Hanover Hermann Park

[diggity]

bump bump bump....another one bites the dust

My link

[lockmat]

Just curious, did the 1st floor spaced ever get leased out?

[lockmat]

Good news:

The Mosaic, the two-tower 790-unit residential high rise overlooking Hermann Park, will soon have its first retail tenant. It's a natural foods grocery store and sandwich shop called Nature's Market.

With a targeted opening date of Feb. 23, Nature's Market will be a "small urban bodega,"

The store will feature sandwiches, frozen yogurt, fresh-squeezed juices and a tea bar. Nature's Market will also carry dry goods and produce and sell beer and wine. The 2,500 square foot corner store has a patio with WiFi.

Located at 5927 Almeda, the Mosaic has 20,000 square feet of street-level retail space.

http://blogs.chron.com/primeproperty/2011/02/austinstyle_bodega_moves_into.html

Only 17,500 sqaure feet to go!

[ricco67]

Good news:

http://blogs.chron.c...moves_into.html

Only 17,500 sqaure feet to go!

I think that should do well. If they advertise properly, they would probably get quite a bit of traffic from the nearby apartment complexes.

[roadrunner]

I think that should do well. If they advertise properly, they would probably get quite a bit of traffic from the nearby apartment complexes.

This will be an interesting test for the Almeda market. There are a surpisingly large amount of young professionals who live along that corridor in those apartment complexes. It's a relatively untapped market. If this does well I think we'll see more business take a chance down the street.

I know people whisper that Almeda is the "next Washington", and I don't think that's going to happen, but I wouldn't be surprised if it becomes a more active strip in the next 10 years.

[Lotus]

I have faith that these towers will one day become desirable residential icons, although I've read some anecdotes that they are somewhat cheaply built. The overall vision was correct but the timing wasn't. Too bad the creators won't enjoy the fruits.

[TheNiche]

The overall vision was correct but the timing wasn't. Too bad the creators won't enjoy the fruits.

It was a fool's vision from the beginning. Philips had a low basis on the land, and that was the only mechanism to obtain construction financing. Previous condo developers ran into problems when they developed too many at once, and Philips did just that...on a scale unprecedented for Houston, even going back to oil boom days. Worse still, his unit mix was extremely limited. (It's easier to sell 10 1BR, 10 2BR, and 10 3BR than 25 1BR and 15 2BR; and notice that the number of units goes up as the average floor plan gets smaller, for the same enclosed area.) The initial condos delivered at the peak of the Houston market, but pre-sales couldn't convert. If anybody in the multifamily business hadn't already concluded that this project was going to go bust, they figured it out pretty quickly...in spite of attempts by the first of several in a line of contracted listing agents to propogate false market data. The rent vs. own for Mosaic was all out of whack, with extraordinarily high prices per square foot, property taxes, maintanence fees, etc. Owners could never dream of renting out their unit and recouping a decent amount of the cost; but they could surely count on that unsold units would languish on the market for years, with a second tower possibly being built and once again flooding the market for years after that! Where's the value proposition?

Contrast Mosaic with 2727 Kirby, which managed (to my own amazement!) to stay out of foreclosure. 2727 Kirby was well-located on justifiably-expensive dirt in a highly desirable location, included one eighth the number of total units planned to be sold, and included relatively larger units targeting a smaller market, but one for which affordability was less at issue than desirability. 2727 Kirby also suffered from its timing to market and some stiff competition; it didn't perform as well as the original investor (deceased) would have liked. But who needs a vision when you've got good sense?

[Lotus]

It was a fool's vision from the beginning. Philips had a low basis on the land, and that was the only mechanism to obtain construction financing. Previous condo developers ran into problems when they developed too many at once, and Philips did just that...on a scale unprecedented for Houston, even going back to oil boom days. Worse still, his unit mix was extremely limited. (It's easier to sell 10 1BR, 10 2BR, and 10 3BR than 25 1BR and 15 2BR; and notice that the number of units goes up as the average floor plan gets smaller, for the same enclosed area.) The initial condos delivered at the peak of the Houston market, but pre-sales couldn't convert. If anybody in the multifamily business hadn't already concluded that this project was going to go bust, they figured it out pretty quickly...in spite of attempts by the first of several in a line of contracted listing agents to propogate false market data. The rent vs. own for Mosaic was all out of whack, with extraordinarily high prices per square foot, property taxes, maintanence fees, etc. Owners could never dream of renting out their unit and recouping a decent amount of the cost; but they could surely count on that unsold units would languish on the market for years, with a second tower possibly being built and once again flooding the market for years after that! Where's the value proposition?

Contrast Mosaic with 2727 Kirby, which managed (to my own amazement!) to stay out of foreclosure. 2727 Kirby was well-located on justifiably-expensive dirt in a highly desirable location, included one eighth the number of total units planned to be sold, and included relatively larger units targeting a smaller market, but one for which affordability was less at issue than desirability. 2727 Kirby also suffered from its timing to market and some stiff competition; it didn't perform as well as the original investor (deceased) would have liked. But who needs a vision when you've got good sense?

I see. Thanks for the detailed understanding. My version of "correct vision" is one of a layman, a dreamer, taking into account the area's potential, the views, the park, Med Center and the striking architecture. Apparently it sounds as if the professionals involved's collective vision was about as pie-in-the-sky "good sense" as mine.

So we are left with a couple of new towers, all by there lonesome in a part of town that is showing signs of waking from the dead and reincarnating as something entirely different. The value in these units could then rise as well and the towers become what they were originally envisioned as, just 10-20 years later.

[lockmat]

I know people whisper that Almeda is the "next Washington", and I don't think that's going to happen, but I wouldn't be surprised if it becomes a more active strip in the next 10 years.

Really? That area seems too homey to become a Washington type destination. What makes them think that?

[Lotus]

Really? That area seems too homey to become a Washington type destination. What makes them think that?

They said the same thing about Washington. Nothing there but shacks and tracks. All it had going for it was location. Almeda is on "the good side of the tracks", actually the freeway, and is surrounded by money and development. The street is wide and there's really not a "destination" blvd for drinks and eatums anywhere nearby. So, I think that is the standard idea as to why it could become something one day.

The only thing is that Washington evolved naturally with the townhouses coming first, then the retail. Almeda doesn't have a bunch of teardowns in the area allowing townhouses to get built en masse like the Wash area, so that would mean more expensive residential projects, which are far less likely to just start sprouting up in clusters. However, the pattern of retail development doesn't have to be the same for Almeda. They can start by attracting the Med Center-Museum crowd and add the condo towers down the road.

So there, rich developers. We've done all the figuring out for you, now just get to work!

[lockmat]

They said the same thing about Washington. Nothing there but shacks and tracks. All it had going for it was location. Almeda is on "the good side of the tracks", actually the freeway, and is surrounded by money and development. The street is wide and there's really not a "destination" blvd for drinks and eatums anywhere nearby. So, I think that is the standard idea as to why it could become something one day.

The only thing is that Washington evolved naturally with the townhouses coming first, then the retail. Almeda doesn't have a bunch of teardowns in the area allowing townhouses to get built en masse like the Wash area, so that would mean more expensive residential projects, which are far less likely to just start sprouting up in clusters. However, the pattern of retail development doesn't have to be the same for Almeda. They can start by attracting the Med Center-Museum crowd and add the condo towers down the road.

So there, rich developers. We've done all the figuring out for you, now just get to work!

I guess with it being so close to "sophistication," the med center, park and museums, that's why I couldn't see it happening. But I guess anything is possible.

[TheNiche]

I see. Thanks for the detailed understanding. My version of "correct vision" is one of a layman, a dreamer, taking into account the area's potential, the views, the park, Med Center and the striking architecture. Apparently it sounds as if the professionals involved's collective vision was about as pie-in-the-sky "good sense" as mine.

So we are left with a couple of new towers, all by there lonesome in a part of town that is showing signs of waking from the dead and reincarnating as something entirely different. The value in these units could then rise as well and the towers become what they were originally envisioned as, just 10-20 years later.

Mosaic and Montage will stabilize, eventually. Even then, however, 792 units really isn't that many in the grand scheme of a community. There are many times that number already existing within a mile of there; not to mention many tens of thousands of jobs.

Also, on account of that the ratio of improvements to land value is so horribly askew, on account of that there is still so much developable land, and on account of that improvements depreciate (the same as a car)...no, the condo values are destined to fall. Look at 2016 Main. You can buy a well-located highrise condo for really not very much money; but you end up paying more toward maintenance fees than toward the mortgage.

[asubrt]

Sort of a rehash of things already said here, but worth posting nonetheless...

http://www.chron.com/disp/story.mpl/business/7441654.html

[lockmat]

Does anyone know if the retail has been filled or if there's anything there at all? Just curious

[JLWM8609]

Does anyone know if the retail has been filled or if there's anything there at all? Just curious

 

I think there's a small grocery store there.