Eight months ahead of schedule with regard to the completion of Phase II, according to J.K. Dineen and Tishman Speyer Managing Director Carl Shannon, inventory in Infinity’s 300 unit second tower will start selling in January (2009) and will be available for occupancy three months later (April).
Tishman Speyer Managing Director Carl Shannon said Phase I of the 365-unit Infinity is 70 percent closed, with 251 units sold and 40 condos in contract.
In terms of closed sales, that’s right in line with what our plugged-in reader reported two weeks ago. And the terms on that 10% second program: five-year fixed at 7.5 percent.
UPDATE: With respect to tower two, a plugged-in reader reports: “I checked out some of the units in Phase II today and noticed that all of the ranges are Viking. Looks like they upgraded as compared to Phase I.”
∙ Tishman plans sales at second Infinity tower [San Francisco Business Times]
∙ An A+ For Ingenuity (And Openness): Infinity Closings Update [SocketSite]
∙ The Infinity’s “New Financing Program”: 10% Seconds [SocketSite]
Comments from Plugged-In Readers
What is the status of the common areas? It’s all still a boarded up porta potty site.
Aren’t the condos in tower two going to cost a premium over tower one? At the rate this economy is going, good luck with that Tishman.
BTW, the featured resale of Unit 4B on this site is now listed at $1.4, a reduction of $100K after being on the market for three weeks.
[They’re] in the process of taking the boards down today. It looks like the boarded up part of the courtyard could be done in a week or so.
the sales velocity on tower I went too slow. most prospective buyers are simply waiting for Tower II to start selling. Thus, as I said the other day, it is high time to start selling Tower II. I’m glad they’re finally doing it.
Once they sell a fair # of Tower II then they can discount the remaining Tower I condos (not before)
some other posters talked about renting out Tower II, but that just doesn’t make sense IMO. Also, not sure what the contract says for Tower I buyers (would it be breach to make half the complex an apartment rental?)
The contract does give the builder the right to rent units, so maybe that is how they will deal with the inventory remaining a year from now.
As an Infinity resident I’m glad they’re starting to sell them. I think many of the tower 2 units are more desirable, so they should go for a bit more. All I can say is I’ll be glad when the workmen are gone.
Anon – Are the configurations of the Tower 2 units going to differ from Tower 1? I had heard all was essentially the same, although the views from the East and South facing units in Tower 2 will certainly be nicer. Sadly though, while the Infinity workmen may leave, sounds like they will soon be a new set of workmen at the temporary Transbay Terminal across the street.
The floor plans are the same for both units altho it’s still not disclosed.
That 70% # is the same as its been forever…those units are not selling at those prices. These need to be knocked WAY WAY down.
I checked out some of the units in Phase II today and noticed that all of the ranges are Viking. Looks like they upgraded as compared to Phase I.
Infinty 2 should do well even in this climate. You can’t argue about the location, design or the service.
Having the 2nd tower will benefit all the owners. I bet the water views will go fast.
As for the people who say prices dropped over $200k, I highly doubt it. My friend visited the sales office last week and prices are almost the same 6 months ago. He’s waiting for the 2nd tower, though.
You can’t argue about the location, design or the service.
But it could come down to pricing. How is the targeted clientele doing in the current economic turmoil?
And again, there are units for rent at far less than it would cost to own, with no downside risk at all. I see asking rents on craigslist of $3200 for 1BR and $4750 for 2BR and I would bet money you can negotiate a better deal than that.
This is also why they won’t turn unsold units into rentals — it makes no sense to rent them at prevailing rents. They come out better dropping the price by half and selling them. I don’t know if they will go that low (I doubt it), but once they’ve closed what they think they can close at the original prices, they will start dropping the remainder by leaps and bounds and clear them out so they can pay off the financing, cut the sales staff, and stop paying HOAs. It’s only if they can’t sell them even at about a 50% discount that they’ll start considering renting them (I’m running the numbers in my head, so I could easily be off by many percentage points, but the point is the same and the only calculation is how far prices would have to drop before renting starts to become feasible, and it’s a lot).
This is also why they won’t turn unsold units into rentals — it makes no sense to rent them at prevailing rents.
I don’t think we really know the economics that they’re operating with. IOW–I don’t think you can say what Tishman’s bottom line price is.
I would be seriously afraid of earthquakes at Infinity. This is all landfill at sea level right? At least ORH is built on steep bedrock and has a state of the art tuned mass damper outrigger system. That would be the deal breaker for me.
The Infinity’s foundation is on bedrock, not landfill. To get to the bedrock required excavating a hole deep enough to accommodate the five story underground garage.
I seriously hope you are right. So the bedrock is only 50 feet below the landfill?
He is correct. The Infinity is actually one of the most solid structures in SF. The ground around it would be totally destroyed, the roads would be at all different heights, but the Infinity would be good as new.
I wonder what the SOMA/South Beach crowd is doing now that their pipe dreams of a brand new high rise community south of Market street may be fizzling out due to the lack of financing for these projects…
I remember the One Rincon salesperson gave me this huge pitch about how the neighborhood was transforming…maybe not as soon as we all hoped now?
jsesep- I still have my doubts that even the Transbay Tower itself, a signature landmark for the new neighborhood, will even be built within the next 10- 20 years.
With 114 units left in Tower I [365 less 251] Tishman faces the unenviable predicament of being forced to add another 300 units worth of inventory from Tower II as the carrying costs presumably become unsustainable. Accordingly, unless all 114 units sell by the end of the year [not likely] Tower I ends up competing with Tower II for the same pool of buyers. That’s never a good scenario.
I believe the asking prices will continue to remain the same and perhaps be higher for Tower II. I would not expect much in the way of discounts. However, it’s my understanding that bids of hundreds of thousands BELOW the asking prices are being entertained. I imagine that will continue to be the case.
While the Viking ranges may be a nice touch [standard above the 28th floor for Tower I, I believe] I think the 2/2 floorplans will continue to be a tough sell. The A, B, E and F floorplans [all 2/2] all have living/dining areas that barely fit a decent sized couch and a bistro table. I had more living/dining space in my college housing. How deep is the poll of condo buyers willing to pay $1-2m for 2/2 units with this design flaw? I imagine it will continue to be fairly shallow.
sf – That mass damper in the top of 1RH is designed to neutralize sway caused by wind. It won’t do squat in an earthquake and in fact is somewhat of a liability with its mass positioned in the worst possible place.
They are asking 1000+/square foot for hopes and dreams in my view. I would have no problem paying that kind of money for an established neighborhood, but you are taking their word for what will develop…I saw both ORH and Infinity and decided against buying at either one.
It is hardly a certainty and is contingent on so much.
The Business Times article cited above states that the “all-in” cost of the two towers is about $500 million. With 665 total units, that works out to about $752K per unit. Does anyone know the mix of 1BR/2BR/3BR units? It would be interesting to see what Tishman’s gross proceeds might be (and when they might realize them) compared to this $500M cost burden. As we discussed in another thread, Tishman appears to have some recent huge acquisitions and projects that aren’t panning out so well. Servicing the debt portion of this $500M (+/-) investment for multiple years is probably something they didn’t plan on. Someone stated in an earlier thread, that Tishman was only “3-4 sales away from paying off the entire construction loan”. If that is true, how big was the loan? Did they use mostly equity for this project?
According to my preliminary title report, there is one deed of trust in the amount of $322,100,000. This was given to me in writing when I purchased a unit at the Infinity. Given that the loan is nearly paid off, it’s simply unrealistic to expect bargains, give-aways, and unusually favorable deals.
Both the St Regis and the Four Seasons opened during unfavorable times, economically speaking. Nobody got a bargain in either of those places. In fact, the St Regis sat as a vacant tower for a year or two before they even finished the interiors.
“Given that the loan is nearly paid off, it’s simply unrealistic to expect bargains, give-aways, and unusually favorable deals.”
If the loan is nearly paid off, why hurry Tower 2 to market and allow it to compete for a limited pool of buyers with Tower 1? If Tishman was sitting pretty financially, shouldn’t they be able to take their time with bringing new inventory to market? Hence, I wonder if this loan is as close to being paid off as some contend it is. In addition, given the unfortunate fate of some of Tishman’s other projects [in the billions of dollars] cash flow may be critical.
If the loan is nearly paid off, why hurry Tower 2 to market and allow it to compete for a limited pool of buyers with Tower 1?
If it’s ready, why wait? Even if the sales are slow, it’d still be beneficial to sell at least some of them, rather than carry them all.
I’ve said this before, but the remaining units in tower 1 are not the best (low floors, weird layouts, poor views). There are a number of units in tower 2 with dead-on water and bridge views. IOW–they are really two different types of product.
“I’ve said this before, but the remaining units in tower 1 are not the best (low floors, weird layouts, poor views)”
With 114 units still unsold, which represents 31% of the building, are you saying that almost one third of the Tower I units are crap? Sure, the east and south facing units in Tower 2 will have nicer views, but the units facing NW will all look right back into Tower 1. Conversely, if the towers have identical floor plans, are one third of Tower 2 units “weird layouts”? If so, that means around 220 units in the complex appear to qualify as “not the best”. Not exactly a ringing endorsement of the development. Perhaps Tishman needs to stick to commercial/office properties.
The rounded floorplans don’t permit a dining room table or a square couch. Wasted space in already modest floor plans makes $1,000 / SQFT hard to justify. It’s not surprising that 31% of these units remain unsold. Apparently, buyers are willing to pay a significant premium for the view units, but the rest of the units won’t move unless they are significantly discounted.
I’m an ex San Franciscan about to return home. I’ve been looking online for a while and I will visit in November to try and buy a new condo. I’m looking for a 2/2 for under $1 million. I’ve certainly
looked at Infiniti (as well as Arterra, Blu, and others, and resales
at Watermark, Beacon, etc). Do you think there are sufficient
discounts available to make the remaing Tower 1 units a good buy?
I need a place to move into by January.
All advice appreciated
I closed in May, and am overall quite happy with the building.
No incredible deal for me; but, I am comfortable with what I paid. I have heard — the friend of friend conversaions — that they are entertaining offers at notable discounts over asking. If you like the building and find a unit you like, make an offer for what you’d be comfortable paying — you have nothing to lose. I think you will find a 2/2 for under $1MM.
254 closed of the 365 as of this week, with another 50+ in contract (which probably includes those folks walking away).
How does the rental market look for the infinity towers? I see ads on craigslist with prices all over the place. Does anyone know what the average 2/2 or 3/2 rents for? How fast do these condos rent out?
Comments are closed.