Condos a trend downtown

BY AMANDA McCLURE | MARCH 25, 2009 7:30 AM

Renovating a set of condominiums in downtown Iowa City is part of the city’s long-term goal to bring more people into the area.

In an effort to boost economic development downtown, officials say the project — the Grandview Terrace Apartments — will bring more residents and taxes to the area.

“There are some university students who don’t want to have kegs four days a week, and that’s who we’re catering to,” Lepic-Kroeger Realtor Ryan O’Leary said.

He estimated the renovated condominiums at 332 S. Linn St. will cost between $225,000 and $325,000 — doubling the assessed value of the building. While all 48 units are available to rent, he said he hopes to sell them within the next two years.

“People who move here are the ones who want downtown to work and expand,” he said. “This is a great opportunity for us to work toward that goal.”

Though the condominiums would have high taxable property values, the taxes accumulated on the property wouldn’t dramatically increase. In Iowa City, condominiums and most apartment buildings are taxed at a residential property-tax rate, which is half of the tax rate on commercial properties.

“Economic-development aspects such as vibrancy, shopping, working, and living are going to be greatly improved by this project,” Iowa City Mayor Regenia Bailey said. “But in terms of taxes, they may not make a large difference.”

The current residential property tax is $40 for every $1,000 of a house’s value. According to City Assessor Dennis Baldridge, the average home in Iowa City is worth $177,144.

“It would help propel the tax base by bringing in new residents,” Baldridge said. “Their property values would be much greater as high-end condominiums, but it’s hard to say if that will have a large impact on the tax system.”

Steve Long, Iowa City’s community-development coordinator, said part of the city’s long-term goal is to have residential variety and promote environmentally friendly modes of transportation.

“One of the other great things when people move downtown is that it reduces the amount of driving, and promotes walking and biking,” he said. “Fewer vehicle trips create a greener way to live.”

Long noted the role the UI has played in creating a higher density campus — with fewer people driving to work — and adopting sustainable buildings close to the downtown.

Baldridge said updating the area’s district has garnered a lot of interest in the past decade. Upscale condominiums in the Plaza Towers, 201 S. Linn St., sold incredibly fast when they went on the market, he said.

“It looks like there’s some need for a high-scale lifestyle in Iowa City,” he said. “There seems to be a demand for that type of housing downtown. Ten years ago, a lot of the high-end stores and restaurants that you see today would have never survived.”

Baldridge pointed to the addition of a grocery store and more expensive shops and restaurants in the area.

“Iowa City has also seen a trend towards more high-end businesses downtown,” he said, and one of the city’s goals is to offer the benefits of surrounding neighborhoods in the downtown district.

“Bringing people downtown is always a good thing,” City Councilor Mike O’Donnell said. “If you can look out your window and see the Old Capitol, you’re in a good place.”

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