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The Pedestrian Mall party scene in Iowa City hasn’t dissuaded buyers from paying top dollar for luxury housing.
By Lauren Sieben
The University of Iowa touts numerous academic accolades, along with one honor that university officials might prefer to disregard: the number nine spot in the Princeton Review’s annual list of top party schools.
But in spite of Iowa City’s nocturnal transition into a hub for alcohol-fueled shenanigans, the party scene hasn’t deterred buyers at residential buildings downtown, including Plaza Towers — a luxury condominium complex in the downtown Pedestrian Mall.
“I remember when I graduated law school in ’79, realtors were telling me there was a lot of demand for downtown housing,” said Marc Moen, the founder of Moen Group and the developer of Plaza Towers. “Thirty years later there still weren’t any properties.”
Before the completion of Plaza Towers in 2006, the area was used as a parking lot. It was the last developable space in the city.
The first three floors of the building house commercial property, including the hotelVetro lobby, Formosa, the Bread Garden and Iowa City Fitness. Hotel rooms occupy floors four through six, and the rest of the building – floors seven through 14 – houses condos for sale and for rent.
Each ultra-modern unit includes high-end appliances and a bird’s-eye view of the city. The condos essentially sell themselves, explained Bobby Jett, Moen’s husband and the property manager at Moen Group.
“We spend zero on advertising,” Jett said.
Moen Group owns other rental properties in Iowa City, primarily drawing in students. But the steep cost of living at Plaza Towers has kept most students out, attracting tenants and buyers who range in age between 20 and over 80 years old.
Paying a premium
A 500 to 600 square-foot unit at Plaza Towers rents for $1,180 a month; an 1,100 square-foot unit rents for around $2,160. Rent doesn’t include utilities or the $85 monthly parking fee, and condos are priced roughly between $350 and $460 per square foot.
$650,000 can afford a 1,675-square-foot unit with three bedrooms and two bathrooms.
Critics initially doubted the viability of high-end housing in Iowa City, but the condos at Plaza Towers sold before the complex was completed.
“All the banks said, ‘No way, it’s not going happen … no one will pay that,’ ” Jett said. “It was a gamble, but that’s the only way you really get ahead.”
Buyers who aren’t determined to live downtown can spend a fraction of the cost for double the space by taking their search a few miles out. As of November 2010, the average home in Iowa City sells for $141 per square foot, according to real estate search engine Trulia.com.
But many buyers are willing to spend double to live steps away from restaurants, shops, cultural events and even a few unruly undergraduates.
“Some point directly to the students and say ‘[They are why] I love being here,’ “ Moen said. “[But] if you ask people point blank if they live here because there’s a bunch of drunk people in town, they’d say no.”
Moen informally surveyed condo owners and tenants at Plaza Towers before the November city vote to either return to a 19 bar age in Iowa City or retain the 21 ordinance — the 21 ordinance ultimately won. But the results of his survey, Moen said, were “all over the board.”
“People that live and bought here wanted to do it because the students were here. They wanted to be around energy,” Jett said.
Click here to read a profile of the Loewenbergs and find out why the Iowa City couple moved from their longtime suburban home to a condo in Plaza Towers.
Linn St. Place
The success of Plaza Towers has inspired similar projects downtown, bringing in higher numbers of permanent residents to a traditionally student-dominated neighborhood.
Two blocks away from Plaza Towers at the corner of Linn and Court streets, Ryan O’Leary, a realtor at Lepic-Kroeger in Iowa City, sells renovated condos at a price point close to that of Plaza Towers.
Linn Street Place, formerly a student apartment building, first began renovations in the past year and a half, O’Leary said. The three-floor building is home to commercial offices and 48 residential units; some renovated, some undergoing renovations and others still being leased to tenants.
The base price for one of O’Leary’s units starts between $175,000 and $225,000, averaging $250 to $275 per square foot.
“One of my colleagues had said that he thought we were crazy,” O’Leary Said. “He said what we should have done was just painted the walls and changed the fridges and then sold them to rich kids from Chicago. And I was really offended by that, because the infrastructure of the building is excellent.”
Costs by comparison: Downtown and eastside property for sale
- A one-bedroom, one-bathroom unit at downtown Linn St. Place with 900 square feet is listed for $277,000.
- Less than a mile away, a three-bedroom two-bathroom home on Governor Street with 1,786 square feet and a back yard is listed for $250,000.
- Source: Lepic-Kroeger, Realtors Current Listings (Oct. 20, 2010)
Each unit has a patio – some as large as 15 by 30 feet – and each comes with two heated, underground parking spots and storage space.
O’Leary’s aims his marketing efforts at young professionals, retirees and empty nesters. The condos have attracted buyers from ages “18 to 80.” The trick, O’Leary said, is not to target only one demographic in marketing the renovated units.
“The fact that we are two blocks from downtown makes a huge difference,” O’Leary said, noting that the building’s proximity to restaurants and shops attracts buyers who are environmentally conscious and looking for “walkability.”
Although O’Leary’s marketing efforts haven’t focused on students, some parents of students have shown interest in purchasing units for their children.
“We figure our building will appeal to anybody … that values both a clean quiet and a professional atmosphere, but also the proximity to downtown,” he said.
At the start of the building’s transition from rentals into condos, O’Leary struggled with a few rowdy student renters. But after the first year of new rules, O’Leary said partying isn’t a problem and hasn’t dampened the interest of buyers.
“The perception by many is that anything within a mile of downtown is going to be overrun with students having loud parties four nights a week. That’s just not the case,” O’Leary said. “There are lots of neighborhoods that are clean and quiet and don’t have problems with vandalism or noise pollution.”
Other developers have built similar high-end condos, but mostly outside of downtown and into nearby Coralville.
The University of Iowa plans to rebuild the Voxman School of Music and Clapp Recital Hall — a complex that was destroyed by the 2008 flood — at the southeast corner of Burlington and Clinton streets. The $125 million building includes plans of residential condominium space, according to a report from Facilities Management.
Talk has also circulated of condo development above the future University of Iowa Museum of Art, but university spokesperson Tom Moore said potential locations for the new museum have not yet been determined.
Money, Jett said, is the key factor for future projects downtown.
“Of [permanent residents], how many have the income to buy something here who don’t want a yard and a swing set?” he said. “It’s a very, very limited number of people who want to live like this and who can afford to live like this, so to build another [building] like this – could it even survive? Are there enough people that could fill it? That’s the unknown.”
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