london

Has anyone moved into the main building (1211 St Clair) yet? Thought the plan was for lower floors this past fall and upper floors this spring. Any updates? Fed's announcement today to try and bring mortgage rates down is a positive. Today's WSJ article on Fannie toughening standards for condo mortgage loans is a negative. This could really hamper new condo projects across the country. Hope Zaremba can hang in there... this is one tough market. I'm rooting for him as he's put his money up while the other major downtown housing projects have fallen to the wayside.

I think this project will take a longtime to resurrect unless Wolstein wants to offer his and mom's signature. I appreciate Wolstein ponying up $50 million but I'm guessing he did this expecting to immediately lay off on bonds. Unluckily he got caught in the credit market meltdown. Plenty of smart people are losing WAY more than $50 million. This is just a drop in the bucket. All the people quoted in Crain's have a vested interest. Do you really think they'd say anything negative. Get some quotes from banks, private equity, hedge funds, etc. with the ability to pull the trigger on lending and I'd give the article much more credence. Nationally, it very well will get worse. The commercial lending pain is in the early innings as deleveraging grinds the economy to a halt. I'm struggling with two scenarios... Japan where this lasts many years or an inflation bubble a few years out due to the world's central banks firehose money supply mentality. Not sure which is the worse outcome but regardless I fear this pain train has a long way to go.

Ipsilon was out in front of this... and created some good debate with this post. This board is interesting due to people's differing professional backgrounds and there added expertise. Unfortunately, I think developers (and not just in Cleveland) are worse off now than what I thought this summer. I know, not a good opinion. Unrelated... but not... ironically, KeyCorp and Cleveland should be thankful that the Treasury's decision to sacrifice Nat City probably saved Key. Just my opinion.

Fair point. Zaremba may have a ton of loot. I haven't seen the Lorain development so this may be way off base... but the way I'm thinking about 1211 is that the upfront cash flow necessary for this 10-story building and entire development parking deck are much more significant than the cash flow for a low, spread out townhouse development. For E.13 to E.17 he could probably fund with a decent line of credit as he continually turns over eight townhouses vs. a midrise building coming on-line all at once.

I think Ipsilon's post is more than fair. If anyone thinks banks aren't reconsidering their development commitments, your sadly mistaken. Banks are running out of sources to replenish capital as institutional investors have gotten smoked. Banks, big to small, are still bleeding and trying to ratchet down leverage. Regarding FEB, I don't know if they have loan commitments or not. If they do , bankers may be itching for one loan covenant violation to call their commitment. If they do not, Wolstein shouldn't be surprised to find banks looking for a personal guarantee. Developers loathe this but banks are licking their wounds. Just my opinion.

^I think Docta is right on... Zaremba needs to sell some more units at 1211 before they'll be in position to start more buildings. I love that Zaremba put his money where his mouth is and moved forward with this project. No risk, no reward! However he's had some bad luck with his timing. The real estate market is tough, the building is nearing completion and from what I can tell only 40% of the units sold. With the way banks are recoiling from developer/contractor lending I'd have to believe Zaremba's feeling some pressure. Just guessing, as I don't know how his loan is structured, but he's probably has an interest reserve setup until the building is complete. Then the bank is going to be looking for repayment of principal whether all the units are sold or not. Again, I hope Zaremba's way successful since he had the guts to move forward. However the timer is ticking.

I wonder how bad it will get for downtown and near downtown developers?? We never participated in the real estate bubble to the tune of double digit growth in home prices... however buyers are now looking for big reductions in Cleveland real estate prices, maybe rightly, maybe wrongly. We've considered places like the Pinnacle and the Avenue District but you can't sign a contract if you don't know when your house will sell... yet you can't sell your house if you're unable to guarantee that unit will still be there when your house does sell. I know the old catch-22. I've seen the Pinnacle in the Credit Clearing Bulletins and some of their subs have placed liens on units?! I wonder if they've had buyers back out or what's up with the developer not paying? Regarding the Avenue condo building, wondering if all buyers who put deposits down will be able to follow through once units are completed?? Sorry, kind of all over the place, huh?

Looks like they been tweaking the Avenue District website. They don't have the current "District Letter" in the left margin anymore and the archives have them all jumbled up. Also, I noticed they've changed the loft pricing list as only the units AVAILABLE are listed. Now it's a little trickier to glance thru the list and notice changes compared to the old format.

Agree with shs96. I think the water (river) has the potential to make this the best project going. However it has to be done right and none of the initial renderings (however true or not) are inspiring. Hopefully, having a completely blank canvas as everything has been demolished will allow some creative thinking. Further south on the East bank I've always thought the old Arhaus building would be a great building for condos. That building has great architecture and views of both the river and the West bank. This would create some one-of-a-kind pads. Wonder if the current owner is considering anything like this?

^Holy Cow!! :-o Was MayDay just scooped on pic?! :-D Good stuff McCleveland. Can't wait to see how the exterior turns out.

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Checked out the Avenue District website and noticed the condo pricing list has been updated. I haven't checked this in quite some time so not sure when it happened. Noticed the fifth floor is no longer sold out but I think they still have about the same total number sold, no? Some of the pricing looks different too.

Going from memory but I believe the 10-story condo will have a maintenance fee of $2.50 sq ft per year. The townhouses association fee is much lower but I'm not sure if it included access to 1211 St Clair's future workout room. Also, I'm not sure if there is space allotted for a workout area in the initial 10-story building or if it would be part of a future phase. The tax-abatement is a huge incentive but somewhat offset by the maintenance fee (talking the 10-story bldg). Zaremba has priced the condos at the top of the downtown Cleveland market on a price per sq ft ratio. One thing I've heard is Zaremba is doing the townhomes which has made upgrades much more reasonable compared to the condos which are union and upgrades (not out of the ordinary) are astronomically priced.

^agree with 8ShadesofGray. If I remember correctly I thought that option was only for two or three years max. My guess is they're not moving fast enough to exercise but doesn't mean they can't re-up or extend the option.

Maybe so but I think they tend to be optimistic. I've checked out units at both the Pinnacle and Avenue District and found there's usually more available then what their websites would lead you to believe. Not that they're trying to be deceptive but I don't think updating units available is their first priority.