Ashley Terrace high-rise in downtown Ann Arbor sold to investment firm
Ashley Terrace, the mixed-use high-rise in downtown Ann Arbor, has been sold to an investment group in Bloomfield Hills, Mich.
Alidade Capital Fund LP bought the building from the lender Bank of America, which foreclosed on it early this year.
Ann Arbor News file photo
The purchase, according to information provided by Alidade, will be just over $6 million once all aspects of the deal are finalized.
The building includes 99 condos, 17,100-square-feet of office space and 9,702 square feet of retail space at the northwest corner of West Huron and North Ashley.
The purchase, completed last week, includes 29 unsold condos, in addition to the retail and office space and the on-site parking.
The building was built in 2008 by Joseph Freed & Associates as part of a building boom following intense developer interest in downtown Ann Arbor.
Condo sales hit some roadblocks as the economy turned, with the lender eventually starting foreclosure proceedings in spring 2010. That move accompanied other actions by BOA against the Chicago-based Freed.
When the foreclosure was filed, the outstanding debt on the property was $20 million, according to county records.
Freed also led the redevelopment of Arborland, which it sold in 2005 for $102 million, and built the 411 Lofts student high-rise on East Washington, which was sold in late 2010.
Meanwhile, Alidade Capital also owns Station 3 Lofts in Royal Oak.
Comments
Tru2Blu76
Wed, Jul 6, 2011 : 8:31 p.m.
I guess we'll have to wait and see how this all affects the current tenants. Wondering: if it's possible for AnnArbor.com to get tenant stories? We NEED Capitalism, but do we need consequences like this?
Goodphotographer
Wed, Jul 6, 2011 : 4:18 p.m.
What a deal! I wonder how long before they make that money back. @kef...I'm sure it looks better from the inside than out : )
Veracity
Wed, Jul 6, 2011 : 2:12 p.m.
Andy Piper: A huge demand for cheaper rental housing downtown may exist but certainly Ashley Terrace was unable to attract occupants at rates that would have allowed the original owners to make a profit. Alidade Capital Fund LP can afford to slash rental rates and still make a profit since the property was purchased for less than a third of its construction costs. New construction remains expensive and Ashley Terrace is not the only new residential construction downtown that has lost money and needed to be sold at deep discounts to its construction costs. If Village Green's City Apartments, the Georgetown Mall, and Arbor Hills Crossings are ever built expect that they will add to the list of failed developments. IMHO, with each instance, developers obtain approvals from City Council and quickly take their profits off the top of any financing. Then they have no financial risk from business failure once construction of the buildings is completed. Are you still wondering why financial institutions are reluctant to loan money? BTW, I wonder if Alidade Capital Fund LP was able to renegotiate TIF payments to reflect the significant drop in property value. Of course, such a deal would reduce benefits to the City (SOP).
Andy Piper
Wed, Jul 6, 2011 : 11:18 a.m.
AShley Terrace is 100 percent full as the 29 units are presently rentals. There is a huge demand for downtown Ann Arbor housing. If the new owner prices these right they should sell quickly and the new owners will be grateful to have a place downtown, with secure parking that is not run down. Take a look at any of the real estate websites and you will see how little inventory there is available in downtown Ann Arbor. If you want something that is newer and clean with parking - forget it!
CynicA2
Wed, Jul 6, 2011 : 11:50 p.m.
Because they are rentals does not mean they have rent-paying tenants OCCUPYING them. Some may have tenants, but judging from the number of lights on in that place on any given evening, I seriously doubt that even the sold units are all occupied. Even during the school year, there are plenty of consistently dark windows to be seen. Maybe the occupants are just energy conscious - but I doubt it.
kef
Wed, Jul 6, 2011 : 2:20 a.m.
This building gets my vote for #1 ugliest building in town. Good Luck.
CynicA2
Tue, Jul 5, 2011 : 9:21 p.m.
So... what kind of hit did Freed take on 411 Lofts, if any? How much did he owe on that, and what was the selling price? I have heard that was a debacle, too, but don't know the numbers. B of A sure took it on the chin - $20 million owed versus $6 million on the sale. But then again, no one ever accused commercial bankers of being rocket scientists. They can peeled pretty good in the financial collapse by those sharpies on Wall Street and their good buddies in DC. Buy high, sell low, guys! Way to go!
Tom Joad
Tue, Jul 5, 2011 : 9:14 p.m.
Basically 1/3 empty. I would have guessed higher. I never see any lights on in that building.
CynicA2
Tue, Jul 5, 2011 : 9:25 p.m.
Yeah, me neither. Guessing many that sold were bought buy speculators hoping to flip them, 'cause you KNOW that residential real estate never goes down, right?! Then they got stuck with them and couldn't even rent them when the Great Recession hit. So there they sit... !