urbanSTL

JCity wrote:everytime i drive by on highway 40, or wherever else i am in the city, i look at this building and get a boner. St. Louis needs MORE of this. It looks so chicago or should i say, st louis. When is Opus starting their second tower?

Boner does not cut it. Massive wood is more appropriate when describing this project. Hopefully the efforts of some anti-density residents does not delay future possible projects.

Great shots.



Would love to see some of your other shots from the building.

Urbanite85 wrote:


Just to play devil's advocate and in defense of it, maybe there is something to be said about the argument for the enforcement of the limit on a building's height here in the Central West End.

The Park East Tower brought something new to the neighborhood, and at least at the time it was proposed, it was the only option for people looking to purchase a condo unit in an ultra luxurious modern tower. The Chase was still a rental building and the other towers in the neighborhood paled in comparison to what was being proposed. The fact that many of the residents of the new tower come from the county shows that people were waiting for something like this, or said another way, they would not have moved to the city but for this tower. Whether another tower is necessary, especially after the recent Chase conversion plan, is an open question that will probably be determined by the resales of the park east tower units and the current sales of the Chase units. On a personal note, I would not have purchased anything in the CWE had this tower not been constructed, although I may have purchased something at the Chase later. I realize one could make the argument that if you want to live in a big high rise you should move to DT or Chicago but I don't agree with that kind of logic. If the CWE wants to grow (and I assume it does), it should position itself to attract as many people as possible, including those who for whatever reason want to live in this kind of building. Considering the disposable incomes that will come with the current residents of the PET and the future residents of the Chase, I think the net result will be very positive for the CWE.

Urbanite85 wrote:
The Park East Tower has been successful with its sales, but I must point out that a good number of those sales proved to be by investors, some of who don't even reside in this state, whose only intention was to resell the bought unit.

Flippers help get these projects off the ground. Consider them freelance partners willing to take on some of the risk. As many developers won't even break ground until X% of units are sold, flippers are kind of an integral part of the process. Ironically, many flippers are usually related to the project in some way. A cousin of mine who sells units in buildings like these in Miami often has her family and friends buy several units once she's convinced the project is going to be a success. I can see how some people might be put off by this, but I'd rather see these projects get off the ground than never happen at all. And if you want one of the units at the pre-construction price, you have to be willing to commit early. It doesn't seem right to me to complain later once the unit is done that the price for the unit has gone up. Flippers had to invest X amount for 1.5 years and wait to close before realizing any gain, assuming there even is one. Finally, by preventing flippers from putting their units on the market until they close, the incentive to invest for flipping purposes is largely curtailed. The recent slew of properties put on the market is not that surprising and the number seems relatively small considering the fact that this project has been in construction for a year and a half. In addition to the flippers we may have other sellers whose circumstances have changed since they first purchased their units. Like all of you, I am watching this with bated breath to see how these sales turn out.

Urbanite85 wrote:
I think we need more amenities than residential properties at this point. Focusing primarily on the types of restaurants and shops, perhaps something like The Boulevard in Brentwood that offers even more shops and restaurants to the Central West End that will bring in more than just residents.

I couldn't agree more. One of the things I love about the CWE is that you do not need to drive to go about your day. With a grocery store, a movie theatre, restaurants etc. all within walking distance I consider it an ideal neighborhood. More amenities would only increase the popularity of the area and encourage more people to move into the neighborhood. I just think that by giving possible residents various options with regards to housing, you only increase the pool of potential residents. I mean, a lot of these people could have moved in years ago if all they cared about was the neighborhood. Obviously, the type of housing was a determining factor for many of our new neighbors, who otherwise might have stayed put or moved elsewhere like DT.



Happy 2007 everyone.

Urbanite, I think I see your point better now. I certainly agree that an empty tower brings little to a neighborhood. And building towers where there is no demand will not in itself create it. But I think there was demand and this tower met that demand. I think this particular tower added something to the neighborhood that was sorely missing. Do we need 4-5 more towers? The market will ultimately decide that question. If the Chase sells poorly I doubt Opus will go ahead with their plans for another tower. And while I understand flippers complicate the picture with regards to estimating true demand, those flippers are the ones taking the risk that there will indeed be enough demand to sell their units.



Finally, with regards to the wind issues and the light issues, I would be lying if I tried to downplay the negative affects of putting up these towers. If a new tower went up and blocked my view I would be mad as hell. But I suppose that's why I bought as high as I did. Coming from NYC I am used to the dreadful lack of sunlight and it's a shame that anybody has to suffer in exchange for the great views the PET residents will have. But I suppose that's just something people have to deal with in a market economy.



In the end, I'd like to think (perhaps just for selfish reasons) that the PET brings something postive to the CWE and in turn to St. Louis as well.

an increase in supply may actually cause a decrease in demand

Do I even have to comment on this? The falsity of this statement is one of the first things you learn in an econ class. Now, an empty, poorly kept building, a failed project, or a change in the urban fabric (adding a high rise in a lowrise neighborhood) may decrease demand, but simply increasing the supply does not affect demand.

Jeff707 wrote:

an increase in supply may actually cause a decrease in demand

Do I even have to comment on this? The falsity of this statement is one of the first things you learn in an econ class. Now, an empty, poorly kept building, a failed project, or a change in the urban fabric (adding a high rise in a lowrise neighborhood) may decrease demand, but simply increasing the supply does not affect demand.

Not so fast. I can think of a few examples where increasing supply would in fact decrease demand. I'll give you a hint, hard to find luxury goods. In fact any product that owes any of its allure to its limited supply will suffer if the supply of that product increases exponentially. Why can't we apply this logic to real estate? While it might not be the driving force or even a force at all, theoretically one could argue that certain buyers relish the idea of having units in the only modern highrise in the CWE. Perhaps if three towers had gone up simultaneously, the appeal of any one of the three buildings would have decreased because that exclusivity factor would not have existed to the same degree. I realize it's a tougher argument to make for condo units versus limited edition sports cars but I'm sure somewhere such an argument could be made. I mean, remember the Seinfeld where they were told there were no villas in Tuscany to rent. Suddenly, Tuscany seemed more appealing. Just as the the lack of supply makes something more attractive, perhaps too much supply sends the opposite signals. Imagine also a restaurant that is almost empty at 8pm on a Saturday night, what thoughts cross your mind--the food must be awful. Maybe too much supply would actually make people worry about the neighborhood and thereby decrease demand.

Supply affects price, not demand. But I understand what you are saying, there are some people that only buy (demand) expensive things. When supply increases, price drops and those people no longer demand the good. But, remember, others will step in.



In those cases, it's not merely the supply, but the prestige that comes into play, as well as anticipated resale value. If they added one more floor to the PET, the demand (or price) would not have decreased. Add a whole tower, then demand for condos at the same price may go down because of fear of low resale values. Remember, demand is different than price. So, to the extent that the all, a majority or some "market-moving-number" of purchasers were pure speculators, then I would agree with you. If all purchasers were going to move in and live there for a long amount of time, I don't think demand (price, actually) would be affected at all by supply. Also, I don't think that these condos are of such high value that another tower will decrease demand out of prestige alone - hell, there are already 80 people in the building that can make the same claim as you (living in a luxury high-rise). I don't think there are people in St. Louis saying, "if 50 more people in the CWE live in half million dollar condos, I don't want to live in one anymore because it's just too pedestrian and common and living in one won't maintain my image of wealth and taste."



If it was demand for the biggest house in the CWE, then, yes, it would make a difference - there can only be one biggest house, but even then only the price would change. Uh... yeah... I forgot where I was going with that....

Before price changes, you have to have a shift in supply or demand. So my argument would be this and let me use a fancy car as an example and let's say they only make 50 cars every year. That high exclusivity makes the demand very high and say the price $1,000,000 per a car because everybody wants to car that nobody else will have. So in year 1 all 50 cars are sold for $1,000,000 each. Then in Year 2 the company gets greedy and says we are going to produce 1,000,000 cars for $1,000,000 each. Now that the car isn't as exclusive, high rollers don't want them as much and squak at the though of paying $1,000,000 for a car they now deem worth maybe $100,000. So nobody buys at $1,000,000. This is a lack of demand. The lack of demand is noticed by the head office and the price is reduced to increase demand. The price drops down to $100,000 and now the cars start selling again.



So the increased production first reduces the demand, and then the lower prices increase the demand.



I won't try to make this argument with Park East Tower units, but to some degree I'm sure it's there.

The demand for that car didn't change, just the price. The demand for $1,000,000 cars of that brand did change, though.



I probably shouldn't argue numbers with someone call tax guru, though. They don't teach many numbers intensive classes in law school (although I only got interested in economics due to law school teachers). And I avoided finance, tax and accounting classes in the Business school.

Yea, here we disagree. Try thinking of the car @ $1,000,000 as different from the car @ $100,000. They are in turn two different products. One had no demand, the other a lot of demand. While it's true the car didn't change, it was the price that CHANGED the level of interest. For example, would you be interested in buying my apartment for $5,000,000-um, no. But what about if I offered it to you for $1. The demand for my apartment at $1 would be pretty high. In other words, the price of the good will affect the demand. In general, lowering the price increases demand (think of sales at department stores) even though the good itself doesn't change.



Now by demand I mean real demand, as in, I'm actually willing to go out and buy it at its current price. Not just yea I'd like to have that if I win the lottery. I mean, if that's what we use as demand then there's unlimited demand for every luxury product.

Fair enough.



I am glad we didn't take that any further because I had exhausted my memory of econ....

Sorry, I was in a bad mood, and the negative tone of a lot of your post was really off putting to me for some reason. It came a cross as a 21-year-old know-it-all post so I responded likewise. I realize my assumption of your age was based totally on your board handle and could easily be wrong.



It was unnecessary, but my point still stands - demand and price are different.

I'm not gonna lie - the thought of an undergrad student cozied up on a couch in the window of his half million dollar condo, looking out over the city, sipping on a hot chocolate, pontificating on the faults of the neighborhood to people that had lived there a long time also affected the tone of my response.



I'll reduce the ageism in my future posts.

Is our condo warrantable yet? Anybody know how many peeps have moved in etc. And do you think you could make the pool from your balcony, urbanite?