The Seattle Condo Blog

Adapted from a press release.

Welcome mats will soon roll out for homebuyers at Enso, Vulcan’s highly anticipated new LEED Gold certified condominium project in downtown Seattle’s South Lake Union neighborhood. Enso buyers began closing on their new homes today, and will start moving into Enso tomorrow and through early next year.

During one of the most difficult real estate markets in history, Enso has continued to attract growing interest from a range of buyers, with 55 percent of the 135 homes now sold. A total of 75 sales contracts have been signed with both new buyers and existing buyers in the last six months alone, translating into a robust 13 sales per month. The South Lake Union Discovery Center has also seen a nearly 60 percent increase in condo-related traffic in November compared to last year.

Enso has also received Fannie Mae approval, a critical step in allowing buyers to obtain loans and close on their new home purchases. Most lenders also typically require a project to have at least 51 percent of owner-occupied homes for buyers to obtain financing. By successfully achieving a strong enough level of pre-sales at Enso before allowing buyers to close, Vulcan has been able to preserve the project’s ability to attract new buyers seeking assurance they can close in a timely manner and avoid the prospect of auctioning its remaining condo inventory at a diminished value.

As part of Vulcan’s novel sales strategy in response to a declining real estate market, it significantly reduced condominium prices in order to attract both new buyers and retain existing buyers – helping them preserve equity in their homes from the outset. As the first condominium project in Seattle to revise Purchase and Sales agreements with new reduced pricing for existing buyers on a large scale prior to closing, many of Enso’s pre-sale buyers have decided to re-commit to the project and close on their homes. Pricing for Enso homes ranges from the low $300,000s to over $1 million.

“We saw many buyers from other projects who decided to walk away from their earnest money because they could not obtain financing or did not want to purchase a property for more than it was now valued,” said Ada M. Healey, vice president of real estate at Vulcan Inc. “We understood how critical it was to go back to our pre-sale buyers – who bought at the height of the market – and proactively lower prices to 2009 levels. We carefully monitored market conditions to ensure our homes were priced to sell. We took a long term outlook and wanted to do what was best for our buyers, the neighborhood and ultimately, our project.”

Received information today that Enso Condominium is expecting to begin closings and move-ins before the end of the year. According to a buyer update, Enso buyers will be receiving closing notices within the next 15-25 days. This is great news for Enso buyers who’ve been waiting and waiting to close. It was previously indicated that Enso/Vulcan was holding off closings until they could close more than 50% of the units.

Veer Lofts, located in Seattle’s South Lake Union district, has reduced prices and is offering a limited time $8,000 seller credit on any purchases before December 1, 2009. It is timed with the November 30th expiration of the First Time Home Buyers Tax Credit. For purchases that close by November 30th, buyers will effectively receive $16,000 in savings ($8,000 seller credit and $8,000 tax credit).

Veer Lofts offer three styles of home layouts: flats, full 16′ two-level lofts and a hybrid flexi-loft layout. Flats start from $259,500, Flexi’s from $282,500 and the full-lofts from $379,500.

Website: www.veerlofts.com

It was a busy day for condo related news:

2201 Westlake (office building / Enso Condominium) receives LEED Gold Certification

Adapted from press release.

Characterized by its innovative environmental and sustainable features, the 2201 Westlake development in South Lake Union now represents Seattle’s first mixed-use and high-rise residential project to earn prestigious LEED (Leadership in Energy and Environmental Design) Gold certification from the U.S. Green Building Council.

Developed by Vulcan Real Estate, 2201 Westlake was designed and constructed from the ground up using sustainable development practices. As a LEED Gold-certified project, 2201 Westlake exemplifies sustainable innovations that promote energy and water efficiency, indoor environmental quality, eco-friendly materials selection and alternative transit options as part of a healthier workplace and living environment.

The project’s sustainable features include proximity to public transit, bicycle storage, underfloor heating and cooling systems, use of recycled and rapidly renewable materials, low VOC paint and carpeting, drought tolerant landscaping, the recycling and salvaging of construction waste, plumbing systems that reduce portable water by 35% and an exterior glass curtain wall with low solar heat gain properties.

The Great Hole of Seattle (1 Hotel & Residences) to be filled

Full article from the Seattle Times: Starwood luxury hotel site becomes a parking lot

The pit, on Second Avenue between Pine and Stewart streets, was excavated in mid-2007 for the 1 Hotel & Residences, a proposed 23-story luxury tower. But work on the $200-million hotel and condo project stopped that fall, and the developer later acknowledged it couldn’t get construction financing.

A spokesman for the site’s owner, Connecticut-based Starwood Capital Group, said Monday that the hole should take eight to 10 weeks to fill. A Starwood affiliate applied last week for a city permit to develop a temporary parking lot on the property.

Eleven Eleven East Pike bulk sales

Full article from the Daily Journal of Commerce (subscription required): Kundig-designed lofts: Justen tries bulk sales

The Justen Co. is trying the bulk sales strategy to sell a third of the units at a new condominium project on Capitol Hill, Eleven Eleven East Pike. The project has 27 lofts designed by Seattle-based architect Tom Kundig of Olson Sundberg Kundig Allen Architects, ranging in size from 600 to 1,150 square feet.

Nine units are in the first release. They are between 612 and 793 square feet and are priced between $255,000 and $379,000 in the bulk program. That’s 20 to 25 percent lower than the initial list pricing, according to Dean Jones, president and CEO of Realogics, which is marketing the project.

Under the bulk sales approach, buyers get a volume discount depending on the percentage of homes that are sold within each release. Buyers can join the bulk sale with a refundable deposit of $500 through the end of the month. Units must close by Nov. 30.

Related:
Enso Condo website
Eleven Eleven Condo website

Enso Grand Opening

The Enso Condominium, Vulcan’s newest development in the SLU Gateway district, is hosting its Grand Opening celebration this weekend at 820 Blanchard Street (Denny & Westlake).

Buyers and condo enthusiasts will have an opportunity to tour model homes and enter to win a $500 gift certificate at Whole Foods.

The grand opening runs this weekend, August 15-16, from 11 AM to 5 PM. Parking is available at the Discovery Center, located just north of Denny.

Vulcan Real Estate and Williams Marketing hosting a preview event last night for Vulcan’s upscale South Lake Union development, Enso Condominium (website: www.ensoliving.com).

I’ve been anticipating the completion of this project, which is one of my favorites, and it did not disappoint. The craftsmanship and quality of finishes met expectations. With its aggression pricing, Enso fits into the the mid-level luxury niche nicely.

I noticed that one structure apparently disappeared. Early in the design phase the little triangular lot at the corner of Denny and Westlake was supposed to be a wine bar lounge. It’s now a small park.

Matt has a lot more photos and videos on his blog.

The condo marketers version of musical chairs continues to go around as Williams Marketing takes over sales of Enso, and as of today, Veer Lofts.   It had been rumored that Vulcan was considering handling sales in-house after the contract with John L. Scott expires this month.   The Williams Marketing website also indicates they’ve taken over sales at The Pittsburgh.

Williams Marketing recently relinquished marketing and sales operations at Brix, Olive 8 and The Danielle.

Veer Lofts just announced special pricing on five homes for a limited time. Three of the units are top floor full-loft units while the other two are a flat and a flexi-loft unit.

The current pricing is available for homes that are purchased by July 1, 2009. In addition, Veer Lofts is providing a $500 California Closets credit and are waiving HOA dues till November 2010.

#317 – $270,000 flat, approximately 615 sq ft, previously offered at $275,000
#403 – $280,000 flexi-loft, approximately 635 sq ft, previously offered at $295,000
#606 – $465,000 full-loft, approximately 1,130 sq ft, previously offered at $485,000
#607 – $440,000 full-loft, approximately 957 sq ft, previously offered at $475,000
#617 – $395,000 full-loft, approximately 906 sq ft, previously offered at $399,000

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.

Enso just announced special “pre-opening” pricing on several units to entice potential buyers. All of the units are either one-bedroom or one-bedroom plus den that are now being offered between $350,000 to $499,000. With the homes ranging in size from 687 to 979 square feet, that’s around $500 per square foot. The pricing is available to purchases under contract by May 22, 2009.

#504 – $350,000
#1004 – $375,000
#1304 – $385,000
#710 – $435,000
#910 – $445,000
#1310 – $474,000
#1009 – $485,000
#1309 – $499,000

Additionally, Vulcan is offering a few other incentives – up to $8,500 in closing costs, no homeowner dues until December 2010 and will donate $500 to a SLU non-profit organization in the buyer’s name.

Vulcan sent an update letter to Enso buyers a few days ago notifying them about the special incentive they’re implementing in order to facilitate more sales. My guess is that Enso will need to conform to FNMA’s 70% presold requirement and this is a push to get them there. Vulcan did reiterate its commitment to its top-tier condo development and is aiming for the temporary certificate of occupancy by May 25th.