BUILDING OUR CITY
The new downtowners
Market called ripe for condos
By JEFF WILKINSON
jwilkinson@thestate.com
The building boom in downtown Columbia is nothing less than a
wholesale remaking of the city center — creating a new urban core
of homes with river views, Viking kitchens and short walks to
work, the restaurant or the art museum.
About 4,000 units have been built or announced recently, and
that doesn’t include 3,000 more expected to spring up around USC’s
Innovista research district.
So who’s going to buy them?
Probably your neighbors.
Out-of-towners and investors will be a big part of the mix. But
experts said most of the units will be snapped up by local baby
boomers tired of the daily commute, the big yard and the big house
in the suburbs.
The kids are grown. The bank account is flush. And, as the
television ad says, this isn’t a generation prone to rocking on
the front porch.
They would rather rock in the city.
More than half of the buyers are expected to be “boomers coming
back into the city,” said Jim Berardinelli, vice president of
Robert Charles Lesser & Co., a Washington, D.C.-based real estate
advisory firm.
The firm researched the Columbia market for The Beach Co.,
which broke ground for the 750-unit CanalSide development last
week.
“It’s the leading edge of a huge market, and they have a lot of
wealth,” Berardinelli said from his Atlanta office. “Birmingham,
Nashville, Charlotte — five years ago all these cities were in the
same boat (as Columbia now). And what we’ve seen is a massive move
downtown.”
Broad, deep market
Add to that retirees, singles, nontraditional couples, out-of
towners accustomed to downtown living and Gen Y hipsters. What
you’ve got is a market that is not only broad, but deep,
Berardinelli said.
Consider this: Of the about 200,000 households in Richland and
Lexington counties, less than 25 percent are married with children
at home, according to the 2000 U.S. Census.
The numbers “are surprising at first,” said Harry Miley of
Miley and Associates, a Columbia-based economic development
consulting firm. “But they’re right.”
That deflates the contention that the downtown housing market
will suffer because of concerns about inner-city schools.
And 3,200 more households are expected to be added to the metro
mix each year as the U.S. population continues to move South.
S.C. state demographer Mike MacFarlane said the number of
households in Richland and Lexington counties grew to about
216,000 by 2003, but the percentage of married households with
children remained the same, less than 25 percent.
With those numbers in your hip pocket, turning 4,000 in-town
units doesn’t seem quite as daunting a challenge, especially when
you consider that many of them are already sold.
Strong demand
Congaree Park on the West Columbia Riverwalk is a good
indication of the demand.
Developer Wade Caughman sold all 53 lots for single-family
homes in 40 days, at some of the highest prices ever seen in the
Midlands — $160,000 to $325,000 for one-tenth of an acre.
On the Columbia side, Caughman’s City Club condominium and town
house project on Gervais Street, across from the State Museum, is
all but sold out — only nine of the 54 units remain.
There, pre-sold units went for as much as $915,000, complete
with plans for 10-foot ceilings, Brazilian cherry wood floors and
elevators.
Although prices begin at $300,000 to $550,000, most of the
units pre-sold for $775,000.
However, those prices are exceptional because of the proximity
to the river — and its recreational opportunities and views.
“The stuff with the true river orientation garners the highest
prices — 25 to 30 percent higher,” Berardinelli said. “You have to
be careful in this market not to price things too high. You want
product in the price points of $200,000 to $350,000, because
that’s the deepest part of the market.”
Caughman said almost all his buyers were from Columbia.
“The lake. Spring Valley. Heathwood,” he said. “They want to
get closer to downtown and the pulse. Less yard. Less maintenance.
“There’s plenty of money in this town, but they spend it
everywhere else — Charleston, the coast,” he said. “People haven’t
had anything quality to purchase (downtown) before.”
Convenience
Larry and Ann Miller made the move from Forest Acres to the
West Bank.
They bought a prime lot at Congaree Park, and built a house
with unmatched views of the Congaree River and, in winter when the
leaves are gone, Columbia’s skyline.
“On the weekends, it’s a parade of boats,” Ann said. “And it’s
incredible how many people walk on the riverwalk.
“I had never been on the riverwalk,” she said. “But we saw it
and it appealed to us. We decided in 24 hours to buy the lot.”
But the view was only half the incentive. The other was
convenience.
Both work downtown — Ann in a real estate office and Larry as
an asset manager and financial planner.
“Neither one of us wants to commute,” Larry said. “We don’t
want to drive.”
They both love cooking and eating out. So the blossoming of
restaurants downtown in the past few years was also an attraction.
“It’s the lifestyle of being able to walk to places,” Ann said.
“We can walk to New Orleans (restaurant), Cafe Strudel, Mangia
Mangia.”
City life
The term for the Millers’ move is intra-migration — from one
area of the city or region to other.
The other side of the intra-migration coin is Paul and Jean
Denman.
Paul, originally from Hampshire, England, and Jean, a Dallas
native, moved to Laurens 26 years ago to take care of an ailing
aunt. They both found good jobs in the small town and stayed.
But a yearning for city life never left. When they retired last
year, they moved to a condominium in a renovated building on Main
Street. It’s lined with books, original art and mementos of their
life together.
“We fantasized about London or New York but couldn’t afford
it,” Jean said. “We looked at Asheville, but having the USC campus
here outweighed the good things Asheville had to offer. And
Greenville didn’t have a theater that showed art films.”
Jean, a former USC Union teacher and administrator, said having
so many young people around was an attraction.
“I want to see what they are wearing and doing now that I’m not
at the university,” she said.
The Denmans’ interests include art films (she is on the board
of the Nickelodeon theater), trips to the art museum and dining at
places like Gervais & Vine, Hampton Street Vineyard, Motor Supply
and the Oyster Bar.
“And bar-hopping expeditions,” Paul said with a grin. “We met
in a pub in London, and we still go to bars together.”
Among their favorites: Kelly’s and The Whig.
New arrivals
But intra-migration is only half the story. The other half is
new residents — or in-migration.
Columbia’s Pat Mason has been studying human migration patterns
in the Carolinas for more than 20 years through his Center for
Carolina Living.
Through questionnaires in his Carolina Living visitors
magazine, he has surveyed 50,000 new arrivals about why they moved
here.
He estimates 150,000 people will move to the state next year.
While the majority list Charleston as their preferred place to
move, when it comes time to settle down, more people choose
Columbia, Mason’s research has shown.
The reasons are that jobs are more available and housing is
more affordable. And it’s still close enough to the mountains or
the beach for day trips.
That trend should increase as downtown Columbia becomes more
cosmopolitan and the cost of living on the coast continues to
rise, Mason said.
“We didn’t have them (moving downtown) before because there was
no place for them to live,” he said. “I’ve been blown away by
what’s going on in Columbia. We are like the Fourth Ward was in
Charlotte 10 years ago.”
One of the new arrivals is Chuck LeMark, a Denver native who
moved here from Florida to work at the Cultural Council of
Richland and Lexington Counties.
LeMark lives in an apartment in a renovated building on Main
Street. He is looking for a condo or town house downtown.
“I walked around and fell in love with this place,” he said.
“You have blues right there at Mac’s On Main. Jammin’ Java. The
(art) museum. It was a no-brainer.”
LeMark is an art aficionado who, through his job as the
cultural council’s director of development, is working to install
art throughout downtown.
He also doesn’t own a car, a rarity in Columbia for those who
can afford one. He cites philosophical concerns about the
environment.
“I live downtown, and 98 percent of my meetings are downtown,”
he said. “So I wanted to walk the talk.”
Pioneers
LeMark’s landlord, developer Tom Prioreschi, is a pioneer in
downtown living along with partner Ron Mohling.
The former New Yorker has redeveloped five buildings on Main
Street, creating 167 apartments or lofts in some of the city’s
more venerable buildings, starting with the Kress Building in
1998.
He also has renovated the Barringer and Silver’s buildings,
among others.
Prioreschi views downtown living as both environmentally and
economically beneficial to the city as a whole.
“In-fill development,” as it is called, requires little or no
additional infrastructure such as roads or sewer and water lines.
And it takes cars off the highways, reducing air pollution and
additional expenditures of tax money for road projects.
“Those are the stealth sprawl costs,” he said. “People are
becoming more and more aware of those costs and are responding to
it. And it’s the responsibility of developers to respond to that.”
Still, he admitted that people interested in the environment,
entertainment and convenience are in the minority in Columbia’s
housing market.
The number of units being built downtown seems large, but
Prioreschi estimates it is only about 10 percent of the greater
Columbia real estate market.
“But if 10 percent of the people in Columbia choose to live
downtown, I think we can easily absorb 750 units a year,” he said.
‘Creative class’
A large part of that 10 percent is expected to be the “creative
class” of researchers and others who will move to Columbia if
USC’s ambitious plans for a downtown research district come to
fruition.
Stella de Bode is one of those people.
She is a USC medical research scientist studying children who
have had one side of their brains removed due to seizures. A
native of Latvia, de Bode moved here from Santa Monica, Calif.,
where she was a researcher at UCLA.
USC has better facilities; it’s cheaper for the children’s
families to come here for therapy; and USC provides additional
money for her research, she said.
But after 20 years in Santa Monica — “It was as downtown and
urban as it could get,” she says — de Bode is suffering a bit of
culture shock.
“I wish Columbia was more cosmopolitan,” she said.
De Bode bought a $240,000 condo in Renaissance Plaza on Lady
Street.
“It’s pretty cheap,” she said. “For the same amount of money I
am paying for my very nice two-bedroom luxury condo in Renaissance
Plaza, I would be able to buy a one-bedroom in Santa Monica.”
Her condo should be ready by August. In the meantime, she and
her 14-year-old son are living in the Vista Commons apartments on
Pulaski Street.
“I don’t like suburbs,” she said. “I want to be closer to the
action. Closer to Five Points, to the Vista, to life, to music,
the theater. From downtown, I walk to all these things. We walk
everywhere.”
Her downtown favorites: The Factory, a gym in the Tapp’s
building, and the new Cloud Nine market on Gervais.
“They have a good selection of chocolate,” she said. “I’m
happy.”
investors’ impact
But de Bode is concerned about the empty storefronts in the
live-work units on Lady Street.
Investors have purchased many of those units, and a number sit
empty. The developer attributes the vacancies to streetscaping
problems on Lady Street.
But many people are concerned that sales numbers in the overall
market are being inflated by investors wanting to get in on the
ground floor of Columbia’s burgeoning market and they might not be
occupied by homeowners for years.
“The land banking (purchasing for investment purposes) that is
going on is unbelievable,” said Carolina Living’s Mason.
He said the new units are popular with investors for the same
reason real estate always has been desirable: It will probably go
up, especially in a growing city.
“Investors would rather see dirt” than take chances on the
stock market, Mason said.
Developer David Bryant of Metropolitan Development Inc., who
partnered with Ben Arnold’s Arnold Cos. on the Renaissance Plaza
project, said only about 20 percent of the units were purchased by
investors — mostly the live-work units — and they likely will
become long-term rental units.
Berardinelli said most developers will cap the number of
investor purchases “because they don’t want their projects to sit
empty.”
All the live-work units at Renaissance Plaza have been sold,
Bryant said. But some still are empty, he said, because of the
Lady Street streetscaping project.
“Residents and tenants have been slow to move in because there
is a construction zone outside of their window,” he said.
Bryant, Caughman and other developers interviewed, however, are
looking for more land to build more projects. And out-of-state
developers are starting to become interested.
“They believe Columbia is an untapped market,” said Fred Delk,
executive director of the Columbia Development Corp., a
public-private partnership that seeks investment for the Vista. “I
hear that over and over again.”
Caughman and other developers said the stakes will rise as land
becomes scarce and outside interests come in.
But he predicted no shortage of people who will buy if the
product and prices are right.
“We’re in our infancy,” he said.
Reach Wilkinson at (803) 771-8495. |
