For a man with about $175 million riding on an unconventional condominium project set to open in the spring, Patrick Turner seems remarkably unworried.
Never mind that the real estate market is in the dumps. Never mind that no one has ever put condos in a converted grain elevator or really knows how many people want to live in one.
And never mind that not one unit at Silo Point has sold.
Turner, a developer known for tackling tough, unusual projects, is turning the abandoned plant at the edge of a peninsula in Locust Point into 228 upscale condos. Concrete bins once used to store and weigh grain are becoming modern lofts in the sky.
But unlike most developers of new homes, Turner is forgoing pre-construction sales, which developers typically count on to build momentum and help cover costs. Turner says he will not announce prices or take deposits until the end of January, about two months before the bulk of the project opens in April.
"Most developers won't take the risk," Turner said.
But he says he's financially able to wait and believes it's better to set prices according to the current market. That helps minimize the risk of either low-balling them and forgoing profit, or setting them too high and then being forced to cut prices, losing contracts from early buyers .
At this stage of a project - especially in a slow market - most developers would be advertising low, "pre-construction" prices, opening sales offices and putting the finishing touches on a model designed to sell.
Turner is doing none of that.
Such a strategy could be risky, especially in a slumping housing market in which sales of condos have been slower than other housing types and inventory is climbing. Some developers have slowed timelines for projects while others have shifted planned condos to rentals.
"You have a large project," said William Rich, a Delta Associates vice president who tracks condominium sales in the region. "If the sales pace isn't going as quickly as hoped, you would be sitting on lots of units, and paying utility bills and other costs on an empty building. When you start sales right at the end, options are more limited, in case something goes wrong and in case sales aren't up to expectations. You have a building already, you can't knock it down or change it easily to a hotel or office building."
