Wednesday, October 15, 2008

Credit bust gives the few old buildings that remain in downtown Madison a reprieve

The Residue of Time
Many of the older, low-rise buildings that dominated downtown Madison and the UW campus area have been replaced by new development in recent years. Until recently it seemed as if the relentless sprouting of high-rise condos, apartments and commercial real estate would continue unchecked until all vestiges of the old Madison were obliterated by new, high-rise corridors. You could call it urban infilling if you were favorably disposed. Or you could call it a real estate bubble if you weren't.

DevelopmentOne of the last of the big developments to be financed and completed before the bubble burst was the 359-unit Lucky apartment and retail complex at 777 University, touted as "not just an apartment building, but the new model for urban rentals in Madison. A model that includes a new standard for services, finishes and amenities, and one that includes all age groups. Find out what it means to live life with resort-level conveniences while being right in the middle of it all. Find out what it means to Live Lucky." Not as lucky were the tenants evicted by the new construction, which included the only downtown muliplex, along with the longtime student favorite, Paison's Restaurant, which moved all the way off campus to a lakeside location off the Capitol Square.

Lucky towers over these old buildings across the street on University Avenue -- a little enclave of old Madison surrounded by the mushrooming highrises. These and other older buildings in the downtown area have been given a reprieve by the collapsing real estate bubble and the resulting credit crunch.
Developer Steve Brown, who opened the 359-unit Lucky apartments last month on University Avenue and is building the 116-unit Brownstone Terrace Apartments on Madison's Far West Side, said financing was secured for those projects a couple of years ago, when credit conditions were better. But he said refinancing could become more difficult as notes come due if conditions don't improve.

"(Banks) have to get all this fright out of their system," he said. "They're trying to remove all risk from their lending and that's impossible to do in real estate."
Lucky, because it offers a host of amenities in a high-rise location right next to campus, seems to be doing well. Not so for all of the other real estate in overbuilt downtown Madison. Too bad the bankers didn't catch fright a bit sooner.

1 comment:

froggyprager said...

This credit/ economic crisis will leave a good balance in Madison. It now has some nice new buildings but many of the older homes, apartments, etc. are still there. It will stay funky and unique and low budget for many. We have plenty of nice downtown condos plus the crappy student flats and nice historic homes. I think it is too bad they did not put a movie theater in the Lucky Univ. Square place but it looks like a coffee shop is going in. I wonder what all the real estate developers are going to do in this new econimic climate.