Downtown Slowdown

On the front page of today’s Seattle Times, along with a handy map (pdf). It’s an excellent summary, even though a lot of it is old news (many of these stalled projects were noted in previous posts here and here).

The Seattle Times has set up an google map displaying project info supplied by readers, and so far very little has been contributed. But instead of going to the Seatimes, I’d like to encourage hugeassreaders to use this blog as your anonymous confessional to share what you know. Projects on hold? Layoffs? How has the downturn affected your world? What’s your prognosis?

11 Responses to “Downtown Slowdown”

  1. Wooty

    Less know-it-all developers putting up shitty projects. Less over-priced condos. It’s a win for everyone!

  2. JoshMahar

    Hey Hugeassers,
    Quick question. I noticed on the DPD mailer a whole host of subdivisions going on in the outer Seattle neighborhoods. Does this mean that one SFH parcel is simply being split to sell as multiple SFH’s or does it mean that a developer wants to do a townhouse project?
    Also, as the market for large downtown projects continues to slow, do you think we will see an increase in smaller apartment and townhome construction or is this just a general stall in increased density? If so, anything you think can be done to encourage density while construction is on hold?

  3. Matt the Engineer

    Re: Josh’s questions
    1. I’d guess townhouses, though I have no idea.

    2. Take a look at the top chart here. There’s a good 800 more houses on the market compared to last year, but only about 100 more condos. All of this despite the huge buildup of new condos and the economy falling. I’d say the Seattle condo market is a bit down, but quite healthy compared to just about any real estate in our country.

    In general, it seems to me that a down economy drives people toward cheaper lifestyles. This doesn’t necessarily mean toward the suburbs (especially with the fear that gas prices could shoot back up). It makes the most sense to just downgrade your home when you hit hard times – sell a house and buy a condo is one option. The next step is an apartment.

    3. Density just happens during economic slowdowns. People move in with family when they lose a job or can’t afford a mortgage. How we can encourage this and make it continue after the slowdown is to allow for mother-in-law structures, etc. Actually, I’m a big fan of San Francisco’s row houses because they’re easy to turn from a single family house into three flats. Maybe we can modify our codes to allow something similar.

  4. flotown

    Almost every spec project currently in planning without a pre-lease is on hold. However, several larger developers are beginning equity funds to do all-cash, or nearly all cash deals – 50/50 equity perhaps. Yields on income properties will skyrocket as the blended cost of capital moves much higher. Construction costs will come down – commodities have dropped and subs are seeing schedules open up significantly.

    How’s that for a stab.

  5. rbj

    Well. I work at a high-end grocery store in West Seattle mostly frequented by people with large disposable incomes. Our sales have dipped ever so slightly due to what I’ve noticed is a tendency of people to purchase less of the $20 bottles of olive oil and more of the economic and cheaper sizes.

    Other than that, my company still has plans to open another store on the eastside sometime next year. Some of my co-workers are losing their 40 hours though and the rest of us are getting nervous.

  6. joshuadf

    We got messages from both the UW President and CEO of UW Medicine saying basically times are going to be tight but no big cuts expected. There have been losses to endowment investments. (Duh?)

    UW Medicine is apparently going ahead with expansion of UW Medical Center and UW SLU Phase III which is a little surprising to me. A new $200m Seattle Cancer Care Alliance facility is on hold, waiting on bonds.

    UW is fairly insulated from market conditions, in fact there is usually growing enrollment during economic downturns. The big question will be what the next Congress will do with Federal research funding, which is the real bread and butter.

  7. Matt the Engineer

    Hey, it could certainly be worse. Look at today’s news: Seattle is the #1 real estate market in the US.

  8. Grant

    Not quite construction, but on similar lines, we’ve been talking to lots of local auto industry people and it’s looking grim. Even rubber car mats are selling bad in Seattle; that’s a serious wake-up call.

    A few dealerships have even closed and the mid-high end guys are taking a pounding as we speak. Everyone that hates Hummers (include us in that one) will likely get the last laugh out of this as well.

  9. Matt the Engineer

    This might explain that. 61% of petroleum geologists agree that peak oil will happen within the next decade. I wouldn’t invest in a new car right now that uses a drop more gas than a Prius, and even then only if my current car breaks down for good.

  10. dan cortland

    Perhaps the UW could take over Merck/Rosetta’s SLU building, now that Merck has euthanized Rosetta Inpharmatics (300-odd lost jobs).

  11. Haddox

    Ha!

    You would think that they world have OK’d it at the beginning instead of allowing it to go so long without saying a thing and then bringing it back up when it was too late. I don’t understand it at all. Zenerex

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