What If You Lower the Price and Still No One Buys? The Mondial at 910 W. Huron
We last chattered about the new construction high rise The Mondial at 910 W. Huron in River West in June 2010 when the developer cut prices on units by 10% to 30%.
See our June 2010 chatter and pictures here.
Several of you had gone to check out these units after the price cuts.
They started construction on this 141-unit high rise in 2007.
It had 47 units under contract by 2009. But then the recession hit hard and the developer then ripped up those contracts to convert the building into apartments.
By this summer, that plan was squashed and the developer went back to condos. The prices were then cut 10% to 30%.
8 out of the original 47 contracts ended up buying anyway.
Since the price cuts, according to Crain’s, another 17 units have sold for a total of 25 units.
The stats of the building are the following (out of 141 units):
- Sold 8 units out of the original contracts
- Sold 17 units since the June price cuts (or about 3 a month)
- Need 30 sold units in order for the building to qualify for Fannie and Freddie financing
According to Crain’s, the developer is considering more price cuts.
Mr. Berger is considering another round of price cuts to spark interest in the 15-story building, which is west of the East Bank Club and features views of downtown.
“The market is just brutal,” he says.
The pace of sales must increase quickly if Mr. Berger is going to pay off a big construction loan that comes due in 18 months.
The next cuts probably would target the Mondial’s least-expensive condos and would not be as big as the reductions in June, says Michael Golden, co-founder of Chicago-based @properties, which was brought in this year to market the project.
“We’re willing to be aggressive to get deals done right now,” Mr. Golden says.
Messrs. Berger and Golden decline to disclose the new prices being considered. In June, Mr. Berger cut one-bedroom units to $189,000 and three-bedroom units to $460,000.
After those cuts, the project averaged three sales per month. But the development must more than double that pace, to roughly six sales a month, to sell out before a $38-million construction loan matures in June 2012.
Here were the original price reductions:
- Lofts: Were at $249,000 and are now starting at $189,900
- 1 bedroom/1 bath: Were $329,900 and now starting at $219,900
- 2 bedrooms/2 baths: Were at $429,000 and now starting at $329,900
- There are also one bedroom plus den and 3-bedrooms available but no word on prices (and reductions) on those although the article states the 3-bedrooms are now priced at $460,000
Parking is available for $9,000 extra.
(The pictures below are of the model 1-bedroom and 2-bedroom units.)
See Mondial’s web site for more information [The Mondial in River West]
How low will prices have to go to sell these units?
River West condo project mulls more price cuts [Crain’s Chicago Business, Andrew Schroedter, December 2, 2010]
Lucky for those original 47 whose contracts were dissolved by the developer. They really dogged a bullet!
Maybe if the developer threw in a membership at the prestigious (or is it pretentious) East Bank Club…
I always have been interested in this place. If I knew my situation in life wasn’t going to change, I’d try Clio’s idea and buy there knowing I would have to wait for 10 years before moving.
Location, location, location. It’s just not happening there. At the right price of course…
I like River West. Recently been looking at some listings for townhouses in the area — looks like prices were insane in 2007. The area appears to be down about 20% from those levels, but looks like it should be down at least 5-10% more. Also, has ANYTHING closed in River West in the last 6 months?
I too like river west. Close to the el, downtown, up halsted is lp. It still retains a gritty character though.
Keep cutting prices until they all sell. You will be shocked when the final condo sells for such a low price.
What I would do as the developer is set up shell buyers to buy up the condos until they get Fannie/Freddie financing. Then unload the remaining units. Then sell the units from the shell buyers one at a time.
Oh wait its not 2006 people actually might care about mortgage fraud these days lol.
What do you think these need to be priced at to sell?
Right now they’re
189,900
219,900
329,900
and that doesn’t seem to be doing it.
169?
200?
290?
Agree with Gary. This place was cursed from the beginning due to location.
The location isn’t that bad. There are two blue line stops within about three blocks. If they cut prices 10 percent on the two bedrooms it might just be cheaper to buy then to rent at that point especially if they include parking. Wait I’m talking myself into this place, someone stop me.
Penthouse units are the wtg, especially if you can get a 3/3 for ~400k.
“up halsted is lp”
Except Halsted is closed at the river for a year.
How much of a discount should a 2/2 here be compared to silver tower in river north. 30k?
“Except Halsted is closed at the river for a year.”
Its the government, better pencil in 2.
30-50k discount probably, this location is nowhere near as nice as the silver tower (which by the way is really filling up)
I think they are going to have a really hard time selling the loft units and the 2BR/1BA units…people also like to at least have a walk-in closet in the master in a 2BR/2BA, those without it will take a hit in pricing. My prediction is that 700 SF 1BR’s are going to have a problem selling for even $225/SF.
Is there grass to walk my dog?
Still would love that penthouse with the awesome rooftop deck. That would be nice! I laugh about the location issues how did The Montgomery do so well just being three blocks east?I’d agree that public trans is solid but the nightlife and gritty area of thus building brings it down quickly.
“How much of a discount should a 2/2 here be compared to silver tower in river north. 30k?”
Mike – I would think 30k is reasonable given location but be weary of ST. There is a lot of noise that transmits through the lower floors (specifically facing North and East, windows open and closed) and the association may not be in the best of health though not sure what their inventory levels are as of recent. Also last I checked, the developer was in default on the loan and claiming bankruptcy in regards to the building…again, haven’t performed my homework as of late though.
“how did The Montgomery do so well just being three blocks east?”
The Montgomery is awesome if you have the loot. The lower floors aren’t too hot but having lived there and knowing several people that live on the upper floors, its awesome!
The construction is top notch and so is the concierge, but the floor plans are a bit awkward and there are limited units with balconies (only E & W units) in which the bedrooms are in the “columns” on the corners.
It is a quirky building though in regards to rules, such as you cannot let your pet walk through the lobby – you have to carry him/her or use the back door.
“Also last I checked, the developer was in default on the loan and claiming bankruptcy in regards to the building…again, haven’t performed my homework as of late though.”
Must have been a long (relative) time ago–BofA filed f/c in March and a receiver has been operating the sales. Screwing the mezz lender and the (vaporized) equity.
The Montgomery also marketed and sold the units years ago. At least 4-5
110
150
220
Insane I know.
Keep cutting folks. Volume is below the worst part of 2008 and it’s only going to get worse this winter.
there are no more gimmicks available to goose housing stats.
“Must have been a long (relative) time ago–BofA filed f/c in March and a receiver has been operating the sales. Screwing the mezz lender and the (vaporized) equity”
At least 10 months ago Anon…
“The Montgomery also marketed and sold the units years ago. At least 4-5”
The Montogmery starting marketing units in 2003 – I think – because it was completed in 2005, in which the re-hab was started in early 2004 after The Domain was completed but in parallel to The Angel Building (always forget the name of the other Wards one North of The Montgomery along the river…
“I laugh about the location issues how did The Montgomery do so well just being three blocks east?”
It’s east of the river.
“North of The Montgomery along the river”
Correction: West.
Every time I see a cookie cutter 2/2 for more than $300k I just start laughing.
That’s how much a cookie cutter 2/2 cost during the bubble.
“It’s east of the river.”
Makes a *huge* difference, even tho I think the mondials immediate surroundings are nicer than the montgomery–no Cabrini, closer to the el, etc.
FWIW, 1-bedroom rentals across the street at 925 W Huron were going for $13-1500 (depending upon size, before negotiation) with heat and A/C included when I looked a few months back.
High rise rent is always weird because it includes utilities and assessments to pay for common areas, etc. So when you exclude the covered utilities and subtract out the rest of the assessment the imputed rent is a bit cheaper.
East of the river is not that much better. Sure you have a shorter walk to Japonais and David barton steriod club but you are also right on top of a secition 8 public housing project, that area is still slightly gritty, and you have what is left of Cabrini in closer proximity. That cold morning walk to the el is also much further.
That aside I really loved one of the penthouses in the Montgomery. My girlfriend (now wife) and I looked at one awesome unit on the sw corner. Thank goodness that it was out of the price range or we would be upside down on equity now in that awesome space.
Problem with this is that it is right on the train track. Right? Am I missing something?
Japonais is good, in my opinion, but is there much else around there culture/nightlife/restaurant wise? Didn’t really have time to have a look around last time I was out there
Just on the east side of the river that is, I obviously know whats beyond that.
“is there much else around there culture/nightlife/restaurant wise?”
“Just on the east side of the river that is, I obviously know whats beyond that.
“is there much else around there culture/nightlife/restaurant wise?””
Head south, you’ve got the places on Huron/Erie/Ontario. But there’s nothing on Chicago until you cross Orleans and nothing north until (basically) Whole Foods.
Train, no culture = 50% lower.
FYI – just read a post on here that Silver Tower’s HOA maybe in trouble and that sales are slow…..im being honest here, our HOA is fine, just checked and our budget is fine with no increases for a year….the reciever is paying all assestments owed when a unit closes so the title can be clear….last time i heard we are at 65% closed.
also, to comment on the noise, i have a 2br plus den facing north, west and i have a south facing balcony….YOU DO HEAR THE EL, but i don’t hear any traffic on the ohio feeder, but again the brown/purple lines don’t come that often, especially weekend, and honestly, its like a small humm in the background..i sleep like a baby no issues……
Ouch! 141 units with $100,000 avg. price cuts equals $14.1 million of lost proforma profits. I guess the arch-zionist Mr. Berger and his Centrum buddies won’t be helping with the funding of illegal West Bank settlements for awhile.
I went and looked at this building last week. Floors 12-15 have not been completed. The realtor tried to spin it so that those floors are “phase 2”. In reality, the developer is out of money and is waiting to sell more units to get money to finish the project. She also said that a number of people were having a hell of a time trying to get financing because the building hasn’t sold enough units. It doesn’t look like this project is going to end well. Expect more price cuts.
“Floors 12-15 have not been completed. The realtor tried to spin it so that those floors are “phase 2?. In reality, the developer is out of money and is waiting to sell more units to get money to finish the project. ”
This is one of the funniest things I’ve heard of. Who were the owners that already bought into a building that wasn’t finished? Did they not do their homework that construction was still ongoing?
What does Mr. Berger & his Centrum buddies have to say to those owners who previously bought in this building who are now forced to live in an incomplete building?
Is the building even up to code and fit for occupancy if it is not even completed?
I have to imagine that all of the structural and safety components (fire sprinklers and alarms) are finished, just not any of the units themselves. I wanted to see if the view of downtown improved if we went up higher on the floors since the building to the south is about 7 stories tall blocks the downtown view of lower units. But when I requested to go up, that those units were not complete yet because that is phase 2. Until those units are fully completed, you would have to be ‘wasted’ to want to buy there.
Anyone know what the current prices are for the 1 and 2 br units?
This place was just dol to waterton residential who also owns presidential towers. It will be turned into apartments. Now what happens to those 21 some odd poor folks who have already purchases their units. Do they take a huge price cut and sell to waterton as well or do they hope that these are eventually sold back as condos in a decade or so? Will their assessment go thru the roof?
“Do they take a huge price cut and sell to waterton as well or do they hope that these are eventually sold back as condos in a decade or so?”
The building remains a condo building- as far as I know. It’s simply one owner who owns nearly all the units (and can outvote everyone else.) It will make it impossible for the current condo owners to sell to anyone who needs to get a loan.
Just walked by today and saw big signs proclaiming luxury rentals. Looks like the condo approach fell through.