Downtown housing at $200 per square foot
Tight supply in Dayton pushes up prices, results in quick sales.
People told Charlie Simms he was crazy for building new town houses in downtown Dayton. Seven years later, naysayers are nowhere to be found.
Simms, president of Charles Simms Development, is on his sixth downtown housing project, and his new City View town houses have sold for almost $200 per square foot — nearly double what his first downtown product fetched.
Simms said he plans to aggressively build downtown for the foreseeable future because the demand for urban living is intense and shows no signs of cooling off.
The downtown market is underbuilt by about 950 owner-occupied units, according to some local research, and the tight supply has helped push up prices and explains why condos are selling days after being put on the market.
“I think the market is going to continue to grow here,” Simms said. “There are two or three places we are looking at (for new
housing), but I don’t want to jinx anything.”
Simms told this newspaper, “If you told me we’d be selling it $300 or $350 a square foot in five years from now, I’d probably believe you.”
Simms has built more than 100 homes downtown since 2011 and wants to build more. There’s room for it.
An analysis last year by the Downtown Dayton Partner- ship found that the downtown market could support about 950 new owner-occu- pied homes, which it says was a conservative estimate.
The partnership is tracking about 238 owner-occu- pied condos and homes in the core of downtown.
“It’s nice to see growth in price per square foot, but part of that is that demand is way, way, way outpacing supply, and there’s a lot of interest in being downtown,” said Scott Murphy, vice pres- ident of economic develop- ment with the Downtown Dayton Partnership, who authored the analysis.
Dayton’s inner ring historic neighborhoods, such as South Park and St. Anne’s Hill, have nice homes not far from downtown, which has helped meet the strong demand for urban living, Murphy said.
But some empty-nesters and millennials who live downtown right now are renting and would like to buy if they could find the right product, he said.
Price is the primary concern for some people, while some residents who are older may want one-story flats that do not require they climb stairs, he said.
There’s lots of new apart- ments that have opened or that are coming downtown because developers have taken advantage of finan- cial tools that can help pay for adaptive reuse projects, like tax credits, Murphy said.
Some of these incentives require developers to keep housing as rentals for a set period of time. Renovating rundown and old buildings tends to be expensive, and building new often can be cheaper, he said.
City View is Charles Simms Development’s sixth downtown housing project, which offers 14 townhouses with contemporary and urban designs near Warped Wing Brewery.
The three-story town- houses have brick interior, stained concrete and wood floors, second-story balco- nies and rooftop patios, with sweeping views of down- town.
The second floors have an open design with exposed ceiling trusses and kitchens with granite counter tops and high-end finishes.
Thirteen of t he town- houses are sold, even though most remain under construc- tion.
The City View homes are about 1,815 square feet, and the base price rose to about $360,000 after the project started.
In 2011, Simms’ Patterson Square town homes at East First Street and North Patterson Boulevard started at about $139,900, or about $100 per square foot. Today, his new homes, located a few blocks away, are selling almost $200 per square foot.
The Patterson Square town homes sold out in about two years. The last City View home could sell any day. City View hitthe market only about seven months ago.
Ri s ing prices re f lect soaring interest in downtown living and an imbalance between supply and demand, Simms said, but they also have been pushed up by “skyrocketing” build- ing costs related to labor and materials.
Downtown has become one of the hottest places to live because of its amenities, like RiverScape MetroPark and the Schuster Center, and its good mix of restau- rants, breweries and arts and entertainment options, Simms said.
Simms said the price per square foot is not the best measure of value in the region because his town houses are maintenance free, offer unparalleled lifestyle benefits and energy-saving features.
Residents in Simms’ town home communities pay about $100 a month in homeowner association fees, which pay for maintenance, snow removal and yard care.
Simms’ success downtown has been noticed by other developers, who have new housing plans of their own.
Greg Thompson, president of the Greater Dayton Construction Group, plans to build about 27 new condos just south of downtown along Warren Street in the South Park neighborhood, near the University of Dayton and Miami Valley Hospital.
A future phase of development could include about two dozen new town houses, flats and detached single-homes on a property west of the new condos, according to conceptual site plans. The condos are expected to start at about $220,000.
People are willing to pay more to live downtown, but new housing product is commanding the highest prices, which is aided by 10- to 15-year tax abatements, said Steve Seboldt, a Realtor with Sibcy Cline and chairman of the Downtown Priority Board.
Some existing downtown condos and homes are selling for between $105 and $130 per square foot, Seboldt said.
Existing product is selling fast, he said, sometimes just days after hitting the market.
A 1,890-square-foot condo in the Cooper Lofts sold for $265,000 in June 2017. The owner received a signed offer, for the full asking price, just four days after listing it.
Downtown really could use some new housing that is less expensive because without question there are many people who would move downtown if they could afford it, Seboldt said.
“I think there’s a ton of buyers out there willing to buy something that’s under $175,000 or $150,000,” he said. “To get some people downtown, we’re going to need some more affordable prices.”