Naming a weak demand for high-end condominiums, the owner of a high-rise condominium property decided to convert it into an apartment project. The condominium property located at 44 Monroe in Phoenix, Arizona’s business district was acquired by a Chicago-based ST Residential in June 2010.
The company bought the condominium property hoping to sell about 196 remaining condo-units by opening a sales office center in the building, but the company was not able to sell the units as condos, while the prices starts under $200,000.
When the condominium property was completed in 2006, only about 14 condo-units are sold, according to ST Residential’s spokesperson, Greg Sexton.
Sexton also said the buyers for those 14 units will retain their ownership on the condominium property or offer them for sale to the new owner, ST Residential. He also said, the new change of plans from condos to apartment will benefit the current residents.
Converting the condo to apartments offers several advantages to the current condo-unit owners, such as recurring income and the capacity to adjust cost as demand increase and wanes.
According to an Arizona State University, Jay Butler, a housing expert, median resale price for a Phoenix condominium declined to below $60,000 in November from about $88,000 for the same period in 2009.
ST Residential acquired two other local condominium projects— 3rd Avenue Palms in downtown Phoenix and Safari Drive in Scottsdale in June 2010.
CEO Wade Hundley of ST Residential said his company will continue monitoring the Phoenix real estate market and the potential to resume the condominium property back to its original purpose.