Sub Primes Abound In Boise

Looks like the housing market isn’t the only place with sub prime loans.

–They guy who brought us the “green” bank building seems to be “in the red” on a condo project at 10th and Main. There was a foreclosure notice to the tune of $2.5 million posted in the Daily Paper legal ads a few days ago.

–It could be just a perception, but the new “skinny pit” on Front Street where the four lane street jog is located next to BoDo seems to be going as slow as the traffic. The idea of 17 floors of condos on that tiny space still seems doubtful despite another hole in the ground downtown.

–Land at 16th and Idaho once slated for another downtown condo development also went bust earlier this year.

–The infamous “Pit”, hole in the ground at 8th and Main remains an eyesore following years of litigation and bankruptcy. Truly pie in the sky, that project was to be condos, retail, parking etc.

–We haven’t seen any movement on the project at 6th and Front where the old Mission was located. That was supposed to have luxury condos and “affordable housing” in the same building. Sounds very egalitarian, but we haven’t seen many doublewides on Harrison or Warm Springs.

Despite claims to the contrary, it appears downtown Boise is simply not a viable place to build residential space. We see speculators and high costs preventing it from becoming a reality.

The so-called “Mercantile” at Hidden Springs is on the market and that one has a real “bailout” aroma about it. The developer wants to sell it to what appears on the surface to be the homeowners association, but the homeowners have only an advisory vote at present. The developer is head of the association and also on the County P&Z commission. It boils down to the buyer and seller being the same party as far as we can decipher it.
It gets worse. He wants to use money in a county-mandated “conservation fund” to pay more than $300,000 for the building which has never made it as a retail space. The GUARDIAN checked with a county official about who holds the conservation fund
money–said to be well over $600,000 at present.

Even though the County “planned community” ordinance mandated a transaction fee go to the conservation fund, Ada County does nothing to monitor the finances and performs no audit function. They don’t even know if there really is a fund or who controls it! They also don’t seem to have any enforcement or penalty authority. The ordinance is not only without teeth, it doesn’t have any gums!

Comments & Discussion

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  1. That whole concept of a “planned community” is just laughable. Ada County Commissioners who gave the green light for Hidden Springs may have felt there were controls in place, but, like any law, if it is not enforced it may as well not be there.

    The people who bought there were sold on a concept that has not been carried out. Didn’t the original developers have the responsibility to complete Dry Creek road to Highway 55? The last time I went to Hidden Springs, earlier this year, Dry Creek was mostly a pot holed dirt road. Everyone who lives there has to drive on the same two lane road they share with the garbage company for the first mile or so.

    There are no jobs there to speak of – I doubt the teachers at the grade school could afford a house there. I am not sure if any other business, besides a dentist’s office, even exists.

    And you are right about the downtown residential, Guardian. When these guys talk about affordable housing and then talk about $300,000 and up as being affordable, they apparently haven’t checked with statistics on how much money the average family makes in this valley.

    The current real estate market is dead…probably the folks at M3 might be thinking rosy profits up in the foothills, but they might want to wake up and smell the coffee before they invest a lot of money pushing dirt around.

    Phil Bandy, who is running for mayor in Eagle, refers to growth as being inevitable. The Ada County Association of Realtors has been running a push poll in which negative comments are made about his opponent. Guess that makes Phil the pro-growth candidate.

    I could point out to him, as a person who has worked in the real estate business in this valley since 1973, that the fast rate of growth we have experienced in the last few years is extremely rare, and I expect will not reoccur any time soon.

    Thanks for bringing the current situation out in the open. The Daily News doesn’t like to print anything that could be the least bit negative.

  2. John Mitchell
    Nov 18, 2007, 1:19 pm

    Avimor wants to do something similar with a few twists here and there—-these “projects” always sound great—-community owned,financed by the developer etc etc—-IF they were so sucessful they wouldn’t be going belly up in several years—-one can only hope that the Commisioners and Eagle City Council is taking this in with a keen eye toward foothill development…….

  3. They were pouring cement into the hole Saturday morning for the Aspen condos on Front Street. You need to get in the garage and look into the hole to see the action. A windshield survey from Front Street does not tell the whole story.

    Also, despite your assertion that downtown is not a viable place for residential, progress appears to be steady on the condos at 4th and Jefferson. Indeed, that one appears to be going forward at a swifter pace than the Crescent Rim condos, a project by the same developer. And then there is the residential building on 11th and Main where the old Royal Restaurant was located, and it appears to be nearing final completion. Finally, I’ve seen the Cityside Lofts on 13th & Myrtle appears to be in a stretch run toward completion.

    But I gotta agree with you on that Hidden Springs Mercantile deal. It’s smelly.

    EDITOR NOTE–Wasn’t aware of the cement in the Front Street Hole. It just seems like these development deals never seem to make it until they have gone bankrupt a time or two. And yes, there are some that work out.

  4. I heard a rumor somewhere that there once was an honest developer — one who’s prediction of what he would build was accurate, who told the truth about how much money he had available for the project, who built the best houses etc. he possibly could, who kept his promises about what the project would include, etc.

    Since I have not been able to track down the sources of this rumor, I figured I’d pass it on to the Guardian, who is much better than I at digging up the details.

    Yes, I realize it’s highly unlikely that this rumor is true, but, still, it could be. You know what they say: 99 percent of developers make the other one percent look bad.

  5. Dave, thanks for offering an alternative view to “everything is great” stories we get from the “daily” and “business weekly.” Check out the Townhomes by Five Rivers on Warm Springs. Construction has stopped and it looks like they cannot give away the units already finished.

    At least the structure acts as a noise barrier for those living behind it. Even during the dust bowl, real estate types were pushing cheap, productive land in the dust bowl states. They forgot to tell people the land was not tied down.

  6. Ok. Yes, Frank Martin is the developer and he is head of the “homeowners” association.

    He also lives in the community.

    The mercantile is 8500 sq ft. $300k is probably below market value. I believe the developer is required under the planned community charter to sell the mercantile. In theory, this is a way for it to remain a community owned space.

    The open space fund is at $650k. Money from this fund has opened up new trails in the foothills, maintains open space, and supports the organic farm in the development.

    The mercantile seems to draw a decent number of people for meals. The problem has always been service. I think a well run restaurant could do very well there.

    There is a dentist in one of the other retail spaces (non-merc).

    As to Avimor. I can’t imagine why they would even bother building it at this point. Oh well.

  7. Today I was doing one of those jobs Americans won’t do (taking leaves to the dump) and in passing along Gary Lane noticed that TWO subdivisions on Gary Lane were under construction. Not just streets, sidewalks and landscaping the frontage, but actual houses being built.

    Can’t imagine how they’ll sell in a county with, what is it 7500-8000 homes for sale, but someone is obviously optimistic.

  8. I was just up at Hidden Springs and drove through a new sub. It felt like the Truman Show except every other house was empty. It was a very eery feeling. What would it be like to live in a new ghost town?

  9. Rod in SE Boise
    Nov 20, 2007, 4:52 pm

    Wish somebody had some statistics on downtown condos for the last 5 years or so. How many built, sold, still for sale, repossessed, etc, divided by price ranges. Bet there are none under $200,000, and that the best sellers are the most expensive ones.

    And would we call a one or even a two bedroom condo “affordable” at $200,000?

  10. Rod, since 2002, 27 new condos have sold in the central area. Only 6 were less then $200k, about 1 per year. Median price was about $311K for about 1,300 square feet. At the top end, 6 went for over $500K, and one was over $1.1 Million. Seventeen of the sales were since January of this year. They are getting cheaper, median price in 2007 is a modest $270K, and smaller, median 2007 size is 1,200 square feet.

    Affordable housing, by New York City standards. Micron line workers need not apply.

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