Major article on downtown Winston development

[ncbrian]

This is a major article on the front page of the Winston Journal today that outlines the difficulties for one of the targeted demographic markets for downtown residential development.

The lede:

Downtown is where the action is for Eamon Gilmartin, a 29-year-old copywriter at Mullen advertising. In a typical week, he'll check out his friends' art at the SEED Gallery, take in the Films on Fourth and sample Asian fusion cuisine at Xia's.

He would like to live downtown, he said, but he can't afford to buy in the district.

"I don't think my first place should cost over $200,000," he said. "Those are prices you see in major cities."

Gilmartin's concerns are echoed by others. Whether they were graphic designers, teachers, bartenders or bankers, people interviewed said that downtown may be a nice place to visit, but they can't afford to own a home downtown, especially in any of the new developments coming to the city center.

That seems a long way away from how things were supposed to go when a 1998 study showed that the Triad was hemorrhaging young people and employers were having trouble recruiting workers because Winston-Salem's downtown was all but dead.

My take on this is that it was readily apparent that this would have happened because of the high prices announced for the new units as each development came on stream. Perhaps, as Mayor Joines pointed out, it is the high initial cost developers have to deal with when it comes to acreage prices just to start development as compared to other parts of the city.

I wonder if some of the costs could be alleviate if the focus was on refurbishing existing properties rather than tearing down and build new structures. This will lower the initial cost.

Also, perhaps rethinking the boundaries of what is downtown will help improve the situation as much the development now is concentrated along the Fourth St area. This is plenty of infill land north of downtown that should be ripe for redevelopment and allow entry-level homeowners and the targeted youth market to live in proximity to downtown. It may may become Winston's answer to the NoDa area in Charlotte.

It is essential that the downtown is a vibrant representation of Winston and if it becomes the restricted locale of empty nesters and older monied professionals, then twenty years from now we will still complaining why downtown Winston is so dead and what will do about it.

[RaleighInvestor]

$200,000 for a downtown condo anywhere is a bargain.

The person quoted is not representative of people under thirty who would "live, work and play" downtown. I think that there is plenty of demand from young professionals. $200,000-$300,000 in downtown Winston Salem gets you what over $1,500,000 gets you in NYC.

If you are of the mindset that your first "place" should be under $200,000, then there are not many cities in which you are going to live downtown. Maybe he should try Kernersville or Walkertown.

[krazeeboi]

If you are of the mindset that your first "place" should be under $200,000, then there are not many cities in which you are going to live downtown. Maybe he should try Kernersville or Walkertown.

I tend to disagree. I know Charlotte and Columbia in particular are building downtown residential units that go for $150K and lower. There's no reason why Winston can't do this.

[twincity]

Goler was a good option back when it was first proposed. the initial vision was an urban community for everyone, but now it seems to be more attractive to empty-nesters. the should have stuck with the original plan.

Maybe north downtown can be set aside for affordable housing? Tobacco Square IMO looks and should be converted into affordable apartments/condos. there's so much land up there screaming for redevelopment. this is one of few opportunities to make a sizable mixed-income community for the center city.

[ncbrian]

$200,000 for a downtown condo anywhere is a bargain.

The person quoted is not representative of people under thirty who would "live, work and play" downtown. I think that there is plenty of demand from young professionals. $200,000-$300,000 in downtown Winston Salem gets you what over $1,500,000 gets you in NYC.

If you are of the mindset that your first "place" should be under $200,000, then there are not many cities in which you are going to live downtown. Maybe he should try Kernersville or Walkertown.

Well, $200,000 also gets you a nice property as a single detached house relatively close to downtown in the Ardmore area as well.

There is no doubt that there are people able to afford the current prices for the new units downtown but for them, living downtown is a lifestyle choice. They could have easily bought a good size property anywhere in the county but prefer to live downtown. On the other hand, someone leaving college now and just starting off in their new career is going to find it difficult to find a home that they can afford. Most college graduates will start off as renters then move up in what property they lived in as their income also goes up. That usually means a starter home of sorts which use to be about $120k when I was in college so many years ago but it should not be anymore than $150k now. Spend a few years in their new home and build some equity and gain some property appreciation and then they can afford bigger and better properties. Asking a college graduate if he is willing to take on a $200-250k mortgage on top of his student loans on typical starting salaries for professionals is asking him to take on awfully lot of financial responsibility.

[DCMetroRaleigh]

Be thankful it is not worse. Here in Northern Virginia a studio condo often starts at $350,000. It is rare to find a one bedroom less than $400,000 in the DC area.

[ncbrian]

But we really should not be comparing Winston to D.C. or New York or even Raleigh for that matter

[sax184]

The Blvd Centro project had plenty of units under $200k when it came online. I think that as that area expands, we will see more in that price point area. However, I agree with Raleigh Investor. Downtown confers tremendous locational advantages, and those advantages are not going to be cheap.

Things will get better in this respect when there is a grocery and more local retail downtown. Then some 2-person households can become one-car households downtown and afford more units.

Of course, greatly improving the bus system in Winston would help with this, too, by lowering the need to own a car in the city, but that idea seems to be really far off the radar.

[ncbrian]

Of course, there is always the option of building condo skyscrapers of 20-30 stories high to maximise the number of units available for a given piece of property thus reducing the overall cost of constructing each unit but such a development would be totally out of place in Winston and hence not really an option.

I think that if we look at developing the land north of 7th St along Trade St and Liberty St as possible affordable housing, we can extend the jewel that is the Arts District into this area and really make it a desireable place to live. The one thing about Trade St is that it is too short: travel three blocks along it from 4th St and you are out of area.

[suburban george3]

I wonder if some of the costs could be alleviate if the focus was on refurbishing existing properties rather than tearing down and build new structures. This will lower the initial cost.

This is kinda off thread a bit, but it does relay to the expense of living downtown, as a matter of fact it relays into living in many new developments and most condo/townhome developments so younger homebuyers need to take this into consideration and ASK before signing on the dotted line. Just because you may get that great "near-downtown" place for right at the top of your budget, don't forget about the other expenses!!

Just as another note to refurbishing older buildings and the costs to future homeowners, needless to say all the buildings downtown will have somekind of HOA established. I know that the old YMCA building downtown is going to have to go under expensive repairs (remortaring all the brickwork) and these expenses are handed down to the homeowners on top of current HOA dues. Several of the homeowners will have to take out loans or refinance their property to accomodate this one-time assessment. If the homeowner can't pay the assessment, the HOA can levy fines and foreclose on the property.

So, If I were a younger home buyer, I would look for rental property in the area first or newer construction. But, still beware of what the HOA can do in these buildings and actively participate in them!! Trust me I know, I've been the VP of my neighborhood's HOA for 2 years now.

[partial]

We should be more focused on the cost per square foot than we are with the total asking price. First time buyers may be able to spend $200,000 on their first home, but that buys you a lot more in Ardmore than it does in downtown, where prices are in excess of $200 per square foot. If you can afford to spend $200,000 on your first place, its hard to justify buying a one bedroom condo and frankly, $200 per square foot seems like a risky investment in downtown W-S.

If W-S really wants to encourage young people to live and play downtown, it needs more affordable apartments and it needs to encourage developers to build condos with a lower premium per square foot over suburban residential housing.

[sax184]

We should be more focused on the cost per square foot than we are with the total asking price. First time buyers may be able to spend $200,000 on their first home, but that buys you a lot more in Ardmore than it does in downtown, where prices are in excess of $200 per square foot. If you can afford to spend $200,000 on your first place, its hard to justify buying a one bedroom condo and frankly, $200 per square foot seems like a risky investment in downtown W-S.

I couldn't disagree more. With the world supply of oil likely to peak sometime in the next five years, the costs of mobility are only going to soar. Houses without access to public transportation outside of major cities may actually lose significant amounts of value.

Downtown, Ardmore, Washington Park and the West End are, in my opinion, the safest investments in the city.

[ncbrian]

I couldn't disagree more. With the world supply of oil likely to peak sometime in the next five years, the costs of mobility are only going to soar. Houses without access to public transportation outside of major cities may actually lose significant amounts of value.

Downtown, Ardmore, Washington Park and the West End are, in my opinion, the safest investments in the city.

Of course that is assuming that the service and professional jobs also migrate downtown as well. With most of the jobs scattered around various office and industrial parks, it will take a lot of doing to start concentrate these businesses downtown to make transit more viable. The technology park downtown has plenty of room right now so it could accomodate businesses that do not fall under its goal of becoming a biotech center. If the properties are developed more rapidly and derelict land all around downtown is put to use than the proposed streetcar line then becomes more viable and makes any residential areas along their paths much more attractive. Then those areas you mention above will appreciate in price and then we are back where we started which is that the young adult market is shut out of downtown residential areas because of the expensive real estate. A bit of a Catch-22 there.

[sax184]

Of course that is assuming that the service and professional jobs also migrate downtown as well. With most of the jobs scattered around various office and industrial parks, it will take a lot of doing to start concentrate these businesses to make transit more viable. The technology downtown has plenty of room right so it could be adapted to accomodate businesses that do not fall under their goal to make the park a biotech center. If the properties are developed more rapidly and derelict land all around downtown to put to use than the streetcar line then becomes more viable and makes any residential areas along their paths much more attractive. Then those areas you mention above will appreciate in price and then we are back we started which is that the young adult market is shut out of downtown living because of the expensive real estate. A bit of a Catch-22 there.

I agree, but a business is much more likely to make a quick move than a homeowner, especially one that is leasing space. If you're a business owner and your employees keep telling you "I like working here but the commute is breaking the bank"- you'll move if you can.

[partial]

I couldn't disagree more. With the world supply of oil likely to peak sometime in the next five years, the costs of mobility are only going to soar. Houses without access to public transportation outside of major cities may actually lose significant amounts of value.

Downtown, Ardmore, Washington Park and the West End are, in my opinion, the safest investments in the city.

Note that I listed Ardmore as an example of a place were you can get more for your money in this city. I'm currently shopping for a home in Winston and while the average price per square foot in downtown is well above $200, I am finding a large number of homes in Ardmore for about $115 per square foot. Even if you are correct that houses "outside of major cities" will loose significant value and we should all be shopping in the West End, Ardmore and Downtown, how does one justify paying an extra $85 dollars per square foot for a place in downtown instead of other, close options?

[ncbrian]

Note that I listed Ardmore as an example of a place were you can get more for your money in this city. I'm currently shopping for a home in Winston and while the average price per square foot in downtown is well above $200, I am finding a large number of homes in Ardmore for about $115 per square foot. Even if you are correct that houses "outside of major cities" will loose significant value and we should all be shopping in the West End, Ardmore and Downtown, how does one justify paying an extra $85 dollars per square foot for a place in downtown instead of other, close options?

For straight living accomodations, probably not. The differences will come in the amenties so to speak. Does the development have plenty of parking (for Ardmore and West End, parking is a big issue)? On site gym/pool? Proximity to dining, retail and entertainment? It is those sort of factors plus much more that a prospective buyer of a downtown residence has to weigh when making a purchase. If these factors have no relevance to him, then it becomes more of a esteem decision. Does buying a downtown condo give him some sort of status in the community that he will not get if he bought a house in Ardmore? Finally there is the fact that some people just like the idea of living downtown in a condo or townhouse and that they do not have to worry about such things like mowing the lawn only reinforces their opinion that they have made the right choice.

[sax184]

Note that I listed Ardmore as an example of a place were you can get more for your money in this city. I'm currently shopping for a home in Winston and while the average price per square foot in downtown is well above $200, I am finding a large number of homes in Ardmore for about $115 per square foot. Even if you are correct that houses "outside of major cities" will loose significant value and we should all be shopping in the West End, Ardmore and Downtown, how does one justify paying an extra $85 dollars per square foot for a place in downtown instead of other, close options?

Well, that's personal finance, mostly. However, if you are part of a young couple where one spouse works downtown, a downtown residence might allow you to become a one-car family. You can also walk to the bus transfer center and PART regional bus connection from downtown. You can walk from Ardmore, too, it's just a lot longer.

I look at it this way- housing costs and transportation costs are two parts of a continuum. In Ardmore, you may wind up driving more and paying less for housing. Downtown, if you are intentional about how you structure your life, you could drive much less and pay more for housing. Assuming you could come up with two scenarios that yielded a similar payment comprised of mortgage + gas + car maintenance + parking, why would downtown come out ahead?

The mortgage interest deduction and depreciation. The bigger your mortgage payment, the more interest you pay, and the more you can dedcut on your taxes. Also, homes almost always gain value, whereas cars inevitably lose value. The bottom line, if you can find two acceptable properties in Ardmore and Downtown and the monthly budget cost for housing and transportation is nearly identical for either, you may think about going downtown because more of that money will be directed towards an investment which generates equity (homeownership) and less will be directed towards an expense that does not build equity (vehicle maintenance and fuel).

I had a deposit down at 4th and Broad, and checked out the Nissen Building, but ultimately canceled due to a job change that moved me out of Winston. My sense is that Ardmore and the West End are both lovely, but unless you work at the Hospital, the West End confers many of the locational advantages of downtown on homeowners at slightly lower prices than Downtown, where as Ardmore is not as mixed-use and a little further from everything except Baptist. Of course, if you're someone who would walk to Thruway to shop on a regular basis, then maybe Ardmore can have some of those locational advantages, too.

[JerseyBoy]

Well, that's personal finance, mostly. However, if you are part of a young couple where one spouse works downtown, a downtown residence might allow you to become a one-car family. You can also walk to the bus transfer center and PART regional bus connection from downtown. You can walk from Ardmore, too, it's just a lot longer.

I look at it this way- housing costs and transportation costs are two parts of a continuum. In Ardmore, you may wind up driving more and paying less for housing. Downtown, if you are intentional about how you structure your life, you could drive much less and pay more for housing. Assuming you could come up with two scenarios that yielded a similar payment comprised of mortgage + gas + car maintenance + parking, why would downtown come out ahead?

The mortgage interest deduction and depreciation. The bigger your mortgage payment, the more interest you pay, and the more you can dedcut on your taxes. Also, homes almost always gain value, whereas cars inevitably lose value. The bottom line, if you can find two acceptable properties in Ardmore and Downtown and the monthly budget cost for housing and transportation is nearly identical for either, you may think about going downtown because more of that money will be directed towards an investment which generates equity (homeownership) and less will be directed towards an expense that does not build equity (vehicle maintenance and fuel).

I had a deposit down at 4th and Broad, and checked out the Nissen Building, but ultimately canceled due to a job change that moved me out of Winston. My sense is that Ardmore and the West End are both lovely, but unless you work at the Hospital, the West End confers many of the locational advantages of downtown on homeowners at slightly lower prices than Downtown, where as Ardmore is not as mixed-use and a little further from everything except Baptist. Of course, if you're someone who would walk to Thruway to shop on a regular basis, then maybe Ardmore can have some of those locational advantages, too.

I am a resident of Ardmore and I love it! I am able to ride my bike to downtown though it may take about 15-20 minutes. I am able to walk 2 blocks on a sidewalk to the local FoodLion and then grab a hotdog at PB's and walk home. I can tell you that parking isn't really an issue except if you are holding a party. Most homes in Ardmore have garages and driveways and you can basically park on the street except if you live on Hawthorne or Knollwood but people still do it. It truly does pay to live in an urban neighborhood! As one person mentioned, when gas gets to its peak and production declines it will be astonishing to just walk to the grocery store without having to get in your car and drive. I guess living in downtown can be cheap as long as you don't have a car and don't have to make a payment every month. It's much easier to be car-less in Ardmore than it is in downtown.

[partial]

For straight living accomodations, probably not. The differences will come in the amenties so to speak. Does the development have plenty of parking (for Ardmore and West End, parking is a big issue)? On site gym/pool? Proximity to dining, retail and entertainment? It is those sort of factors plus much more that a prospective buyer of a downtown residence has to weigh when making a purchase. If these factors have no relevance to him, then it becomes more of a esteem decision. Does buying a downtown condo give him some sort of status in the community that he will not get if he bought a house in Ardmore? Finally there is the fact that some people just like the idea of living downtown in a condo or townhouse and that they do not have to worry about such things like mowing the lawn only reinforces their opinion that they have made the right choice.

None of those amenities you list exist in any of the developments being planned/built in DT. 4th and Broad, the lofts behind Reynolds, and the new building on Fourth Street (between Liberty and Cherry) appear to be units and nothing more. Nissen has a gym and pool, but it is rental units only. 5 years from now there may be an argument to justify the significantly higher cost per square foot, but right now its a real gamble. The buildings offer less than traditional condos in the area, there aren't many restaurants/bars and entertainment yet (especially true for 20 somethings like myself) and there isn't a real cohesive DT.

I live in the Nissen Building and while I love the location (I can walk to work) there isn't much to do in DT after 5, and what there is to do is a 5 min drive from surrounding neighborhoods with a much lower cost of living. If I could bar and restaurant hop every night like I did when I lived in other cities then my rent would be well worth it, but right now there are only about 6-8 places to go to at night and not much variety.

[ncbrian]

What we have here is the classic chicken-egg problem. Businesses will not relocate downtown if there is no market to sell to while people will not move downtown because there is nothing for them to do downtown unless they drive somewhere else. So it becomes something like a three-legged race as the commerical and residential properties have to move in tandem so that they do not get ahead of each other and create business losses.

I like to think that as each property comes available for people to move in, it supports the opening of a new business whether it be a new restaurant or a retail store. This way may be too slow for some people but it may be the only viable way for these retail businesses to survive given the number of people who live downtown. The wildcard in all of these projections of retail business sales is the thousands of people who work downtown during the weekdays. For whatever reason, it appears difficult for these people to shop or dine downtown on a regular basis but they have no problem going to a chain restuarant or a strip mall in the suburbs.

[don julio]

What we have here is the classic chicken-egg problem. Businesses will not relocate downtown if there is no market to sell to while people will not move downtown because there is nothing for them to do downtown unless they drive somewhere else. So it becomes something like a three-legged race as the commerical and residential properties have to move in tandem so that they do not get ahead of each other and create business losses.

I like to think that as each property comes available for people to move in, it supports the opening of a new business whether it be a new restaurant or a retail store. This way may be too slow for some people but it may be the only viable way for these retail businesses to survive given the number of people who live downtown. The wildcard in all of these projections of retail business sales is the thousands of people who work downtown during the weekdays. For whatever reason, it appears difficult for these people to shop or dine downtown on a regular basis but they have no problem going to a chain restuarant or a strip mall in the suburbs.

Maybe a few more "chain" restaurants and a mall are needed downtown. Don't get me wrong, I don't want to see downtown over run with Applebees & Ruby Tuesdays, but look at how successful Mellow Mushroom is and they are a regional chain. I know I would enjoy a nice Olive Garden or Village Tavern dish after a long day at the downtown office with a couple of friends. Who knows?

And also, what if there was a mall downtown? It would be rather hard to compete with the huge boom on Hanes Mall Blvd, but what if there was a new large outlet mall downtown. Look at the popularity of Tanger Outlets and the such, maybe putting one in downtown Winston would be a good niche. I know people that would come downtown to spend A LOT of money at an Outlet place. It would be a smaller footprint of a building, so maybe 4 stories with a food court. An open airy atrium in the middle of the building. Maybe located on 5th St. somewhere with a skywalk to the Convention Center and the Twin City Quarter Hotels.

I donno, just talkin crazy, that's all.

[ncbrian]

Maybe a few more "chain" restaurants and a mall are needed downtown. Don't get me wrong, I don't want to see downtown over run with Applebees & Ruby Tuesdays, but look at how successful Mellow Mushroom is and they are a regional chain. I know I would enjoy a nice Olive Garden or Village Tavern dish after a long day at the downtown office with a couple of friends. Who knows?

And also, what if there was a mall downtown? It would be rather hard to compete with the huge boom on Hanes Mall Blvd, but what if there was a new large outlet mall downtown. Look at the popularity of Tanger Outlets and the such, maybe putting one in downtown Winston would be a good niche. I know people that would come downtown to spend A LOT of money at an Outlet place. It would be a smaller footprint of a building, so maybe 4 stories with a food court. An open airy atrium in the middle of the building. Maybe located on 5th St. somewhere with a skywalk to the Convention Center and the Twin City Quarter Hotels.

I donno, just talkin crazy, that's all.

I would have no problem at all with local or regional chains. Relocating that Bojangles restaurant on University to somewhere closer downtown may prove to be a hit though they may lose their drive through business.

Downtown malls never work except in the largest of cities or in high tourist traffic areas. If you go over to the Charlotte subforum of UrbanPlanet, you might find a lot of talk about the dearth of retail shopping downtown on the weekends. A good part of their retail is located in a subterreran mall open only during weekday business hours. Downtown retail only works at the street level for most communities. Placing it in a mall or an office development and you will find it deserted in a few years.

[DCMetroRaleigh]

No more malls downtown. At least not, the old style malls. Something with a vibrant street scene like Baltimore Inner Harbor or Boston's Downtown Crossing would be cool though:

Boston's Downtown Crossing

[don julio]

No more malls downtown. At least not, the old style malls. Something with a vibrant street scene like Baltimore Inner Harbor or Boston's Downtown Crossing would be cool though:

Boston's Downtown Crossing

Charleston's downtown retail along King St. works nicely as well. Good atmosphere about it (minus some bad traffic at times)