Wednesday, Nov 26, 2014

Demand rising for Pinellas condo towers


Published:   |   Updated: April 21, 2014 at 12:40 PM

— From the ninth-floor balcony of this new condominium north of downtown, the whole expanse of the city's waterfront comes into view.

A few miles south are a crop of mid- to high-rise office buildings, condos and apartments, several of them new to the St. Petersburg skyline, with the Sunshine Skyway far off in the background.

Looking north there's only water and the faint outline of Tampa in the distance.

All of the luxury units in the soon-to-be-finished Water Club at Snell Isle face the water. Real estate executive Dave Traynor tells prospective buyers they will have an ideal vantage point for spotting manatees and dolphins and, as he speaks, a gray fin breaches the greenish water below.

It's a $1 million view – actually, the 84 well-appointed units with granite counter tops, jet bathtubs and a private elevator start at a half-million – and selling fast.

The twin nine-story towers on Snell Isle Boulevard N.E. is 50 percent sold and the buyers aren't getting the hard bargains many new condominiums saw a few years ago in the wake of recession.

“Now seems to be the time that condominiums make sense because the price per square foot is where people need it to be in order to build and still make a profit,” said Traynor, vice president of real estate and developer services at Smith & Associates Real Estate.

In fact, the Snell Isle condos were delayed when that price sank and investors started buying up brand new units on St. Petersburg's waterfront for a fraction of their expected value.

When the property developer, Kolter, felt comfortable in getting a good return, the Water Club broke ground last February.

The resort-style development, which includes a swimming pool, clubhouse and boat slips, is slated to open this summer.

That doesn't mean another condo craze is at close at hand like the early 2000s, when hotel and apartment owners started selling their rentals en masse as the real estate bubble grew.

High-end apartments still are seen as a safer financial bet as young professionals and ex-homeowners continue to shun the risks of ownership and opt for a less-burdened, urban lifestyle.

Most of the four- and five-story buildings going up downtown are aimed at renters; in many cases, fairly affluent renters.

The exceptions, such as the stately Rowland Place under construction at 120 Second Avenue N.E., are going up in very particular locations - as close to Beach Drive as possible.

Buyers again are paying top dollar for downtown waterfront's row of shining towers and the supply is becoming limited.

“They are pushing the price point higher and higher with all the time that passes,” said Tami Simms, a longtime downtown Realtor who specializes in luxury property.

There's recently been a “rash of new listings” at Signature Place, the last of the new Beach Drive towers that opened at the worst of times in 2009, Simms said.

Some of the action may come from people who bought units for dirt cheap at bank auctions looking to cash in as the market rises again, she said, and they're getting their asking price.

That being said, there's a good number of buyers today who would forgo the $1 million penthouse view or live just outside of downtown in Snell Isle, where prices are closer to $500,000, according to Simms.

More affordable waterfront living may be attracting an increasing number of recent sales at Waterside at Coquina Key, a 900-unit condominium complex on the southeast end of the Pinellas peninsula.

Waterside was among several hopeful projects during the housing boom to convert aging rentals into chic, modern condos.

Prospect Marathon spent more than $60 million to completely overhaul each unit and add a yacht club, docks and other amenities, said John Shine, a real estate developer.

Closings on many of the 900 units lagged as the economy soured and a large number remained empty until investors with RA Group bought the unsold stock in 2011 and re-priced it, many of the units at half their original price, Shine said.

But sales are gaining momentum, a hopeful sign for the condo market, he said.

“Condos sell from about $100,000 up to the mid $300s. Either way, they make a great investment for someone looking to live in Florida and enjoy a waterfront view,” Shine wrote in an email.

Shine is also looking to build a 16-story condo on Fourth Avenue North in St. Petersburg that also had been sidelined during the downturn.

Other parts of the county where residential development has been on hold for several years are also seeing a renewed interest in condos.

A developer called 400 Cleveland LLC, which is part of the international development firm Terra Capital Partners, is in the midst of transforming a five-story bank building in downtown Clearwater into a posh, eight-story luxury residence.

The SkyView faces the recently renovated Capitol Theatre on Cleveland Street, with a rooftop terrace that overlooks Clearwater Harbor. With a year of construction still ahead, reservations for its 51 units have been growing fast, says Paulette Agami, a representative for the SkyView.

“That's a really good indicator of how the market is coming up,” Agami said.

Traynor says there's good reason to believe the trend will continue.

“Our firm is talking to several developers right now that are looking to start new construction towers in downtown St. Pete and we anticipate a few of those to be announced within the year,” he said.

jboatwright@tampatrib.com

(727) 215-1277

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