Last week a plugged-in tipster and buyer in Tower One at The Infinity passed along the following announcement from the Sales Team with respect to Tower Two:
A new year brings fresh opportunities. The Infinity is excited to announce the launch of Tower II. As one of our homeowners or residents, we are pleased to offer you the first opportunity to view and purchase a home in Tower II.
Tishman Speyer and The Mark Company cordially invite you to an exclusive reception at the newly redesigned Infinity Sales & Design Center [on Thursday, January 29]. This will be an opportunity for you to speak with a Sales Associate about our homes, learn about the developers’ vision, and make a priority appointment to write a contract.
Prior to the public release in February 2009, Tower II residences will be offered only to those on our Priority List. If you are interested in purchasing a home we encourage you to schedule a priority appointment in advance of the public release with one of our Sales Associates. Appointments are now being accepted.
And while we have a feeling we’re going to take some heat for this one, we’re also passing along our tipster’s translation which might speak to the mindset of more than one:
Dear Infinity Resident. Since you chose to overpay for a depreciating asset that is now worth at least 30% less than you paid, largely due to the builder authorized fire sale on tower I, we invite you to make the same mistake again. We are aware that you are predisposed to poor financial decisions and hope to have you once again focus your decision making prowess in our direction prior to the public release of prices that is likely to elicit scathing reviews and criticism. Please bring cash and an agent easily persuaded by the need to earn some sort of income in 2009.
It’s tough love. And once again, written and passed along by a buyer in Tower One.
∙ Infinity Sales Update: New Contracts Up But Driven By Discounts [SocketSite]
“A new year brings fresh opportunities.” = “There’s a sucker born every minute.”
I’d be happy if I was a Tower I owner knowing that T2 is not going rental even if prices are 20% lower than T1. Interesting that Infinity is marketing to existing homeowners. Why would you take the risk of owning multiple units in the same complex? Dollar cost averaging perhaps?
🙂
If a number of units recently sold and closed in Tower 1, for significantly less than Tower 2, how does an appraiser justify higher prices in the second tower?
Without making appraisals financing is going to be tough without large down payments.
We’ll see how sales on T2 go, but I believe Tower 2 could still go rental. Streaming cash flows are better than no cash flows 🙂
I bet G feels stupid right about now. He probably could have waited and bought the PH in T2 for the same price as his lower floor T1 PH. Whoops.
It’s an insult more than anything that the Infinity sales team would send this out to T1 residents. They are so under water do you really think that they are interested in viewing their same unit in a higher tower, perhaps on a higher floor, for less money? I don’t think so. Well at least I wouldn’t. I think that the buyer in T1 that wrote out their translation hit the nail on the head.
It bothers me to see outside brokers and even the Infinity sales team acting like T2 is going to be so exclusive and if your on a “priority sales list” you have the chance of getting one before they might “sell out” what a joke. I’ll be curious to see how many units they actually contract during the special “pre-release”.
This Infinity announcement arrived in my e-mail Inbox with a “Gung Hay Fat Choy”, welcoming me to the Year of the Ox. Very cryptic, but it may provide some insight as to the ethnicity of client they are targeting. I guess the year of the Ox also marks the day that Tower I begins competing against Tower II for buyers.
Also, I love they way the Infinity marketing images feature a slender woman pictured in a living room filled with cakes. Of course women that bake lots of cakes are usually skinny. Moreover, strategically placed cakes have got to be the most practical use of one’s living space. Silly me thinking a dining table and couches belong in one’s living area – I guess I must be missing the point. Rumor has it that the innovative building architect said “no living room furniture for you”! How long before we find this character floating face down in the Bay, “swimming with the fishes”?
[Editor’s Note: Not quite. The email you reference was delivered today to those on their interest list. The email we (and our tipster) reference above was delivered last week to buyers (or residents) in Phase/Tower I.]
That was cleverly written.
Why do people buy in to buildings with 400 reasonably identical units?
A unit’s uniqueness — the fact that a potential buyer cannot get an identical product at a differing price — is one of the most powerful tools that a seller has.
If a building has 200 vacant units, all at the same time, how can prices do anything BUT fall by 30%??
huh? Your kidding about the marketing thing with the cakes, you do get it right? As for the email you got – I got the email but no welcome to the year of the Ox – strange?
Having all ready bought in Phase 1 and being more than happy even with all that is going on in the market I can’t wait to see what in the world they plan to say to all of us that show up the 29th. I say that jokingly. This will be interesting. Do they believe that people owning current homes want to buy two places or more right now? Maybe someone does but not me. Will they offer reduced pricing like the 72 hour sale at the Hayes or will this tick people off having all ready bought? More importantly the clause buyers signed regarding selling in the first year or two – will the developer be waiving that if one wants to pay a higher price for phase 2? Will the developer than allow a flood of phase 1 units to hit the market and compete with what they are selling in phase 2? I highly doubt it but again this will be interesting.
Tipster that sent this in or anyone… do we really think phase 1 priced have fallen a full 30%? Or is this just stated to make a point? I don’t even think the median in SF has fallen that much.
I don’t get the thing with the cakes.
Dear Huh: Unfortunately, delicately sized cakes are about all you can fit in the living area of the Infinity Towers. I guess if you don’t necessarily need furniture and your guests aren’t troubled by lack of seating, it will work out just fine. For this reason, we outright dismissed the Infinity when we first looked at them. The townhouses are very comfortable, but there really aren’t any views. Too many other good choices exist in the marketplace.
I want to see the chick with the cakes. Photobucket that ad!
huh? Your kidding about the marketing thing with the cakes, you do get it right? As for the email you got – I got the email but no welcome to the year of the Ox – strange?
I think I get the marketing thing. It says to me: Our architect buggered up, shortchanging everyone on the living space, so we will just obfuscate that fact by putting up billboards with a hottie surrounded by a bunch of cakes in the living area so no one notices. Classic misdirection – I’m shocked it didn’t work.
In terms of the e-mail, the subject was “Happy Chinese New Year from The Infinity”. Perhaps only people with ethnic sounding names got this version … even though I’m not a member of what is likely the target demographic.
[Editor’s Note: Again, not quite (and see note above).]
GWTF: My two cents…30% is by no means out of the realm of possibility. In fact in some cases it could be greater than 30%. If there are lots of Infinity buyers who are way over their heads, or are impacted by job loss, and need to sell immediately, there are going to be large losses. The new T2 supply is also not going to help T1 owners. Inifinity is certainly one of the better buildings with a good location but lets be honest it was never a great value proposition. The condo market in the bay area in general is getting mauled so hold on if you can. If you’re down payment was 10% or less you may want to think about walking away. I was previously in the camp that thought values would return in 2-3 years but have changed my time horizon to 10-12.
I’d be very interested in hearing what the current buyers (pre-construction) feel about their purchase and abuot the developer tishmenspier. Be objective. I know its hard to admit pain/dissapointment if you’ve bought, but what are true thoughts and what are ya gunna do about it?
I saw an Infinity ad with a guy sitting in a room full of champagne glasses in the middle of the night. I guess now it’s moon pies.
Not down 30%? Imagine what prices in tower 1 would do if EVERYONE in tower 1 were to sell tomorrow.
That’s basically what’s happening: about the same amount of inventory, only it’s next door instead of in the same building.
I can’t believe there will be that much difference between the two scenarios. I can see prices falling, after they reel in the first set of buyers at full price.
so where does this put the prices?
Priority List? bwahahahahahahahahahahahahhhh!!!!!!!!!!!
If T2 units are going to be offered for considerably less than T1 what is the chance that some T1 owners might decide to buy in T2 and “walk away” from their T1 purchase?
There are clearly 2 emails. My email notes nothing about welcoming me to the year of the ox. My email and the one referenced it titled: Your’re invited: Exclusive Infinity Tower II launch reception.
[Editor’s Note: See note above.]
Happy Renter – I don’t think people that “walk away” will qualify for a loan any time soon. If you’re a buyer who is considering this option you should be thinking renting versus buying for the foreseeable future.
I am not saying the cake thing is a good advertisment nor that it is crystal clear in it’s meaning because there are many ways one could interpret it. BUT – your pulling my leg right, to think it has anything to do with space?
In todays market this ad is actually sort of funny and sad at the same time.
Perhaps they originally thought at the Infinity you CAN have your cake and eat it too, and continue to eat it because it will never run out.
Cool in past markets..but now?
To wish to have one’s cake and eat it too or simply have one’s cake and eat it (sometimes eat one’s cake and have it too) is to want more than one can handle or deserve, or to try to have two incompatible things. This is a popular English idiomatic proverb, or figure of speech.
It means that once one has eaten one’s cake, it will be gone and no longer in one’s possession. It is similar to “You can’t have it both ways.”
So in todays market as long as this woman does not eat the cakes we should be fine right because clearly the cake in todays market will run out, or maybe all ready has.
Willow:
Not sure I agree on the 30% but maybe; hope not.
If people are in over their heads, or impacted by jobs – will most likely impact the whole city not just the Infinity so we will all be in the same boat, or all ready are.
Extra T2 supply yes I agree will cause an impact.
However I am optimistic – what if the 2 towers straddle the econ mess. Betting it all on black, but it could happen.
A new condo should never be bought because one thinks it is a good value proposition; never was, and never will be. Scary thing is how many people that bought here thought about that? I will say however, of the new condos I think the Infinity will retain it’s value more so than other new towers in the city or at min. rebound faster.
Plan to hold on, bought with the idea of being here a min. of 10 years.
I think she spent way too much money on cake. Now the market for cakes has plummeted (because the Republicans deregulated the caking industry), and she can’t unload them for near the price she purchased them. I see her walking away from her cakes – and then she won’t have any cake and won’t have eaten any either. Probably why the place is empty – she’s moving out. She’s moving someplace that has an abundance of cheap ramen noodles.
And that’s why she looks so sad.
GWTF, I totally agree. The armchair evaluations of each new development and hopeful forecasts for 30, 40, 50% declines in property values are only relevant to the mindset that views properties as a commodity to be actively traded and assumes all property owners bought with the idea of flipping. The fact is that this only became the mindset over the past 8 – 10 years or so. My parents didn’t buy with the idea of flipping the house and pocketing hundreds of thousands in profit and neither did I. Those who understand the intrinsic value of homewonership will be fine. Those who bought based on hype and hope for a quick buck, will not.
Tower II will be interesting because there could be some pent up demand by buyers who wanted to live in the Infinity but were patient enough to wait for Tower II which is likely to be superior in terms of views and some minor adjustments based on lessons learned from the first tower. However, from a macro perspective, perhaps the single biggest factor impacting all developments in the City is how much wealth to be used for downpayments has been wiped out in the financial markets and whether any bank will lend with less than 20% down…. Remember, demand = willing and able buyers; many are still willing, but now unable.
“I’d be very interested in hearing what the current buyers (pre-construction) feel about their purchase and about the developer tishmenspier. Be objective. I know its hard to admit pain/dissapointment if you’ve bought, but what are true thoughts and what are ya gunna do about it?”
Happy I bought. Love our place. Anyone that bought made the decision on their own and should have seen the writing on the wall by the time they closed; if not well, you win some you lose some and I pray for those that bought hoping to make money vs. buying a home they love and may be stuck in.
Management team is great. Developer is great, good at what they do, responsive and for now they care about the property and it’s residents (see if it lasts after TS vested interest is gone post all units closing).
The only catch on the above – warranty issues (but nothing major) still need to be completed in our unit (not completed after initial punch list). Submitting official request soon, will let you know how fast they tend to it all.
Interior finishes look cheap (in unit) but anyone could have seen that at the sales center. I did not upgrade anything as have the intent to do it how I want in years to come so was happy they put base finishes in. Even if the finishes were good I would have wanted to rip them out vs. paying mark up for something someone else likes and that looks like what everyone else has.
Layout in my unit is spectacular (treetop so no curve). Brightness of my unit is fabulous. Extra high ceilings on my floor which are great.
Ammenities are top notch although I am old school and hate that my FM radio does not get reception in the gym so I guess I have to do the Itunes thing. Oh the roller rink carpet in the ammenity areas sucks but they are changing it out now thank God.
Lobbies are nice overall but need new floral arrangements as they look like retirement home decor. Lobby in need of better ambiance, more elegant lighting, too bright like an office vs. cozy and sophisticated like say the Paramount, sales office for Millenium, St. Regis etc. Need new security chairs not office dumpo chairs, something more stylish.
I give the property and how I feel about having bought a 9 of 10 (10 being the best mark).
As you can see the only complaints I have are really nothing.
Jeez–you people need to get a life.
The Infinity sales office is doing what sales people do–trying to sell! They have an email list of people who might be interested and so are sending out a message hoping for a few bites. I don’t see anything unusual or unethical about it.
I own at the Infinity. I hope they build across the street ASAP. Ever hear of the network effect? The neighborhood needs to get a lot denser. And as it does, it’ll be more desirable. All the empty lots in SOMA are a tremendous waste of good land.
Only time will tell but I predict the Infinity resales (like most of the SF condo market) is going to face significant headwinds over the next few years. The employment outlook in the Bay Area is rapidly deteriorating to say the least. I really don’t know how anyone can outright claim they are going to be in a place for 10 years. With the fluid nature of life today that’s an awfully long time.
As for pent up demand I just don’t see where its going to come from unless prices are slashed in a major way and even then the banks are still going to require at least 20% down from buyers. So for those who are interested in that 2/2 for 900K are going to need to depart with 180K. The people I know who have cash are holding onto it for fear that they may shortly be unemployed, or more importantly are stuck with a rapidly depreciating asset.
Phatty I see you are a cake bear that believes the cake market was clearly a bubble and those cakes will soon be 50% or more off, plus you probably don’t really like cake and bitter about people eating it.
Do we have any Cake Bulls that can point out the flaws of said cakes (loaded with transfat) and explain why they are not “Real Cakes”? Then the two of you can call each other names and repeat the same arguments on every single thread.
“single biggest factor impacting all developments in the City is how much wealth to be used for downpayments has been wiped out in the financial markets and whether any bank will lend with less than 20% down….”
Absolutely. 20% min was always the requirement from day one to my understanding so yes the question is who has that now, and/or is willing to lay it on the line.
“Jeez–you people need to get a life.
The Infinity sales office is doing what sales people do–trying to sell! They have an email list of people who might be interested and so are sending out a message hoping for a few bites. I don’t see anything unusual or unethical about it.”
Completely agree but I really don’t think that because people post here, they have no life. You are obviously reading and posting; do you have a life? Not trying to be bitter but this is a blog, where people post – that is what happens on this blog and every blog that exists. You should just be happy that there is such interest to discuss the building any time a thread comes up about it.
I dont recall seeing anyone say the blast was unethical; it is not.
You should know that in todays world most press is good press.
“I really don’t know how anyone can outright claim they are going to be in a place for 10 years.”
Becasue I have lived within a 5 block radius for the past 12 years only moving when I want to. Actually quite easy to do if you buy based on your lifestyle and what you favor vs. buying for investment purposes. Oh and base most decisions on worst case scenario and you shall be fine in most instances.
I am going to be in the same place for ten years. I have 20% down, I’m hiring, and I have a monster truck, oh and I’m looking buy, plus I just got some office space and started another business.
“In an unusual move, the 15 percent reduction is retroactive. It applies to buyers already in contract as well as those just now in negotiations, Baumert said.
“We were not about to allow folks who believed in the project from day one to be treated differently — everybody needs to be treated the same,” said Baumert. “We are in this for the long haul. We don’t just build buildings, we build neighborhoods.”
Maybe the Infinity developer will do the same? OK maybe they laced the cake.. I am getting too optimistic.
gowiththeflow,
everyone was out to scam and they did so successfully, that includes the developer (for slashing prices rather than trying to provide some stability by holding on these units a little longer). The ones left are not the “least desirable”, they are the ones left because they simply didnt release them all out at once.
I assume you bought post construction?
I agree with your last post on the Millenium article. The Infinity developer needs to take the same philosophy and reimbuse its early beleivers something.
I can’t resist the Portal quote:
“Cake, and grief counseling, will be available at the conclusion of the test”
“The ones left are not the “least desirable”, they are the ones left because they simply didnt release them all out at once.”
Your talking about the Infinity here or Millenium?
I was in contract through construction but yes did not buy/close until post so I could see my unit finished.
I think Tishman is respectable, has a good reputation and so far has done everything right in my opinion. They are in business however so it is fair to assume they are out to make money and should be. Thing is they own the lot across the street so as with Millenium I would think they desire to “make a neighborhood, keep current clients happy”? Millenium in my opinion is just trying to one up them given Infin phase 2 will be in direct competition with them here soon. It will be interesting to see if Tishman joins the pissing match. I have a feeling if they don’t keep the people that all ready bought feeling like they are taken care of they will have a lot of unhappy people.. not good given they are tied to this lot and the adjacent one for years to come.
Oh, Rillion. LOL.
maybe the ad means with the kitchens you can keep baking and eating cakes for INFINITY. Regardless, its’ stupid to think that your old buyers are going to be your new buyers. When you buy a new car early in the year you are not going to buy the same car later in the year regardless of what the price would be. THese are desperate tactics. Nothing new though. 140 South Van Ness was heavily markteted by Realtors of the Palms as a trade-up. Look where it got any takers. I have to say I would be a little embarressed a s professional to take this tactic, but like I said, these are desperate times and people gotta make a buck, even realtors and developers.
I live in the Infinity (love it!) and see many interested parties checking out different units, especially on weekends. How is this possible? I keep reading in SS that the sky is falling.
It seems relatively busy given the ongoing struggling economy. Could Tishman have hired these people to fool residents like myself into thinking things aren’t as bad as they seem? Maybe waiting a bit and buying in T2 ain’t such a bad thing after all?
GowiththeFlow,
I’m curious as to which building your in? midrise or tower? and what kind of price you paid / view you have (approx).
Given what you say, I think you should realize that its very likely that atleast one or two of your neighbors got their units for anywhere from 10-20% less than you did – yet you plunked down before you even saw your unit because you beleived in the place and all those sales people saying 80% “sold” or “in contract” which I hope you know was not completely true, in my opinon. Something is grossly wrong with that. You beleived in the property. So in essence the high price you paid was likely used to subsidize others in the fire sale in order to move units.
You really think they care about the community? so they upgrade something here or there to create a perception….wow.
stay the hell away fro T2. What a con. Watch me, prices will continue to fall. As for T1, I wouldnt even touch it at this point. T2 will cannabalize value ot T1. Market heading further down.
anon:
You are interpreting and twisting info, did not say half of what you repeated but here it goes:
Saw unit in person under construction, did not close until very recently, it was completed and had visited it many times to verify I wanted it.
Treetop (exact and only unit type I wanted) and without disclosing price can say I got in for less than what has been discussed on this site and the prices I monitored via agents, SS, etc. for over a year before closing. The specific unit type I wanted were either all sold, or in contract by the time I shopped. I know this to be true because I either met the neighbors and/or tried to buy sim. other more expensive units but they were all ready gone/ not available to me.
And yes I do think they care about the community. Why: Because they still have to sell T2, own the property across the street which they plan to build on so they have a vested interest. I did say post selling all, will remain to be seen if they still do; I can only hope so but never said I expect it.
Has anyone heard any real, firsthand updates on T2? I know they’re giving tours — any word on what the interest has been like? Any deposits yet? How do the prices compare to T1? Are they negotiating yet? What are the odds that Tishman will institute an across-the-board price cut like the Millineum just did?
I’ve said it before and I’ll say it again — location, location, location.
Doesn’t matter what the “property of the day” is on SS, there will be at least a 10 – 1 negativity ratio. Most likely from folks who don’t live in the City, don’t want to live in the City, do not own, have never owned, and have no idea about the REAL reasons people buy where they do.
JohnK,
The “bears are sour losers with a grudge” theory has been debunked many many times and strangely looks similar to the “fence-sitters will be sorry” con phrase from the bubble years.
Many bears are financially educated and didn’t believe the hype of 2003-2007. They made other choices than participating into the Ponzi. It appears they were mostly right in view of the current events. It was a bubble. It popped. Prices are falling. Anything I missed?
Those aren’t cakes.
They’re a 2006-vintage AA-rated mezzanine tranches of a collateralized cupcake obligation.
SFS,
You misinterpret my comment. Many “financially educated” people made money in real estate over the period you mention, myself included. Some know when to get in AND when to get out. However, the view of property as an investment is only one reason why one would choose to purchase. The majority of posters on this board only seem to view it as a commodity and not as a home and their comments reflect that. You could take the negative comments on this board and easily apply them to virtually any asset class from that perspective. However, it ignores the fact that people have not traditionally viewed their homes as investments until fairly recently (historically speaking) and many people still choose to purchase a home for reasons other to “get rich quick.”
“Some know when to get in AND when to get out.”
So lay it on us JohnK. Should a current owner who is counting on the home as an investment be getting in or getting out?
“… many people still choose to purchase a home for reasons other to “get rich quick.”
And nobody will “get rich quick” for many years to come! That is the point most on here are making. The bubble has burst now and people need to be educated that now is not a good “buying opportunity” like the real estate industry is hyping every day! Even if you want a home to live in and not necessarily as an investment … why would you want to lose hundreds of thousands of $ if you had to sell for some reason in the next 10 years? Your argument made sense before the bubble mentality and when houses were appreciating at about the rate of inflation. But now a buyer can really get hurt by making a hasty decision and being sucked in by the “buying opportunity” hype!
The amount of inventory coming on market is unbelievable. Consider just the three projects mentioned on SocketSite within the past week: Infinity, Cubix, and Millennium. According to Socketsite and other websites, those three projects alone represent around 720 units of unsold inventory (~330 units for Infinity Towers 1 & 2, ~75 for Cubix, and ~315 for Millennium).
Let’s take the “fluj/ester/sfrob” viewpoint that “it’s all very micro” – D9 condos do not compete with “ultra real SF” condos (i.e. Pac Heights and Marina). They only compete with other D9 condos. How much inventory is 720 units? 2008 D9 condo sales were 611 units, and D9 condo sales have dropped 70% YOY (http://rereport.com/sf/). A pessimistic forecast is thus that 2009 D9 condo sales are 183 units. An optimistic forecast is that sales double from 30% of 2008 levels to 60% of 2008 sales; then we forecast 367 D9 condo sales in 2009.
So just the three projects mentioned on SocketSite within the past week alone represent between 24 to 47 months of inventory at current D9 condo sales rates. Needless to say, in this scenario prices will have to drop a lot.
Alternatively, we can take the “SS mild-bear” viewpoint that D9 condos compete with other condos in “real SF” (D1 & D5-D9) – people substitute between markets. Given the YOY drop in condo sales in these neighborhoods, we might forecast ~900 condo sales for “real SF” in 2009. Thus these three projects alone represent almost 10 months of inventory being added to the “real SF” condo market. In this scenario, less dramatic (but still large) price declines will have to occur, but they’ll affect all of “real SF”, not just D9.
And of course, these projects represent only a fraction of the total condos (new and resale) that will come to market within the next year or two. They’re just what happens to have been discussed on SS within the last week!
Something has to give. Either prices have to drop significantly to boost sales, or else inventory is just going to pile up to unbelievable levels.
It will also be interesting to see what happens when Tower I owners are allowed to start reselling in mass, starting this February for some. By April of this year I suspect we will see many condos offered for sale in Tower I.
for all the talk about the infinity, there seems to have been very few concrete numbers on what prices people paid for various units. there’s been a lot of light shed on what people paid at ORH, but with Infinity, there have been a lot of discussions about the value and where prices are headed, but it just dawned on me that after all the interesting discussions, i still have no clue what they are even selling for at the moment.
gowiththeflow, youve made it pretty obvious why you are happy. you are probably only down 10% on your condo – and good for you. others 30%. all in less than 1 year! not just because of the market conditions, but because the developers over inflated their prices and the sales team were good at making buyers drink the cool-aid. so, when you look around your neighbors, just realize that about half of them were severely “con’ed”.
Since you asked so nicely, IMHO, it’s not time to go back into Real Estate as an investment, yet. While I’m not one to try to catch a falling knife at this point, nor do I buy into the hype on this board that prices will keep falling for the next 10 years.
I agree with the pessimistic outlook regarding the amount of future inventory and price drops for most of these condos… but high-level units in either tower are still going to be very desirable because of the views. In fact, even more so than before, because development has stopped.
For AT LEAST the next five years, there will be no new options for unobstructed bay views in the entire city.
JohnK – I haven’t seen anyone here claiming that prices will keep falling for the next 10 years. I think most bears think that prices will keep falling for the next 2-3 years, and then will stabilize and/or begin to rise at a slow pace (just like virtually every other RE bubble in history).
If you’d asked me 18 months ago whether we’d reach the 2006/2007 peak by 2016/2017, I would have guessed yes. Now, I think that is very unlikely to happen, absent the Fed allowing (or producing) sustained double-digit inflation over the next decade.
anonm, Was primarily referring to mavo’s post:
“And nobody will “get rich quick” for many years to come! That is the point most on here are making. The bubble has burst now and people need to be educated that now is not a good “buying opportunity” like the real estate industry is hyping every day! Even if you want a home to live in and not necessarily as an investment … why would you want to lose hundreds of thousands of $ if you had to sell for some reason in the next 10 years? Your argument made sense before the bubble mentality and when houses were appreciating at about the rate of inflation. But now a buyer can really get hurt by making a hasty decision and being sucked in by the “buying opportunity” hype!”
Perhaps the 10 years is merely implied….
JohnK,
I did not mean to imply that prices will fall for the next 10 years. What I meant was after the carnage of declining prices over the next 2 to 3 years… anyone who buys in the next year or so is going to be underwater for the next 8 years or so! I do not think we will be seeing the kind of RE bubble that we have seen the last 10 years in our lifetimes. The only way prices will go up quickly is if double-digit inflation kicks in and even then interest rates would be so high as to keep a lid on RE prices anyway.
My wife and I are sitting on cash and expect to buy a nice place in the “real SF” when the prices stop falling… maybe in another two years. IMHO any one who buys now in SF is in for some serious pain. The real price declines have really just started here the past six months or so. And regardless of how desirable SF is to live… prices will come down to what incomes can afford. RE financing is going back to fundamentals. Not everyone is a multi-millionaire that can pay cash for a high-level view condo! Even if they are the last ones built for the next 10 years.
“JohnK – I haven’t seen anyone here claiming that prices will keep falling for the next 10 years. I think most bears think that prices will keep falling for the next 2-3 years, and then will stabilize and/or begin to rise at a slow pace (just like virtually every other RE bubble in history).”
Well this used to be my view. I think though because the government is intervening so aggresively it’s preventing debt from being liquidating and assets from being written down to market levels. Once scenario that could thus unfold is a short term uptick comes into play. But then once the government loses the ability to spend because of increased interest rates and you get a false bottom then a much more dramatic collapse. So it could end up being a 9 months of stability then a very sudden and difficult collapse.
I wonder if the negative people here are blogging as much to their stock broker or mutual fund or 401k??? Real Estate is an opportunity to actually live and enjoy your asset. We live in Tower 1 – the sales people are by far the best in the city, the location is grand and wait and see 5 years from now – would these negative people be complaining if the market went up 30%? We would love to own something in Tower 2 – the views are amazing but will stay in Tower 1 and appreciated the curtosy to offer Tower 2 to us first.
Lawrence, agreed. And as far as I can tell for well over the 1 1/2 years I have been monitoring this site so do 99.9% of the other current Infinity residents.
IF ANYONE HAS ANY TANGIBLE ACTUAL SALES COMPS FOR INFIN COULD THEY PLEASE POST OR LINK TO THEM?? THANKS.
Some Infinity sales are recorded at this site:
http://mortgage.chase.com/pages/other/home_value_estimator.jsp
Im in T1 on a mid-floor with a nice view of the bridge centered in the living room window (D stack). I paid about $1000 sq ft. Since I sold my house in Southern California to move here, for me, any loss is probably a wash. Does anyone claim that The Infinity has fared worse than other SF or LA real estate?
The Infinity faired like all new buildings… you paid $1000 per SqFt and by the time the ink was dry on your purchase contract it was worth $900 per SqFt.
Then in late Sept the financial crisis became national news and it lost another 10% along with virtually every property in the entire city.
IMO anything above $800 per SqFt at the Infinity (or almost anywhere else) is still too high unless you’ve got a dead on water view and a usable balcony. #1003 at 246 2nd had a quality view and a balcony and probably sold for about it’s asking price which was $629 per SqFt. If an Infinity unit does not have a view and a balcony, it’ll be lucky to get $629 SqFt a year from now… when you sell you’ll have enormous listing competition and only a superior price will set you apart.
“others 30%. all in less than 1 year! not just because of the market conditions, but because the developers over inflated their prices and the sales team were good at making buyers drink the cool-aid.”
I agree with you anon, and this dovetails with Willow’s statement that although the Infinity may have the best highrise location in SOMA, it was never a great value proposition. Other condo complexes, although prices are unquestionably down, may not be punished as much as 30%. The oft quoted 20B, who paid $1345 per s.f. for a unit with a cubicle for a living room, is a good example. Assuming he/she can get $940 per s.f. today (even this figure isn’t guaranteed) he/she would have an unrealized loss of over 30%.
Developers care about a neighborhood only in as much as it enables them to profit from their investment. This principle applies to ALL of them – the profit motive will always be the bottom line.
Huh?,
your saying that 20B paid in the neighborhood of 1.7mm? Outrageous! For a partial view of the water and bridge?
Does anyone find it outrageous that in a matter of 6 months the developer managed to sell comprable units at such varying prices/sqft, so as to not even give an afterthought to its impact on earlier adopter loyal buyers?
Yeah, its obvious market conditions changed, but fire sales in the middle of the credit crunch!?! Couldnt they have simply held on to units during the oct/nov time period instead of selling (ie throwing away) them at “the world is ending” prices?
Couldnt they have simply held on to units during the oct/nov time period instead of selling (ie throwing away) them at “the world is ending” prices?
anon:
the developer must evaluate for itself how long it thinks the credit issues will remain, and choose the option that maximizes profits given its analysis.
credit crises typically take years. this one seems particularly bad. it is possible (not 100% assured) that what we see NOW is the “normal” market, and the 2002-2007 prices were bubble prices.
in other words; there may not be a return to 2005-7 prices anytime soon (many years), at least in real (inflation adjusted) terms.
if the developer feels this way, the best way to maximize profit is to sell now.
FWIW: these aren’t “the end of the world” prices. these prices are barely 10-20% down.
end of the world prices are like what’s happening in Detroit, where some places are 90% or more down.
Well put ex sf-er,
It seems we are coming into a new “normal” or what is considered such. As we re-equilibrate all things – economic, financial, psychologic etc – the latter sometimes takes the longest to realize.
It seems we’ve been distracted by so much – prolonged wars, election campaigns to name just a couple – that this realization will now settle in over the coming years, as common sense, comes back into vogue.
so from these message boards it seems like early adopters of TII will likely get screwd again based on the developers tactics. I guess you’d have to be dumb to fall for that one twice.
there is a balance that the developer should also consider. If he really pisses any one of the first buyers off and there is a short sale at the Infinity, he won’t be able to sell at a level much above the short sale as they do count as comps, regardless of what anyone says. I know of a unit that dropped $100k in value in just a few weeks due to ONE short sale in the building.
more than one unit dropped more than 100k in less than a couple weeks. this fire sale has caused a systemic deflation in the values of many peoples homes at the infinity. out of curiosity which unit had the short sale?
and to the point made by ex-SF’er, yes maximize profits is the understandable objective, but PII is a long term game, and it seems they have lost enough credibility from PI to create some hesitation for buyers in Phase II.
So is it confirmed there have been short sales at the Infinity? What units? I was un-aware of this. Is the developer or HOA required to report such to current homeowners? Did the short sales happen in the past month?
I did a refi end of December and my value was appraised fine in comp to my closing appraisal a few months a go; no problems in value, closing, etc., no need to put additional money down or anything strange.
Also what technically constitutes the “fire sale” being discussed? Were there specific units, specific reductions?
“If he really pisses any one of the first buyers off and there is a short sale at the Infinity”
Good lord. Can’t you people read? Don’t you know what “if” means. Nobody has stated that there are short sales at the infinity.
“your saying that 20B paid in the neighborhood of 1.7mm? Outrageous! For a partial view of the water and bridge?”
From past postings I believe 20B went for $1.77m in March ’08. When I toured 3-4 months ago, I think I was shown 22B or 25B and the agent said the asking price was “around $2m”. I really should have laughed out loud.
By the way, if the slender lady does opt to eat all the cakes, she probably won’t be so slender after the fact. That’s enough proof for me that you can’t have your cake and eat it too at the Infinity 🙂
“I know of a unit that dropped $100k in value in just a few weeks due to ONE short sale in the building.”
than next poster stated:
“more than one unit dropped more than 100k in less than a couple weeks. this fire sale has caused a systemic deflation in the values of many peoples homes at the infinity. out of curiosity which unit had the short sale?”
A bit mis-leading.. But I do see your point. Diemos are you saying there have not been any short sales at the Infinity? Thanks.
“Couldnt they have simply held on to units during the oct/nov time period instead of selling (ie throwing away) them at “the world is ending” prices?”
I think the early buyers into the building bought into the sales hype that the building’s architecture and location warranted a significant premium. When it became clear that this extra premium was unsustainable, prices began to drop (sometimes significantly) to fall more in line with neighboring highrises … with the exception of the Millenium.
Although the views in T2 will help, the same design shortcoming that is now hurting T1 (the tiny living space) are bound to have a drag on T2 … except perhaps for those buying into the Infinity as a second home. Far less of those these days.
So back to the fire sale – anyone have any concrete evidence of what units, how far prices dropped etc. or is this all speculation?
20B did indeed sell for $1,771,500, closing on 3/9/08. Don’t know how or why, but the Infinity closings from March of ’08 were posted to bayareasoldhomes.com. Just prices, not square footage, but you can back in to $/sf if you know the floorplans.
“Diemos are you saying there have not been any short sales at the Infinity?”
I’m not aware of any and I would be surprised to see short sales given the short length of time since units started closing.
Dude – The unit is 1317 s.f., hence the $1345 per s.f. from my earlier post.
GWIF – I estimated that this unit may fetch $900-$950 per s.f. in the current environment. This is not based on actual sales – just a guestimate. Perhaps others have closing figured for similar B units from November/December for a more accurate comparison?
I was waiting on a friend and headed to the Infinity on Sunday to kill some time and spoke to the Sales team. They were very nice. I got the impression that they really weren’t interested in selling the remaining T1 units and that T2 was the new focus. I was told there will be about six or seven 2/2 units with no view priced in the mid to high 700’s. A few more in the 800’s range and then remaining units quickly jump to 900 and above. I’m curious to find out how that compares to T1 pricing?
I also noticed that there was a little bit of chatter regarding short shales in the building. It would be naïve to believe that Infinity is insulated from this phenomena considering how many units will eventually be sold. That’s one of the risks of buying into a condominium. I doubt it will be as significant as the Palms or the Beacon but there will be people who can no longer afford their unit or decide they’re upside down and decide to walk…
From another posters link:
301 MAIN ST 15B $1,260,000 2 /2 1,317 PARKING LOT 2008 Aug-2008
$956 sf
301 MAIN ST 10B $965,000 2/ 2 1,317 PARKING LOT 2008 Sep-2008
$725 sf
I have to be honest in comp to these the price for 20B does not seem as outragous as posted. Of course this is looking at comps up to the Sept closing date of unit 10B… going forward, I admit I am a bit nervous to see the numbers..
Mar’08 – 20B – 1317 s.f. – $1.77m – $1345 per s.f.
Aug’08 – 15B – 1317 s.f. – $1.26m – $956 per s.f.
GWTF – I think I will concur that 10B is not a good comp (probably very limited views) but a half million dollar difference between two units just five floors apart (15B & 20B) is troubling. Moreover, this is before the financial meltdown of October to December 2008.
So, even if 20B could command $940 per s.f. today, that would be over 30% down from its purchase price. And $940 is in no way guaranteed, especially with T2 competing for the same buyers.
The short sale was not in that building. Sorry for the confusion. It happened at another building where it screwed up all of the comps. That was meant to counter some posts that short sales do not have that big of an impact. And it was a hypothetical if that happened to the Infinity with someone that would find themselves under water.
Here is the thing… with all the buildings surrounding the property even a few floors can make a difference views – a drastic difference.
However that being said I checked my notes and see that in past prices floating around the net for 21B est. 03.29.07 were $1,250,000.00 and $949.12 psf. This is consistent with pricing for other units I found quotes for on or around March 2007.
Looks as if early buyers did well.
Strange thing is even in the current economy and with T2 coming on line prices seem to continue to rise for Infinity property vs. causing price declines.
Tishman is definately marching to the beat of their own drum.
I see this as a good indication that they are doing what they should be to retain property value for the residents. Fire sales in my opin don’t count (if they have happened as some people state) it’s usually for the left overs. Fire sales are fair and common especially when a bulk of the building has been sold all ready and to that extent not sure they really count for apple to apple comps?
I stand strong on my opinion as always – Infinity will be fine in the spectrum of things and Tishman know’s what they are doing.
Selling tactic Tishman is using is no different than the selling tactic for anything. Intro prices may be lower, get people exited, in the door offer a bit of a deal. Mid stream, inventory declines, prices are solid – no sales. People clammer to buy because they think they will lose out on getting what they want and thus are wiling to pay full price. Finally when the bulk of availability is reduced, remaining inventory is not the best (with exception to the few needles in the haystack the lucky one’s find) prices are reduced again to move things out for next season…it is retail.
“Tishman know’s what they are doing.”
Well, on the one hand I’m not sure how you build units that are 1317 s.f and forget to include any living/dining space? It’s fine if everyone uses the building as a second home, but not so hot if one wants to actually live there, full time. However, the fact that you got someone to pay $1.77m for one of these suggests that they must be doing something right … although I doubt the buyer will see it that way.
In terms of Tishman retaining property value for residents, it’s hard to see how one can credibly make that contention. Clearly the T1 buyer quoted at the top of this thread doesn’t feel the same way.
I agree with Huh?. Gowiththeflow, its pretty clear you have no idea what your talking about. And I dont blame you. You bought and you are obviously biased into beleiving you made a good decision (or not horrible decision, atleast financially). Yes, better off than buying at the beginning, but your facts are all off.
The fire sale was on completely legit and normal units. F stack on the 34th floor. B stacks on higher floors, etc. How are these leftovers? The only reason they are leftovers is because they simply didnt sell and the market tanked, the developer likely reacted in fear of their wallet and absolute disregard for its prior buyers, and dumped units.
BTW, there is no way 21B went for 1.250mm. It that was true, I would see how it would be comforting, but its not.
Face it, earlier buyers were there to subsidize the huge discounts of the last buyers.
Bet you that the developer ends up making more money on TI than they do on TII.
Sorry to tell you anon and huh?, Crazy as it might sound but there are units already in contract for Tower 2.
tbonetk, you failed to make a point.
units in contract in TII can mean:
1. dumb buyers
2. Tishman reformulated their kool-aid
3. Prices tanked
4. etc
your point is?
Of course the buyer paying 1.77m would not see it that way but clearly the fact units sold at these price points = developer must know something. Be that the buyers of the 1.77m prop sees it that way or not it still adds value to the overall property given it is now a comp price.
“Yes, better off than buying at the beginning, but your facts are all off.”
Actually I am saying the opposite – I think it was better to be one of the first one’s in. Prices were lower at the beginning (based on quotes various parties recieved).
“BTW, there is no way 21B went for 1.250mm. It that was true, I would see how it would be comforting, but its not.”
Obviously until we see what the unit actually went for no way to know but I can confirm that the quotes floated all over various blogs, friends got from the sales center etc. were exactly as I stated – I have been tracking quotes since conception of the building.
“the only reason they are leftovers is because they simply didnt sell and the market tanked” I do not disagree here, perhaps they held some units too long than got sucker punched by the crash and had to sell. Do you have the exact numbers or is this personal opinion?
“Face it, earlier buyers were there to subsidize the huge discounts of the last buyers.”
Sorry I do not agree. Prices lowering because of the market sure but I guarantee that initially the idea was to sell ALL the units at a premium NOT subsidize the last buyers.
So is 20b in tower ii going to cost more than 1.7?
also, how can units be in contract when they are supposed to start selling later, Feb for public and 29th for “preferred”? Well maybe because just like in tower i, Infinity really never told the truth about what was available with developer holding on to units and who knows what else.
Example:
Infinity has sold most of their upper floor units in earlier releases. I reserved one a couple months ago on the 32nd floor. Corner unit with pano bay and city views at just under $1000/SqFt.
Posted by: Anonymous at November 7, 2006 2:18 AM
You can go back to just the SS archives and find many examples.
Maybe the developer posted all the quotes on blogs and lied to the people shopping when they quoted them unit prices?
My point re pricing (merely an est.): 2006 prices – decent, early 2007 fairly decent, mid 2007 stirring the kool aid, late 2007 full on kool aid, after depends on who was smart enough to question the developer and sales team because they were keeping an eye on the market and had the knowledge to do so. Recently sure fire sale because T2 is coming on line and there is no point in wasting the teams time pushing the left overs at T1 when they can get the same or more in T2 – plus given the state of the economny T2 will clearly require more of a sales effort – so man up.
20b in T2 at 1.7m?
anon, here’s a reply just for you buddy!
#1) maybe dumb but they have money
#2) Kool-Aid aint bad, you should try some on this beautiful day
#3) i’m sure the units in contract at T2 are not fire sale prices.
#4) etc.. you have anymore???
My point is what are you trying to prove without serious facts?You quote these #’s without evidence of actual sales #. Did prices go down on some units, yes most likely. But without the actual #’s, what are you arguing about? He said, she said gossip?
My guess is you want Infinity to fail. Reason, maybe you want to buy in at a much lower price; hoping if you trash Infinity on blogs you might actually be able to get a lower price??? Get real buddy, the market will play itself out. If buyers don’t step up, the developers will have to. But if people are already in contract, I think you’ll understand where this story will go….
Move over to SOMA Grand or Blu, they are having some problems and maybe you’ll get a unit for yourself @ 75% off.
tbonestk,
I believe Anon is an owner at Infinity that feels that Tishman hasn’t been forthright with him … at least I believe he/she is, based on past postings. I don’t mean to speak for him/her, but I think his point is that simply saying that contracts have been signed at T2 doesn’t, in itself, mean that much. More information is needed about these alleged contracts of sale to be meaningful. Were they signed a higher prices to similar units in T1? Were prices reduced significantly as a means to induce sales? This type of information would be valuable in determining if T2 is likely to sink or swim.
Can you shed any insight on prices and or units in contract for T2? Also, what is the source of your information?
What’s the surprise? Willow posted basic info on T2 already. They are for sale and people are in contract. Best word of advice, if you want to know pricing go into the sales office.
They will blow a lot of smoke in your face but eventually you’ll get the answers to all the questions you’ve asked.
tbonestk,
Willow posted the following information –
“I was told there will be about six or seven 2/2 units with no view priced in the mid to high 700’s. A few more in the 800’s range and then remaining units quickly jump to 900 and above.”
He/she also asked the more crucial question in his next sentence –
“I’m curious to find out how that compares to T1 pricing?”
While Willow’s general guidelines are helpful, it’s the apples to apples comparisons between T1 and T2 similarly situated units that will prove insightful.
Again, if you know for a fact that specific units are in contract and what specific prices were paid, that would be insightful. Otherwise Anon is right – simply saying T2 units are in contract doesn’t mean very much at all.
how typical. automatically assume I’m a male.
Tbonestk, your amusing. I dont know if your a buyer at the Infinity or not, but if you are, your clearly losing money and trying to “stop the bleeding” by supporting the project via a message board. And if your not, you probably dont have the real scoop on what went on.
All my views are simply my opinon, but well informed opinions.
anon –
Let me help you differentiate “your” and “you’re” since you’re clearly having trouble with these two.
“I don’t know if “you’re” a buyer at the Infinity or not…”
“”Your” opinion may be well informed, but not for you to decide”
FYI- 15B’s view is blocked by the tower of 345 spear street (Can’t remember what the name of the building is called) and the Gap building. 20B should clear the the tower and Gap, hence the price differance. Doesn’t mean that spread should be 500K, but it explains some of it.
“Doesn’t mean that spread should be 500K, but it explains some of it.”
20B went for $1345 psf. How close to that number do you realistically think they would get today, assuming they were selling? Is 900-$950 realistic?
As an aside #9E, the subject of a new thread today, is 1163 sf and was reduced to $799k, or $687 psf, assuming they get their asking price.
I’m surprised 9E is going for so cheap on a $/sqft compared to the others we’ve been talking about on this thread. Granted no view, but wow thats a huge discount to an obstructed B stack view prices. What do you guys think? Does this make it the lowest price 2-bedroom ever at the Infinity or is there something else out there?