Fire Sale Prices On New Downtown Condos
MINNEAPOLIS (WCCO) — Walking into the 1200-square-foot unit on the 21st floor, Skyscape project manager Chris Kennelly pokes through a doorway and says, “This is our master suite.”
He’s pointing out the amenities of one of the newest and best-selling condominium towers in the Twin Cities. And if you dream of living downtown, he’s got a terrific deal for you.
“For us it makes the most sense to really try to accelerate the sales pace for this project and get the rest of the units sold,” said Kennelly.
Completed in 2007, just as the recession was digging in, the building’s investors are still trying to sell what remains of the building’s 250 units. To do that, they are taking the rare step of holding a non-foreclosure live auction. Bidders will be able to set their own prices that exceed set minimums on 26 of the unsold condos.
Starting bids on the units will save a buyer anywhere from 35 to 45 percent off the owner’s last asking price. Clearly, the recession and soft housing sales make it a buyer’s market.
One-, two- and three-bedroom units boast hardwood floors and cabinets, granite countertops and floor to ceiling windows. Minimum bids range from $125,000 for the one-bedroom to $325,000 for a condo with two bedrooms and a den. All of the units have two or more baths.
Ali Cohen is project manager with Velocity Marketing, which is handling the sale.
“We don’t require that our buyers are pre-approved, however, we do offer financing though the Bank of America,” said Cohen. “They’re here every day during our open house to do pre-approvals.”
Still, not everyone is excited about the auction. Present condo owners, like Drew Branham, bought their Skyscape units when real estate prices were much higher. Branham’s been in his for the past two years. It’s a two-bedroom unit he paid $319,000 for in the midst of the recession. That same unit is now being offered at a minimum bid of $175,000.
“Yea, you can get people in there but you’re also getting people in there at drastic price reduction,” said Branham. “And the values of the 200 other homeowners that are in there has just been drastically reduced.”
But Skyscape’s investors say the sooner their inventory is gone, the quicker prices will rise for everyone.
“I think we’ll really get to see where the downtown market is this spring. By going through this process it will be a pretty good indicator of the market as a whole,” said Kennelly.
All units being auctioned will be available for inspection at an open house that runs through March 13. The auction will be held March 14 at the Graves 601 hotel in Minneapolis.