Looking for a nice downtown Orlando apartment? You soon may be able to add the 55 West condo tower on Church Street to your list of possibilities.
The condo bust in 2007 left the 32-story building shell sitting empty, with the developer scrambling to find a way to salvage it. Previous ideas included turning it into a hotel or office space.
But now, Fort Myers-based Grosse Pointe Development Co. has brought on Zom Inc. to manage and lease out the planned condos as rental units.
Grosse Pointe Development and Dutch lender SNS Property Finance still plan to develop and register the project with the state as condos, but will hold onto the real estate until the condo market rebounds, said property director Rowland Hand.
“We want to get the building active — we want life in the building,” said Hand, president of Fort Myers-based Construction Consultants Collaborative Inc., which manages the property on-site for Grosse Pointe Development.
Permits are in place to begin the interior buildout, Hand said, and the company expects to finish the work and begin moving people in within four to six months.
Rental rates at 55 West are still being determined.
However, 55 West isn’t the only downtown condo to switch to leasing out unsold units. The Paramount on Lake Eola, which was developed by Zom, also has developer units available for rent beginning at $1,325 per month, according to marketing materials obtained by Orlando Business Journal.
Vicki Daniels, vice president of Zom Residential Services, said the Paramount began leasing units in late January. Although she didn’t know the exact number of units available for rent, it’s “quite a bit of the building.”
“With the condo market, the economy and difficulty in [buyers] getting financed, it was better for us to go ahead and lease units,” Daniels said. “We need the income coming in.”
In addition, 101 Eola in Thornton Park is offering rentals, said Alain Wichner, a Realtor with Windermere-based Independence Realty and Investments LLC, which has closed about 50 condo sales in downtown Orlando since the boom a few years ago. Chance Gordy, vice president of 101 Eola developer Real Estate Inverlad Development LLC, was unavailable for comment.
Leasing has become a necessary option, Wichner said, because developers’ construction loans are outstanding and unit sales are minimal.
In fact, the downtown condo boom and ensuing credit crunch have resulted in fewer sales despite a growing inventory, said a downtown condo report by Winter Garden-based Sexton Realty Advisors Inc. A total of 366 downtown condos sold in 2007, and just 278 were sold last year, the report said.
The Paramount has sold fewer than 50 units since it opened last year, despite sharing a building with the new downtown Publix, Orange County records said.
But downtown’s rental market has been booming and is expected to continue to do well with more developer-direct units available, said Thomas Allen, an agent with Urbanista Brokers Inc., which specializes in downtown high-rise properties.
“Business is gravy for us right now because it’s been going toward that apartment-hunting type of business,” Allen said. “It fulfills a need.”
Meanwhile, 55 West has dropped long-rumored plans to include a hotel. Although the developer worked for almost a year with local operator Legacy Hotel Advisors to bring a Marriott brand to 55 West, the lender decided not to invest the
$50 million-plus needed to get that going, Hand said. “They decided to play it a little conservative.”
The developer also may turn four planned townhouses on the 12th-story pool deck into a community or exercise room, Hand said. The plans also include holding off on building out the top floor levels — 29-32 — to determine at a later date whether to make those into office space, a high-end restaurant or regular units, he said.
[zilla_alert style=”white”] Originally Posted on the Business Journal website by Anjali Fluker [/zilla_alert]