Some poor soul bought a two-bedroom, two-bath unit at the Juhl tower Downtown in 2009 for $465,804. The same unit sold earlier this year for $104,500. And yet, things are looking up at Juhl, a building perhaps more emblematic than any other of Downtown’s speculative frenzy, crash and renewal. Let’s review the colorful history, which illustrates how crazy things were.
In 2005, CityMark Development, which helped redevelop the vibrant Gaslamp Quarter in San Diego, won a sweetheart deal with the city of Las Vegas, paying $5.2 million for the site at Bonneville and Fourth but putting up $2 million in cash, with the city financing the rest. Must have seemed like a good idea at the time. After all, what does San Diego have that we don’t, other than the world’s most perfect weather and the Pacific Ocean?
City spokesman Jace Radke says the city recouped $2 million of the $3.2 million financing deal but notes that what once had been a surface parking lot now is needed Downtown housing and the resulting property taxes. Still, given the speculative frenzy of the time, I wonder whether CityMark really needed city money to be induced to build.
As the Associated Press reported in October 2006, Corus Bank of Chicago was the big lender on the project, and 90 percent of its loan portfolio was in condos, including $770 million in various Las Vegas towers. A year later, the once-faint warning bells were clanging, but the developer was sanguine, at least according to the Chicago Tribune, which reported the building was 70 percent sold with prices ranging from the high $300,000s to $1.5 million for the penthouse. Let’s assume when he said “sold,” he meant something other than what you and I take it to mean.
Finally, after construction delays, Juhl opened in June 2009. Not ideal.
Naturally, foreclosure arrived. “The building was in great condition, but many interiors were unfinished,” says Brian Bauchman, manager of the property. So, much of it sat fallow while other condo towers quickly filled during Downtown’s recent resurgence. When the bank failed, the Federal Deposit Insurance Corporation took control. The FDIC created a partnership with ST Residential, which took over management in April of this year and started leasing Juhl in September.
The building has 341 units; of those, 35 were purchased when it was to be all condos, and ST Residential has leased 36 units since it opened. Studios go for $1,000 a month, and the penthouse units can be yours for as little as $3,400. It works out to about $1.30 per square foot (a bit more for higher floors), which for urban living is pretty astounding.
I took a tour, and it was another reminder of the uncomfortable truth about the real estate crash: that for all its misery, it has led to outstanding value for the survivors. The cool thing about Juhl is that it’s actually six interconnected buildings stacked together like boxes, which means there are a ton of floor plans. There are two-story townhomes, some of which offer your own front door, while others face the sixth-floor pool. The penthouse units have floor-to-ceiling windows. Most of the units offer open, loft-style floor plans — granite, hardwood, big closets, concierge, security, gym, yada yada yada.
But the building has drawbacks, namely the lack of retail, both at Juhl itself and in the surrounding neighborhood. The property has 13 two-story live-work units — live on the second floor, sell your wares on the ground level — and Bauchman says they have letters of intent for about half, including a yogurt shop, an art gallery and a vintage clothing store. (What else does a person need?) There also are three straight commercial units ranging in size from 1,498 to 3,058 square feet. They hope for a bar/restaurant.
I called John Tippins, senior vice president for ST Residential, about the uncertain retail situation but never heard back. Tippins is known for his work at the Ogden, which presumably is the model here.
In an article published on New Year’s Day 2008, a well-known developer was quoted saying, “Downtown is the future.” Correct like a stopped clock, but correct nonetheless.
Rebecca Clifford-Cruz contributed to this story.