Condos

Without picking on one Philadelphia condo building in particular, there can be no argument that more than one condo building in Center City has not achieved its sales goals and projections. Blame it on a poor location, a snotty sales team that doesn't encourage realtor cooperation, or just a plain undesirable building- but it can't be a secret that there are a handful of newer condominium buildings in town that are hurting financially. The Murano condominiums at 2101 Market St. pulled a unique plum out of its hat with a successful auction of 41 of its 302 units. Will more buildings follow in those footsteps?

Around the turn of the century (2000), a number of deep pocket investors and developers targeted the downtown Philadelphia area as a prime target in which to plant new high rise condominium buildings, as well as the conversion of existing non-performing commercial buildings into condos. Center City had not seen any major new conversions or construction in the condo segment since the early 1980's, and it was clear that expansion was in order for our growing urban area of downtown Philly. Though not every planned building made it past the pipe-dream phase, many new buildings did arise, and many empty commercial and apartment buildings did "Go Condo". A number of the buildings have been hugely successful- like Locust Point condominiums at 2429 Locust St. in the Fitler Square area of Philadelphia. Conversely, a number of building that did get built/converted are not selling so well.

Will a number of these non-performing buildings follow the Murano's lead? Will Center City see a plethora of condo auctions as they try to move unsold inventory? I would suggest the answer is neither yes or no-it will be somewhere between an auction crazed town, and business as usual. With banks growing restless to reclaim the monies they are loaned on certain buildings, the pressure on the developers is weighted to prompt some quick action. I would suggest that we are going to see at least three or four other buildings follow the Murano's lead, and take some drastic action to lessen their holdings. Be it a severe price drop, or an auction, I think that the writing is on the wall, and buyers looking to make a smart move should keep their eyes open for major opportunities that are sure to present themselves.

If your goal is to secure the best possible deal for some newer construction condos in Philadelphia, keep your eyes and ears open. My guess is that there will be some staggering price reductions/condo auctions in Philadelphia throughout 2010.