Demand growing in downtown Spokane for apartments, condos

When Pam Novell and her husband, Kerry, sold their South Hill home and moved into a downtown condo, some of their friends thought they were a little crazy.

The couple’s two daughters were teenagers. Pam’s elderly father was living with the family. And the Novells had two pets – a cat and a dog.

The condo turned out to be a good fit for the family, which quickly settled into the two-story, 3,600-square-foot unit in the old J.C. Penney Building at 809 W. Main St.

“We’ve always been a lot outside of the box,” said Novell, managing broker at Windermere Manito LLC.

Kerry walked to his job at River Park Square. The couple’s daughters attended Lewis and Clark High School. Pam’s father, who had Alzheimer’s and was prone to wandering, benefited from the building’s security.

The family gave up their half-acre lot, but downtown was their backyard. The condo’s spacious “great room” quickly become a gathering spot for family and friends. The Novells hosted Hoopfest parties, banquets for one of their daughter’s soccer teams and a homecoming dinner for 12 couples.

“I couldn’t have done that at our old house,” Pam said.

The Novells spent 10 years in the unit before selling it in January. With both of their daughters out of the house, the couple downsized to a smaller townhouse in Kendall Yards.

Their condo wasn’t on the market long. A family with three young children bought it.

Spokane has lagged behind other West Coast cities in developing a vibrant downtown residential community. But after years of stops and starts, interest in downtown living has hit a growth spurt. Developers are building hundreds of new units to meet demand for housing in the city’s core.

Population: 7,000 & growing

Spokane’s city center is already home to about 7,000 people, according to the Downtown Spokane Partnership. Downtown has about 525 condos and 3,200 apartment units, with another 522 residential units under construction or in the planning phase.

Job growth in Spokane’s University District could create demand for a few thousand more units in downtown and nearby neighborhoods though 2040, DSP studies indicate.

Adding residents to the city’s core helps ring-up sales for downtown retailers, restaurants and bars. It creates walk-to-work scenarios and also increases public safety, said Juliet Sinisterra, DSP’s economic development manager.

“There’s this whole notion of creating a vibrant 24-hour downtown, where you have people using the streets at all hours of the day,” she said. “Downtown moves beyond a place people frequent from 9 to 5.”

The majority of people who want to live downtown are either millennials or empty nesters, developers say. However families, such as the Novells, are part of the mix, too.

Housing reflects diverse population

The housing units under construction reflect the diversity of downtown residents’ income levels. The renovation of the historic Ridpath Hotel is a good example.

Most of the Ridpath’s 206 units will be targeted to people earning less than $29,000 per year. The project includes about 100 micro-apartments – studios of about 250-square feet – that will rent for about $450 per month. Developer Ron Wells said the units will help meet demand for housing for downtown’s service workers.

The Ridpath’s penthouse condos represent the other of the spectrum. Since the condos were sold as unfinished shells, it’s hard to put a precise dollar value on them, but Wells estimates the build-out value at $500,000 to $1.2 million.

“The condos sold out in three days,” he said.

Demand for the apartments has been high, too, Wells said. More than 375 people have expressed an interest in renting one of the Ridpath’s apartments, though the list is a couple of years old, so some of the potential applicants may have moved on.

One of the Ridpath’s new tenants is moving here from Manhattan, Wells said. He’s renting a micro-unit – the same size apartment he had in New York.

Wells said he advertised the units ahead of construction, developing the waiting list to prove market demand for the units to lenders and underwriters.

Spokane was “slow to embrace new concepts of downtown living,” Wells said. But now, “I really think it’s showing signs of catching up.”

Two other large projects will add apartments to the downtown and nearby areas. Centennial Properties is remodeling the old Macy’s building downtown. The building, which has been renamed “The M,” will have 105 apartments, plus retail and office space.

Centennial Properties is a subsidiary of Cowles Co., which also owns The Spokesman-Review. Another Cowles Co. subsidiary, 809 Lofts, developed the condos in the old J.C. Penney building.

The Kendall Yards neighborhood, across the Spokane River from downtown, has 182 apartment units and Greenstone Corp. plans to construct another 150 units over the next two years. Smaller units have the highest demand.

“They’re pretty attractive for young professionals and students,” said Joe Frank, Greenstone’s president, in a recent interview.

An elevator, sauna and private balcony

Novell, the Realtor who lived downtown, sees a similar diversity in condo prices.

Recent condo listings in the downtown district include a small one-bedroom unit priced under $300,000. Her office also has the listing for a $1.6 million condo at 1219 W. Riverside.

The three-story unit has 4,200-square feet, its own elevator and cherry wood and limestone floors on the main level. The condo’s outdoor terrace overlooks the Spokane River. The master bedroom suite contains a sauna, office and private balcony.

While that property has luxury finishes, Novell also hears from clients who want to live in an old industrial space, with exposed brickwork and beams.

She’s currently seeing a high demand for downtown condo units priced between $500,000 and $700,000. Most downtown condo buyers want at least 2,200-square feet of living space and two secure parking spaces, she said, which bumps up the price.

“Those are the properties that have waiting lists and bidding wars,” Novell said.

At Kendall Yards, townhouse properties with those amenities are rapidly appreciating in value, she said. Last year, units in a fourplex were listed for sale at prices under $400,000. Now, similar units have asking prices of $525,000.

Novell sees recent apartment construction as a predictor of future condo demand.

“There is a lot of demand for downtown living,” she said.

But not everyone is ready to immediately commit with a condo purchase, Novell said. People want to rent for a while to get a feel for what it’s like to live downtown.

“They’re doing a test-drive,” she said.