REAL ESTATE

Older apartments spiffed up, sold as converted condos
New South Congress project the latest example.

By Shonda Novak
AMERICAN-STATESMAN STAFF
Friday, February 22, 2008

Granite counters. Hardwood floors. Stainless-steel appliances. Pedestal sinks.

No, these aren't the selling points for yet another ritzy downtown condominium project. Instead, they're features of a dated 1960s apartment complex on South Congress Avenue near Crockett Street that is being transformed into 103 condominiums designed to offer an alternative to downtown's pricier housing.

Developer David Kline's $13.5 million condominium-conversion project, 2020 Congress Condos, is one of a growing number of such developments planned or newly opened as developers seek to provide more moderately priced housing in Central Austin.

Condo conversions have become popular because developers can work with an existing building and bring the project to the market more quickly, which can translate into moderately priced units, said Kline, president of Austin-based Kline Ventures. The company owns and manages 26 properties, mostly in the University of Texas campus area.

Last year, 824 apartments were converted to condos in Austin, from the downtown area to the suburbs. This year, 1,167 more units are expected to be converted in the Austin area, said Robin Davis, manager of Austin Investor Interests LLC, which tracks the apartment market.

The 2020 Congress Condos are priced from $96,900 to $108,900 for units with 425 square feet. The highest-priced units range from $189,900 to $199,900 and have 943 square feet. In addition, there are three 731-square-foot townhome units, all priced at $199,900.

Kline just started marketing the project, whose first buyers are expected to move in by mid-summer.

"With our price points, we are opening up home ownership to a segment of the market that cannot afford to pay the prices" of many of the units being built in and near downtown, he said.

Kline said the average price-per-square foot is $235, about half the price of the new construction taking shape as part of downtown's residential building boom that is adding hundreds of condominium and apartments.

Kline expects his project to appeal to professionals, students, first-time homebuyers and out-of-towners seeking a second home when they attend UT games or other events.

In East Austin, 41 Waller, a 30-unit condominium conversion on Waller Street, is attracting interest from young professionals, empty-nesters, high-tech workers and athletic types who frequent the Lady Bird Lake hike-and-bike trail, said Amy Warnick, the project's lead sales and marketing director.

Units feature stained concrete floors, granite counters, travertine rainshowers, stainless-steel appliances, covered parking and private patios and balconies. Prices range from $215,900 to $265,900 for two-bedroom units with 936 square feet. There's one remaining three-bedroom with 1,260 square feet priced at $299,900. Warnick wouldn't disclose the number of units under contract, but they will be ready for move-ins next month.

Brad Pauly, a broker with Pauly Presley Realty, which is marketing the units at 41 Waller, said rising costs of building materials play a role in developers focusing on existing properties.

Ryan Robinson, demographer for the City of Austin, said that with demand for downtown area housing skyrocketing, "market pressure pushes prices up, and property owners can realize a larger margin from selling units as condos."

Most of the converted units have emerged from apartments built in the 1960s and 1970s in "prime locations" in Central and Southeast Austin that command higher-than-average prices, Davis said.

Often they appeal to buyers because they offer "upscale living in a mixed-use development" with boutique-style retail, restaurants, coffee bars and the like, "all in one new urbanism-type community in the heart of the city," Davis said.

Barbara Ditlow, a real estate agent with Capital City Sotheby's International Realty, knows of four condo conversions in South Austin, all with updated wiring, plumbing and walkways, plus granite counters, stainless steel appliances and wood floors.

Ditlow is the listing agent on two, including the Gillis Park Studios off Oltorf Street, between South Congress and South First Street. The Gillis studios have 90 units starting at $99,000 for a 425-foot efficiency. It will have three phases, with the first phase ready for move in now.

"It's very affordable, very chic, very well done," Ditlow said.

But Ditlow said buyers need to do their homework before purchasing converted condos.

"Some (developers) buy these apartments at high price points and have to skimp on the finish-out to meet the bottom line," she said, adding that it's important to research the developers and their track records. "Don't get stuck with sow's ear when you thought you were buying a silk purse."

snovak@statesman.com; 445-3856

 

2020 Condos
photo by Mark Matson

Kline Ventures is turning old apartments on South Congress Avenue into condominiums. The first buyers at 2020 Congress Condos are expected to move-in by mid-summer.
41 Waller condos

41 Waller in East Austin is another example of an older property converted into condo units sold at cheaper prices than new units downtown.
2020 interior
photo by Mark Matson

At the 2020 Congress Condos, developer David Kline of Kline Ventures is touting the average price-per-square foot price of $235, which is about half the price for a new condo downtown.
Developer David Kline
photo by Mark Matson

David Kline's converted condos in a renovated 1960s apartment complex on South Congress Avenue are set to be ready for buyers by mid-summer.
41 Waller condos interior

Stained concrete floors and granite counters are among the updated features at 41 Waller, a 30-unit condo conversion whose two-bedroom units with 936 square feet start at $215,900.
 

Original Austin American-Statesman article may be seen at
http://www.statesman.com/search/content/business/stories/
realestate/02/22/0222condos.html
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