A good part of real estate is sales and marketing! Most agents do not have a sales and marketing background. Brad Golik is a strong believer in the power of a good marketing program.
Design approval for Block 20 recently happened. For more information on this project, click Block 20 http://www.nextportland.com/2016/07/13/block-20-approved/#more-8144
Also, notice of pile driving went out recently!
So how will the timing be for the release of new condos at Block 20? I do not believe they will be as favorable as they were for the developers on The Cosmopolitan. If you remember reading on my blog, Hoyt Development had the perfect storm happen for them when they released their highly priced (a majority in the $600 to $1200 sq. ft. range) units. When the Cosmopolitan was released, inventory levels were at extremely low levels…non- existent almost! They were able to capture crazy pricing because buyers had no other options. That is not the case right now in our market. Today, like everyday, I brought up new condo listings. What was most interesting to see was that there were 11 price reductions! This is something we are starting to see everyday as things have slowed dramatically. So , moving forward, it will be a different environment for the developer.
I took a fair amount of abuse from the developers about my many comments about the Cosmopolitan, most were about pricing. Did they sell out the building at those high prices? Yes! (98%) sold. Good for them and their and their profits! (maybe not so good for the owners) If you recall, my biggest fear of selling a unit at The Cosmopolitan was worry for my clients that the market could slow down or turn around and what would happen to buyers who paid such a big premium when or if that happened… Guess what? That time is here! The market has slowed dramatically. (again, look at price reductions in the market) What will happen when Cosmopolitan buyers need to sell ( job relocation etc.)? Stay tuned. I do not believe it will be a good thing for the seller’s. Another consideration is the high number of apartments that have been built in the downtown area. I feel we must be reaching a point of saturation in the rental market. When this happens, rental rates go down. For the last several years, it has been cheaper to buy instead of renting with rental prices at $2.25 to $2.75 a sq. ft. When rental rates start dropping, you will have more potential buyers going the rental route than we had before. They will be happy to sit on the sideline and let the slowdown happen and be patient before buying.
What about the pricing at the new Block 20 development? One thing I know, construction prices ( concrete, steel, sheet rock) have continued to rise. Will we see prices touching $1000 to $1200 again? I don’t believe so. Much will also depend on the finishes of the building though. Will they compare to that of the Cosmopolitan and The Metropolitan or will they be a notch or two lower?
If you have questions about Block 20 or wish to be on a waiting list for info, please give me a call. If you think there may be some interest in the new project, keep this in mind. It will be important to work with a buyers agent not associated with the developer…remember, the buyers agent works for your benefit, not the developers!
Brad Golik is a condominium specialist with Pearl District Properties.
If you would like see any of Portland’s beautiful available condominiums, give Brad a call to set up a viewing tour.
503-896-8856 – firstname.lastname@example.org
As The Cosmopolitan nears completion, the feedback is…?
As the Cosmopolitan nears completion, it reminds me of the night when the developer invited many top agents to get their input on what their condo buyer’s wanted in a new “Luxury” condo development. Here were some of the suggestions from agents that night: Bigger decks, high end finishes, spacious master suites, spacious feeling units, fireplaces, and my input…a small artificial grass “potty” area for pets on the mezzanine level so that owners did not have to go down to street level late at night. Now, lets take a look at how they did in these areas: High end finishes. Well this was a given considering the prices charged. But is everyone happy? The truth is, Pedini cabinets are very nice, but they are a little over contemporary for some. All in all, a decent job here! Bigger decks? Well, apparently after the meeting, the developers ran to the architects…and told them to do the total opposite! The deck space on a majority of these units is terrible! Add the exterior door swing and they become even smaller!
Spacious master suites. A majority of the master suites remind me of Waterfront Pearl. (and this is not a compliment!) Most masters at The Cosmopolitan have a width of 10 feet (and only one place the bed can go) So with a King bed and headboard/footboard you are looking at about 2.6 feet or less of space to walk around your bed! And remember people, as an example, the SW corner units (E4 Plans) are $1,000,000+ condos! Fireplaces…we are good here! Pet area on the Mezzanine level…not happening! And not saying it was a great idea just because it was my idea…but? And finally…and I want to spend some time here, spacious units. This is where I think there will be the biggest amount of disappointment amongst buyers when they move into their new units. (and from people I have spoken with that have seen the units, it seems to be pretty accurate.) The problem in a number of floor plans is the actual usable living space. In a number of units there is an excessive amount of hall space. To use an example, let’s go back to the E4 plan in the SW corner…or the 14 stack (1314,1214,etc..) This unit is a 2 bedroom unit with 1,592 square feet. If you calculate in the amount of hallway space in this unit, it equals about 225 sq. feet or approx. 14% of the total square footage… this is a lot! ( if you take away that amount it makes the actual living areas closer to 1,367 sq. ft.) At 14% it comes in a close second to the worst unit which is the 2 bedroom units on the NE corner (the D6 Plans or the 17 stack…1817,1717 etc.) these have approx. 14.5% of the square footage in hallways. Others in the building are the 15 stack in the SE corner below the 14th floor at 13.5%, the 12 Stack in the NW corner at 12%, and the best in terms of actual usable space is the 15 stack in the SE corner above the 13th floor as the number there represents only 7.3% (and remember, these are approximate numbers, not exact!) For a little perspective here, let’s look at the D6 plan (NE corner below 19th floor) At 1,350 square feet, if you loose about 200 square feet that puts you at 1,150 square feet. In the world a spaciousness in condos, 200 square feet of space is a lot of space.
So are there other buildings in town with hallways taking up livable space? Of course (but none that you ever paid $600 to $1200 a square foot for!) The point I am trying to make here is that if you walk into your new unit at The Cosmopolitan, and it feels a lot smaller than you were thinking it was going to be… depending on which floor plan you bought, this could be part of the reason.
Some of the other feedback that I have heard has to do with customer service, or from what I have heard on a number of occasions, the lack of. Have spoken with several that have not gotten great service in working on the design aspects of their purchase…even one who paid over several million! Hopefully there will be more people with positive comments than negative ones as we move closer to closings!
So you’ve decided that you are ready to sell your condominium. The next step is deciding what real estate agent you should use to help you sell it. One thing I see happen over and over again are the seller’s using the same agent that helped them buy the unit originally. Is this a good or bad idea? You are thinking that when you bought the unit, the transaction was reasonably smooth so you want to use the same agent. Again, is this a good idea or bad? The answer… it depends!
The factors you should consider when selling your unit are very important because buying is very different than selling. One of the most important factors is whether or not the agent is a condominium specialist or not. Should you hire an agent that is not a condo specialist? My answer is NO! And the reason is simple… these agents just do not know the condo market! Most important, and this is a big one, their day to day marketing does NOT cater to condo buyers. As a condo specialist, my marketing is targeted to condo buyers EVERY SINGLE DAY! This is IMPORTANT! A typical agent can not just flip a switch and fill their pipeline with condo buyers. Typically, they spend one day in Beaverton and the next in Lake Oswego. It is very hard to be an expert in the entire city. Actually, it is impossible! That is why I specialize. So I can be the best that I can be and truly understand my market.
Knowing your market is very important for a listing agent. What I see often from agents that do not spend time with condos, is a lack of understanding of pricing. I will be honest, if you were looking to sell a house in the Alameda area of Portland… I am not your guy! Why? Because I don’t understand the market as well as someone that works that area. Pricing can be substantially different in that area by being 1 to 2 blocks off of certain streets. Same goes with condos. I get calls all of the time from “suburb” agents trying to pick my brain on pricing because they know I have done a lot of condos and know the market. Do I like to get these calls? Absolutely not! It is very frustrating to see a seller put their trust into an agent that does not understand the market. To make it even worse, I go crazy when I see that same agent get the listing and don’t use professional photos to market the condo! It happens EVERYDAY, and it is usually because the seller was comfortable with the agent when they bought the place. So is this the right agent to list and sell your condo? Definitely not.
If you have read my blog for any length of time, you have probably heard me say “Any agent can sell your place…but at what price?” This is so true. I am a firm believer that good marketing makes a difference. It works for NIKE, Coca Cola, and Johnson & Johnson. Why do they continue marketing like they do? Because it works! Buyer’s are willing to pay more for something that is presented in a nicer way. Same can be done in real estate. If you can make a sub par listing look better than it is, you will get more people through the door. If a lazy or cheap agent does not pay for professional photos, the chances are the condo will not look as good as it could and it will lead to less people coming through the doors to look at it and in turn, the seller will get lower offers.
Now let’s say that original agent also does a fair amount of condos. All I need to say here is look at the previous paragraph! Marketing matters!
We have all heard recently how crazy the market is lately. We have heard that it is a Seller’s market and that there are no deals to be had. Wrong!
Yesterday, my client closed on the purchase of a beautiful new Penthouse condo at The Elizabeth. Originally priced at $3,299,000, my buyer closed on this unit at $2,200,000…FULLY FURNISHED, and the furnishings were stunning! After 10 months on the market, this penthouse was most recently priced at $2,995,000. I have been in this business a long time now and I must say, this has to be one of the best purchases I have seen… and this in a “Seller’s Market”!
One reason that I want to bring up this purchase is to talk about the importance of correct pricing when you put your home on the market. It is great to try and push the price a little in this market…but there is a very fine line! There are many penthouse units in the market that right now are becoming stale because they were priced way over the market price. The Penthouse at The Elizabeth was one of them and you may recall my blog posting when that unit originally came on the market. If you did not read about it “Luxury Condos and Portland Penthouses” in November when I wrote about it…here is what I said:
“Topping the list is the largest of the penthouse units at the Cosmopolitan priced at $3,883,000. If I had to guess, this will be the first one to sell of the three penthouses that are in the $3,000,000 price range. The other two, the penthouse at the Casey priced at $3,499,000 and the penthouse at the Elizabeth priced at $3,298,900 are very overpriced in my opinion. ( so is the one at the Cosmopolitan…but it will eventually sell very close to its asking price). The other two are priced in the $1000 a square foot vicinity. This is way too high, in my opinion!”
Now I am not patting myself on the back for being right about the pricing… (because I was VERY wrong saying the Cosmo would have difficulties selling) The reason I point this out is to let seller’s know that when you overprice a unit, it will cost you more in the end because the unit becomes stale and lowball offers will start to come…much like our offer on The Elizabeth penthouse after it had been on the market for 10 months! If you are a buyer that is looking for a luxury condo or penthouse and would like to hear our negotiation strategy for this purchase, give me a call as I would love to assist you in finding a great unit! If you are an owner that is thinking about selling, I would love to sit down with you and share my marketing program with you. I truly believe that I have the best marketing program for condos in the + $500,000 market!
If you are a buyer in the luxury end of the market and possibly looking for a penthouse, please give me a call because I believe with the sale price of $2,200,000 at The Elizabeth, ( the most recent comp) the other units in the market that are priced at $2,000,000 or higher will be getting a pretty big dose of reality and need to adjust pricing or at least be willing to accept a realistic offer!
Brad Golik is a condominium specialist with LuxuryCondosofPortland.com and Pearl District Properties. He is also a founding member of Condo10.
When you decide that you are ready to sell your condominium, one of your biggest decisions should be who you will hire to sell your condo. You do have many options of real estate agents to hire so how do you know how to select the right one? From the very start, you would be very smart to eliminate agents whose major portion of their business are homes out in the suburbs. Why eliminate these agents? It’s simple…they just DO NOT know the condo market well enough. They do not know the intricacies of selling condominiums and they really do not understand the pricing of most units. I cannot tell you how many times I have heard these “Suburban” agents tell me “Well unit #??? Sold for $500 a square foot so that is why we are priced here!” What they just don’t understand is the difference in pricing throughout the building. Was it on the 3rd floor or the 10th floor.? Was it looking south or east to Mt. Hood? Is there potential for a building to go up in front of the unit? Is daylight blocked by another building? These are just some of the many issues that contribute to pricing a unit. You cannot just say that because one unit sold for $425 a sq. ft, that another one will.
This lack of knowledge often leads to units being under-priced, or more often, over-priced. The big problem when agents overprice a unit is that it becomes stale on the market, goes through several price reductions and then in the end, sells for less than what it should have sold for if it were priced right.
To me, the biggest reason not to hire a “Suburban” agent in my opinion, is the lack of consistent marketing everyday to condo buyer’s. As a condo specialist, my marketing is directed 24/7 toward condominium buyers. I am consistently filling my pipeline with potential buyers of condominiums. A suburban agent is in Lake Oswego one day, Beaverton the next marketing to people looking to buy a home, not a condo. I will say this, if you are looking for an agent to sell your $2,000,000 home in Lake Oswego, I should probably not be your first choice. I am not a specialist in that area. I am a specialist with condos! You should strongly consider this when selling your condo!
The other important issue to look at, and I think this is a big one, is how good that agent is at marketing. A good way to check on this is to see how good of a job they do at marketing themselves! If that agent has no true branding, or has sub par pictures on their website…if they have one, or is hard to find, this should tell you something. Most agents will not spend a lot of money on listings and I believe this is a huge mistake! Many, many agents don’t even spend the money for professional photos. Here is something I saw recently that was so funny. (but sad for the owners trying to sell) On a listing, an agent stated that you really need to come by and see the condo because the pictures do not do it justice! Are you kidding me? That is the job of the agent to do beautiful, stunning photos that draw people to come view the condo! This is the very minimum an agent should be doing. See an example of one of my listings here: http://www.PacificaTowerCondo.com
Now you know part of the reasons for hiring a condo specialist, now I want to touch on another point. I have seen many people use the agents that were the on-site agents that sold the building when it was brand new. I advise caution if you are thinking of going this route and here is why… Yes they were very nice when you worked with them before (remember, they were trying to sell you something!) While many on-site agents are in fact, very nice, most of them have limited experience in the resale markets. I mentioned above the importance of spending money on listings to make them stand out. Most of these agents have always spent the developers money to sell units, not their own!
There are many other things I believe to be important that a specialist can offer. If you have any questions, please feel free to give me a call or shoot me an email and I would be happy to sit down and discuss things with you.
Brad Golik is a condominium specialist with Pearl District Properties. You can find him at http://www.LuxuryCondosofPortland.com or by giving him a call at 503-896-8856
As we start the new year, one thing remains the same…low inventory! As new listings come on the market, those searching for a new place to live will want to react fairly quickly as there are more buyers than there are condos for sale! If you are looking to sell, not a bad time to push price a little! Last night I went to an open house at The Waterfront Pearl. The listing was a beautiful 8th floor unit with sweeping views of the Willamette River. Stand at the windows in your living room and you feel like you are on top of the river! This unit, priced at $989,000, featured 1729 sf. As I viewed the condo, my first thought was that I wish I had a client with me as I felt it might be under priced at only $572 a sq. ft. While this building is not The Cosmopolitan or The Metropolitan and it will not command the same prices, I do believe this unit could get closer to the $636 per sq, ft. range which puts It closer to the $1,100,000 price tag. Compare this to 2 units left at Cosmopolitan. One is 1643 sq. ft. and priced at $1,559,000 ($953 sq. ft.). The other is 1363 sq. ft and priced at $1,197,000( $878 sq. ft.). Both of these units are on the 25th floor at the Cosmopolitan. While the Waterfront Pearl unit is not on the 25th floor and does not have 25th floor type views, It does have gorgeous river views and people rarely get tired of looking at the river traffic below your windows. To me it is kind of a wash in terms of views. So then, you have to ask yourself, are 25th floor views worth an extra $300 to $371 a sq. ft.? If you were to see the river views from the Waterfront Pearl unit, I believe your answer would be “No way!” . Those views were pretty stunning!
If you are looking to sell your condominium in the near future, be aware of current inventory levels…this is so important. While comps will give you a good starting point, placing your condo in a side by side comparison with every condo in the price range is more important! Right now, for example, there are only 9 condos in the $900,000 to $1,100,000 price range and not 1 of those units competes well with the new Waterfront Pearl listing mentioned above! Does this strategy of pushing the price work? You bet it does! You may have to also sell the appraiser on your pricing, but a good agent should be able to justify his pricing. Another example of this strategy is the Cosmopolitan! The prices they attained happened for 1 reason and 1 reason only… no to low inventory!
Brad Golik is a condominium specialist with Pearl District Properties. You can call him for a free market analysis at 503-896-8856. Email: email@example.com
** If you would like to view this new listing at Waterfront Pearl, give Brad a call (but you better hurry!)
When you write in a blog, sometimes you will make statements that are right and other times you may be wrong. This is the risk that you make when you put yourself out there. At times I will mention that I think a unit that comes on the market might be overpriced, underpriced or priced just right. In the case of the new Cosmopolitan, the market has spoken! From the very beginning, I have said that I felt the Cosmopolitan was overpriced. Was I wrong? Well, the Cosmo is now about 85% sold out. The market has absorbed those high prices, prices that I mentioned were higher than Seattle’s Insignia development. How could I be so wrong? For the developer, Hoyt Street Properties, their timing was the perfect storm, in a good way. Not only did interest rates not go up as many have feared, they actually went down. The biggest reason the developer was able to capture these high prices… LACK of INVENTORY. This is where I was dead wrong in predicting what would happen in the market. I don’t believe anybody would have guessed we would have continued with the low inventory that we have continued to have.
Typically, as prices rise, owners who were underwater begin to see some equity and sell as prices begin to go up. This time around, it has not happened! This was the perfect storm for Hoyt. In regards to pricing, it really is the market that determines the price. Because buyers had no other options, they were forced to pay the high prices at The Cosmopolitan. In doing so, the developer never had to reduce prices like I thought they were going to need to do. So was I wrong in my saying they were priced too high? I am sticking to my guns in terms of my opinion on pricing. Again, I don’t determine prices nor does the developer, it is the market. Is Portland ready for $1000 a square foot prices? I still don’t believe so. Several agents have tried pricing a couple nice penthouses in town at the $1000 a ft. level and they are not selling. The real determination of pricing will come when these units go into the resale market. This has been my biggest fear in not wanting to put my clients in this building. While some are certainly willing to take that risk, it is hard to determine what the market will do between now and then. What I do believe though, is if the market were to turn around, I believe it will be very difficult to get the $800 to $1200 a sq. ft that the buyers paid. When things aren’t shiny and new it is more difficult. Will the extra height of the building justify those prices then? I am not so sure. The new Overton apartment building, which is slated for 26 floors, takes away some of the theory of not getting views blocked by being in a 28 story tower.
So was I wrong on pricing? Like I said, the market has spoken and the developer has won! However, somebody asked me the other day if my parents moved up from San Diego, would I sell them a unit there? My answer… NO! I would do exactly what I said was an option early on. I would rather find them a nice unit at The Metropolitan, Park Place, The Henry or The Casey at $600 to $800 a sq. ft and have them put $100,000 to $150,000 into it. That way they would have the dream kitchen they want (which is not ultra contemporary) and they could do some other things to make it exactly how they want it. They could have a unit that I believe would far exceed, in terms of finishes and design, what they would be getting at the Cosmopolitan. And not that the ultra contemporary finishes at the Cosmopolitan are not nice, Pedini cabinets, your only choice, are just not for everybody’s taste.
To finish up I want to add just one thing. Everybody that is buying at The Cosmopolitan is not just buying an investment, they are buying their new home that they plan on living in for many years. So for those people who don’t have plans or need to sell anytime soon, they will be living in a very nice building in a very nice part of the Pearl District. They will be in a building that offers many nice views and a building near several close by parks…it will be a nice place to call home!
Brad Golik is a condominium specialist with Pearl District Properties. I you are thinking about listing your Portland condominium, give Brad a call and learn about Portland’s best condo marketing program.
503-896-8856 l WWW.LuxuryCondosofPortland.com
Condo Sales for March
Portland Condo sales for March were strong considering how low our inventory is. In the month of March there were 63 sales in the area that I cover, which is from Pearl District, Uptown, Downtown to South Waterfront. This includes all condos and town homes priced above $200,000. To compare, February had sales of 37 in that same area. What is very interesting though is not the increase in sales of 70%, which is not unusual for this time of year, it is that there are currently 122 pending sales. Now 122 pending sales is nothing unusual, however, what is unusual is that this is the first time since I started writing in my blog that the pending sales actually exceeded the Active listings! Currently there are only 110 Active listings in my designated coverage area.
With numbers like this it could increase the numbers for appreciation in our area. While it was expected to see growth slow down some, the numbers may be higher than expected. It is certainly a sellers market with the low levels of inventory we are seeing. What will be important is the number of units that normally hit the market this time of year. As I mentioned, being a sellers market, this has been a huge windfall for the developers of The Cosmopolitan as they are getting buyers to plunk down a non refundable deposit for high priced units because of the fear of not being able to buy resale units at other buildings. If we were in a normal inventory market, I guarantee we would not see buyer’s overpaying for units.
If you are one of those buyers who may be looking for an upscale, high floor unit and looking to pay above $1,500,000… be patient! Next week I will be listing a unit that will be priced in the ballpark of $560 a square foot. A comparable unit in the
Cosmopolitan will cost you upwards of $1,000 a square foot! In my listing you could do a $250,000 remodel and still come in under $615 a square foot. Yes, sometimes patience does pay!
Brad Golik is a condominium specialist with Pearl District Properties.
Specializing in Portland Condos , Portland Penthouse, Portland Town Homes, Portland Highrises, upscale buildings including The Casey, The Metropolitan, Park Place, The Henry, The Westerly and many more!
Inventory has been very tight recently but the last two weeks we have seen an upsurge in new listings, hopefully a sign of what is to come. Traditionally, the spring is when we start to see an increase in listings. Never has this been more needed than in this current market. In our last blog post we mentioned that the sales, while slow, at The Cosmopolitan have benefited from the lack of inventory. While those units will not close until the summer of 2016, people fear they will not be able to purchase what they want and feel the need to make an offer at The Cosmopolitan. Right or wrong, this is what I feel is happening. Buyers feel that while The Cosmopolitan may be overpriced, as we have stated many times, they feel like there may not be units come on the market between now and the summer of 2016. For current seller’s, this is a huge advantage in capturing a premium in the sale of their units. Recently I showed a unit before it was even on the market. This unit was on the 15th floor of the Metropolitan and priced at $1,200,000. The seller got an offer before it went on the market. Because of the lack of inventory, and the very high prices at the Cosmopolitan, the seller was able to get $637 a sq. ft. This was a large unit at 1881 sq. ft. To get this size of a unit at The Cosmopolitan you would need to spend $1,600,000 for 1773 sq. ft. I think the buyers of that unit got a very good deal. As for an update of sales at the Cosmopolitan, they are currently at 59 sales or 39% of the building sold. One of the new sales was finally above the 21st floor. This is only the 2nd unit that has sold above the 21st floor to date which is not surprising when you consider the prices ( these 2 units sold for $875 and $1,000 a sq. ft) For comparison, I will be listing a unit in another high end building, above the 21st floor for about 595 a sq. ft. One thing to keep an eye on at The Cosmopolitan is to see if they get any offers on the penthouses or junior penthouses. Many times, buyers of penthouse units may buy a unit even when they know it may be overpriced. Sometimes it may be that these buyers have enough money that they can overlook the price to get what they want. This has not happened yet at The Cosmopolitan. If the general public see’s that someone is buying those units and paying $1000 to $1200 a sq. ft, it somehow makes them feel justified to pay $800 to $1000 a sq. ft. To date, the project has had several of these units go pending and then go back on the market. Perhaps it is the realization that they were about to pay $400 to $600 a sq. ft. more than the average of all of the Million dollar condos that sold in 2014 ( $579) Again, these were the best of the best in Portland! If and when the Cosmopolitan does sell one or two of the of the eight junior penthouse and penthouse units it may add to peoples confidence to put down an offer on the units on the 20th to 25th floors. Right or wrong!