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Tuesday, November 14, 2006

God Save the Queen

A Seattle developer says he plans to save two historic apartment buildings by converting the units to condos.

"The trouble with many of these old buildings is it just doesn't pay to keep them up when you've got them as apartments," Ben Rankin, a principal of developer Pioneer Property Group, said while touring the Pittsburgh apartment building last week.

"We can offer things that are priced substantially below the new construction here and have the architectural advantage," Rankin said. "I feel that if there is a real need, it is for inexpensive owned housing in the city."
I'd venture there's a need for inexpensive rentals as well. People don't -need- to own, they want to - but certainly not by 2007 when we'll be deep in the throws of the national housing retrenchment.
On its Web site, Pioneer Property Group says it makes money on niche developments, but also has a "social mission" to "increase the density and supply of urban housing without adverse impact on our architectural heritage or the urban landscape."

"You could build a condo tower on a site that may have a five-story walk-up apartment building now," he said.

Developers are converting the Pittsburgh, a lower Queen Anne apartment building, into condos. But converting an apartment building to condos instead generally brings needed investment in an old building and creates many owners, complicating any subsequent move for demolition, Chaney said. "We think that's not a bad model."
It's not a bad model, it's an insane one. Building a new condo from scratch would take several years, where a condo conversion can be done in a matter of months. Condo conversions usually signal the end of a housing boom cycle as they're seen as a "fast buck" before the Schei├če hits the ventilator.

No matter how you sugar coat it, renters will need to find a new place to live. Worse yet, I predict these units will "repartment" themselves less than one year after they're finished. I have nothing against capitalism and during a "normal" market I can see how this would work. Unfortunately this developer is just going to waste everyone's time.
The condos range from 430 to 750 square feet, costing $239,000 to $370,000. The Pittsburgh will have four small condos selling for about $150,000. That's inexpensive by Seattle standards, but not within the reach of most of the building's renters.

Rankin said he did not see how he could make the condos that affordable in the city. The developers provided all residents with the $500 the state requires in relocation just for low-income tenants and have someone searching out nearby apartment vacancies, he said.

"There still are a lot of buildings out there for rent," Rankin said.

But Michelle Thomas, a community organizer for the Tenants Union of Washington State, said Seattle is losing too many affordable apartments.

"I'm not sure that preserving a building at the cost of preserving apartments that are affordable is that much of a priority," she said.
Sounds wonderful, doesn't it? A kind benefactor swoops down to save a few buildings from ruin, while at the same time providing a much needed service. I will enjoy watching them try to sell these!

(Aubrey Cohen, Seattle P-I, 11.14.2006)

9 comments:

synthetik said...

More Seattle PI rah rah about why condo conversions and gentrification are good for Seattle's "soul".

SeattleMoose said...

Bad timing is everything....

stephen said...

"The trouble with many of these old buildings is it just doesn't pay to keep them up when you've got them as apartments,"

Are ya kidding me?

Can you imagine the steady stream of assessments on these? Poof they're condos so it now pays to keep them up.

I pity the poor bastards that buy into this line of BS. Affordable is code for "we are tired of pumping money into these old buildings so you get a coat of paint and best of luck to you.

Grivetti said...

The condos range from 430 to 750 square feet, costing $239,000 to $370,000. The Pittsburgh will have four small condos selling for about $150,000. That's inexpensive by Seattle standards, but not within the reach of most of the building's renters.

Yo, Pioneer Property Group, or as you'd like to be known "the Mother Teresa of Condo Developers", I gotta give you mad props... right here in a cheerleaders article you basically scam-the-sell right in front of the prospective buyers eyes!

Economics 101 people, if you're buying a unit that can no longer be rented out to cover mortgage costs of prospective renters because you're too deep with your financing, you have a NEGATIVE P/E ratio!!!

[demon voice] GET OUT NOW!! [/demon voice]

PugetHouse said...

I don't think Mother Teresa's potential clients are necessarily worried about P/E ratios. MT is merely making room for deserving new owner/residents.

deserving = having a better job than the person being kicked out on the street and thrown a gold coin

Anonymous said...

I was just forced out of one of these historic buildings they are 'saving.' The building was kept up beautifully and was in better condition than most newer apartments in belltown/lower queen anne. Most of the units remodeled before Pioneer arrived are nicer than the designer upgrade.

As for being afordable: my unit was a 550 square foot studio with a view for under $700 a month. They wanted me to buy it for $269000 and a new building across the street will be blocking the view.

I can understand why they were showing the reporter the Pittsburg instead, it needed some work.

deeplennon said...

Seattlest has taken notice..

http://www.seattlest.com/archives/2006/11/14/from_apartment_to_condo_and_back_again.php

synthetik said...

Here is the link.

"third or fourth horseman of the apocalyspe"

LOL.

trackbike said...

Of course, when your blog is named "Seattle Bubble" you're kind of backed into a corner in terms of how you view any development news.

LOL -- they got that right!