Wednesday, February 4, 2009

Atlantic Station Condos to be Auctioned

40 Element at Atlantic Station condos to be auctioned

Developer wants to unload in stagnant market; bids start 56% below list price

The Atlanta Journal-Constitution

Tuesday, February 03, 2009

Atlanta’s condominium market was so hot a few years ago, an entire building would pre-sell in a matter of weeks.

Element at Atlantic Station in Midtown was one of those must-have properties. Its 322 units were all under contract months before the building opened.

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Element at Atlantic Station in Midtown opened in 2006.

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Even a fire that destroyed the partially built project in July 2005 failed to dim Element’s appeal. Just one contract was canceled, and Element was rebuilt.

But those supposed sales were a mirage. Half of Element’s buyers abandoned their contracts, and today the developer, the Lane Co., still owns 35 percent of the units.

Now Lane wants to shed a bunch of those Element homes all at one time. Boston-based Accelerated Marketing Partners will auction 40 units Feb. 28 at the W Atlanta downtown.

The next day, Accelerated Marketing Partners will travel to the W Perimeter Hotel Atlanta to auction 35 units at the Sterling of Dunwoody, a suburban project developed by the Providence Group.

Auctions have become a quick fix for stalled sales in metro Atlanta. Last year, Accelerated Marketing Partners sold more than 50 condos at the Tribute Lofts in intown Atlanta and at the Promenade at NorthPlace in Sandy Springs.

Intown Atlanta is awash in 6,000 unsold condos, according to the local real estate consultant Haddow & Co. Just 66 new units sold in the second half of 2008, Haddow & Co. says. For the year, 645 new condos changed hands, which is 76 percent below the average of the previous eight years.

Element opened in 2006 when condo sales were beginning to slide and inventory was soaring. Contract signings and sales closings on new units slipped from 60 percent in 2005 to 49 percent the following year, Haddow & Co. says.

Element supposedly quickly sold out in late 2004 when all 322 contracts were signed. But by the time it opened, “the market shifted and the buyers did not show up,” said Andrew Gardner, the Lane Co.’s director of condo operations. Many of those buyers apparently were investors who walked away from their earnest money because of the changing market, he said.

Gardner said an auction quickly establishes what the market is willing to pay and helps the developer exit a project.

Minimum bids at Element will be as much as 56 percent below listed prices. For example, a one-bedroom unit at Element that was priced at $214,900 will start at $95,000. Other minimum bids will be $139,000 for a two-bedroom unit that was listed at $276,900, and $205,000 for a three-bedroom unit that was priced at $414,900.

The Lane Co. used Accelerated Marketing Partners last year to auction condos in Hollywood, Fla.

Jon Gollinger, co-founder of the auction company, said the Atlanta marketplace is at a stalemate and “you’ve got to let the consumer break the logjam.”

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1 Comment:

  1. Anonymous said...
    Atlantic Station is where it's at!

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