Penthouses Ready at 44 Monroe
The Arizona Republic
Jun 22, 2012 :
Penthouses Ready at 44 Monroe
Failed downtown Phoenix high-rise condominium project 44 Monroe, now an upscale apartment complex, said it has completed eight luxury penthouse rentals and will begin offering them for lease.
Local commercial-real-estate analysts said the completion and marketing of high-end penthouse apartments in downtown Phoenix represents an interesting gamble that could well pay off, given the rarity of such properties in the area.
The penthouses range from 2,200 to 2,800 square feet and are on the 33rd and 34th floors of the tower.
Monthly rental rates range from $4,800 to $5,350, according to 44 Monroe property manager Kevin Bohm.
"These amazing residences have floor-to-ceiling-view windows and offer panoramas of the city and beyond," Bohm said.
"These penthouses are remarkable."
Owner ST Residential of Chicago hopes wealthy residents will be drawn to the opportunity to rent a luxury penthouse in downtown Phoenix, in the heart of the city's entertainment offerings.
Bohm said the target market for the units is executives, doctors, attorneys, professional athletes and others working in downtown or central Phoenix.
"We're pioneering a new luxury lifestyle in downtown Phoenix," Bohm said.
Two of the penthouses already have been pre-leased, a company spokesman said, adding that overall, the 210-unit44 Monroe is 97 percent leased.
The 34-story apartment high-rise, 44 W. Monroe St., has suffered a handful of setbacks in its six-year history.
ST Residential announced in January 2011 that it would convert 44 Monroe from a condo project to apartments, citing weak demand for upscale condominiums.
Although the eight penthouses' exteriors were completed years ago, their interiors had been left unfinished, because luxury-condo buyers generally want to select their own interior designs.
ST Residential purchased 44 Monroe out of foreclosure in June 2010 and opened a sales office inside the building in November 2010, hoping to sell its remaining 196 units at prices starting at a little less than $200,000.
The company was unable to sell any of the units as condos. Only 14 units sold when the project was built in 2006, and none was a penthouse.
Tighter lending standards and the sudden affordability of single-family homes in the Phoenix area hit condo investors hard after the housing market crashed in 2007.
Converting to apartments offers some advantages to property owners, such as recurring revenue and the ability to adjust prices.
And ST Residential still has the option to resume condo sales if it decides the market can accommodate them.
ST Residential is an investment and debt-resolution firm that is 60-percent owned by the Federal Deposit Insurance Corp.
Unlike the Resolution Trust Corp., which the federal government formed in 1989 to dispose of failed lender-owned assets following the savings-and-loan crisis, ST Residential involves the FDIC and a group of private-equity firms led by Starwood Capital Group.
Before its purchase by ST Residential, 44 Monroe was owned by Corus Bankshares Inc., a holding company whose bank was taken over by regulators in September 2009.
A month later, ST Residential was formed for the sole purpose of buying $4.5 billion in residential real-estate assets that Corus had repossessed.