Yesterday, I had the opportunity to hear Ed Lewis, the developer for The Landmark, speak on the luxury condominium market in Scottsdale and the surrounding areas. The luxury condo market, loosely defined as a project where a condo has sold for $1 million or more, is relatively new to the Phoenix/Scottsdale area. According to Ed, six years ago, there was only one luxury condo development in the Phoenix valley. Today, there are 27 luxury condo developments either completed or under construction.
What is driving this growth? One thing is that many people are choosing to ‘downsize’ their larger homes and move into luxury condo projects that offer all of the amenities and fewer maintenance issues. And since the Scottsdale market is home to many second, third and higher homes that are frequently vacant, these luxury condos work well for folks who want to “lock and leave” their homes until the next visit. Another is the rise in mixed-use developments where people can live, work, shop and dine without ever having to get into their cars.
Ed outlined six value drivers for the condo market. They include:
- Costs – Prospective buyers will take into account the cost per square foot, the quality of the finishes, the condo’s location within the project and other costs such as association dues. There are also some economies of scale when you buy into a multi-family project versus building a single-family home.
- Location – This is the big one for real estate since the location and area demographics are crucial in the decision-making process. Additionally, the popularity of the “pedestrian lifestyle”, where you can walk to dining, shopping, entertainment and more is particularly attractive and gaining a lot of traction.
- Views- By buildings vertically, Ed likened it to artificially building several “hillside lots.” The higher the floor the better the view from your “lot.”
- Community Amenities – In luxury developments, the amenities are many. You will see spas, top-of-the-line fitness centers, resort-like pools, beautifully designed club rooms, business centers, private storage, wine storage, retail space and more.
- Community Services – These services can run the gamut from valet service, porters, round-the-clock concierges, security and onsite property managers and maintenance.
- Home Features – These are the actual characteristics of the condo itself from floor and location, finishes, views, floorplan and more.
It was a wonderful session and afterward we were invited to tour The Landmark. In my next post, I will describe The Landmark and some of the remaining units for sale. It is a spectacular development and truly lives up to the promise of a luxury condo development.
