When 21c Musuem & Condos, the latest downtown luxury condo project, was announced on June 11, many interesting questions were once again raised about the downtown luxury condo market. While the market remains strong for units priced below $400K — such as many of those in 360 and Milago — the market for high end units is not yet proven. With a bunch of high-end developments in the works including the Austonian and the new Four Seasons Residences, we should find out soon whether a real market exists for hundreds of units priced over $500K, and dozens priced over $1M as these projects come to fruition. As none of these projects have broken ground, it’s hard to know where they really stand.
When the 21c project was announced, some interesting speculation on the Austin luxury market made it into the news coverage. Here is an excerpt from the Statesman:
Some observers question whether downtown might end up with a glut of high-end condos, as has happened in some other major cities. But Poe and some local real estate developers and consultants insist demand remains strong locally as baby boomers, young professionals, empty-nesters and others seek an urban lifestyle.”I think your market is pretty deep,” Poe said. He noted that developers would have three years to sell units before the building opens, adding that selling 65 units a year is “not an unreasonable goal.”Charles Heimsath, president of an Austin-based real estate consulting firm that advised developers on the project, said strong pre-sales and reservations at both the Austonian and the Four Seasons suggest a solid demand.
The information from Charles Heimsath, an independent consultant, is very encouraging if true. It makes sense that the 21c developers did their research before deciding to proceed. We’ll keep our eyes open to see if we can uncover any additional information on the state of presales at the current set of high end projects.