OLYMPIA – Demand for condominiums is growing in Thurston County, but several proposals to build more have yet to get off the drawing board.
After years of dormancy, the condo market is taking off, driven by early retirees who want a break from home maintenance and singles who want a price break compared with single-family homes, real estate agents say.
“There is a big market here for empty nesters and single people,” said Jeanette Hawkins, community affairs manager for Olympia developer Tri Vo. Last year, Vo proposed building nearly 300 condos on part of the former Olympia brewery property in Tumwater.
Construction of Vo’s Veranda Towers project isn’t expected to begin until next year at the earliest, but buyers already are calling to reserve units.
“We already have a waiting list of people who want to live there,” Hawkins said.
Through July of this year, 55 condos had sold in Thurston County, a 34 percent increase compared with the 41 that sold during the same period three years ago, according to the Northwest Multiple Listing Service.
Olympia lawyer Brian Budsberg is typical of the emerging condo buyer. Budsberg, 50, is single. His sons are in college and living on their own.
“I wanted the ease of living and good security,” said Budsberg, who bought a condo in Smyth Landing, a complex of 12 condos overlooking West Bay. “All of the maintenance is taken care of.”
Budsberg said he enjoys gardening and plans to do that on his 400-square-foot covered deck.
He declined to discuss the sale price of his condo. Spence Weigand, a real estate agent with Adams Real Estate, said Smyth Landing units range in price from $420,000 to $850,000.
“There’s definitely a need for more upper-end condos,” Weigand said. “There are a lot of people tired of the taxes and the maintenance of their property, but they can’t give up their views.”
The south Puget Sound area’s condo market is still small compared with the large, booming market in Seattle. More than 1,600 Seattle condos are on the market, compared with 51 in Thurston County, according to the Northwest MLS.
But the demand for condos in the area, particularly those with water views in downtown Olympia, is growing and exceeds the limited supply, said Kathy McCormick, a senior planner for the Thurston Regional Planning Council.
Market surveys done in 2001 and 2003 showed increasing demand for downtown Olympia condos, she said. The first survey estimated that up to 120 new downtown condos a year would sell. In 2003, the estimate had increased to 175 a year, McCormick said.
In response to such forecasts, at least two developers have proposed downtown condo projects, including one that would build 100 units on a parking lot on Columbia Street between Fourth and Fifth avenues.
Seattle developer Jim Potter has negotiated with city officials for more than two years, but talks have slowed because of disagreements over the amount of utility hookup fees the city would require Potter to pay.
The Olympia City Council last week switched some of the financial burden of the fees to buyers of the condos in hopes of persuading Potter to build the project.
Potter estimated the fees would add up to $9,000 a unit to his costs. He said the fees were the major obstacle to proceeding with his proposal.
Another developer cited city building codes as a reason for dropping a plan to build a dozen condos atop a proposed parking garage, retail and office complex in downtown Olympia. The codes allow Vine Street Investors to build the condos atop the proposed Columbia Place development, north of the Phoenix Inn, but they would have been too costly, Olympia architect Glen Wells said.
“It just didn’t work; we were quite disappointed,” he said.
What scuttled the rooftop condos were fire safety concerns that would add to the cost of building materials, said Tom Hill, the city’s permit and inspection services manager.
Other issues slowing downtown condo development are concerns about blocking views of Budd Inlet and whether incomes in the south Puget Sound area are high enough to support waterfront condos, Olympia Mayor Mark Foutch said.
“Our economy here is based pretty much on state government and … middle-income folks,” Foutch said. “The higher-income folks are building houses out on the bay and are not particularly interested in condo living downtown.”
Foutch suggested that the developers might be proposing condos a bit ahead of market demand. Continued South Sound population growth and a healthy economy eventually might combine to make a high-profile project more viable, he said.
“Someday, it’s going to be possible to construct condos downtown,” Foutch said. “There will be enough people with enough income to afford them.”
Lower-priced units already are selling quickly, said Tamara Strawn, a real estate agent who specializes in condo sales. Most sales in the county occur for units priced below $250,000, she said.
“They’re selling like crazy for anything between $150,000 and $220,000,” she said. “People’s lifestyles are busier today. They’re looking for something where they can just come and go.”
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