The happy story will come in time—the one in which 300 more rental units come to downtown, bringing critical mass, businesses and more to the area. But a hill of condo deposits stands in the way.
It’s difficult to estimate the number of deposits still in play at the failed Juhl Lofts condominium project at 353 E. Bonneville Ave. It could be as low as two dozen or as high as 100. In the past two weeks, ST Residential, the site’s new owner, sent letters to buyers with an initial offer of 20 percent of their deposit money.
Buyers are furious at the thought of taking the deal, having paid taxes on the interest made on the money over the past few years (interest that was never paid out to them) and also enduring botched closing attempts in 2008 and 2009 as the condo market buckled.
About 35 of the 341 Juhl condos sold in 2009. The timing couldn’t have been worse. Falling real estate prices had lenders asking for larger deposits in the eleventh hour. Questions about construction defects and appraisals made the situation worse.
Even today, some buyers say they would still purchase a Juhl condo, but only at fair market value. A March sale of a 1,126-square-foot unit fetched only $93 a square foot, a far cry from the mid-$300s to mid-$400s a square foot originally marketed.
But ST is holding the line: If someone really wants a Juhl condo today, they’ll pay their original contract price or negotiate a settlement, company spokesman Pete Marino says.
So now buyers contemplate banding together with legal representation, as former Cosmopolitan condo buyers did, receiving a 70 percent settlement in 2009. In the case of the Cosmopolitan, $200 million in deposits were on the line among hundreds of buyers. Juhl is a much smaller pool.
A unified voice will strengthen the buyers’ cases, says Craig Cherney, a Scottsdale, Ariz., attorney familiar with the Juhl situation. But for now he wouldn’t be surprised to see “various deals being cut at various price points.”
Until the final deal is cut, the modern building at the corner of Bonneville Avenue and Third Street will continue its four-year run of silence.