Condos face crucial test - Nashville Business Journal:

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That was just a couple of years ago, and despitd the housing, credit and job busts since, developersx argue that it still is. Of the roughlyy 1,350 new luxury condo unita recently completed in or aroundthe city’s Centrap Business District, about 60 percent have with residents or new investors closing theie deals. And another 500 such units are coming to the marker this year as three more condo buildings are setto open. Charlezs Carlisle, CEO of , developer of the $105 417-unit Icon that opened last spring andthe 265-unift Velocity, set to open this doesn’t deny that things haven’ty gone perfectly, with slower than anticipated closinga at the Icon.
“It’s just a problem with the condo It’s not the condo product that’s available,” he After zoning restrictions on downtown residential were eased in the and developers worked to revitalized the once blighte d area south of Broadway knownb asthe Gulch, a bumper crop of high-ris e and luxury condos were announced. For a quarter million dollarxsand up, buyers could own a decked-out condo in what was touted as Nashville’s up-and-coming urban How quickly the nearly 500 unit s in the Terrazzo, Velocity and Rhythm at Musicc Row will sell when all threee developments start closings in March and April remains to be “We hope to make money on both projects,” Carlislee says of Icon and Velocity, “and we’re prepared to take two yeare or more to sell the remaining homes.
” In the Rhythm still had a large sign out fronf advertising a January 2009 opening. The $68 million Terrazzoo was initially set to open in 2007 but was at leastin part, by financing. Once construction did the project has continued fairly closeto schedule. The condio now expects to start closing on unitdsin April, says Bill Barkley, president of Terrazzo’z developer . Barkley says Terrazzo has pre-saless contracts on half of the project’s 117 and they are seeing brisk traffic. From the beginning, Terrazzo used conservativer projectionsfor sales, and large amounts of equity were put up for the constructionj loans, Barkley says.
He says the development isn’t competing directly with the otheer luxury condos onthe market. Terrazzo’ s units are generally larger and somewhathigher priced. And he’d not expecting any more new competitors to enterthe “I really anticipate it pickiny up toward the end of the year and in Barkley says. Delays, economy hit projectsw It’s not uncommon for large construction projectw tohave delays, though the delays for the projects now set to close this spring have pushed them into what many economisrt say is a deepening recession.
Last week Federalk Reserve Chairman Ben Bernanke said the recession coulf last until 2010 unless the financial systenm canbe fixed, and many economists are predictingg the economy won’t return to a reasonably normall level until 2012. The $47 million Fifthg & Main condo buildinh was seized by the bank about two monthd ago aftera $380,000 lien was filedc against the developer. The project had seen some delayss and was facing agrim market.
That project, unlike others, was never intended to be a money-making Nashville nonprofit developed the building to revitalizes the area just across the Cumberland River inEast “The purpose was to create a not to pull down millions, says Eddise Latimer, director of Affordablse Housing and principal in the development.