A plugged-in reader reports:
I was in contract for a unit at Esprit Park and ended up backing out due to employment issues. I just settled escrow a week ago and I won’t get into the details but I can honestly say that the result was very fair.
I checked on the Esprit Park website yesterday and found that they have updated the number of units “sold” which includes units both sold or in contract. They haven’t always been on top of updating the site but it had previously been hovering around the 47 to 49 unit mark out of a total of 142 units. Right now the website indicates only 30 units (21%) sold one of which is the developer’s unit which was briefly listed for sale in December I think. This seems like a potentially serious issue due to the more conservative rules that both Chase and Wells, the approved lenders, have regarding % of units sold prior to funding.
The 1/1.5 units have also been lowered on MLS to the lowest price yet of $552k [Editor’s Note: now down to $538,938]. However, my contract from last April was lower than that so this development still has more to fall. Especially considering the reductions at Radiance you’ve posted today.
I was a real big supporter of this development and the developer and I still am. Obviously things have changed dramatically in the market since my contract in April 08 and these units will have to either go rental or sell real cheap but I think the design and the professionalism of the developer were great…
For the record, we’re fans of the development and developer as well, but we’re even greater fans of being plugged-in to what’s really happening in the market sans a sales office or industry spin.
UPDATE: From a plugged-in reader with respect to lenders:
Note Chase has pulled their funding for Esprit Park (they wouldn’t pre-approve us in Jan). Apparently they were too exposed to new units. Its now Wells and Patelco.
∙ Listing: 900 Minnesota Street #S115 (1/1.5) – $538,938 [MLS]
Boo, I think you made the right choice and walked away. I too liked the design of Esprit parked but the prices were too high for the “up and coming” area. The area will get better but not anytime soon. It’s not as bad as Soma Grand but why pay South Beach prices to live in the dogpatch?
Besides Just for You, and Hard Knocks what else is in the area? I haven’t been to the development lately but are they certain to open the restaurant downstairs still?
Esprit would make excellent rentals!
Section 8 rentals?
Why all the Dogpatch hatin’?
I’ll fill in a couple more restaurants there for you tbonestk: Piccino (amazing pizza, soup, salad type of place and they serve Blue Bottle coffee), Serpentine (Slow Club spinoff), Yield (all-organic wine bar and they serve food too). These are all within 100ft of 22nd and 3rd, in addition to the places you named. And don’t forget 22nd St Station for us commuter types.
I’m not ready to make the jump to Esprit Park yet, but I’m keeping an eye on the prices.
“Section 8 rentals?”
SURE! Whatever it takes to get this development filled and people off the streets.
“Why all the Dogpatch hatin’?”
With a name like dogpatch you have to ask? This place was “up and coming” at one point, but with places like Noe and D7 and D8 showing increasing weakness, it’s going to be a loooooooooooong time before such hoods regain even a fraction of their former momentum. They could probably get more in section 8 rents at this point (the sec 8 program actually pays quite high rents).
Section 8 rentals would be cool here. From my limited understanding of the Section 8 segment (but growing by the day :)), only the county/government is dumb enough to overpay for rental properties. That’s the economic beauty of it from the investment point of view. The foolish taxpayer in effect pays, for example, $1800/mo for a place that would have a tough time getting $1000/mo reliably in the private markets.
I’d guess we’re not there in this part of SF…. yet.
City landlords who want to collect Sec. 8 money can get $1325 for a 1bd. unit.
But you have to get 10-30% of that from the tennant (the rest from the gov’t.)
And if you wanna charge more you have to get it from the tennant.
If you visit the area – it’s a great location, great finishes, great units. The problem is there are only so many people looking to pay $500k for a 1 bedroom (and there more available units – in that one development – than demand for that type of unit in the whole city).
tbonestk! You busted me!
The Ramp is a short walk away and while a little rough on the edges it’s a sweet place to hang out in the warmer months. Good grub and fair drinks. And it’s also a very short walk to 18th in Portero where you’ve got Baraka, Chez Papa, Goathill, and that Thai bar/restaurant. 5 min walk from Esprit.
I don’t think anyone hates the dogpatch more then spencer who at times seemed to be searching city parks for needles and poop. But I always defended the hood when he dumped on it because it has a lot of conveniences and I actually just dig it. It’s unique. But one main part of that was anticipating the development of Mission Bay and that could be lot farther off now.
The world changed in September. Unfortunately I just couldn’t make it happen. In the end I think I got lucky because I would have been bullheaded enough to go through with it if my earnings potential hadn’t crapped out or if they had finished the development on time. I would have been one of those idiots people speak of on this site. I’m afraid I’ve now turned into a bear. I might come out of the cave in 2012.
Oh and Build Inc. rocks! I’m bummed they got caught up in this. I hope they manage to come out of this OK and develop another day.
First sunny day in Spring I’m playin’ hooky from work and takin’ T-Third to The Ramp.
LMRiM:
Have you found that there’s competition among Sec. 8 landlords in locales where it pencils out?
Vouchers are limited — 6,000 in CoCoCo (which has a pop. of about 1 million).
Only some of those are big families.
But there are potentially many hundreds of 4bd. homes there that one could purchase for $150-200k, and collect $2000 in Sec. 8 rent (and of course thousands more smaller houses and apt. units.)
I guess I’m wondering whether there could be more Sec. 8 LL’s than voucher-holders, thus constraining potential rents?
Rubicon,
Yes, I am finding (hearing) that there are areas with more vouchers than available housing, but these are on the East Coast (central Long Island, about 50 miles out from NYC border). I have family out there and we are actively looking. I’m not looking in CA.
We’re seeing 4/2s in average shape going for $90-110K (foreclosure), requiring some sweat equity and $10K or so to make livable. Not great neighborhoods, but not bad either. Just run down, perhaps comparable to parts of Pittsburg or Abtioch out here (but tough to make direct comparisons because the housing stock is older on the east coast and the demographic is more stable). Taxes are in the range of $4K per year (big difference from CA – no prop 13), and Section 8 rents are $1600-2000. Imputed tenant contributions are very low – sometimes as low as 5% – so long as you get the “right” kind of tenant.
Not something to get rich with, but they do pencil out nicely and there is always the chance that the phony Obamabucks start flowing even more.
Note Chase has pulled their funding for Esprit Park (they wouldn’t pre-approve us in Jan). Apparently they were too exposed to new units.
Its now Wells and Patelco
Why would they turn this into section 8 rentals when the developer paid the fee to eliminate the BMR units required for new construciton in SF?
Seems that people commenting on here are always will be renters.
“I don’t think anyone hates the dogpatch more then spencer who at times seemed to be searching city parks for needles and poop. But I always defended the hood when he dumped on it because it has a lot of conveniences and I actually just dig it. ”
I don’t hate the Dog Patch. I just thought the units were way overpriced for the neighborhood, and apparently I was right.
My problems are more with the marketing of this area being the next big thing.
I would consider living here if a few things happened:
1) Cafe Cocomo would have to be closed; its a breeding ground for drug abuse, noise pollution, public intoxication and vandalism
2) the vagrants were not allowed to stay under the freeway or in the park itself.
3) the park was cleaned on a more frequent basis. needles and dog poop can be found upon inspection
4) the vandals, graffitti artists were punished and dissuaded with the full hammer of justice.
5) The prices of the 2 bdr top floor units came down to $550K.
as far as i am concerned, “up and coming ” is a phrase created by realtors and restaurant owners. if up and coming is a 20yr process, then i am only intersted in gettting in in the last 2-3 yrs of that up and coming. I think this area has about 15 more to go.
Then I am in.
Tangential, but Baraka went out of business in January. Shame, too…great lamb tagine.