The new marketing team for the St. Regis Residences is wasting no time trying to rev up sales at Jon Cronin’s half-empty luxury condominium tower in the Seaport.
The Collaborative Companies said on Wednesday it was running a “limited inventory bid sale” of 10 one- and two-bedroom condos with minimum required offers that are about 20 percent below recent comparable sales at the St. Regis.
Sales have fallen short of expectations since the 114-unit building opened a year ago amid a slump in the high-end condo market. Planned when mortgage rates were below 4 percent, the project was slowed by a lawsuit over waterfront access, and later by COVID-related construction disruptions. The average rate on a 30-year fixed mortgage is now above 7.5 percent, the highest since 2000.
The 22-story tower, the last project by famed architect Howard Elkus, has prime waterfront views and white-glove amenities such as 24-hour concierge and butler services. But the condos — even units that don’t look out over the harbor — were priced at a premium to the market.
Sue Hawkes, The Collaborative Companies’ managing director, said the minimum bid process — an unconventional approach — was intended to reset prices and generate interest in the building.
“I believe there is enough money sitting on the sidelines waiting for a capitulation in the market, and this would be that,” she said. “We believe this will get bids up and the result will be significant sales.”
She acknowledged that existing owners who had hoped to flip their units at a profit may be disappointed by Cronin’s decision. Cronin himself could take a financial hit depending on where the winning bids come in.
“Nobody wants to lose money,” she said. “But the best opportunity for appreciation is when this building is sold out.”.
Most of the units being offered don’t have waterfront views. The minimum bid is $1.4 million for one-bedroom units with a den, down from the most recent comparable sale of $1.775 million. The minimum is $3 million for 2-bedroom units with a den, down from $3.7 million. Bids are due by noon on Nov. 16 and winners will be notified later that day.
Cronin said that he has signed on Leader Bank, M&T Bank, and Citizens Private Bank to offer below-market financing programs. “We absolutely believe in the long-term value of this building,” he said.
Steve DiFillippo, who bought a three-bedroom unit in the St. Regis, isn’t concerned about the potential effect of the new sales effort on the value of his waterfront condo.
“I am there not to sell the place,” said DiFillippo, owner of Davio’s restaurant group. “I am there for the long term. The building is absolutely incredible. The services, the parking, location — I just love it.”