The red light in front of the Marina Condominiums seems symbolic of what has happened to the luxury condo market in Madison, although the Marina Condominiums on Lake Monona were luckier than most, since they got in ahead of the market collapse. Even so, Sheridan Glen, a real estate broker who has been selling units in the building, said it has taken some time to come close to selling out.
"In 2001, when downtown condo construction began in earnest, developers could count on selling out a building in 12 to 18 months," he said. "Now it's taking four years to sell out but that is probably what it should take."Things look much more dire over at Metropolitan Place Phase II on West Mifflin Street, where it was reported this week that its bankers were pursuing foreclosure against Buckingham LLC and developer Cliff Fisher on three mortgage loans that had fallen into default. The project, criticized at the time it went up for being too big for its location, is far from sold out, and the owners have fallen behind in keeping up with the carrying costs.
Glen has most recently been involved in marketing the upscale Marina condominiums on East Wilson Street. Opened in 2004, the 55-unit building still has six units left unsold, he said.
The second phase of Downtown Madison 's largest private housing project is in default to the tune of more than $26 million, its lenders said in court documents that seek foreclosure of its three mortgages.Tim Homar, attorney for Fisher and Buckingham, indicated his clients would try to maintain control of the project, and pointed to an "uptick" in sales.
The fate of the newly completed Metropolitan Place II, a 164-unit condominium tower facing West Mifflin Street, could indicate that national housing trends are reaching Madison, thought by some to be more immune than most places to twists and turns in U.S. economy.
According to city property records, only 61 of the building 's 164 units -- about 37 percent -- have been sold. Homar said there were two closings last week and offers on condos continue to come in.As recently as last fall, Metropolitan Place Phase II was trying to appeal to rich Badger fans looking for high rise pied-à-terres for game weekends as way to sell some of those units. Those days seem to be over.
"Actually, we 're witnessing an uptick, " Homar said. Prices on offers aren 't as high as they would have been two years ago, he said, but agreements with the banks keep prices from falling very far.
Alderman Mike Verveer had this comment for The Capital Times.
"I guess this shows that even downtown Madison isn't exempt from the nation's foreclosure crisis," he said. "But this is certainly going to lead to a lot of nervous people."Some of us outside city government were nervous a good deal earlier, and wondered why city officials kept approving every high-rise development that came down the pike, permanently altering the human scale and amenities that made downtown so livable in the first place.
One of the casualties of this unfortunate development is the Willy Street Coop, which had been going to build a downtown grocery in Metropolitan Place II. They've had to pull out and start over, because the developer failed to keep his commitments. Maybe if city officials hadn't been quite as focused on facilitating the condo boom, we'd have that downtown grocery by now.
And we wouldn't be facing the drag on downtown development that overbuilt, unsold condos will pose for years to come, if developments in other cities are any indication. But that's what a bubble is like. Everyone loses perspective.