Not all home construction in Philadelphia has stopped dead in the water
because of the current real estate slump and credit crunch for developers. Some developers are adjusting sails to suit lighter breezes.
Among those who've found bank financing and have a project under way are developers Stan Godorov and Richard Woldow. With Royal Bank of Pennsylvania money, they're turning 26 Civil War-era millworker rowhouses in the Manayunk section into a European chateau-style village.
Godorov and Woldow are accustomed to bigger projects, but they say smaller ones like this are a way to sail through the current slump. Their secret: keeping the price as low as possible. Lower prices mean more potential buyers can qualify for mortgages.
The developers are asking $79,900 for the smaller 810-square-feet trinities, and $85,900 for slightly larger ones with decks. They believe the prices are low enough to attract young professionals "who make a nice income but haven't accumulated much in savings," Godorov said.
The so-called "Alden Walk" project is one of "a number of smaller projects" under way at a time when building "activity is astoundingly low," according to Harold Berk of Harold R. Berk and Associates, legislative chairman for the Building Industry Association of Philadelphia.
Activity is in the doldrums for two reasons: Fewer buyers are buying during a nationwide real estate slump, and many banks are reluctant to make loans for big commercial and residential projects in the wake of the national savings and loan crisis.
"Clearly, one of the big efforts under way everywhere is to get a handle on costs," Berk says, "because the cost of housing has gotten out of sync with our demographics. There are not sufficient numbers who can afford to buy."
Godorov says marketing studies show that potential young professional buyers for his Manayunk development now live in nearby apartment complexes. He says their rent is higher than a mortgage would be at "Alden Walk," on Umbria Street near Gates.
To lure those renters, Godorov and his partner are making the trinities as maintenance-free as possible; they come with brick patios front and back, for instance, not grass.
Godorov says a selling point to Royal Bank - the 10th bank approached over a period of about seven months - was that "we could refinance if the market turns really bad and rent them and sell them later individually."
Godorov's last big housing project was the construction of 43 townhouses in East Falls at Indian Queen Lane and Wiehle Street. The three-bedroom, 2 1/2- bath townhouses went on the market in 1987 beginning at $89,900.
Godorov's partner, Richard Woldow, has mostly built commercial buildings, including the 5000 Boardwalk condominium building in Atlantic City.
In Manayunk, Godorov and Woldow gutted the rowhouses, which were built in 1860 to house mill supervisors. The rehabbed trinities retain only the original 18-inch exterior walls in their new life. The developers enlarged existing windows, giving each trinity two sets of French doors with wrought- iron railings. Each house comes with major appliances, air conditioning, skylights and other amenities.
About 20 minutes from Center City, Manayunk is the hilly home to the CoreStates U.S. Pro Cycling Championship. Just as the real estate market slumped here about 18 months ago, young professionals were snapping up its rowhouses to rehab, and along its quaint Main Street, entrepreneurs had opened trendy bars and restaurants.
Home sales are down in Manayunk and throughout the city. Last month, the Philadelphia Board of Realtors released figures showing that 27 percent fewer homes had been sold in the first three months of this year compared to 1989.
