Naples condo conversions go for rock-bottom prices, some say
A private buyer has paid $3.2 million in cash for 72 Naples condominium units that had once been apartments, which some real estate agents believe is a bottoming out of prices in a slow market.
The 72 units in The Reserve at Naples, a 300-unit development near Pine Ridge Road and Interstate 75, went for about $44,400 per unit, said Jonathan Richards on Wednesday. Richards is a senior associate for CB Richard Ellis who represented the bank in the sale.
“It establishes a floor for condos of this type, fractured condo projects,” Richards said of the development where some units condominiums and others are apartments.
“We don’t see prices going much lower than this if at all.”
The apartments were bought and converted into condos in 2005, Richards said. All but 72 of the units sold and the converter turned the properties back over to the bank. The appraiser’s Web site shows that bank was Bank of America.
Some condominium properties in the development went for more than $350,000 each in 2007, according to the Property Appraiser Web site.
This is the only such sale this year, and a comparable sale in 2008 illustrates how much the market has declined.
Richards’ firm sold Laguna Bay on Immokalee Road in 2008 at $79,000 per unit.
Several apartments were converted to condos during the real estate craze. But about half a dozen could not complete the sellout and now contain some apartments, he said.
“There’s been some successful (conversions) in Collier County early on,” Richards said. “But the ones that got in late, after 2004, almost all of those are fractured.”
Ross McIntosh, a Naples broker whose company, REO Accelerated Disposition Associates, specializes in investor-owned sales.
He agreed that the sale signified a floor for the market, but that it wasn’t a guaranteed bottom.
“It only implies a bottom,” McIntosh said. “There’s always a risk. There has not been very much bulk-sale activity in the market for the last year and 18 months. … The guys that did get in, now their prices have declined since their purchase.”
Richards said the new owner, whom he declined to identify except to say “a local private buyer,” planned to rent the units with the possibility of selling them as condominiums down the road.
McIntosh said that was a common tack.
“We don’t know they’ll attract decent tenants,” he said. “They may struggle. But they have a vested interest in the health and welfare of the community and that’s good.”
Naples News by Tara McLaughlin
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