Another thing to consider is if there were no parking minimums a developer could potentially build apartments/condos with no parking. Each unit would be rented/bought for less but since there would be more units, they could still make the same amount, or more, per building. First couple years out of college I would have jumped at the opportunity to live at a place like that.
1 Like
You don’t have to maximize returns. You have to make the interest payments in the contract/loan agreement.
2 Likes
The costs associated with all the amenities that seem to come in greater quantities with each subsequent project have to be paid for by the tenants/owners.
Could be wrong, but it seems to me that amenities do not actually add that much cost to a project. They’re more of a marketing tool to create the perception of luxury, but when it comes down to it, I can’t imagine developers are actually investing all that much to justify the higher cost. There’s usually a gym, maybe a game room or billiards or something of that nature, a dogwash, and a communal space. So maybe you get an extra 3 units into the building if you take out the amenities. Is that enough to cut the overall cost per unit by 20-30%? Say you have a 150 unit condo building averaging 400k per unit. In order to bring this average down to 320k, you’d need to shave off $12 million from the project. Replacing the amenities with 3 new units gets you less than $1 million more in revenue, plus a small recovered cost from the unbuilt amenities.
There has to be a model out there to provide housing that doesn’t have the highest end appliances, cabinets, finishes etc.
As others have pointed out, “luxury” units in the Triangle more often use middle-of-the-line appliances and finishes. I don’t think there’s much cost to be gained here. I agree with you that there’s got to be a better model, but I don’t think we’ll see it until supply catches up with demand.
Would you agree with me that amenities take space that could otherwise be sold or rented, creating additional income, and reducing the costs for other units?
Mark, you sound like someone who has never run a business.
1 Like
My aren’t we condescending. What does running a business have to do with maximizing returns for investors? The investor (banker in this case) just wants their agreed upon interest payment at the time it is due. Sure they looked over your business plan or prospectus before going in, but they also know not to squeeze the business owner dry.
1 Like
Yeah, but like I said in my comment, I think it would result in something like 3-5 extra units at most. In a large condo building, that’s negligible – not nearly enough to bring units down to “affordable” rates.
1 Like
One thing alone won’t create more affordable units. It’s the aggregate of many things.
3 Likes
The incremental development alliance is doing a workshop in RTP in March. You should go! You could pull off building a 3 unit building, living in 1 unit and sell or rent the other 2 for that mid market.
2 Likes
Hmm, I might…sounds interesting.
1 Like
Really cool group that was started to help people like yourself who think, what if I built some of this housing we need? Here is the sign up for the workshop coming up Durham, NC Small Scale Development Workshop — IncDev Alliance
This looks interesting for someone who might want to build a cottage court development but has a lot of known unknowns, and probably more unknown unknowns.
1 Like
Yesterday afternoon (29th) I rode by and noticed that the entire block seems to be covered in hay, like they just finished their drainage work and are planting the whole lot in grass. Is there a potential delay? Or are they just making sure they don’t have to redo the drainage work in a month?
1 Like
There’s no delay because they never really started construction; that was just the repair for the culvert that needed to be done prior to the commencement of the actual work, and more importantly (to me) the eventual reopening of Dorthea Drive, which shamefully has been closed for over a year.
3 Likes
This is a reply I started writing weeks ago to an old post from this thread and frankly I’m not sure if this is the right place for it, but here goes:
This is probably not going to be well liked here by some (especially by @Mark) but all those 1920s-1930s era apartments on the west side of downtown are not that dense. They range from under 20/acre for Raleigh Apartments up near Cameron Village, to 30 units/acre for Cameron Court, up to a max of 50 for Shelton.
These are large complexes, with character and lots of big trees, and are pretty affordable (and low on amenities) but they are garden apartments that aren’t very tall and don’t use their lots that efficiently.
In comparison, the densest recent mid rise I can find is 425 Boylan at 160 units/acre. Peace is 128 units/acre (including a grocery store). And of course there’s Skyhouse at nearly 500/acre (but its parking is not on the same lot as the tower.)
At some point, I hope we can find a way to preserve some of the buildings and some of the character of these complexes, but otherwise increase the density. Wonder if that is possible.
2 Likes
I suspect that the contractor/developer have a legal obligation to manage runoff from their land. If they aren’t ready to start immediately, I suspect that they are planting grass to manage runoff. Frankly, even within their property, they probably want stability.
It means they are not starting construction immediately. Otherwise, there’s no reason to worry about preventing runoff. My guess is that they have to get greater than 40% pre-sold before they can start…same as Fairweather.
So you folks need to start writing checks if you want this to start before summer!!
1 Like
10/32 already sold 
2 Likes
I’m not going to dispute purely objective facts. My generalized arguments against tearing these down are the same as in other situations. 1) Environmentally, we are well past being able to toss useful materials in the dumpster. The rate of resource use is unsustainable all the way down to sand for concrete. 2) The built in assumption that the only urban grid we’ll ever get is already here, end of story is a total cave to suburban, vehicle required, living. Build more efficient city in the newly built areas and places where density is vastly lower than on any of the sites just cited.
Edit: Also, I figure with the amount of greenspace available on these sites, there is a decent chance they get converted to condos (I think someone else said that). I think historic garden condos would be more than enough of a selling point to command very high prices per foot, especially if the kitchens and baths get upgraded even more (Boylan/Joyner did theirs when they achieved their actual historic register status).