Sabine On Fifth Auction Results

UPDATE: As of 3/24/10 there are five units remaining at the Sabine.  Send me a message for availability.

In a packed house, over 200 registered bidders showed up for the auction of 31 units at the Sabine on Fifth condos.  31 29 buyers walked away very happy, as this was believed to be the last great buying opportunity for attainably priced downtown Austin new construction.  Where 27 units were originally intended to be auctioned, earlier in the week CWS (developer) decided to include three more, then in the final minutes of the auction they included another 1bd.

The building has 80 units total.  Once the 31 auction units close, there will be 13 new construction units remaining.  These will be sold through traditional channels.  36 units closed before the now settled lawsuit was filed in February of 2009.  During 2009, the 44 remaining units were taken off of the market due to litigation.  This auction marked the “re-debut” of the Sabine.

# of units offered = 31 (29 bids accepted as of 4pm Sunday)
Avg winning bid (inc. 4% prem.) = $228psf
Avg original asking price = $326psf
Avg discount from asking price = 30%

You’ll recall that the Brazos Place auction fetched an average of $281psf, and that was an avg 29% discount from original asking price.

-Jude

Auction Planned For Downtown Austin Condo – Sabine On 5th

Auction Planned For Downtown Austin Condo – Sabine On 5th

*** UPDATE: Sabine auction results ***

A selection of the remaining units in downtown Austin’s Sabine On 5th building will be auctioned on February 28th.  A lawsuit filed by residents against CWS, the developer of the Sabine On 5th, and the building’s condominium association (which was under CWS’s control) has been withdrawn as the parties have reached a settlement agreement.  The lawsuit was filed last year as residents grew tired of lack of action by CWS regarding “persistent and major problems” relating to elevator repairs, amongst other problems.

The HOA has been turned over to the owners, which is unusual in buildings where less than 50% of the units are sold.  The specific terms of the settlement agreement have not been released.  Scott Dixon Smith, president of the Sabine On 5th HOA, indicated that “there will be major renovations to the building to alleviate the concerns of the lawsuit.”

Greg Miller, vice president of investments at CWS, has confirmed that steps are being taken to prepare the Sabine for the auction.  27 of the remaining 44 units will be available for bidding.

During the litigation no units were available for sale, and CWS’s loan had twice been posted for foreclosure by Compass Bank.  The first time in September, when Compass Bank granted CWS an extension to remedy issues.  Then in December, it was reposted for January’s courthouse auction.  CWS was able to restructure the debt and is expected to offer most of the remaining inventory for sale via an auction this February.

There were several condo auctions in 2009, and when the Sabine goes to auction, it will be the second major development in downtown Austin to do so.  The first, Brazos Place, was auctioned last year by Kennedy Wilson.  Brazos Place is frequently compared to the Sabine on 5th since both structures are located east of Congress Avenue and are adaptive re-use condo conversions

Originally built as an office building in 1981, and converted into condos in 2007, the Sabine is located along the west bank of Waller Creek, on Sabine St between 5th and 6th Streets.  With the success of developer discounts at 360 Condos and the Shore Condos, the Sabine is the last “attainably” priced building with new inventory left.

Email jude [@] downtownaustinblog.org, or send me a note, to inquire about the Sabine auction and the status of Waller Creek.

-Jude

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A Sabine Condos Auction?

UPDATE 01/05/2010: The Sabine auction has been confirmed.

UPDATE 02/28/2010: The Sabine auction results!


This should be interesting…

In a conversation with a credible source I learned that CWS, the developer of the Sabine condos in downtown Austin, is on an almost certain trajectory to place the remaining units at the Sabine condos up for auction.

Information is a little spotty, but 20-25 undetermined units could be auctioned off in mid-October, just in time for buyers to qualify for the $8,000 first-time home buyers tax credit. The remaining units would be sold in the open market.

In February, a group of owners filed a lawsuit against the Sabine HOA, controlled by CWS, which has prevented any units from being sold since then.

This would be the second downtown Austin auction, the first being Brazos Place.

Updates will soon be forthcoming. 🙂

-Jude

p.s. As a current resident/owner, and former listing agent for the Sabine, I have a personal interest in this story. Investors and buyers desiring original pricing, unit availability, and insights into the building and specific units to pursue/avoid should contact me directly – judegalligan [@] gmail.com

Sage Condos Auction Results

[non-downtown related news, but should be of interest to most DAB readers]

The remaining 23 units at the Sage Condos, located on 1702 S. Lamar, were auctioned off today. JP. King was the auctioneer of the “highest bidder’s choice” style auction where the winning bidder could choose to purchase any unit for the amount of the winning bid. The video above is of the first auction.

Including the 10% buyers premium, the average winning bid was $131 per foot, and prices ranged from $151,250-253,000.

I estimate 300 people were in attendance, perhaps 1/3 of those were registered bidders, the other 2/3 being spouses, friends & family, etc. Though originally slated for only 10 absolute auctions, the developer was on-site and confirmed all but five of the winning bids. The units were offered “as-is.” The bidding interest favored the units with downtown Austin views.

PDF of winning bids

-Jude

p.s. you’ll notice the video is labeled austincondoauction.com. That will soon become the repository for all the auction results and discussion – as soon as I work the bugs out 🙂

Bel Air Auction Latest – Did The Auction Work?

This past Sunday the Bel Air auction was hosted at the Hilton hotel.  I was out of town, unfortunately, and was not able to record the winning bids. Keye reported 300+ attendees.  All of the units had a winning bidder.

After Brazos Place, the Bel Air auction was the second high profile condo auction in Austin.  There was some speculation in my office that the undisclosed reserve would be roughly 2/3 of the original price.  My sources indicate that most of the winning bids were in the ballpark of 60% of the original list price, but these were all won “Sold Subject To Confirmation.”

Here is the shocker:  Of the 25 units that were auctioned at the Bel Air condos, only two of the winning bids were accepted! The Seller/bank was still negotiating hours after the auction and many of the units  may have added 5-10% on top of the winning bid [and on top of the 4% buyers premium] in order to meet the reserve minimum.

The auction rules clearly state that the Seller was allowed to set a reserve:

“All homes have an unpublished reserve price (Unpublished Reserve Price) which means that the seller has established an unpublished minimum selling price. The Starting Bid is not the reserve price. In order to become the winning bidder of a home, a bidder must have the highest bid and meet or exceed the unpublished reserve price. The highest bid is subject to acceptance by the seller (see ‘Subject to Confirmation’ section below). With respect to a high bid less than the seller’s reserve, the high bid and resulting purchase agreement/offer are subject to the seller’s acceptance, counter-offer or rejection during the auction, in the contract room, and/or within 3 days following the auction.”

The rules go on to state…

“With respect to a winning bid that is not immediately accepted by the seller, the auctioneer will inform the winning bidder that acceptance of their winning bid is ‘Sold Subject to Confirmation.’  The winning bidder acknowledges and agrees that winning bidder’s purchase/offer is subject to and contingent upon the seller approving the resulting purchase/offer, acceptance, counter-offer or rejection during the auction, in the contract room and/or within 3 days following the auction.”

Over the next couple of days we will see how the dust settles.  Because it was behind closed doors we don’t know how many of the auctioned units actually went under contract nor where the final negotiated price ended up for those units.  I wouldn’t be surprised if someone from the DAB readership was in attendance.  If so, please share your experience in the comments! 🙂

If we can confirm the final negotiated prices, then it appears we can expect the average clearing price at Bel Air condos to be in line with what I’ve been suggesting: a  25-35% discount is the magic number for a developer to quickly unload condos in bulk, in either the open market or the auction market.

When the undisclosed reserve is set too far above what the market is expecting it can ruin the effectiveness of the auction.  It’s situations like this that I suggest bidders bring a Realtor they trust – per the rules of the auction it cost bidders nothing – and they can help with strategy, understanding the project’s history, and negotiating when unexpected scenarios like this occur.

-Jude