Regular readers may recall this post from last October: Construction Defaults Over 10%, Tacoma Condos Empty.
Tacoma News Tribune: Downtown condo sales at a crawl
How’s the market for condominiums in downtown Tacoma?
“What market?” says Judy Mayfield, head of sales for The Esplanade, the 162-unit project on the Foss Waterway, now nearing completion.
After two years of extolling the virtues of the nine-story luxury project, Mayfield and her staff have yet to close a deal on a single unit.
Translation: “We were really counting on suckering 162 flippers into buying luxury condos in Tacoma on the false hopes that they could sell them for a profit in the perma-hot housing market. Now that the market has cooled and everyone realizes that nobody wants to actually live in luxury condos in Tacoma, we’re screwed!”
Apparently they were even more screwed than we might have guessed. Here’s a story from yesterday’s Tacoma News Tribune: $80 million Esplanade project faces foreclosure
An $80 million Tacoma waterfront condominium project, caught in the financial whirlpools of the recession, faces foreclosure by late August unless the developer can find new sources of funding.
The Esplanade, a nine-story condominium on the west side of the near-downtown Thea Foss Waterway, has until Aug. 21 to escape from the imminent foreclosure, said sources close to the project who were not authorized to speak publicly.
Just 10 of the 162 housing units in the building at 1515 Dock St. have been sold, and none of the retail spaces on Dock Street or facing the waterfront walkway has been leased.
According to the Notice of Trustee sale filed with Pierce County (pdf), the developer (Thea Foss Holdings, LLC) has outstanding obligations of $48,532,793.62 on the project. If I’m reading the document correctly, it looks like their financing required them to pay in full on February 1st. Apparently they thought they would have sold enough units by then to cover their costs. Obviously after having sold just just six percent of the units in over two years, they came up a little bit short.
(John Gillie, Tacoma News Tribune, 06.24.2009)