More than a thousand new apartments are being proposed for downtown, with four projects seeking city approvals in just the last four months.
Proponents say the new projects will add something vital for the downtown’s health: year-round residents to support downtown businesses.
Critics fear the city is moving too fast and could end up with a glut of empty or unfinished apartments — a reverse version of the Eden condominiums that sat unfinished for seven years across from City Hall before a new developer bought the project in 2010 and finished it as Heritage rental apartments.
The four downtown projects, combined with the 384-unit Broadstone at North Boca Village apartments under construction in the north end of the city, will add almost 1,600 units in eastern Boca Raton. Competing with the new units will be former condominiums that were converted to rentals when the condo market deteriorated.
The apartment binge is being driven by developers going where the money is, not by what is best for the city, said Ann Witte, a research economist and Townsend Place condominium resident downtown. “The banks will finance apartment rentals right now. They won’t finance office or retail because the market is so saturated,” Witte said. “My guess is that the market can absorb somewhere around 800 rental units.”
Lewis Goodkin, a real estate analyst and president of the Miami-based Goodkin Consulting Corp., agrees that it’s all about the financing. “What I’m concerned about, like a lot of things, when a market gets hot, it’s because investor groups are paying big bucks for rentals,” Goodkin said. “I think that there’s not enough work being done to determine how large that market is.”
But the demand is real and growing, said Charlie Siemon, a development attorney representing several of the apartment developers. “I think we’re catching up for lost time. We’re filling an imbalance,” Siemon said. The demand, he said, is coming from a number of sources, including people who went through foreclosures who either don’t have the credit or the desire to get back into the ownership market, people who prize their mobility and don’t want to be tied down by a mortgage and college students who would prefer a downtown lifestyle. “If we don’t have attractive urban-style rental housing, we’re not going to be competitive,” said Siemon, who says there’s a need for one-bedroom apartments. “Now people are realizing paying for more space than you really need is not a good idea.”
Witte said that if the rental market falters, it won’t be easy to convert those smaller rental units into more desirable condominiums. But the rental push could be a blessing for downtown, proponents say, because a large portion of South Florida condo dwellers are seasonal residents who wouldn’t provide the year-round spark the downtown needs.
“The goal is to sustain a vibrant downtown,” said Ruby Childers, the city’s downtown manager. “From a marketing perspective, if we have residents downtown to support the activities downtown and the businesses, then it’s going to flourish.”
The downtown projects that have been proposed are:
- Via Mizner, which will have 350 units on the east side of Federal Highway north of Camino Real;
- Camden Boca Raton, a 261-unit complex just west of Federal Highway between Southeast First and Second Streets;
- Ram, 208 units proposed for the southeast corner of Federal Highway and Palmetto Park Road;
- Archstone, which includes 378 rental apartments and 25 townhouse rentals on the north side of Palmetto Park Road east of Northeast Third Avenue.
The Archstone project, approved by the Community Redevelopment Agency in February, sparked a furor because its three-football-field long apartment structure of up to nine stories will be next to single-family homes.
The density of the housing will create traffic congestion, critics say, and they don’t think the project has enough ground-level retail space to get people out of their cars and walking downtown.
Opponents submitted petition signatures last month to hold a referendum to overturn the council’s decision to extend downtown development regulations to the Palmetto Park Road site, changes that were needed to allow the project to move forward. That effort was dashed after City Attorney Diana Grub Frieser said state law prohibits initiative petitions that challenge approved development orders. “Projects of this kind are put together by people and organizations that can walk away after the fact, but it’s the surrounding residents that live with it for the rest of their lives,” said George O’Rourke, who lives in the Golden Triangle neighborhood next to the Archstone site.
“We can develop a town that is done tastefully with new development, with new vibrancy,” O’Rourke said. “It doesn’t have to be the highest density. It doesn’t have to be gaming the ordinances.”
Councilman Anthony Majhess, who voted against Archstone, wants to make sure the city gets the right mix of residential, office and retail in the downtown. “I’m happy that we have economic activity and what should be affordable options for rentals in the downtown, but I’m concerned we’re moving forward without a plan,” Majhess said. “I’d be less concerned if the banks were loaning money in all sectors, but they’re not. So now rental’s the most important thing.”