I noticed on the various relocation advice threads that of the various buildings/neighborhoods Downtown that are suggested to folks, no one ever mentions the Avenue project. Is that because its full, still in construction, or just not recommended?

Mostly people are looking for rentals, the Avenue is for condos.

ah--got it. that makes sense, thanks.

ah--got it. that makes sense, thanks.

 

No, it doesn't.

 

Mostly people are looking for rentals, the Avenue is for condos.

 

But there's no demand for rentals here, so nobody builds them.  There's also no demand for retail here.  Don't build any of that either.  Doesn't matter how many people are constantly seeking rentals and retail... the "expert report" says to build condos so that's all we're gonna do.  One day, if we build enough condos, the expert report will say it's OK to add some retail, maybe some rentals too.

 

Time to try some different experts, folks.

 

^Actually...no body is building condos today because builders cannot get financing for  them and buyers have an almost impossible task to secure a mortgage loan for a condo.  And if you are looking for retail space I can point you towards a one brand new one in an upscale neighborhood that has stayed vacant now for about a year.

sorry... but, what are you talking about?  "There's no demand for rentals, so nobody builds them?"  In the past 15 years we have added THOUSANDS of housing units downtown, the overwhelming majority of which is rentals...  we just finished building a $70m rental apartment building.  Of the 7 residential properties on East 4th street, all built in the last 15 years, 5 are rentals.  Almost the entire Warehouse District is rentals outside of Pinnacel, Grand Arcade, and Erie Building.  Avenue, Pinnacle, and the Erie Building are about the only large scale condo buildouts we've seen in downtown.

I think 327 is disappointed there were no ground-up rental buildings built in the last few years.  Even though he think the rents being proposed to fund them (Varsity Village) are too high.

why would you build ground up when there were a plethora of vacant buildings perfectly suited for adaptive reuse?  The only reason any ground up new builds finally came along, is that we are finally getting to the point that we are running out of vacant buildings to repurpose. And if the global economy hadn't completely fallen apart we would have seen large scaled new construction of all the things people wanted.

People are usually looking for rentals in the relocation threads.....  Trust me, if someone sounds like a candidate for the Avenue District, I'm all over it.

Strap if they're branded "Varsity Village" it's reasonable to expect they'd fit undergrad budgets.  This would also be a reasonable expectation given the overall plan at CSU.  It would be disappointing if that whole project got built and the situation for undergrads remained unchanged.  Not 100% disappointing, obviously, but I think you catch my drift. 

 

As for the wider market, there is a specific type of ground-up rental building I've been pointing to, and it's tied to what people have been requesting.  This isn't the only place I hear such requests.  There is an extent to which the demand is not for rehabs.  I think there are plenty of rehabs at this point to match that demand segment.  As the city grows, more rehabs will be needed. 

 

But the area we're short in right now is modern rentals for young professionals.  I'm not too worried about price points at the moment because we don't even have the units.  But as with anything, price points will come into play.  And it's not a question of whether the city will subsidize housing construction.  It already does, and has been... but it's been subsidizing the wrong kind, based, I think, on a misread of demand.

 

And the retail thing... the problem isn't a lack of spaces, other than for department stores.  I don't think we need any additional small retail spaces.  For the smaller stuff, the main problem is a lack of department stores.  Reduced parking rates are another way the city could help things along.

^I was just giving you a hard time.  I definitely agree that the brand new rental building is a missing segment in the rental inventory- I think everyone here agrees- but I don't think it's because it's been overlooked.  The city has been all over FEB and Uptown trying to get them to happen.  As McC mentioned, the developers just didn't get them started before everything fell apart.

FEB and Uptown are great projects, but I think they're both aiming at the high end of the market.  What we need are good ol' moderately priced high rise units.  Like the Chesterfield, but newer and minus the reputational baggage.  They don't have to be in a whole new neighborhood complete with retail and offices and hotels and what not.  In fact, adding all that extra stuff raises the development cost and, thus far, prevents us from fixing the imbalance.

 

Maybe the margins for developers aren't as high on what we actually need.  That's where the public can perhaps step in.  The city has been funding all sorts of housing construction in various ways.  It's just missed the mark in terms of what type of housing development it's been encouraging.  This is a matter choice, a matter of policy.  Policies can be adjusted.

 

 

well some of the newer rehabs ARE "modern buildings for young professionals", they just happen to have historic exteriors. Just look at 668 or Euclid Block.

 

My point was being FINANCIALLY it makes zero sense for a developer to create new build when there have been so many existing buildings to choose from.  Federal and State historic tax credits are powerful incentives that makes projects "work" financially for developers.

 

And as stated...  There would have been multiple large scale new build development that would have comprised retail, apartments, and for sale housing if the economy wouldn't have tanked in the WHD and FEB.  Now we're only getting a small portion of the FEB development, and the WHD is in limbo.  We'll see some more rehabs (Schofield / Truman / etc) because in the current lending environment that is what can get done.  We'll also see some new build, but it will be where there are more "safe bets" and they will be smaller in scale.  For example, Uptown (only a $47m project as opposed to the whd proposal $1b or FEB $500m).

 

Regardless once the economy pulls itself up (and there are signs it is very slowly coming around from a development point of view), we'll see a lot of new build proposals because there quite frankly isn't much rehab left (Euclid btw 9th-12th, and AT... that's about it other than small scale 4-8 unit pick offs like joshua hall)

ah--got it. that makes sense, thanks.

I'm surprised you didn't know this was a condo.

MTS--I knew they were condos (the townhomes notwithstanding)--it was this part to which I was responding:

 

"Mostly people are looking for rentals."

 

some people relocate and buy, (instead of rent) especially in the current economy when--pricewise--renting vs. buying are close.

MTS--I knew they were condos (the townhomes notwithstanding)--it was this part to which I was responding:

 

"Mostly people are looking for rentals."

 

some people relocate and buy, (instead of rent) especially in the current economy when--pricewise--renting vs. buying are close.

 

I dont find that true, considering consumer lending practices are super tight. 

 

In this economy, people have to move, rent while learning the financial lay of the region then try to buy.

 

I bought a house earlier this year.  It was a battle and I had jump through hops I've never experienced.

many people move into a property they purchase, moving from another property they already own. perhaps they are less likely to ask a question here (unfortunately) and instead rely on realtors for info.

many people move into a property they purchase, moving from another property they already own. perhaps they are less likely to ask a question here (unfortunately) and instead rely on realtors for info.

 

Could be.  Just in my experience - in the last 5 years - I dont know many people who have moved from one metro are to another without renting first.

Strap if they're branded "Varsity Village" it's reasonable to expect they'd fit undergrad budgets. This would also be a reasonable expectation given the overall plan at CSU. It would be disappointing if that whole project got built and the situation for undergrads remained unchanged. Not 100% disappointing, obviously, but I think you catch my drift.

 

You and I have vastly different ideas of what an "undergrad budget" is.  All Varsity Village needs to do is beat dorm pricing to attract undergrads to their units.  Quad units in Fenn Tower fetch roughly $3500 a month.  Offer a 2 BR 2 bath unit to an undergrad at $1200 - $1500 a month and you're very competitive with University owned housing.  Put 4 people in that 2 BR place and it's very cheap per person.

 

Cheaper units will sprout up in older buildings, but a new build isn't going to come into the market at what you consider an "undergrad budget".  How is someone going to build a high rise that offers 1 BR for $400 and 2 BR for $600?  Especially in this lending market.  They will charge what the market will bear and it looks like the market can bear the higher prices based on the huge success of 668 Euclid.

How is someone going to build a high rise that offers 1 BR for $400 and 2 BR for $600?

 

build smaller units! smaller units not only allows the rent to be cheaper, but allows for greater density, meaning more shops and restaurants on the street. that's how NY is a successful city able to support so many restaurants and shops on the streets including a 24 hr deli on so many corners. density! on another post, someone was stressing over his 1000 sq foot apartment for 2 people. with one exception, in the last 15 yrs, with one exception, i've NEVER had an apartment so big--in fact one of the nicest i've ever had was 600 sq feet and I thought it was a large amount of space. Cleveland needs density very badly to support life and activity on the street. if an investor needs x dollars for a return, one way to do it is to make the units smaller--not more expensive. If the units were more price competitive with the burbs, it may draw even more people. more people also means more neighborhood schools (both public and private) that will help attract more people with school age kids as well, providing a more balance neighborhood.

We also need to focus on filling the existing density, or as close as we can get to calling it that.....such as along Euclid.... Ideally, I would rather see every building on the heart of Euclid renovated and filled, before adding anything new that simply pulls away interest again to create another "district" while none of the dots are connected. If these areas are not filled first or at a same time, I see potential too many empty spaces, including new space. The same thing is happening in sprawl land where new plazas are built...while they cannibalize others, or do not fill quickly because of a glut. I have seen even newer places remain unleased for a long time. 

How is someone going to build a high rise that offers 1 BR for $400 and 2 BR for $600?

 

build smaller units! smaller units not only allows the rent to be cheaper, but allows for greater density, meaning more shops and restaurants on the street. that's how NY is a successful city able to support so many restaurants and shops on the streets including a 24 hr deli on so many corners. density! on another post, someone was stressing over his 1000 sq foot apartment for 2 people. with one exception, in the last 15 yrs, with one exception, i've NEVER had an apartment so big--in fact one of the nicest i've ever had was 600 sq feet and I thought it was a large amount of space. Cleveland needs density very badly to support life and activity on the street. if an investor needs x dollars for a return, one way to do it is to make the units smaller--not more expensive. If the units were more price competitive with the burbs, it may draw even more people. more people also means more neighborhood schools (both public and private) that will help attract more people with school age kids as well, providing a more balance neighborhood.

 

You cannot compare NYC to CLE.  The model doesn't work especially in this economy.  This is no longer a build and they will come economy, I'm looking at apartments now.  I can't tell you how many "new" building in NYC are over 60% empty.  I do not like new buildings but I was shown a contract to take over the entire floor plus half of the floor above for a song a total of 8k sq ft.  Downtown Brooklyn, Williamsburg, Harlem, Hell's Kitchen, the LES, Battery Park, Ft. Greene and West Chelsea are full of buildings which are not selling.  Also a lot of buildings have clamped down on second party buyers buying for a child.

 

The problem right now is financing.  PERIOD.  We all know young people want to live in unique downtown spaces, but we cannot turn over current buildings quick enough because banks are not lending.  I agree we need more studio and one bedroom units, but building a new building at this point is not an option.

 

Having more units doesn't bring the price down. It increases cost and maintenance and if its a high density building it going to be run of the mill, not even middle of the road, but a bland human warehouse.