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December 24, 2008

One Rincon Hill: From The $500's $700's $500's

One Rincon Hill: From the $500's

In the words of a plugged-in reader:

Has anyone noticed on One Rincon Hill's website, prices are stated as being from the "$500's" as opposed to the "$700's" a couple weeks ago? Not really a tip, but perhaps the developer is getting a bit more aggressive...

No word on when - or rather if - they'll be changing that "from the $700's" sign by One Rincon Hill drive. And do keep in mind that when the sales office first opened over two years ago there were at least a few units priced from the (high) $500's as well.

First Impressions: One Rincon Hill Sales Center [SocketSite]

First Published: December 24, 2008 8:15 AM

Comments from "Plugged In" Readers

I was noticing last night that the only lights on at ORH (on the backside) were in the upper floors. Everything else on that side was dark. That usually means no one is living there. Scary.

Posted by: Mystery Realtor at December 24, 2008 8:47 AM

I feel like there were always units at ORH from the "High 500's" but the website has always said "From the 700's" maybe they are releasing some less expensive, less desirable units this month. They have been doing so well, maybe they were "holding back" some special units!

Posted by: Ryan at December 24, 2008 9:46 AM

There were units in the $500s, on opening night. Not since then.

According to a trusted source, here is where ORH is today (approximately):

230 out of 370 closed escrow, or 62%.

60 are in default (meaning still in contract and past closing date and unlikely to close).

80 units unsold and available.

So... a total of 140 are available (38% of the building) for purchase in some form.

And as far as price reductions go... several TWO bedrooms have gone into contract in the $800,000s recently.

About 50% of the occupied units have renters in them at this time, and another 20 or so are currently available for rent. See the Property Manager on-site for rental opportunities, she is advertising quite a few of them herself.

Merry Christmas Everyone!

Posted by: MBPioneer at December 24, 2008 11:04 AM

So every light has to be on in the building for you to think it is not empty? Do you leave every single light on in every single room in your house 24/7? Personally, I rarely leave any lights on. Maybe a reading lamp, the kitchen light if I need it, or the bathroom light. I have a feeling there are ORH residents who act the same way.

Posted by: sf at December 24, 2008 11:16 AM

38% empty. Darn, I was off by 12% in my prediction 15 months ago (at 8:48 pm), but the rest of it was pretty accurate:

http://www.socketsite.com/archives/2007/09/what_happens_when_its_time_to_fund_well_have_to_wait_an.html

Posted by: tipster at December 24, 2008 11:27 AM

Yep, tipster, you were pretty accurate. That extra 12% that closed was likely do to the extreme pressure that was put on buyers to close as a result of the steadfast refusal to return any of the 3% deposits. The sales staff managed the process very tightly and did a good job threatening, cajoling, sweet talking and generally persuading buyers to complete the purchase. Since most deals had brokers, they too, joined the effort to close. Add in the on-site lenders, who at last check, were still doing some crazy loans with 10% downs (not zero like before)and rolling in two years dues, closing costs, etc. due to inflated appraisals from last spring.

Posted by: MBPioneer at December 24, 2008 11:39 AM

Is it reasonable for the Property Manager (concierge) to be renting units and charging a fee? Seems like a conflict of interest. I thought a concierge was a referrer not a for profit enterprise and doesn't she work for the HOA? Also, doesn't it cause some level of liability to the HOA? What if I rent a unit and something happens on the lease, do I sue the HOA since the concierge represents the HOA?

Posted by: legit? at December 24, 2008 11:44 AM

yea that's right. when a house has no lights on at night, that, of course means NO ONE LIVES THERE...usually.

yea, right. guess that means I dont live in my house when the lights are out.

Posted by: noearch at December 24, 2008 11:51 AM

You also don't live there if you travel during the holidays.

Also still, which side is the back side?

Posted by: EH at December 24, 2008 2:22 PM

tipster - You also were assuming that they'd go ahead with the 2nd tower in the post you are referencing. If they had done so, the 2nd tower would presumably have channeled prospective buyers away from the 1st (alternatively, people considering buying in the 2nd tower now have no choice but to buy in the 1st, if they still want to get into ORH in the foreseeable future). So the 2nd tower cancellation (or rescheduling, or whatever they're calling it) should cause 1st tower occupancy rates to come in above-forecast.

Regarding lights, I think Mystery Realtor's point is that there are a lot more lights on the top floors than on the lower floors. That implies either that lower floor people travel a lot more than top floor people (seems somewhat unlikely) or that the lower floors have very low occupancy rates right now relative to the top floors (seems more likely).

Posted by: gmh at December 24, 2008 5:29 PM

tipster,

that old thread was hilarious. Especially the back and forth between anon and anon.

"I have shorted homebuilders since 2006. And yes, I am rich"

Posted by: spencer at December 24, 2008 5:30 PM

As to deposits being "nonrefundable," I have a friend who got out of a ORH contract and got back a chunk of the deposit, although not all of it.

Posted by: sunnvyvalesteve at December 24, 2008 9:39 PM

I can't believe how many responses here were devoted to "refuting" Mystery Realtor's suggestion that fewer lights meant fewer occupancy! Sensitive. C'mon folks - what s/he really meant was that people who live on higher floors have more money, and therefore more money to waste on electricity, and we should be scared of all the poorer folks walking around in the dark in the lower floors!

Or, possibly, if a building has lots of lights in one area at a given time of night, and few lights in another area at that exact same time, there is some correlation with occupancy?

Nah, I like the other one better.

Posted by: Lights Out at December 24, 2008 10:02 PM

So, if MBPioneer's numbers are right (and they certainly seem plausible), actual owner-occupied units at ORH constitute about 28% of the total number of units in the building!

Values at this building should really implode next year. The depression is just getting started - it's barely hit the real economy and the Bay Area - and rents have just started to decline it seems. 50% off the original sales office pricing (on average) seems a pretty safe bet. HOas will have to be adjusted up, and services/amenities will go down. How could it be otherwise when a developer so clearly botches its forecast, as here?

The phantom second tower and the uncertainty that will hang over the project should increase the distress, and make this a worse bet than towers like Infinity that have at least finished build-out (even though in the short run perhaps the additional inventory from the second Infinity tower might create some near term pressure that ORH doesn't have among potential buyers who don't understand that uncertainty should command a larger risk premium than a known negative like an empty second tower).

Posted by: LMRiM at December 26, 2008 9:43 AM

I agree the Infinity was wiser to finish the second tower so that residents can feel comfortable that they are at least living somewhere that is complete, and not half assed like ORH. The 2nd tower was supposed to house all of the amenities like the gym, and I believe the swimming pool. Are residents there paying less HOA for these drawbacks?

Posted by: sf at December 27, 2008 2:55 PM

Is there a real estate blog for "regular renters?" Not all of us overextend ourselves (or make $200,000 year) and not worthy of paying $15,000 a month for an overrated home. Any news source for single renters looking to pay around $1,000 out there? Would it kill Socketsite to promote the rebar of the rental market- the regular working people?

Posted by: sf at December 27, 2008 8:13 PM

"Any news source for single renters looking to pay around $1,000 out there?"

Craigslist

Posted by: diemos at December 28, 2008 6:56 PM

Is 1RH going to redo their website without the 2nd tower computer generated into it?

Posted by: J at December 29, 2008 9:00 AM

"Any news source for single renters looking to pay around $1,000 out there?"

Try the Manteca Times. Also, Stockton/Tracy Gazeteer.

Posted by: Foolio at December 29, 2008 10:24 AM

Excuse me, excuse me, (jumping up and down, raising my hand, call on me), I am one of those who do not make $200k and would love to find a rental for $1k, but hey, I know this is SF we're talking about and there is NO SUCH thing. So, get over it. Enjoy the great info and news and pics offered here. I sure do, and would like to say "thank you" for some interesting moments in my otherwise tedious day.

Posted by: dkzody at December 29, 2008 12:57 PM

Here's another problem w/ORH that I noticed on my way home to the east bay today- ORH is blinding when the sun is setting- the reflection off the glass is going to cause some accidents (and wasn't that fairly predictable - thank you SF planning.)

Posted by: SF2OAK at December 29, 2008 6:04 PM

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