Monday, April 03, 2006

Downtown Scottsdale is crazy for condos - Tribune Article

By Jonathan Athens, Tribune

April 2, 2006

New York. Chicago. Add Scottsdale to that list when you think about upscale urban living. Downtown Scottsdale’s condominium market is booming, with construction cranes and the steel skeletons of what will soon become luxury dwellings looming against the skyline.

Thousands of people will make downtown their new neighborhood, helping turn the area into a 24/7 way of life for a new breed of Scottsdale residents who want to escape suburban sprawl.

Longtime Valley resident Anne Davison said she decided to buy a new condo in downtown Scottsdale because she wants to live in a sophisticated urban community.

“I plan to live there forever. I don’t ever plan to go back to living in the suburbs,” Davison said.

A forty-something real estate agent by profession, Davison sold 10 condo units in the Optima Camelview Village and then decided to buy one for herself. Her daughter, Elizabeth, also has bought a unit there.

Investors over the past three years have poured more than $1.6 billion into every segment of the downtown area — retail, employment, cultural, hotel and residential, according to a January report by the city on downtown developments.

Of the 2,600 new, planned or built condo units, 2,100 are situated in downtown and those units are selling at average prices of more than $500,000, city records show. The condominiums at Optima, considered the largest downtown condo development, range from $400,000 to $5 million.

The 750-unit village in March sold its 500th unit, with the first residents expected by early summer, an Optima news release states.

The people choosing to move downtown fall into what sociologists have dubbed the “bookends generation,” those who are at both ends of the work force spectrum.

At one end are older Americans not yet ready to retire; at the other are upand-coming, techno-savvy young Americans.

They want to live “a 24-hour lifestyle,” said John Little Jr., executive director of The Downtown Group, the city’s liaison to downtown businesses.

These new urbanites, Little said, “are people that have been living in gated communities who are excited about a lifestyle that is more engaging than what is afforded in a gated community.”

The wave of new downtown residents “is going to spark a rethinking of what downtown is and how it works,” Little said.

“Literally, we are creating new downtown neighborhoods,” he said.

The Davisons, Scottsdale City Councilman Wayne Ecton and his wife, Martha, gallery owner Debra O’Hara, and college student Ryan Martin reflect the new faces of those new downtown neighborhoods.

For Wayne and Martha Ecton, moving from a house in outlying Scottsdale to their $620,000 condo at Main Street Plaza this August is a major lifestyle change they know well. The Ectons say they are looking for the convenience of being able to walk to shops and restaurants.

“This is heresy for a Scottsdale person to say, but I like streetlights,” said Martha Ecton, 67.

The Main Street Plaza is a mix of residential and retail units located at the corner of Marshall Way, Main Street and Goldwater Boulevard.

The first phase — 33 condos ranging between $500,000 and $1.75 million — is sold and residents are expected to move in this summer. The developer is planning to build another 54 residences — a mix of 10 townhouses, 40 condos and four penthouses ranging in price from $400,000 to $3.25 million.

Despite those prices, Ryan Martin, 21, said it’s false to think only the wealthy can afford to live downtown. The philosophy major at Arizona State University bought a $150,000 townhome near Indian School and Miller roads about a year ago to be closer to restaurants, art shows and sports events.

“What I like best — it’s located right in the heart of Old Town Scottsdale,” he said. “There’s always something going on.”

Martin said he “lives comfortably,” earning an average $40,000 a year at his job as a bellman at the Hotel Valley Ho, another upscale downtown development.

Valley Ho was a playground for some of the Hollywood set in the 1950s. Today’s version is a remodeled resort with 194 boutique hotel rooms and 37 condo units, all of which are tentatively sold.

Real estate agent Mark Himsl said the condos went for between $608,000 and $2 million, and that seven of them are penthouses listed at $1.2 million to $1.6 million. He said he expects the first closing will take place in mid-July and the last will be on Sept. 1.

The most expensive or “Wow!” units are priced high because of the features they offer, Himsl said.

For example, a pair of two-story lofts at the Valley Ho feature 20-foot glass walls.

One amenity that Deborah O’Hara loves about her new condo is that it’s close to her art gallery — right downstairs.

About six years ago, she and her late husband, Calvin Puckett, came up with the vision for a live-and-work contemporary gallery, knowing the downtown area was taking off. Puckett died the year before the Calvin Charles Gallery on Marshall Way officially opened in 2003.

It was an expensive venture — she wouldn’t reveal the cost — but “the commute is a lot easier,” she said.

The downtown condo growth in Scottsdale is indicative of a national trend, and could possibly be spurred by traffic congestion, said Jay Butler, director of the Arizona Real Estate Center at ASU.

“People want to return to a more hip way of living,” Butler said. “It’s an urban thing.”

The real question, he said, “is how deep is the market?”

Condominiums comprise roughly 8 percent of the housing market in general, he said.

“Are we going to go to 12 percent? That’s a big unknown right now,” Butler said, adding he doesn’t expect the condo market to grow by more than 1 percent.

Contact Jonathan Athens by telephone at (480) 970-2342.

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