The Seattle Condo Blog

It had been anticipated given the low pre-sales rate that Rollin Street Flats would convert to apartments, especially in light of the new Fannie Mae condo guidelines. Here’s an excerpt of the letter that was sent to pre-sale buyers:

Unfortunately, pre-sales at Rollin Street are at approximately 25%, which is below the 50 – 70% threshold Fannie Mae and most mortgage lenders require for buyers to obtain financing.

Market conditions tell us we will not achieve the required minimum 50% pre?sales in a short timeframe.

As a result, we have decided to convert Rollin Street into a rental apartment building. We will refund your earnest money deposit (currently safely held in an escrowaccount) and any deposits you made for upgrade finish options.

We had expected to be able to communicate this decision earlier, but the process of getting permission from our construction lender took much longer than we had hoped.

Additionally, they are offering a credit to Rollin Street pre-sale buyers at Vulcan’s two other SLU properties – Veer Lofts and Enso.

We appreciate the commitment that you have made to the South Lake Union neighborhood.

Recognizing this, we will offer you a credit to apply toward a purchase at either Enso or Veer Lofts–our other two condominium projects in South Lake Union. You are also eligible for a lease credit to apply toward renting a home at Rollin Street.

I actually see this as good news for the condo market. The immediate effect is the reduction of 200+ condo units from the downtown market, which is significant, and should benefit existing properties (e.g. 2200, Cosmopolitan) as well as soon to be delivered properties (e.g. Enso, Escala, Alex, Olive 8). After 2009, there will be no new condo units delivered in the downtown area until 2012 at the earliest, providing much needed time to for the market to absorb the inventory and stabilize.

So what about the prospects of the other developments that’ll be delivered this year. I believe two are on thin ice – Marselle and Danielle -and both could do well as apartments. Currently, Schnizter is adamant that Equinox will remain condos, but given the poor sales activity at all three of their Seattle projects (Brix and Gallery being the other two), it’s hard to fathom they can keep all three as near empty condo buildings. On the other hand, we’re seeing a glut of new apartments complexes in the downtown area (Olivian, Aspira, Rollin Street, Taylor 28, Axis, Hyatt Place, Moda) so there will be stiff competition for any new entrants into the rental market.

A few local condo projects are now claiming a place on the social networking site, Facebook. With more than 175 million users, Facebook provides another venue to tout new condo projects as well as to bring new owners and future neighbors together.

Marketer/Developer created Facebook pages/groups:
- Brix
- Veer Lofts
- Enso
- Rollin Street
- Trace
- Maison Jiselle

Buyer/Owner created Facebook pages/groups:
- Veer Lofts owners group
- Rollin Street buyers (profile page, “friends” accepted once purchase is verified)

Besides Facebook, a few condo community blogsites have also been popular for owners, residents and condo aficionados alike – Cosmo Seattle, Fast Times at 2200, The Grandview and Mosler Lofts (restricted).

Vulcan hosted a hard hat tour of Rollin Street Flats today, which provided a first glimpse of the project. Overall, the build quality and finishes met expectations, definitely an upgrade over Veer Lofts.

Based on the model unit at the Discovery Center and marketing materials I was anticipating the homes would be a bit more refined with large open layouts. With the exception of the two-bedrooms, the layouts were not too dissimilar from other recently completed condo developments. To me, the layout as well as the sterility of the exposed concrete walls and ceilings were quite reminiscent of Mosler Lofts. The decks seemed a bit too narrow, probably wide enough for potted plants and a bistro set, but not much else. The “shotgun” units on the alley side don’t seem receive a lot of ambient daylight, mostly due to the depth of the units, something to keep in mind if you like bright and airy living spaces.

Rollin Street’s common areas are impressive. On the lower level there’s fitness center and a full-sized basketball court that also serves as a volleyball and badminton court (Update: BB court is not regulation, it’s 24 x 80 ft with hoops on both ends). The second floor houses a huge community room and a large landscaped terrace that incorporates a fireplace feature and BBQ area. A second outside terrace is located on the penthouse level. One unique design feature that Vulcan included are the elevator lobbies on each level with floor-to-ceiling windows providing Westerly views. Upon arriving home and exiting the elevator the first thing you’ll see is the Space Needle.

One feature I wasn’t aware of is that every home at Rollin is air-conditioned, pretty sweet. Dues run about 52 cents per square foot, which on first glance seems high. But, it covers nearly everything except electricity, so it’s quite reasonable.

Currently, Rollin Street is approximately 35% sold. They aren’t offering any incentives at this time (Vulcan is probably the one developer who can weather the downturn). Interestingly, they are using the low sales rate as an inducement. The development won’t be turned over to the association until it’s 75% sold, therefore, owners will not have to pay HOA dues in the interim (Vulcan covers in the meantime). So, they say, if you buy today you likely won’t have to pay any HOA dues for another 9 months. A nice way of saying they aren’t expecting to reach the 75% sold rate until well into 2009. And, no, they are not considering converting to apartments.

No word yet on the commercial/retail tenants slated for the building, other than for a high-end home furnishing store.

Unfortunately, Vulcan is the only developer to prohibit photography so no photos to share.

Rollin Street Flats is an upscale condominium in South Lake Union. Links: Our review and Rollin Street website