'Points of light' incentives abound at Colonnade

September 30, 1990|By Edward Gunts

For the next three months, buyers of residences in the Colonnade condominiums may also receive, tax-free as part of their purchase, enough funds to cover a substantial portion of a grandchild's college education.

If the buyers are relatively young and can't yet afford a mortgage payment at the Colonnade but expect a raise in the near future, they may qualify for a "lifestyle subsidy payment" that would give them $500 a month for the first 18 months after they move in to bridge the gap.

If they are worried about selling their current house, the developers of the Colonnade will guarantee the sale for them.

And if they aren't happy with their new residence after two years, the developers will buy it back from them at the price they paid.

These are a few of the "11 points of light" that developers Howard and Richard Rymland have created as incentives for people to buy the last 50 residences at the 11-story condominium and inn complex, which opened earlier this year at University Parkway and Canterbury Road.

The sales campaign is one of the most aggressive ever launched for a condominium project in the Baltimore area. It is part of a trend inwhich developers are becoming increasingly resourceful and sophisticated in providing incentives to stimulate sales in an uncertain market.

As part of the new sales program, the Rymlands changed real estate companies and offered "rewards," such as a trip to the Netherlands, to agents who bring in buyers.

Developer Richard Rymland said 67 of the 117 Colonnade residences have been sold and that most of the residents are scheduled to move in this month and next. He said the new sales incentives were developed in response to changing market conditions, including the Persian Gulf crisis and the anticipated rise in inflation brought on by higher oil prices.

"This program is essentially based upon the realities of the world markets which are now severely modified and influenced by the conflict in the Middle East," he said.

"We're trying to make it as easy as possible for people to buy by taking away all the barriers."

Mr. Rymland said that prices for the Colonnade originally ranged from $138,000 to $1.3 million and that the average sale has been around $400,000 -- making the Colonnade one of the area's highest-priced condominium projects.

He said the development team changed realty companies becausethe original broker, Hill & Co., is best-known for working with buyers at the top end of the price spectrum.

Mr. Rymland said the remaining residences range in price from $180,000 to $1.1 million, and most are priced around $250,000. As a result, "we're after a much broader market with our current program."

The Colonnade LP brought in O'Conor, Piper & Flynn to handle the remaining units, he said, because it has a reputation for working with a broader range of buyers. It also has a guaranteed home purchase plan that fits well into the Colonnade's package of sales incentives, he said.

"Hill & Co. did a fabulous job," he said. "We would use them again. They did exactly what both they and we expected them to do. But when the product changes and the market changes, you have to change with the market."

Other offers in the "11 points of light" include:

* Free membership for three years to Club Colonnade, the on-site health facility and pool, plus discounts on valet parking and hotel accommodations available on the lower floors of the building.

* An accelerated settlement program in which buyers receive a $100-a-day bonus for completing their acquisition sooner than 180 days. If they settle in 100 days, for

example, they receive a $100-a-day bonus for 80 days, or $8,000. The maximum bonus is $10,000.

* A plan that will enable buyers aged 40 to 60 to pay off their mortgages in another 20 years. The developers will set aside $10,000 in tax-free government bonds, which are expected to grow to $50,429 by 2010, at which point they can be used to help pay off the mortgage.

* A "community support" program, in which the Colonnade Foundation will donate $10,000 in the buyer's name to a local beneficiary.

* The Colonnade Educational Trust, in which the developers also set aside $10,000 in tax-free bonds, which could be used in 2010 to help pay for a grandchild's tuition at the college of his or her choice.

In addition, the developers are offering special financing for a limited number of buyers. They also have agreed to execute contracts of sale that contain a contingency for the sale of the buyer's current residence and a contingency based on the buyer's ability to secure a financing package that suits him or her.

Mr. Rymland said not all 11 of the offers can be used by any one buyer. For example, buyers can take only one of the incentives that involve the $10,000 investment. But all buyers can take advantage of the health club and the guaranteed sale offers.

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