'Sold!' Auction reflects downturn
Bidders pack meeting room, get better condo value than expected
At the Seaport Hotel yesterday, a condo auction drew plenty of potential buyers, and yielded several bargains. (John Tlumacki/ Globe Staff)
By Kimberly Blanton, Globe Staff | October 8, 2006
Kevin Starr jumped into the fray as bidding for the third-floor Boston condominium kicked off at $825,000 and surged to $835,000, then to $837,000.
Hoping to elicit an $838,000 bid, the auctioneer, Ken Cullum, shouted, ``You won't be sorry tomorrow!" No one took the bait. ``Sold for 837!" he said, pointing to Starr, who had snared for $837,000 a condo that had been on the market for $1.2 million a month ago.
``I thought it was the deal of the auction," Starr said.
``I had no idea he was going to bid," said his wife, Daire Starr. ``Oh my god!" she screamed with joy.
The Starrs were among almost 200 registered bidders who packed a meeting room at the Seaport Hotel for an event that had been the talk of the town. The auction of 31 unsold units in the 96-unit FolioBoston in the city's financial district was the first of a newly constructed project in the Boston area since the 1990s real estate bust. The two-hour auction had been seen as a way to gauge values in a softening real estate market downtown.
Bidders ``got a better value than we thought they'd get," said Jon Gollinger , FolioBoston's sales agent, whose firm, Velocity Marketing, conducted the auction on behalf of the Folio developer, Michael Rauseo. ``But we're satisfied," Gollinger said. ``The market has spoken."
Ten condos, with asking prices of $1.16 million to $1.76 million, sold for prices that were 21 percent to 36 percent below the asking prices. Less-desirable or smaller units on lower floors or with no views -- mostly priced in the $800,000s, and therefore attracting more bidders -- sold at smaller discounts, of up to 29 percent.
In the second quarter of 2006, the median price for downtown condos declined 4 percent, to $454,500, compared with a year earlier, according to the most recent data available, from Listing Information Network, or Link, which tracks the market.
Link's president, Debra Blair, said the auction's results had confirmed that while the market has softened, the bottom hasn't fallen out.
``Bidders came out ahead because they got a little bit of a deal," Blair said. ``If this market was stagnant and falling, you wouldn't have had as many registered bidders" buying at those prices. Most of the units sold for well above the minimum prices the developers had said they would accept.
Bryan Rich's hands shook as he signed an agreement to follow through on his $1.14 million winning bid for a 14th-floor penthouse with a terrace.
Five minutes later, he won another contest with a $1.09 million bid for a terraced unit next door with water views.
``My wife's going to kill me," joked Rich, former business owner who recently moved from the Boston suburbs to Miami. He plans to rent the units.
Having lost out in earlier bidding attempts, Deb Connolly , a nurse practitioner at Massachusetts General Hospital, won the auction of the final unit on the block. She agreed to purchase a 1,216-square-foot unit, with two bedrooms and two bathrooms, for $608,000. ``It was a great deal," said Connolly, who rents an apartment in the North End.
Steve Goulas wasn't ready to buy yesterday. Sitting amid the frenzied bidding, methodically recording each unit's sale price, the Manhattan investment banker for JPMorgan said he was just observing. He and two friends, Boston attorneys, want to buy a condo. They believe prices will continue to drop over the next six to nine months, he said, because so many condos are under construction.
Goulas had a parting comment as the auction ended: ``I'll see you at the next one."
Kimberly Blanton can be reached at blanton@globe.com.
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