Downtown New Residential Units

Issues concerning Downtown as described by the Downtown Council. River to 31st Street, I-35 to Bruce R. Watkins.
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DaveKCMO
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Re: Downtown New Residential Units

Postby DaveKCMO » Mon Jul 31, 2017 2:47 pm

wahoowa wrote:is it more pervasive than that?


nope. just anecdotes from people in the market to rent.

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Re: Downtown New Residential Units

Postby WoodDraw » Mon Jul 31, 2017 5:23 pm

wahoowa wrote:most of the datapoints i have for that are for terms where the full set of amenities weren't completed for the whole duration of the lease term (e.g. p&L tower before north building constructed) or for early renewal commitment incentives (1light). is it more pervasive than that?


I've mostly seen the same. A lot of new places giving deals, but I didn't hear it much from any established place. I'd be very interested though.

I think 3 light will be a big tell. If they move straight forward or push back

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Re: Downtown New Residential Units

Postby flyingember » Tue Aug 01, 2017 9:21 am

DaveKCMO wrote:i hear lots of buildings are offering deals or lowering prices. how long does that happen before projects in the pipeline start to get jittery?


Going back to the basics supply and demand says prices should have risen in recent years.

I bet we're just seeing a return to more normal rates with a lot of supply coming online soon.
The two clear tells are is if these buildings are older, smaller or have less amenities and what's been said, if Three Light begins construction quickly.

The craziest I remember was talking to the maintenance staff of the Union Carbide building around 2013 say they could empty and fill a unit in the same week.

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Re: Downtown New Residential Units

Postby grecobs » Tue Aug 01, 2017 10:01 am

We could be entering a bubble or a simple cooling of what has been a red hot market. Do not forget downtown's population has more than doubled in the last decade and there will soon be an additional 20-30% increase in the housing stock based on current projects underway.

If phase II of the streetcar passes, I would expect the boom to continue for another 5-10 years. While I would love nothing more than to see this boom continue, downtown is still very underserved by basic urban necessities.

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Re: Downtown New Residential Units

Postby earthling » Tue Aug 01, 2017 10:13 am

If streetcar extension passes sounds like it may be up to 6 years before going live. That might keep developers focused generally more on downtown for quite a while. What's important is that even if there is a slowdown, the current buildings in progress equate to totaling nearly 35K downtown residents, which urban planners say is the sweet spot for a highly functioning downtown. It would be nice if the momentum continues but units over $2/sqft might hit a saturation point resulting in a slower momentum. But even if the focus moves towards midtown, that's still close enough to downtown to have overall beneficial impact for both areas.

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Re: Downtown New Residential Units

Postby flyingember » Tue Aug 01, 2017 11:02 am

What's been said over and over is clearly going to determine the next phase, jobs. The streetcar won't do this by itself.

And as we clearly know this will depend on suburban transit as much as urban. A commuter rail line, streetcar expansion, true commuter and urban express bus service would all help here.

By no means is it a perfect plan, but next week's Q2 will help set the stage for what the year 2030 looks like.

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Re: Downtown New Residential Units

Postby loftguy » Wed Aug 02, 2017 11:00 am

DaveKCMO wrote:i hear lots of buildings are offering deals or lowering prices. how long does that happen before projects in the pipeline start to get jittery?


When new buildings come on line, people involved are always jittery.
There is pressure to perform and get cash flow going.
As result, 'a month free with a thirteen month lease' is quick to emerge.

It's my read that most people are still underestimating the marketplace.
However I would not want to have a big supply of $2,500 per month 2 bedroom apartments coming on line.
That looks like the potential point of saturation right now.

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Re: Downtown New Residential Units

Postby JBmidtown » Wed Aug 02, 2017 12:11 pm

I'm really not sure why developers aren't trying to build smaller infill development with affordable/non-luxury/below market rate rental units. Is the return on those types of developments really that marginal?

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Re: Downtown New Residential Units

Postby wahoowa » Wed Aug 02, 2017 12:23 pm

loftguy wrote:However I would not want to have a big supply of $2,500 per month 2 bedroom apartments coming on line.
That looks like the potential point of saturation right now.

then perhaps it's encouraging that two light disagrees, as they are throwing 30+ ~ $2500 2BR apartments into the mix https://twolight.prospectportal.com/Apa ... 564/tab/2/

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Re: Downtown New Residential Units

Postby pash » Wed Aug 02, 2017 4:25 pm

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Last edited by pash on Thu Aug 10, 2017 6:56 am, edited 1 time in total.

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Re: Downtown New Residential Units

Postby shinatoo » Wed Aug 02, 2017 7:03 pm

Two beds at $2500 is the same as a $400,000-450,000 house payment. It's going to be hard to keep filling those units up at those prices. Especially when schools are still suspect and traffic isn't that bad. The pioneers that "really just want to live downtown" will move in. But those that think with their wallet will be scared off.
Quocunque Jeceris Stabit

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Re: Downtown New Residential Units

Postby flyingember » Wed Aug 02, 2017 7:30 pm

pash wrote:
JBmidtown wrote:I'm really not sure why developers aren't trying to build smaller infill development with affordable/non-luxury/below market rate rental units. Is the return on those types of developments really that marginal?

Less than marginal. Smaller buildings typically have lower returns than bigger ones, and the bigger buildings we've recently started to see go up around downtown are only financially feasible at the top-of-the-market rents they're asking.

Having seen the cost of everything that goes into a home, if they can command a 20% discount per unit because they have 100 units that's a huge deal for a project.

It's means that $400k equivalent unit cost then $320k. And that's how they afford the extra cost of everything else not for a unit like common areas, elevators and such

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Re: Downtown New Residential Units

Postby earthling » Fri Aug 04, 2017 2:34 pm

Fox 4 on the downtown residential boom, pointing out empty nesters moving downtown too..
http://fox4kc.com/2017/08/04/strong-dem ... ls-growth/


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