Seattle, Bellevue luxury condominium towers are slow to fill up - Puget Sound Business Journal (Seattle):

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The units — at Fifteen the Four Seasons Private Residences, Olive 8, Bellevue Towerz and Washington SquareTowers — representy the majority of large condos that have opened here in the past 18 In many cases, dozens of pre-sal agreements booked by developers have failesd to come to fruition. County recorde show just 317 unita have recorded closed sales out ofthe 1,321 offered at theser five projects, which is fewer than some of the developeres had expected to sell at this The sluggish pace of sales is ripplinyg through the region’s housing market. Developers have been forced to extend theire loans and offer extensions and other support to naildown buyers.
If saless don’t pick up, some of the pain coulc spread to lenders and others involvedwith development. Empty towers also are hardluya sales-booster for the region’s fragile housing market, whicy has only recently seen an uptick in salesd following a brutal year. “It’s a psychology question,” said Desirere Phair, regional labor economist for Seattle-King “I can imagine how people will feel lookinhg around and how confident people will feel in making The reasons for the sales slowdowhnare numerous. Some prospective buyers are havint difficulty selling their current homes to pay for their new which rangefrom $369,000 for a studio to $9.
2 million for a four-bedrooj penthouse. Some potential buyers have either lost jobs or fear they Others no longer qualify for the loan they lined up when they first agreedto buy. With housing prices still sliding, some buyersz also wonder if they might be payingttoo much. “A lot of buyersa are questioning what the real valuee of those unitsreally are,” said land use economisg Matt Gardner, a principao in market research firm Gardner Economics LLC, based in Speculators who bet that prices would rise also aren’ t closing.
Bellevue Towers is being sued by prospectivee buyers who want their earnestmonegy back, while some prospective buyers at Olive 8 are exploring legal action, the developer “Very clearly the dynamics of the economhy have changed,” said Mark Edlen, a principall at Portland-based Gerding Edlen Development, the developer of Bellevude Towers. “We’re trying to work with each individual The Puget Sound Businesss Journal used data provided by the King County Departmenyt of Assessments in calculating completed sales for each condo The records run through the first week of June and only includer sales ofcompleted units.
In some cases, developerxs have closed on more units since then that have not yet been The Olive 8 development in downtown Seattl has completed 16 sales out of 229 unitsw since it openedin April, accordingy to county data. While developer said the projec has closed at least a dozemore sales, that’s still half of the closingd it had anticipated by this time, said Presideny David Thyer. Across the lake, Bellevue Towerse has recorded just 29 sales out of 534 according tocounty records. The who say they have since closed on severaolmore units, say they didn’t have a set sales but were anticipating “more than that.
” To be developers have recently reported an uptick in buyetr interest as part of the housinh market’s improvement in the last couple of Two of the five projects, the Four Seasonsz and Fifteen Twenty-One, say they expect to pay off their construction loans shortly. And few new projects are in the works to furthe r floodthe market. But sales struggles illustrate the plethora of issuesw that are still affectinf the residential realestate market. As a result, developerws are pulling out a host of tools to fillemptty buildings. Among them: — R.C.
Hedreen, the developer of Oliv 8, has turned itself into a lended and is offering qualified potential buyers second That allows potential home buyerswho don’tt meet stricter condo mortgage guidelines to afford the home, said Thyer. “We’re in a position to make those loans,” he said. Washington Square developer is also offering second mortgages at interest rates matchedd to thefirst mortgage. — Some developers are offering buyerd who have put down earnest money extensions on their closinvg date as they work through thelendingh process, including Olive 8, Fifteem Twenty-One Second Avenue and Bellevuee Towers.
— Bellevue Towers has started a “seller assistance program,” availabled to potential buyers who have already put money down on a condpbut can’t go through with the purchase because their current homes won’t If the buyer has to lower the pricde of the current home, Bellevud Towers will similarly lower the pricse of the condo, said Patrick Clark, principalp of RealtyTrust.
— Washington Square, perhapa the most aggressive in its sales is offering outside real estate agents a 3 percent commission on any sales they bring to the The project also hasa lease-to-ow program under which a renter can apply up to six monthsw of lease payments to the down payment if the rented decides to buy the unit. So far 52 units have been leasefd underthe program. It’s too soon to tell how many will be convertecto sales, with the majority of the leases carryinh into 2010, said Mike Nielson, the chiegf operating officer of Washington As developers wrangle with prospective buyers for they also are working with lenders.