Orlando Project Being Planned

ORLANDO, FL - Developer Craig Ustler is forging ahead despite the credit crunch, recession and commercial market slowdown putting the brakes on large construction projects. His firm, Ustler Development Inc., is planning a $10.1 million, 30,000-square-foot, mixed-use development at 800 N. Orange Ave., catty-corner to its 801 N. Orange Ave. project completed in 2006 in downtown Orlando.

Preliminary plans for the new five-story building include 1,000 square feet of ground-floor commercial or gallery space, 15,000 square feet of office space and residential condos.

The reason for planning the project now: Although downtown Orlando's commercial and condo markets are still going through the wringer, things won't stay that way forever, Ustler said. "It's fair to say we're trying to time the market — we want to position ourselves to ride the wave up. To do that, you've got to be in planning stages now."

Once construction financing is secured for another project his firm is developing — the $35 million, 105,000-square-foot office building that will be a regional headquarters for GAI Consultants Inc. near Lake Eola — Ustler will assemble a development team for the North Orange Avenue project. The firm hasn't named an architect or an engineer, although Orlando-based Baker Barrios Architects did some preliminary work on the project.

Thomas Chatmon, the city's Downtown Development Board executive director, said Ustler Development's interest in that area shows economic investment activity is growing northward from the central business district. The project will add to existing and planned mixed-use developments, "creating a vibrant and viable uptown district," he said.

One surprising piece of the project is the planned six residential condo units. The downtown condo market is in such bad shape that several new condo towers — including The Paramount at Lake Eola and 55 West — have shifted to leasing plans.

In addition, foreclosures continue to pile up in downtown Orlando. RealtyTrac reported 21 loan defaults in March for the downtown ZIP code of 32801. Much of the residential property downtown is multifamily, industry sources said.

But Brenda Genant, vice president of sales for Coldwell Banker The Condo Store, said Orlando may be on the verge of a market shift, since sales are up. The Florida Association of Realtors reported 280 condo resales in February, more than double the 125 condos sold for the same month in 2008.

Much of that could be attributed to lower prices, as foreclosures and short-sales drive down prices. The median sales price for condos in February fell 65.4 percent, from $162,800 in 2008 to $56,400 this year, the association said.

If Ustler has the project ready to go when the market turns and it is priced right, said Genant, he'll benefit from pent-up demand. "You're starting to see cash buyers coming out of the woodwork. If you can pull the permits, get the construction permits lined up, you can pull the trigger when the time is right."