After nine months and no presales, a high-end condo tower envisioned for the end of Tobacco Row has been scrapped.
Developers David Johannas, Jerry Peters and Howard Kellman have pulled the plug on One Shiplock, an 11-story, 15-unit building planned at 2723 E. Cary St.
The project, which was valued at $10 million, did not secure one buyer since floor plans hit the market last June. The highest-priced units were listed at $1.55 million.
Johannas, a local architect, had touted the project as introducing a home ownership option in rental-heavy Shockoe Bottom, but he said minimal interest and feedback from prospective buyers told him the location is not ready for the higher-end, modern product they were pitching.
“I don’t think this location has quite come into its being yet,” Johannas said. “It’s not quite connected over to Stone (Brewing), it’s not quite connected over to Rocketts Landing, so it feels like it’s floating over on the edge.
“I feel like more development needs to come into that area to attract a higher-end buyer in that location,” he said. “Maybe a lower-end buyer would still be interested, but there’s a little more connectivity that has to happen over there.”
Peters, a veteran Richmond developer whose projects have included the Scott’s Edge apartments in Scott’s Addition, said they were surprised by the lack of interest. The project had received a special-use permit from the city and had the support of the Shockoe Bottom and Church Hill neighborhood associations. Purcell Construction was signed on as the builder and contractor.
“It’s really surprising to us, and very disappointing, obviously,” Peters said. “There’s just no market that materialized.”
The units were being marketed by One South Realty Group, which held a launch event last summer and developed a website for the project. After several months with no buyers, Peters said they supplemented One South’s efforts with local marketing firm Madison+Main, to no avail.
“Still nothing materialized, so Jan. 1 we said it isn’t going to happen and there’s no sense in continuing to push on it, and we made a decision to abandon the project,” he said.
Peters offered guesses as to why the units didn’t sell, from location to product to price point.
“It’s a relatively modern project. Every time you start to make a design somewhat interesting, it narrows the market,” Peters said. “Maybe we just designed a product that wasn’t particularly attractive to the Richmond market at that price point. Or it would have been a good product, but not in that location.”
Peters also suggested some effect from The Tiber, a long-stalled development near Libbie and Grove, as potentially influencing the local market for high-end condo presales.
“There was some supposition that there was some residual overhang from The Tiber project that cast a pall on the concept of buying high-end condos on spec,” Peters said. “We never had that objection raised specifically, so I’m not sure that that’s the case.”
The 0.3-acre site at the foot of Pear Street is owned by David White of development group Historic Housing. Peters said they were under contract to purchase the site, which factored into their decision to pull the project.
“We weren’t under pressure exactly, but we were being asked to make a decision because we had the land tied up and we weren’t using it,” he said.
White, who is seeking zoning approval for a five-story apartment building at Pear and East Main streets, said he was surprised by the lack of response for One Shiplock. Through Historic Housing, White had previously proposed condos for a 13-story building that ultimately was withdrawn due to public opposition.
“I was surprised that they hadn’t been more successful with sales than they were,” White said. “The project that I proposed down there, I actually had quite a few (unit) reservations before I even got started on it.”
While Peters and Johannas said they will not propose another project for the site, White said he sees apartments there some day.
“We are taking a look at some possibilities of maybe an apartment development there. Nice apartments, but apartments – not condominiums,” he said.
Meanwhile, Historic Housing’s zoning request to accommodate a five-story apartment building at 2801 E. Main St. received the support of the city planning commission last week. The request, first made in late 2015, was scheduled to go before city council last night, but White said they were requesting a two-week deferral to allow time to review the project with neighborhood groups.