For Sale, er, Rent
One local project gets caught in the stormy real estate market
A development that was once at the forefront of the uptown condo-buying craze is now an example of another real estate trend: converting for-sale projects into for-rent ones.
The New Urban Development Glossary
renwick (REN wik) vi. when a condo developer cancels the contracts of condo buyers while a project is under construction, then attempts to sell the units again, at a higher price. In a sentence: "I gave them my 10 percent down payment, and two years later they renwicked me."
That's what happened at the Enclave, the low-rise apartment complex in First Ward. Merry Land Properties announced plans to build the project—first known as the Renwick—in 2004. But it never seemed to get off the ground.
The project was bought in 2005 by Colonial Properties, which reported that an impressive sixty out of eighty-five units had already sold, and that they would begin work on the building by the end of that year. Then the construction stalled, and the cost of building materials soared.
In August 2006, Colonial told the sixty buyers that their sales contracts were being canceled, but offered to sell them the same units at a higher price. They changed the building's name to the Enclave and relaunched their sales campaign. That didn't work, so earlier this year Colonial decided to offer the units for lease.
Real estate analyst Frank Warren of Warren & Associates says we should expect more for-rent projects because banks that finance housing developments "just don't want to tackle for-sale product right now." He says the shift is a boon for renters, who enjoy the amenities of a for-sale property. The Enclave was built with granite countertops, covered parking, hardwood floors, and two-inch blinds -- features you wouldn't typically see in a rental.
At about $1,500 a month for a one-bedroom apartment, the rent is about $300 more than what a tenant would pay at Post Uptown Place, another luxury rental complex, in Fourth Ward. Colonial spokesperson Kelly Kish said demand has been great, with nearly half the apartments rented within three months of the project's opening.
Rental complex may not be the final incarnation of the Enclave, however. Several years ago, the big news in local real estate was condo conversions: revamping for-rent apartments and selling them as condominiums. So when the market turns another corner, don't be surprised to see the for-sale sign back out at the Enclave.