11/10/15

Sneak peek of the Pacific Heights condo project

One of San Francisco’s most-anticipated luxury condominium projects next year – Trumark Urban’s The Pacific – will sit in one of the city’s ritziest neighborhoods where new projects rarely see the light of day.

The building will give residents (likely some top tech-company executives) access to Golden Gate Bridge views. Realtors are already speculating that the best units could go for a New York City-esque $3,000 a square foot.

“Our mission has been to create something that has never been done before – a boutique, effortless living experience in the middle of the most desirable neighborhood in the world,” said Arden Hearing, managing director of Trumark Urban.

But getting the new homes in Pacific Heights ready for luxury prime-time by next year is anything but effortless.

Trumark Urban is one of the city’s most active condo developers, buying early into hot neighborhoods and getting projects out of the ground to beat the competition. This may be its trickiest challenge yet – especially with pricing hype sky-high and floor plans remaining under lock and key so far.

The construction timeline is still on schedule, but the gutting of a former University of Pacific dentistry building to turn it into luxury condos has proven difficult. Hearing told me that the development team has had construction surprises as it took on adaptive reuse of the formerly brutalist-style dentistry school, which was built in 1967.

“We have discoveries every day. The building methods of the 1960s were not up to snuff with today’s standards,” Hearing said. “We just had columns that weren’t there. Beams that weren’t there, but were on the construction drawings. Columns that were crooked, not straight … It’s sort of like doing a down-to-the-studs remodel and rebuilding the building. It’s been no quicker or cheaper than it would otherwise.”

The project, which will include 10 two-story townhomes and a 66-unit main building, will launch its full website later this month and start selling some units early next year before it opens in the spring. Trumark Urban gave me a first look at new exterior and interior renderings, which you can see in the slideshow. (Regrettably, there aren’t images yet of the “private yoga garden” the developer is marketing.)

The developer had previously estimated the cost of the development would be $158 million, but Hearing declined to give an update on that. Most of the windows are up on the building now, and the skin will get wrapped around by the end of the year, Hearing said.

The Handel Architects-designed building also will need to be wary of luxury buyers’ scrutinizing eyes, especially as the market has shown signs of cooling. Poor unit layouts spelled doom for the sales of luxury condos at the second One Rincon tower, I reported earlier this year.

“If the homes are well laid-out and have plenty of light, they’ll get top dollar. If they chopped up the building, and you’re walking into something that feels more like a box and they’e trying to push $2,000 a square foot, they’ll have a problem,” said Todd Montgomery, a top agent at Climb Real Estate. “If they align product with price, they’ll sell this building and they’ll sell it for location.”

The “family-friendly” units will range from 1,000 to 4,000 square feet typically, Hearing said. (Depending on location in the building and views, that means some larger units could fetch $12 million.)

Some of the top penthouse units can be combined for a “7,000 or 15,000-square-foot home if they want to,” Hearing said.

The rapid pace of sales at Oyster Development’s Rockwell condos likely gives Trumark Urban heavy confidence about that location.

Those other Pacific Heights condos, a half-mile away on the other side of Lafayette Park, have sold at an impressive clip of 32 units a month, according to the real estate marketing firm Polaris Pacific. The 13-story tower put 163 of the 260 homes into contract between its April start of sales and September.

Trumark Urban’s The Pacific isn’t made up of ground-up towers like 181 Fremont, One Rincon, or Lumina, adding to its allure for many buyers because it will have “unique, intimate feel,” Montgomery said. But he added that it might not jump to the top of the list for Chinese homebuyers because it’s “a very different product than what they’re used to buying,” which would be new-construction towers.

Who will be buying – whether it’s for primary residences or second homes?

“You’ll have senior level executives, potentially in tech. And you’ll have professional services, doctors, attorneys, consultants, people in financial services,” Montgomery said.

Hearing added that the design of the building layout has received input from plenty of consultants and real estate agents whose clients have bought heavily in mansion-heavy Pacific Heights.

The New Fillmore reported earlier this year that Trumark Urban – and financial partner Hillwood, headed by Dallas property magnate Ross Perot Jr. – got inspiration from the luxury hotel and condo projects in New York City, Milan and London. Polaris Pacific is marketing the building for the developer.

But if median prices don’t reach jaw-dropping levels, they can alway point to a slowing luxury market. Paragon Real Estate reported that the upper tier of the market has cooled off in part due to stock market uncertainty.

“We see a healthy stabilizing,” Hearing said. “ We see demand being very strong, and hopefully we’re getting to a place where pricing will achieve a normal kind of market. (San Francisco) can’t keep this up.”

Source
bizjournals.com
Cory Weinberg

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