level doing the same thing if the need arises.

[hoya]

Condos aren't worth anything unless there's a lot of cool stuff to do right around them. If I have to get in my car and drive to get anywhere fun then there's no reason not to live in a house. The attraction to condos isn't "living in a condo", it's living right next to all the cool stuff.

The only place we have that within walking distance is right downtown.

[Pete]

^

A view and low maintenance would be two other reasons.

But you can get the low maintenance component in a patio home or a new home with a smallish lot, which seems to be the strong preference in the OKC market.