Two months after unveiling a new name, new floor plans and a new sales center for their development, the team in charge of building condominiums on the former Market Square Arena site is reporting more success than the first time around.
Reservations have been taken for two-thirds of the units that need to be sold before the developer can fund One Market Square, real estate agent Kurt Flock told the Metropolitan Development Commission Dec. 7. Market Square Partners is considering four lenders, all of which have similar presale requirements.
In real numbers, 50 to 60 of the first 31-story tower’s 208 residences have been reserved, said Richard Shields, who is overseeing the project for Chicago-based Mesa Development LLC.
Shields also told the MDC of plans to begin taking reservations in late January or early February for two midrise buildings on the west side of the Market Square site. Soon, the group will also start more aggressively marketing units on the top four floors of the tower, the drawings for which are just now being finalized.
Developers hope to begin construction on the midrise buildings at the same time as the tower, with the 60 units in the three-story buildings being completed in the first quarter of 2007, a year earlier than the first high-rise units. Earlier plans called for midrise buildings to be constructed after the tower.
The total cost for both phases of One Market Square, which includes twin, 31-story condo towers, could reach $288 million, Shields said. When Market Square Partners was first selected in February 2003 to redevelop the site, the esti- mate for a similar design was $140 million.
Earlier designs for the project were scrapped when months of marketing produced only 41 sales. Market Square Partners then cut ties with Chicago-based Consoer Townsend Envirodyne Engineers Inc. and hired Mesa to head up a redesign.
Changes from the initial plan include more floor plans, a pricing structure that reflects the different views from the east and west sides of the tower, underground parking for the midrise buildings, and a glass-enclosed swimming pool on a fifthfloor terrace.
Loft-style condos in the midrise buildings will range from 750 square feet to about 1,000 square feet, Shields said. Located throughout the buildings will be 27 units earmarked as affordable housing, which will sell for about $135,000 to $160,000. They will be identical to the market-rate units in the midrise, but may have less expensive appointments, such as appliances or floor coverings, he said.
Next month, Flock Real Estate Group, which is marketing the condos at One Market Square, will begin converting reservations, which require a $5,000 refundable deposit, into contracts with a non-refundable down payment. Contracts with buyers will be ready to sign when the project’s construction drawings and designs have been approved by the city’s Department of Metropolitan Development, which is reviewing them now.
The project’s lenders require about 40 percent of the dollar amount of all units to be sold before financing can be secured, Shields told the MDC. Those requirements will be met when 78 to 84 of the units have been sold, depending on how expensive those units are.
Based on Mesa’s experience at its other high-rise condo projects in Chicago and elsewhere, about 80 percent of those who make reservations end up signing contracts. However, other buyers typically sign on when floor plans, designs and finishes have been finalized, he said.
“It appears the momentum is very good,” said Terry Sweeney, director of real estate for Indianapolis Downtown Inc. “The real proof will come when they convert those reservations to contracts.”
In general, condos at the higher end of the price range at One Market Square have been reserved more quickly than those at the lower end, Shields said. That’s not surprising considering purchasers are those who can afford to make a down payment about two years before their condos will be ready to move into.
Flock said his firm is gearing up for a “mini-relaunch” of One Market Square’s marketing efforts after the Super Bowl, as weekend attendance at the sales center has dropped since the start of the football and holiday seasons.
By that time, developers expect wouldbe buyers will begin seeing activity on the Market Square site, which has been used as a parking lot since the arena was demolished in 2001. Market Square Partners plans to file plans paving the way for site work to begin sometime in January, Shields said.
Based on Market Square Partners’ report to the MDC, work may be closer to beginning than at any time in the nearly three years since the developers were picked from six bidders vying for the site. Although the main partners of the development team-Columbus, Ohio-based Smoot Construction and locally based Shrewsberry & Associates-haven’t changed, Massachusetts-based developer Diamond & Co. and CTE both have left the project.
CTE in April filed a $3.2 million mechanic’s lien against the project, seeking money the company said it was owed for services performed on the site. That lien was released by CTE in October. Market Square Partners wouldn’t disclose how much was paid to settle the lien.