Multi-family housing and smaller homes are targeting families and young professionals, but experts differ on the extent of the trend.
If the expert opinions at the recent University of Florida Bergstrom Center Real Estate Forum are any indication, Gainesville’s tastes in housing are shifting away from larger, more expensive homes requiring long commutes toward smaller homes, apartments and condos that are more convenient for getting to work, shopping and entertainment.
Just how pronounced this shift is and how fast it’s occurring is a matter of opinion. Several developers are betting heavily on “new urbanism,” a movement being touted nationally that’s based on people living, working and playing in compact communities resembling historic towns.
The Alachua County Commission has encouraged this trend by adopting policies regarding “transit-oriented development,” with densities more than three times those of Town of Tioga or Haile Village Center and some buildings up to six stories tall.
The new urbanism flag-wavers include Mike Warren of AMJ Inc., who built upscale townhouses costing up to $400,000 each between downtown and the Duck Pond—in a project called Regents Park—between 2002 and 2007, prior to the housing bust.
“We looked at the East Coast, from Savannah to Boston, for a model,” Warren says. “There wasn’t anything like it in Gainesville.
“This is a market that was totally underserved. It’s made up of people who are used to living in a quality space in an urban setting. They like being near the Duck Pond, but they don’t want an older home.”
Among the Regents Park owners are Dan Boccabella, senior director of product management for software company SumTotal Systems, and his wife, Robyn LeBoeuf, a faculty member in UF’s marketing department.
Boccabella loves living downtown, and he’s done so for more than a dozen years. He moved from the Seagle Building to a 2,300-square-foot condo in Regents Park.
“If I want to do something once I’m home, all I have to do is walk,” he says.
Among the Boccabellas’ neighbors in Regents Park are Rebecca Nagy, director of the Harn Museum of Art, and Joe Alba, chairman of UF’s marketing department.
From time to time, Boccabella has considered buying a single-family home, but he prefers the conveniences of living downtown over a new suburban home west of I-75 and the energy efficiency and reliability of new construction over a historic Duck Pond home. “My only complaint is that we only have a one-car garage,” he says.
AMJ also built OakGate, a 32-unit townhouse development in the 2900 block of Northwest Sixth Street. OakGate, priced at less than $200,000 per unit, hit the market in 2007, when mortgages were tightening up, and only three units sold, leading Warren to convert the remaining units to rentals.
Rent is $975 for a two-bedroom unit and $1,100 for a three-bedroom. “We had intended OakGate to be for police officers, nurses and teachers,” Warren says. “It’s pretty much who we thought it would be, but they’re renting. It’s cheaper to rent than own.”
Although both Regents Park and OakGate are full, neither project has been very profitable, and Warren has held off on completing the additional 64 units he had planned for OakGate, he says.
Like OakGate, most condo communities built between 2006 and 2008 have become primarily rental communities, says Aaron Bosshardt, CEO of Bosshardt Property Management.
“If you built condos with a target price near $200,000, you’re not making money with rents of $700 to $900,” he says. “Still, most investment groups are sticking with their properties, refinancing them if they can, and fighting to break even.
“It’s not like Orlando and other parts of Florida where investors are walking away.”