Downtown Steamboat projects begin to see return of high-end buyers
November 21, 2010
Steamboat Springs — Four downtown redevelopment projects that came of age in the recession quietly are putting up some noteworthy numbers this fall — and one, The Victoria, is resurrecting itself.
All four were built on corner lots at key intersections between Lincoln Avenue and the Yampa River. Some still had brightly painted construction barriers in place along the sidewalks when the recession began to grab national attention in fall 2007. Before the concept of the urban vacation condominium in this ski town could be validated, Steamboat Springs' real estate industry already was nosing over into what would become a tailspin.
Now, there is tangible evidence of a market for the product category. The early pioneer for the model of commercial on the first level with residential above in downtown Steamboat was the successful Waterside development at the west end of Yampa Street. It came in with lower price points, between $280,000 and $530,000, in 2005.
Howelsen Place, which had been selling some of its most economical condominiums at Lincoln Avenue and Seventh Street during summer and early fall, posted a $990,250 sale of a two-bedroom condo last week and has a similar unit, listed at the discounted price of $1.29 million, poised to close Dec. 14.
At the east end of downtown, The Olympian at Fifth and Yampa streets is about to hatch a contract on a two-bedroom, 2.5-bath condo listed at $1.38 million that originally was listed for $1.98 million. The actual sale price at The Olympian is being withheld, but the price reduction of more than $590,000 speaks to what's happening on the south side of Steamboat's Main Street. Add to that the perception that the new product in the core of Steamboat's historic commercial district is relatively scarce.
"We have come down to a price now where buyers are recognizing what we have here," Olympian listing broker Brian Ladd said. "We're about 30 percent off our original pricing. The thing we've got going for us is we have a finite amount of product — we have 86 units (among The Olympian, Alpen Glow, Howelsen Place and The Victoria). In the last 12 months, we've sold one-fifth of the downtown inventory (units, not gross dollars). A one-fifth absorption speaks well of our product."
The two pending sales in The Olympian and four in Howelsen Place, added to a combined 21 sold units (13 in Howelsen Place), mean that 32 percent of the available units in those two projects are spoken for, Ladd said.
Alpen Glow, a sibling to Howelsen Place with Green Courte Partners, the developer for both, has sold three of 14 units and has no contracts pending.
Three Realtors, colleagues at Steamboat Village Brokers, Chloe Lawrence, Cindy Rogers and Arlene Zopf, recently have become the new listing agents at The Victoria at Lincoln Avenue and 10th Street. Local developers Steve and Denise Peterson successfully have worked with Wells Fargo Bank to have foreclosure proceedings withdrawn, and the bank is offering seller financing to prospective buyers.
"We're financially in a strong position," Zopf said. The foreclosure "has been withdrawn because there is no need for foreclosure. They closed a unit this summer."
Denise Peterson said she's seen signs that things are turning around for the downtown properties.
"We have people inquiring, looking and asking about The Victoria," she said. "A year ago, there wasn't anything. I'm certainly looking at it as a positive turn."
Peterson said she thinks her building, with its more traditional architecture, differentiates itself from the other downtown redevelopment properties.
"We're a little removed from some of the hub-bub at the other end of town," she said.
On a percentage basis, The Victoria has the greatest commercial component of the four downtown redevelopment projects. It had seven original units, and five still are for sale.
The Victoria's Realtors say they are working with a small group of interested buyers, some of whom have taken them up on an offer to enjoy overnight stays so they can reassure themselves the building is well-insulated from the noise of traffic below.
Lawrence said some of those prospective buyers are Steamboat vacation-home owners who want to downsize from bigger homes that require more work.
The discounts from original pricing average 33 percent, Rogers said. A 1,976-square-foot Victoria unit with two-plus bedrooms and three baths is listed for $895,000.
Zopf said price per square foot isn't the primary issue for prospective buyers.
"You have to think of The Victoria as a boutique hotel," she said.
Mark Scully, managing director of Green Courte Partners, said the availability of seller financing from his development's project lender has helped to close deals at Howelsen Place. Alpen Glow has seen little activity this year.
"I know of one buyer who got 3.89 percent on a seven-year jumbo loan," Scully said. "Lenders are realizing this is part of their challenge and they can make money" making loans on resort homes.