Niche Development: If You Build It, They Will Come

Posted by: Kevin Koitz on October 2nd, 2010

What has 2700 to 3500 sq. ft of one-story living, at least 2 bedrooms+, at least 2.5 baths, upscale finishes, 2-car garage parking, and a balcony or terrace for outdoor living?

If you live in Bethesda, Maryland…the answer is “nothing”….at least nothing currently available to purchase…and just a few lucky owners are living in the limited number of units that fit this description.

Despite a crying need for luxury “empty nestor” pads in walkable communities, developers in downtown Bethesda Maryland (an urban village in the close-in DC suburbs) don’t seem to get it.

Most condo buildings may have a couple of these high end units, but the majority of the development is devoted to 1 and 2 BR units with a square footage that tends to max out at about 1200-1400 sq. feet.

And the requirement for a “balcony or terrace for outdoor living”? Nope! Developers haven’t gotten the point. You CAN sell outdoor space. Even if it doesn’t “count” as finished square footage of the unit.

Two of Bethesda’s largest luxury buildings, The Lionsgate and The Edgemoor, you’ll be lucky to find much larger than a “Juliet balconies”. Great, so you can open the doors and probably squeeze your body out onto a narrow ledge (with railings, of course :-) — but there’s no way to fit a chair so that you can enjoy your morning coffee or your evening glass of wine (or your morning glass of wine and evening coffee?) in the great outdoors.

Outside space is crucial to the buyers who call us and are looking to downsize. All are giving up large, single family homes and are already a little anxious about traveling to their new homes via an elevator. And now you’re going to tell them that they can’t even step out onto a balcony should they start feeling a little cooped up???

With a lot of development in the downtown core area of Bethesda currently on hold because of the economy, developers would be wise to reconsider their plans. It is obvious from the calls we get that there is a crying need for large(r) condos as described in the first paragraph above.

A boutique building made up almost entirely of 2700 to 3500 square ft units would do extremely well in our market area…in any economic climate. So a kind reminder to developers — just do some research.

Especially with many housing markets relatively stagnant, you don’t need more inventory, but I’m an advocate for more “smart inventory”.

What’s happening where you live? Are you seeing a need for similar housing or some kind of “niche property”?




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