A Tale of Condos Gone Rental
In Liz's case, there are a few tenants who gleefully eye their neighbor's higher-floor view location and fantasize about breaking down walls/floors/ceilings to create the palace they always dreamed about. For them, we suggest reading more about it.
But for most renters, the "going condo" notice was, and is, the realization of their worst fears: It means a move, leaving behind the friends and sense of community they had found in the building.
Sure, for a lucky few, it means wiping out their life savings and borrowing from relatives to try to buy the apartment they had been living in afford-ably for years. But for most? Out the door while unit after unit is "remodeled" and put back on the market as a condo for sale. In the heyday, sometimes a remodel meant slapping a coat of paint on, if that.
But then came the recession and that version of the tale ended. Today's story from the Brothers Grimm has a twist on the old plot. Instead of apartments turning condo, condos are turning into rental apartments. After a developer has tried every marketing ploy known to man and still can't unload those condos that he began building at the height of the market, it becomes a matter of last resort: Get some tenants in there until the bank figures out what to do.
Now we can add to that growing list, The Exposition, a 22-unit Kanner Architects-designed development in West Los Angeles just announced that it is "taking a break from sales" after the FDIC took over its lender, Affinity Bank. I love that euphemism, taking a break from sales. The FDIC sold the assets in this case to the Pacific Western Bank which muddied up the completion of the largely completed building. Chris DeBolt, head of Hollywood-based development company Urban Environments, who told Curbed LA that he expects sales to resume at the project early next year.
DeBolt said that all is needed are final construction documents and to get the last of the subcontractors paid. No units were sold before September.
The Exposition is following on the heels of The Chapman on Broadway and 8th Street in Los Angeles. The building, with a marbled lobby entry, ground floor retails shops and units with contemporary finishes, had anticipated sales in the $300,000 to $1 million range. Move-ins were anticipated for the summer of 2007. Fast forward to the summer of 2009 and they are now seeking renters.
In New York City, there is even a formal plan -- announced this summer -- to convert unsold condos into apartment for moderate-income families. The program, which hopes to convert as many as 400 units, is designed to provide grants to real-estate developers and lenders to subsidize the completion of developments if the owners agree to turn the building into rental units for middle-income families, which in New York means an income of up to $126,720 for a family of four. The pilot project is funded initially with $20 million of city funds, but could be expanded if initial results proved successful.
So is there a happy ending to this fairy tale? Only time and post-recession spending habits will tell, boosted perhaps by a little revisionism on behalf of the "30 Rock" writing staff.