Mayor Says Lumberyard Condo Sales Are Picking Up

The Lumberyard project—an endeavor that will total $50 million as a whole—is finally seeing condominium sales on units comprised in Phase Two of the project.

And the sales come as a breath of fresh air. Collingswood Mayor James Maley says progress is long-overdue, mainly because the economic recession reared its head just after Phase Two of condo construction was complete.

"If I knew that the worst housing recess in the history of the world was coming, we probably wouldn't have started (construction on condos) the year before (the recession hit)," said Maley.

During Phase One of Lumberyard condominium construction, 41 apartments and 10 retail units had sold out immediately. But when Phase Two was complete—the most recent Lumberyard construction—the recession left new, beautifully designed homes sitting vacant, on prime lots in the heart of downtown Collingswood.

The borough made every effort to try and sell units in the midst of the economic crisis.

And now, Maley said, those efforts are finally paying off.

"We've been offering different incentives (to condo buyers), including price reductions, tax abatement deals," he said. "We've been offering theses types of incentives for the past year."

And the proof is in the pudding. While not every Phase Two unit has been sold, they're moving slowly, but steadily—a far cry from the beginning, when they all stood vacant.

Of 24 condos that make up Phase Two of The Lumberyard project, eight are currently occupied, and 16 are still still for sale.

"But a couple of those (16 available) units are already under agreement, and a few more are just waiting for contracts to be completed," said Maley.

One factor that's accountable for the spike in recent sales? The borough is offering five-year tax abatements to all buyers.

"The abatement we have in place lets buyers pay a percentage of what their taxes would otherwise be during their first five years of occupancy," said Maley. "I don't have the specific numbers in front of me, but a buyer would pay something like 20 percent of their taxes in year one, then 40 percent, and so-on, until they're finally paying taxes 100 percent in-full by the fifth year. It's a graduated system, meaning a homeowner gradually pays more and more taxes, until they're eventually paying full taxes during the last year."

But what about units that are still vacant? Does the borough pay taxes on those units until they're sold? 

"Some units are still sitting empty, but taxes on those units don't start until a certificate of occupancy is issued. When someone buys a unit, and gets their certificate of occupancy, they start paying taxes from that point forward," said Maley.

But Maley added that, on the borough's end, there are still some costs associated with empty units.

"For us (the borough), there are some taxes, but we're taxed on the land where the unsold units sit," said Maley. "But those taxes amount to something like $18,000 a year total. And it's the kind of money that comes out of your left pocket and goes back into your right pocket."

Which pocket is the right pocket? It's a pocket that will soon benefit the borough, said Maley.

"We (the borough) are different than a housing developer," said Maley of developing The Lumberyard. "Because this project will be a benefit to our town for the next 50 to 100 years. It's a project that'll bring tax revenues for both the borough, and the public school system. It's a project that'll create community benefits way beyond what people might think."

But whenever the last Phase Two unit sells, that sale still won't mark the end of The Lumberyard project. The final portion of the project will begin soon, in which a complex of only commercial units will be constructed across from Powell Lane.

"We have slightly different plans for that building, which will include all commercial units—and most likely no residential ones. We haven't started construction on this phase yet, but we'll begin as soon as we find people to occupy the commercial offices," said Maley.

Nothing about the final legs of The Lumberyard project have been easy, but upon completion, the body of the project will be worth every setback.

"It (project development) is definitely harder than in the past. The world has changed," said Maley. "But we're still ready to make things happen and better our town."