Developers of Walnut Creek’s newest luxury condominiums are confident their units, the city’s first real live/work housing, will beat the odds in today’s turbulent housing market.
Industry experts are still trying to gauge whether the market has finally hit bottom, but 555YVR’s owners say their 87 units have a winning combination of amenities and proximity to downtown and BART. They hope the condos will continue to usher in a new era of housing for Walnut Creek where people are less auto-dependent and want to be closer to downtown.
The city’s 20-year general plan encourages multifamily housing projects downtown, where residents can live near transit and walk to shops and restaurants.
The 87-units at 555 Ygnacio Valley Road, between Main Street and Broadway, rise four stories and offer unobstructed views of Mount Diablo to the east. The condos, which go on sale in June, range in size from 763 square feet to 1,400 square feet and sit on the former site of the JFK University building. Construction began in 2007, but there have been no pre-sales for the one- and two-bedroom condos, which will range in price from the high $300,000s to mid-$700,000s.
Tax incentives and location have Bruce Dorfman, developer with Thompson-Dorfman Partners of Mill Valley, optimistic that 555YVR’s condos will sell fast. The complex has five affordable-housing units and comes complete with a fitness center, media room, dog run, underground parking and a rooftop “sky lounge.”
“This is the only new project in the I-680 corridor and may be for the next two to three years — no one else can get financing,” he said.
It’s expected that young professionals and first-time home buyers will be the likely tenants, but the price has got to be right, said Steve Reiser, president of the Contra Costa Association of Realtors and a Walnut Creek agent. “They really need to be cognizant of pricing them right.”
The median sales price for a condo in Walnut Creek in April was $362,000. In April 2007 the median price was $599,900, according to statistics from the Realtors association. “They are going to have to price them right or they will end up renting them out,” Reiser said.
Renting is exactly what happened with several units at the Mercer, a 181-unit luxury condo project on North California Boulevard.
The real innovation at 555YVR may be the six live/work units on the bottom floor facing busy Ygnacio Valley Road. The units each have a separate entrance to a storefront and then the condo is in the back or up a flight of stairs. The live/work units were something city leaders pushed for, and it helped solve a problem for developers, Dorfman said.
“To have your living space down on the ground floor facing Ygnacio Valley, no one wanted that,” he said.
He envisions owners of the live/work units will be those with small businesses and relatively few customers, such as a graphic designer or consultant. Live/work units are not new; both Oakland and Emeryville have several. And there is a small live-work complex in downtown Pittsburg that was built in the late 1990s. Stockton-based developer Terry McDonald gutted and remodeled a nearly 90-year old three-story building at Fourth Street and Railroad Avenue, and five tenants moved into the building in 1998.
In Walnut Creek, a small condo project on Walker Court built what were intended to be live/work units and to this day most of those units still remain empty because the prices were so high, Reiser said.
Getting residential units downtown is vital, said Emily Chang, executive director of the Walnut Creek Downtown Business Association.
“People perceive that this is on the outskirts of downtown, but it’s actually a very short walk to the heart of downtown,” she said.
It’s an even shorter walk to the BART station. But how that convenience will translate to sales is anyone’s guess. The condo market “is kind of indicative of the entire market,” Reiser said. “We are very cautious but it seems to be looking up.”