April 16, 2008
Arterra (300 Berry) Sheds A Little More (In More Ways Than One)
The latest Arterra incentive: 4.875% 5-year fixed rate (i.e., 5/1 ARM) financing plus a $20,000 flex incentive on two-bedroom units. And a bit of the fine print: "Based on loan amount of $417,000 and $700,000 purchase price."
First Published: April 16, 2008 3:58 PM
Comments from "Plugged In" Readers
Aren't we supposed to be the city that lives outside the box? If so, why is everything new that is built so BOXy.. I do love the blue and orange together though.
Posted by: sf at April 16, 2008 4:20 PM
Do those little trolley cars have silencers on their wheels, or is this a new, upscale housing development for the deaf?
Posted by: That's Ridiculous! at April 16, 2008 4:37 PM
As a resident of Park Terrace across the street, I consider Arterra a new, upscale noise and fumes blocker.
Posted by: Anonymous at April 16, 2008 4:48 PM
I like the blue and orange too!
Posted by: Tweety at April 16, 2008 5:18 PM
The blue & orange is fab, but in our tentative Colonial Williamsburg conservative way, it is only a suggestion of what could have been -- as if the hum drum white banal structure behind the blue & orange screen gives the building legitimacy.
The height at least is not ridiculously low and let's hope the building invites some interesting design in the area.
Posted by: invented at April 16, 2008 5:25 PM
Anyone know how the sales are going here ?
Posted by: eeye at April 16, 2008 5:44 PM
Yup, lots of people buying $700k apartments will have $283k lying around for a down payment. I'm sure this incentive will fire up sales.
Posted by: anon at April 16, 2008 5:45 PM
You mean we have to pay real money for an apartment here? Uh-oh.
I think San Francisco real estate needs a new slogan Sell now or be priced in forever!
Posted by: That's Ridiculous! at April 16, 2008 6:30 PM
Yup, lots of people buying $700k apartments will have $283k lying around for a down payment. I'm sure this incentive will fire up sales.
I'm sure people will simply piggyback it.
use their loan for the $417k, then get a second loan for the the remainder (minus downpayment)
it's interesting when you put it this way though: how many people with $283k downpayments are in the market for a $700k condo?
I'm guessing very few. People with that high of downpayment are looking at $1.5-2M+ homes IMO.
it just shows how out of whack things are.
Posted by: ex SF-er at April 16, 2008 7:09 PM
Its a good thing Friscans are their own worst critics. People often point out our smugness, but honestly, I have never seen a more self deprecating population anywhere. Not in Amsterdam or New York or LA, where I have previously lived (although we are equally as smug as those places!).
Posted by: me at April 16, 2008 7:17 PM
wait.. is that the actual finished building or is that temporary construction wrapping on the left side.??
Posted by: LP at April 16, 2008 7:41 PM
This turned out looking worlds better than the early renderings. I'm amazed! Being among the first LEED certified residential buildings probably made being seriously daring with the design difficult.
The $20k incentive sounds nice, and that interest rate is nifty also. Too bad we're down to buyers with some cash.
Posted by: Mole Man at April 16, 2008 7:47 PM
"The $20k incentive sounds nice, and that interest rate is nifty also. Too bad we're down to buyers with some cash."
Buyers with cash. A whole new concept for the SF condo market. LooooooooooooL
Posted by: anon at April 16, 2008 8:07 PM
The noise factor ... not an issue if you're on Berry street side. I actually toured the building.
The height - it's actually taller than every other building down there, the penthouse will have sweet views and as there's no room for other buildings to go up that will be a lock.
Sorry it's not "The Greenwich" - talk about people with money to burn on the worst building ever. No incentives. $1000/sq ft. High HOA's. Wow, thanks, I'll buy here at take my $12 cab to the Marina when it's actually warm down there.
Posted by: the Wu at April 16, 2008 8:25 PM
"Yup, lots of people buying $700k apartments will have $283k lying around for a down payment. I'm sure this incentive will fire up sales."
I think this misses the point -- it sounds like they're offering to buy points to lower the mortgage interest rate, and limiting this incentive to loans for $417K reduces the cost of the incentive to the seller; one point is one percent of the loan amount, and so forth. You wouldn't need a downpayment of $283K, and could finance as much as your lender would allow in a piggyback loan.
Posted by: sacdomc at April 16, 2008 8:30 PM
Anyone have an experience negotiating with them? How much can a person get off list price?
Posted by: Dave Jackson at April 16, 2008 9:32 PM
Ha ha, a $213K SECOND mortgage on a $700K condo? As in, "stand in line behind the first one that's gonna reset 4 times?" That's so 6 months ago!
Not gonna happen at an interest rate anywhere near 4.8%.
Posted by: tipster at April 16, 2008 9:47 PM
$417k is the "old" conforming loan limit. Presumably buying down the interest rate to on "jumbo conforming" loans is a lot more expensive.
Posted by: Amen Corner at April 16, 2008 9:59 PM
"The noise factor ... not an issue if you're on Berry street side. I actually toured the building."
No noise but you'll get the smell of the sewer! HAHA. 10' x 20' box sewer runnning under Berry st is sure to stink up the place!!
Posted by: sharpie2828 at April 17, 2008 12:10 AM
I was down in the area a couple of weekends ago and it's a wind tunnel (on an otherwise nice day everywhere else in the city). For that reason alone I could never live down there.
Posted by: anon at April 17, 2008 7:12 AM
These buildings are a necessity, but who would live there? Probably not the rah-rah Realtors who are selling the coolness and novelty of these condos.
They live in a charming Victorian warm and cozy at 700/sf. Let the suckers eat concrete for breakfast, work and dinner at 1000/sf.
Posted by: San FronziScheme at April 17, 2008 8:15 AM
Well put, San FronziScheme!
Posted by: fre at April 17, 2008 8:53 AM
FronziScheme - I for one will be living there
I think its a great building, a great area and has lots to offer a potential residents.
Most of these units are not going for 1000/sqft (maybe the penthouses with great views are). It sounded like that is what you were suggesting and if that is the case you are mistaken. I can't wait to move in.
Posted by: JJ at April 17, 2008 9:16 AM
JJ: you just don't get it. sure it's a great building with lots to offer, LEED certified, with great transportation, and affordable (by SF standards) next to a lovely park-well maintained, too; and a nice new area. But, so what , no one on this site likes ANY building! all they do is criticize anything being built. personally I'm happy when anything gets built in this city. I can't wait to move in also [July?August?]. And even though we have $238k+ "lying around" we still bought at Arterra.
LP: my guess is the wrapping on the side (5th street) is to protect the building from the dust of the construction of Avalon 3. web cam:
Posted by: Leningrad at April 17, 2008 9:50 AM
JJ. What does it have to offer to a potential resident? A box next to a loud caltrain station and bunch of crazy people at night.
Posted by: misha at April 17, 2008 9:56 AM
Instant equity, natch.
Posted by: Foolio at April 17, 2008 10:14 AM
Well said, Leningrad. I'm going to live there too & am really excited about the developing neighborhood -- UCSF and PacBell Park will keep this area going for years to come.
Posted by: sacdomc at April 17, 2008 10:27 AM
I'd think being next to the train station is quite attractive to a sizeable segment of the buyers over there. Different strokes for different folks. Those of you who want a house and a yard in Pac Heights for 850K can be pretty obnoxious.
Posted by: fluj at April 17, 2008 10:35 AM
"it's interesting when you put it this way though: how many people with $283k downpayments are in the market for a $700k condo?
I'm guessing very few. People with that high of downpayment are looking at $1.5-2M+ homes IMO."
Not sure the numbers of other people here.... but i personally have 300K to plop down, but would not consider buying anythign over $850K. i would never consider buying a $2M home at this stage. I would invest the rest. granted i probably wouldn't put down 300K to buy the home, but would certainly put down 20%.
and i think this kind of deal is interesting and might pull someone like me into the market. except for the fact that they are still asking too much.
Posted by: Spencer at April 17, 2008 11:19 AM
I work in the area and I have to say that Arterra with it's blue and orange detailing is my visual favorite of the new condos.
Also, the proximity of public transportation (caltrain and muni) is a definite plus in my book. I'm not sure I understand the people who see this as a negative.
That said, I wouldn't be interested in buying one unless they were priced around 500k for a 2br.
Posted by: location at April 17, 2008 11:35 AM
I think the noise and odor issues in this area have already been discussed. In any event, it is a positive addition, many are attracted to the new construction feel, and the pricing is in the ballpark, so to speak. I also assume the monthly HOAs will be steady compared to older units.
Posted by: fred at April 17, 2008 11:58 AM
its a noisy area but it is in a city. so...it doesnt work for everyone.
mission bay will get better, get filled in, construction will end ,etc etc over time.
i think only question abt atretta is pricing and velocity in a really weak market.
Posted by: LP at April 17, 2008 12:18 PM
A couple things to clarify- there seems to be a lot of mis-understanding about the rate buydown: Typically only a min. 10% down payment is required. The promotion is a 3 point permanent interest rate buy down on the first loan; the 1st loan can be conforming or non-conforming, thus impacting the final interest rate with the buy down (i.e. under 5% for a conforming loan or over 5% for a non-comformin loan). The 2nd loan, if applicable, will be at prevailing rates. Lenders run several different scenarios to see what makes the most sense for the buyer and also considers how long the buyer intends to live there.
Arterra is 50% sold.
Posted by: mlasf at April 17, 2008 2:28 PM
The crowd that buys the 1.5-2M homes more than often is all cash. 3 houses on my street going for 1.5+. All retirees who cashed out their businesses.
A lot of people actually have 200-300K lying around. Mid-high income 30-something couples who save their 20-30K a years. Single professionals who got a windfall (dotcommies 2.0) or empty-nesters that wants to transfer some of their wealth to their son/daughter before retirement.
And many many other situations.
There is plenty of money around. That does not make these places right-priced.
Posted by: San FronziScheme at April 17, 2008 3:03 PM
Misha - this building offers buyers an opportunity to purchase brand new construction that has "green" features at a reasonable (for SF standards) price. It also offers a great location if you work on the Peninsula and has useable amenities.
I did extensive research across all neighborhoods and this project was by far the most compelling to me. There is no way I could buy an equivalent sized condo in Pac Heights or the Marina at this price point.
Are there trade offs....of course! But that is what buying a house/condo is all about unless you have a few million in the bank. You look at size of unit, floorplan, location, amenities, price, and decide what is important to you. Then you make a decision.
My unit does not overlook the loud train station and all neighborhoods in SF have a few crazies running around. Arterra will have a 24hr attended lobby and secure parking which can't be said about most Marina flats.
I think its a great project and look forward to living there but clearly it's not for everyone.
Posted by: JJ at April 17, 2008 3:10 PM
The crowd that buys the 1.5-2M homes more than often is all cash
no way. most of my friends/colleagues who bought in the $1.5-2M range, and none were all cash. In fact, I've only met ONE person in my life who bought in all cash. (parents of my wife's ex).
yes, even the google folk I know used financing.
there are many reasons for this, but much of it is that
-most people don't have $2M in cash lying around (yes, that includes google folk... if they cash in all their stock at once it's one helluva tax bill)
-many don't want all their money "dead" in RE.
-there are tax incentives to having a mortgage.
Now, I might believe that people buying the $4+M range are buying with cash... but not the $1.5-2M range.
Is there any stat on this?
Posted by: ex SF-er at April 17, 2008 3:18 PM
I stand corrected. Let me rephrase: The crowd that buys the 1.5-2M homes more than often has much more than 300K in cash
Base salaries at Google are not very high for the common tech worker. There is a "performance" bonus where your peers/superiors give you marks and you can get a good 3 months pay extra. Overall, their paycheck limits the mortgage amount they can pay, especially at 7% or so. The lucky ones who got in early or come from Youtube are putting a sh!tload down and doing a loan for the tax break. They could perfectly pay 100% cash but don't.
But the Google and other windfall types own most of the upper third of the market. The others are mostly over-stretching their finances to stay there.
Posted by: San FronziScheme at April 17, 2008 3:47 PM
I also bought here and am excited. Tell me where else I can get a two story townhome that's reasonably priced, with storage and parking?
The Cal Trans station is a HUGE plus to me - I am one of those Google kids that works down in Mt. View. Being able to walk out my house and hop on an express train is going to kick the crap out of my commute from the Marina I have every day currently.
As someone said, there are trade-offs...I think the neighborhood is great, the building is rad, and the price point is right on for new construction. It's everything I wanted in a first home and kills the Inifinity, Rincon Tower, and that joke the Greenwich or Soma Grand. I looked at all of them. The weather, it's about 10 degrees hotter down in this part of the 'hood than the Marina on any given day. Yes it's windy on the street, but there's a wind protect roof/sun deck.
Posted by: dan at April 18, 2008 9:09 AM
Interesting Dan, after reading this site for months I thought that google would have gone under by now and you would be out of a job. Instead, it looks like their hiring rate has increased.
Posted by: TechDefender at April 18, 2008 9:18 AM
I don't know the difference between 1.5-2M buyers and 4M buyers finances per se. I'm sure it varies greatly. What I do know is something about what really occured when "all cash" or "cash" was written in the financing column of a sold property in the MLS. There's still a mortage in place. They've just structured it in a manner that the amount of cash has rendered the mortage a foregone conclusion -- think 600K down on 1.5M or something.
Posted by: fluj at April 18, 2008 10:47 AM
I'm interested to hear what set the Arterra apart for you relative to One Rincon & the Infinity, what type of unit you purchased and what your price point was [per sq. ft]. Are these are factors related to the building itself or just based on proximity to Cal Train? Thanks.
Posted by: Recent ORH buyer at April 18, 2008 1:22 PM
The short answer:
I thought Arterra was a better value, better location. Doesn't have all the amenities, but I don't need them. Low HOA dues, great layouts/floor plans (walked through about 10 units in all 3 buildings). Solid incentives.
Purchased: 2 story, 1 BR, 1.5 BTH townhome.
Negotiations were great at Arterra - and incentives they threw in put me over the top. I wanted a townhome which are tough to come by - although would have settled for a decent size 1BR+.
I took a tour of the Arterra building and I liked the look and feel, the layouts are good w/ great spacing - solid natural light, the noise factor was negligible (seriously, people get over this) even in units on the King St. side - thick walls, double paned windows. My parents toured as well and even in units that weren't completed the noise wasn't bad - we were all surprised (on the 4th and 7th floors facing King). I guess what put me over the top was the space and layout along with the amenities/low HOA dues. I don't need a pool as an amenity (I have access elsewhere), don't need a "wine tasting" room or a "theater" in my building - thanks, but would rather go out or do that in the privacy of my own home. Anyway...
The location was a plus, I think it's a nicer, more up and coming neighborhood than the one surrounding Rincon. My girlfriend and I walked around Rincon Tower and were like, why would I ever want to live here? You're at the bottle neck of the Bay Bridge. Granted, they have every amenity under the sun - the reason being I feel is if you ever leave you'll realize there is nothing actually around you - we couldn't locate the closest grocery store (at Arterra I have a two block walk to Safeway or Whole Foods). HOA's were so high here and Infinity that it just seemed like I would be throwing money away - and HOA's are only ever going to go up. I believe Infinity are pushing $700 if I remember correctly and Rincon low $600's - could be wrong.
Anyway, overall I felt Arterra was a good value. Is it perfect? Probably not. For what I'm looking for it's great. It being a green building was a nice touch - which I never before really cared about. Being close to the ballpark was also a nice addition. I like the idea of a "new" neighborhood with parks close by. Plus I thought the layouts were great, came with parking and they threw in storage (good decent storage, not a chicken cage 3 x 3 rack). Add it all up and I was pretty convinced that it was a good place and a good decision.
I didn't really have a price point to be honest. I looked at places that were $1000/sq ft and thought it was a joke to pay that.
Posted by: dan at April 18, 2008 2:11 PM
I agree Arterra is a great building.
Wondering what's your $/Sqft and does your unit have any views?
Posted by: missionbayres at April 18, 2008 2:30 PM
854 approx - not complete/finished so don't know the "actual".
No views, street entry - which has it's up and downs. Less secure, but I like the feel of going into my home, as opposed to a hotel.
Posted by: dan at April 18, 2008 3:03 PM
I too am a future resident of Arterra, and used the same decision criteria as dan.
- incentives & negotiations
- minimal amenities to keep HOA's reasonable
- convenient location
- new construction
- parking & storage
Couldn't find anything that offered as much at a comparable price point.
Posted by: lbt at April 18, 2008 8:46 PM
Thanks for your perspective and extended answer. Sounds like you made an informed decision and found a new home that has a combination of almost everything that best suits your lifestyle. Congrats on your new purchase.
One more question - if I'm not being too nosy, what was your cost per sqaure foot?
Posted by: Recent ORH buyer at April 21, 2008 9:11 AM
Well, I just walked over to the Sales Office and wanted to get some information of the $700k 2/1. The lady at the Front gave me a list of all 2/1s and 2/2s starting at over $779k. So, I was perplexed and asked her about this promotion. She didn't have an answer. Than some guy from the back came out and said it was a promotional unit and was sold after the email was out. Interesting how fast the unit was sold within a few days.
Posted by: Al at April 28, 2008 1:40 PM
what are the current incentives?
Posted by: cachu at May 1, 2008 10:12 AM
Looks like its at 65% according to the developer.
Posted by: 1010 at May 14, 2008 5:48 PM
Arterra is offering a 20k flex incentive, plus a 2 point buy down for their 2 bedroom units.
In my opinion, its not a bad deal. The buydown can get your conforming loan under 5%, and you can just piggy back a line of credit as your second. The 20k flex can be negotiated. I'm guessing 30k is not out of the question as long as it's a combo of pre-paid HOAs, upgrades, price cut, etc...
Comparing this building to the others in Mission Bay I think it's a compelling purchase. The HOAs start in the low $400's for 2 bed units (compared to $700+ for the Beacon!). Prices range from the high $600/sqft up to 1000+/sqft for top floors. The views for the most part are great and noise is a non-issue. I toured the building 3 weeks ago and the King St side was surprisingly quiet. Most of the units are on the small side though, and many 2 beds have only 1 bath.
Living in Mission Bay, there's the allure of a new, ever changing neighborhood. 3-5 years from now, Mission Bay south will be near unrecognizable. It will be filled in with new office and condo buildings, a completed UCSF Campus, new hospital, a school, parkland, and a retail corridor along 4th street.
I've lived in Mission Bay for 3 years now and part of the reason I plan to stay is to see this brand new neighborhood evolve and improve...
Posted by: missionbayres at May 14, 2008 5:48 PM
Well, to those of you who purchased at Arterra, looks like I'm going to be your neighbor. I'll be the one blasting his music at 2am.
All joking aside, I do have a question. With the plans for having grass atop the Park building, how will they plan to mow it?
Occupancy should be ready by July for the first 5 floors with the upper floors releasing upon completion starting from floor 6 moving up.
Posted by: cachu at May 17, 2008 5:51 PM
"I'll be the one blasting his music at 2am."
Dude, you bet' not.
Posted by: 0101 at May 19, 2008 1:07 PM
Why is Mission Bay so boxy? I was pondering this exact question when I visited Vancouver to compare the difference in development. There is so much more detail in Vancouver's architecture and so much more site amenities. One theory (of many)goes by the fact that the City of Vancouver has sensible planning and does not extract an arm and leg from developers, leaving them some funds left to make the upgrades to architecture and landscape. It is no new news the city of SF extracts a ridiculous amount from developers through the arduous entitlement process, (example of many: 20% affordable housing requirement, long review process, offsite public works improvements), fees, expensive permits, additional consultant fees (EIRs, countless public meetings, cost to pay poor architect and landscaper designer to redraw over and over and over again to meet planning dept's and public's satisfaction) The money set aside for better architecture and landscape is drained to pay for these consultants and MANY more in order to get the building approved and pay for extended mortage cost on land.
Buildings in Mission Bay are boxy because the designer is maxing out Mission Bay's planning guidelines for the purpose to capture as much floor space so developers can sell or rent as much as they can to recover cost and to stop profit bleed. If you compare Arterra, Beacon, Radiance, Avalon Bay, 235, 255 Berry, their massings are very close to the max. bulk and height requirements of Mission Bay's planning guidelines.
Contrary to public opinion, most developers I deal with(private and public) START and WANT better architecture and landscaping. It's a no brainer, good design promotes, sell and rents the building faster. At the same time developers like to build "trophies" or "babies" they are proud of, especially if it's a 5 year process.
There is a popular notion developer have this deep endless pocket of money ... but fact of the matter, all new development are financed through loans, which are very difficult to get. When push come to shove, if developers cannot get financing to fund the 'niceties', there's not much they can do but to cut cost, which we in the industry call "value engineering". Architects hate it, developers hate it, contractors hate it. Why? Because it's time consuming, confusing to coordinate, inefficient, the paperwork is horrendous and lastly it can result in a crummy building.
Posted by: hhatmm at June 4, 2008 8:51 PM