Sierra Construction owner Roger Collins, one of the buyers, tells GlobeSt.com the $19-million development should get under way in February and be complete a year or so after that. It will rise on what was originally planned as Ovation, a 79-unit apartment building with four ground-floor commercial spaces. The sale price was not disclosed by the parties involved and had not yet been recorded. It will be paid in two installments, says Collins.
Originally, the apartment project was to be complemented by Encore, another apartment building. Together, they were to be a $19-million, 126-unit development on two parcels that sit across an alley from each other at Second Avenue and Denny Way, near Seattle Center's Pacific Science Center. Prudential Life Insurance, which last year acquired three other completed Fortune Group multifamily developments, had a pre-sale agreement to acquire all of the apartment units in this project an another on Capitol Hill upon their completion.
After running into problems, however, Smith in September sold his stake in the Capitol Hill project to his equity partner, locally based Hal Real Estate Investments. Hal is now moving forward with the $40-million, three-building development, which will include two condo buildings totaling 159 units and one apartment building with 59 units at 14th Avenue and Pine Street. The forward sale agreement to Prudential is null and void, however.
Smith was originally looking to sell both parcels at Second Avenue and Denny Way as well. It's unclear if another buyer is in the wings for the apartment building project across the alley from the property Collins now controls, or whether the other sales will allow Smith to hold onto that property himself and develop it sometime in the future. Smith was on vacation last week and was unavailable for comment. He did, however, leave a message confirming the sale to Collins and company.
Collins and the other owners of the project have some experience developing condominium buildings. The group is just finishing up the Marq, a building at Denny Way and Bellevue Avenue that includes 48 residential units and one ground-floor commercial space. A grand opening is scheduled for Jan. 17, at which time sales will begin. The group also is seeking a Master Use Permit for development of another condo building further down Bellevue.
"We are becoming noticed around town as being interested in urban condominium projects," says Collins. "That's why Steve brought the project to us."
Collins says his group of investors focus on projects wherein most of units are under $300,000. At the Marq and at Ovation, 80% of the units will meet that rule. "We're trying to deliver at a price point that the city is in need of," he says. "Our units will start at $150,000 and there will be several in the $300,000 range; at Marq, there also will be five penthouses over $400,000."
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