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Pinellas condos' fate not tied to developer Opus South's bankruptcy

Only 10 of 153 units have sold at Water’s Edge, a high-rise condominium next to Clearwater City Hall. Opus South’s other high-end Pinellas development, 400 Beach Drive in St. Petersburg, is faring much better, with 80 percent of units sold.

JIM DAMASKE | Times

Only 10 of 153 units have sold at Water’s Edge, a high-rise condominium next to Clearwater City Hall. Opus South’s other high-end Pinellas development, 400 Beach Drive in St. Petersburg, is faring much better, with 80 percent of units sold.

A prominent Atlanta developer headed for bankruptcy court this week, casting uncertainty over two high-end Pinellas condo projects.

But those familiar with Tampa real estate say market forces, not Opus South's credit woes, will determine the fate of its Pinellas properties, which face different challenges.

Water's Edge, a $100 million high-rise in downtown Clearwater, sits nearly empty. Only 10 of 153 units have sold, a hefty drag on Clearwater's downtown market.

On St. Petersburg's waterfront, 400 Beach Drive is 80 percent sold, property records show. Prices have softened, but not collapsed, as they have in South Florida and at Tampa's Channelside.

The Opus Group, based in Minneapolis, develops office, commercial and institutional projects all over the county. Its Opus South subsidiary has built high-end Florida condos, including St. Petersburg's Park Shore Place, which is sold out.

Opus stopped initiating condo projects two years ago because of the economic slowdown, spokeswoman Winston Hewett said, "but no one anticipated that we would see an absolute shutdown of the capital and refinancing markets."

When loans came due on projects already in the pipeline, Opus could not refinance, she said. It now owes $324 million in past-due loans.

Water's Edge, the tallest building in downtown Clearwater, took a big bite of that. It has stunning water views, upscale amenities and virtually no residents.

By January 2008, Opus had contracts and down payments for 109 of the 153 units. Then disaster: A legal glitch voided all contracts. With the condo market slumping, buyers took their deposits and walked.

Since Water's Edge opened in September, only 10 condos have sold; the average unit costs $750,000.

It's too early to tell what will happen with the property, Hewett said. But Opus intends to leave the condo market.

"It'll be like every other property the bank takes over," said Clearwater developer Guy Bonneville. "They'll auction it off, sell it for what they can get, and get it off their books."

If that happens, it could shake up Clearwater's condo market. A neighboring high-rise, Station Square, is also largely empty and is putting units up for rent.

Bonneville is building a condo tower called the Strand at Clearwater Centre. He now plans to slow down construction and not open until late 2010, hoping for an economic rebound.

In St. Petersburg, Opus South has sold all but 19 of 400 Beach Drive's 93 units.

The most recent sale was last month, when a 3,306-square-foot condo went for $1.2 million. In June, a same-sized unit sold for $1.345 million.

A company run by Pinellas developer Jimmy Aviram is listing a 2,597-square-footer for sale at $995,000. His company bought it in December for $1,175 million, property records show.

Aviram could not be reached for comment, but Joel Cantor, who is finishing out Signature Place at the south end of Beach Drive, said his research shows that St. Petersburg's waterfront row condos are selling about 17 percent off their 2006 peak.

Signature has contracts for about 80 percent of its 244 units, Cantor said, with closings due to start in June.

This month, Signature announced a 25 percent discount off sale prices, which averaged $700,000, and has already sold eight new units.

The discount, which Cantor's lender will help underwrite by reducing his obligation, also applies to people who already signed contracts. That's to keep them from bolting, Cantor said.

Pinellas condos' fate not tied to developer Opus South's bankruptcy 04/23/09 [Last modified: Tuesday, April 28, 2009 12:51pm]
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