I've recently relocated to Irvine, leaving behind an 1,800 sf high rise condo in a mid/large (growing) city. The beauty of condo living was being in the heart of downtown where I could walk to work, restaurants, special events, etc. Others liked it for the skyline views. Prices were higher than the burbs, but that was in exchange for convenience, location, and the premium on center city land prices paid by the developer.
I just don't see how $800/sf is in any way justified for this and similar projects. You're not receiving any of the locational benefits of being in a lively 'downtown' area (as described in earlier posts). As situated, these projects seem more like suburban condos. However, in suburban condos one expects a price savings over similarly sized single family homes to account for the fact that you have no land ownership. In a sense, condos are supposed to represent a bargain over a single family home since you're not paying for land and there is much less infrastructure required. Some developers have tried the premium pricing route, touting building conveniences and luxuries -- but when you come down to it, its no more luxurious than SF developments featuring multiple community pools, tennis and other amenities where you also have room to have your own home gym, etc. I mean, I'd rather pay a $100 a month gym membership that I can cancel whenever I want to than a $1,000 HOA fee.
I also don't get the argument about the 'no mello-roos' benefit -- an argument in support of the outrageous HOA fee. My understanding is that the purpose of mello-roos is to offset infrastructure costs -- roads, new schools, etc. to service new sprawling developments. High-rise condos just don't have that kind of impact and so mello-roos doesn't make sense anyway. All in all -- those are some pretty hefty charges for a gym, pool and cable TV.
Does anyone have access to what was paid for the parcel of land? It would be interesting to calculate the builder's construction cost and see how much the mark-up was. I don't have much of a sense of land prices - but I can only assume it must have been outrageous if the builder needed to charge $600-$700 a sf when most of the construction was vertical. Even with concrete and steel prices being what they are, actual unit construction shouldn't have been more than $200 a sf -- and that should be attenuated with each vertical level that shared the underlying land price. A better comparison would be to take a similarly sized SF home, subtract out the value of the land from the asking price - and then compare it to the condo price.
I think this type of project only makes sense under certain conditions. One -- land is so scarce and population is so large, that its the only option. Two -- when people willingly choose the inconveniences of multi-family living because they're offset by prime locations, neighborhood amenities, short or no commute, etc. Three -- it represents a significant savings over SF pricing. Here in Irvine it seems they're going for option two, but with a very weak sales pitch. As currently priced, I think its a suckers deal.
But, to answer the original question, the best buyer profiles for this type of project (IMO) are single professionals who think kids are 5-10 years away and older (mid 30s+) professional couples without kids or with plans for a small family. Plus, the occasional empty nester.
