I don’t think downtown is running out of space, there’s a big swath of single family homes in a big circle all around downtown. Turn those into denser development, and then a 20 story building downtown makes more sense to the person paying for it.
88.4% I believe is all apartments and vintage. Usually apartments are broken up into classes like office space, so newer vintage is A and older product is C. Historically, 93-95% is considered expected occupancy for the Class A. Let me see if I can dig up a Costar or Berkedia report detailing the downtown apartment market for Raleigh.
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This development is highly beneficial for the city for several reasons:
- Increased Supply: More supply leads to greater competition among renters.
- Momentum for Growth: I first evaluated the hotel portion of the site back in 2019, and in 2025, seeing this project finally take off is exactly the momentum Raleigh needs to sustain its resilient growth. Currently, we are unlikely to see more office space downtown, as the lifecycle typically begins with residential developments, followed by retail, and finally office spaces, which can pay the highest rents. We also currently have an excess of office inventory. As @anon8787296 has shared, the Omni will have lots of retail.
- Enhanced Walkability: Every non-vacant street contributes to a continuous streetscape, enhancing walkability. Fewer vacant buildings, parking lots, or fields in the downtown core make it easier to activate the area.
I understand your sentiment about retail spaces. However, I’ve seen ground floor conversions from retail to apartments for spaces that didn’t rent out, and the reverse can happen as well. The developer might find that no one wants a ground floor unit, but a retail tenant could easily occupy the space. If this ends up being podium construction for the lower levels, converting from residential to commercial space won’t be a major challenge.
Most new developments aren’t going to be 10-story+ buildings with glass or expensive facades, and that’s okay. It might be frustrating to see beautiful proposals get significantly altered, but it’s important to understand that there are numerous external factors at play. Just consider the impacts of the recent tariffs as an example of volatility. At the end of the day - I like the quote: “Better to aim high and miss, than to aim low and hit.”
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Yes it is occupancy rate for the stabilized apartments downtown that would include newer and older ones. I just was reading the new 400H apartments are 90% leased.
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Oh joy. Drivers entering the city from the South @ the money shot get to see a parking garage. What a f*cking disaster!
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TBF I believe the original plan with the 20 story skyscrapers had the same issue …
This was my takeaway, too. That’s a good chunk of residents activating that corridor quickly.
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However, there would also be a tower to grab your attention as well. Right?
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Maybe they can do the same paint job as the Rockaway parking deck hat, and it’ll just disappear from view.
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Is it possible you’re/they’re mixing up figures? 21.4% is cited in this report that came out 10 days ago, but it’s not related to residential occupancy… it describes the year-over-year increase in food and beverage sales in Glenwood South.
The report claims downtown’s residential stabilized occupancy rate is 88.4%. So that’s roughly 12% vacancy, which does not include recently completed developments still in lease up. That is still high, for the record, and probably high enough to slow new residential construction significantly.
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…but not enough to significantly lower the average rent prices, OF COURSE lmao
Avg rents in Raleigh down 3%, wages up 3% YoY. That’s not nothing especially if it is a trend.
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Thanks for sharing that data. That is really a good scenario to have: the city and economy keep growing while big ticket costs are under control.
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For sure. Just for reference in dollar terms - a person paying the avg rent in raleigh and making the median income would have an extra ~$300/mo based on this.
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The Biz Journal article from today said DRP paid $35.5M for the property in 2022, that’s gotta sting from a development standpoint. Assuming they sell of the hotel pad for $5M, they are still in for $30M + whatever their holding cost has been the past 2+ years which puts their basis at around $55,000/per unit which is very high!
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They put some much work in to the old project. I remember it being stuck for weeks because the appearance commission didn’t like one tiny part of the building design so that took about a month to redesign. Makes me question whether all these endless committees are a detriment to design since cookie-cutter by definition will sail past the process.
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That is interesting. I’d love know if that contributed to the original proposal downfall.
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High construction cost of high rises. Probably easier to finance. Lack of office tenants and there was no mention of office space in the new plan when some was planned and spoken for by Dogwood State Bank. However this is a lot more apartments than first proposed and feet on the street in downtown is a good thing for a LOT of reasons.
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Not a fan of the architecture. If it were up to a certain standard I could live with the height but it feels like a major downgrade architecturally as well, in a very prominent placement in the city.
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12 posts were merged into an existing topic: Zoning and Density