2519 replies to this topic

[ah59396]

Honestly, I feel terrible for the people that own a condo in that building.  It will be YEARS before they can sell.

[ricky_davis_fan_21]

I don't! They have 51 floors of empty halls to play in!!!

[tozmervo]

best game of paintball ever.

[dubone]

They clearly knew what they were getting into.  And as cash buyers, they probably do not have a major reason to sell and get out.   Even if this does become apartments, it will be a luxury apartment building.

[atlrvr]

I would think they would sell......they could discount units by approximatley 40% and still turn a nice profit.  Essentially that level of debt averages out at around $260k/unit.

Those 2-story uptown view 950k 1 bedrooms should price out at around $225k-$250k even with a 30% profit margin baked in.

I think the market would support that pricing, even with that many units.

[sleightofhand]

I spoke to someone involved with Northwood and they confirmed it was purchased to put back on the market and sell.

[ES Charlotte]

I have confirmation that Northwood will go rental with the building... Should get more details shortly.

[dubone]

Hmm.  Those are competing ideas.  So perhaps they're still looking at the financial impacts of either direction?

[ES Charlotte]

dubone, on 12 May 2012 - 02:05 PM, said:

Hmm.  Those are competing ideas.  So perhaps they're still looking at the financial impacts of either direction?

Well from what I've been told... They bought it sight unseen with the thought that it was similar to a standard floor plate like avenue, catalyst etc... But when they found out the how different each unit was in size, price and layout they contemplated selling because they were worried about the demand for so many high end units... They have since went back to their original plan.

[dubone]

Oh ok.  I tend to prefer the rental option, although it will probably suppress plans for other new apartment projects from coming in.  But realistically, it is far more important for uptown to get that building occupied, so if it keeps new projects out then so be it.

I assume since Northwood got the debt at such a good discount that they will not necessarily need to put these up for high prices.  Will this end up bringing down rents uptown?

[ES Charlotte]

I would think (or I would hope so ).... They bought the building at $250k per unit... If they don't price them aggressively, I'd speculate three years to rent the place out... On the other hand, it could rent very quickly if they stay within the medium range for uptown then bump prices next go round etc. There's a huge demand for rentals uptown right now and prices are skyrocketing, but there isn't nearly enough demand for 200+ units or so priced at or above $3000.

[ricky_davis_fan_21]

I wish they would sell at a discount. I would snap up one in a heart beat, and rent it out.

[dbull75]

I was kind of hoping to see them do a fire sale too, much like Garrison is doing. I think they would do well... Then again, if the Vue goes rental, this building will fill up a lot faster.

[dubone]

So the medium-level pricing for rentals would be purely to be some sort of firesale to get it full and not due to the product that was actually built being middle of the market for uptown, right?  

From the perspective of getting the project full of residence, I say this is all very good news.  I do hope, though, that it doesn't cannibalize other uptown rental projects, with people moving from out of Catalyst or Post into the Vue because they've priced so agressively.   It would be very good for them to get it on the market in time for the DNC.

[ES Charlotte]

I still don't know what their plan is for pricing... I was just speaking hypothetically because I know the uptown rental market. You don't find many rentals Uptown over $3000 that aren't a penthouse... For example: There are 7 condos uptown over $3000 right now in MLS. Only 3 are legitimate and they are all penthouses. The other 4 are DNC pipe  dreams (ie: a 3bd/2.5ba at Fredericks Place is listed at $7900).  I personally think aggressive pricing is the right move but who knows... I don't foresee them going so low that Catalyst and others can't compete...

Hopefully we'll find out soon because I wouldn't mind renting there for a year or two

[dubone]

http://cltdevelopmen...uction-set.html

I guess this is moving quickly.  Can someone explain what happens next? Is Northwood going to own it after that date for certain or may there be other buyers.

[atlrvr]

That will be up to Northwood, but I believe the auction begins at the face value of the senior debt, which I believe is more than what they paid.  If someone offers more than that, Northwood could let them "win" and would be paid that amount so they would have instant profit.  Northwood could also outbid them if they wanted to make sure they keep the property, and essentially they would just owe themselves, so they wouldn't lose the property if that didn't want to.  Most like, there will be no bidder except for Northwood which will bid the original value of the debt, and "owe" themseleves that much to take the title free and clear at which point that will own it for a total cost what the paid for the debt last month plus some minimal legal/admin fees.

[mad_park]

What will this sale mean for the few people who own units?

[dbull75]

mad_park, on 22 May 2012 - 07:34 AM, said:

What will this sale mean for the few people who own units?

It means they are screwed. Those people are losing a ton of money. The auction applies to only the unsold units.

[dubone]

Everyone closing in 2010 at 2006 prices knew what they were getting into.  Either they had negotiated a very good deal for using cash or they are wealthy enough to want the intangeables of living in the building despite the loss of value of the asset.