Museum Tower shell 2010
You may recall that in early November 2012, Museum Tower came out with a gutzy move to spur condo sales: offering buyers an unprecedented two-year, money-back price guarantee. George Zimmer’s voice kept circulating through my head. At the time, I remember thinking, wowsers, that’s bold and I need to know more about this!
Well, Steven C. Sandborg, Vice President of Sales and Marketing at MT, and I finally got together to discuss the deets. And this is rather unprecedented. Let’s say I go in and buy a gorgeous unit on the 12th floor of Museum Tower for $1,400,000, MT’s lowest priced unit. From the day I close on that condo to the two year anniversary of the closing, I have a contractual right to exercise an option to sell it back to them for the price I paid for it. Or shall I say, this option is included in my sales contract. That option says that I must give the developers 30 days notice that I want to sell my unit back to them for what I paid for it in January of 2013. Then they have 60 days to buy it back.
Simple: If I paid $1.4 million, MT will buy my unit back from me for $1.4 million two years down the road if I choose to move out.
What they are doing, here, is giving buyers an assurance they won’t lose money, guaranteeing their investment will hold it’s value for 730 days. Because of all the controversy surrounding MT’s “reflective problem” in the media, potential buyers may be concerned, and may have expressed concern, that the condos could depreciate in value.
Well, this little clause will sure fix that.
I asked Steve — can the developer say no?
“We cannot say no,” he told me. “This was done to address both current and future buyer concerns about the building because of all the questions that have been raised with the reflective issue.”
This was done, he says, to instill confidence in the value and future of the building.
“We believe happy people won’t go anywhere,” said Steve. “That’s how confident we are about Museum Tower… it’s value is sterling today and will be in the future.”
Why two years, I asked? Did they think it might take that long to get the Nasher issues resolved, for any controversy negativity to fade off into the sunset?
No, he said, it was just a good number.
“You need two years to make a proper judgement on living in a place,” said Steve. “A year too quick, 18 months might be OK, but two years is perfect.”
Has there ever been a program like this anywhere else? Yes, said Steve: he had heard of a similar program at One Arts Plaza in 2007 and 2008 where 90% of the purchase price was guaranteed in a buy back. It was successful, says Steve, for what they wanted to achieve at the time.
“Museum Tower is going to be a great building, and a very positive investment for Dallas,” says Steve. “And this has definitely helped move some contracts.”
Of course, the hush-hush negotiations between Jack Matthew’s Matthews Southwest and Museum Tower’s owners could change the guarantee — if, for example, new owners (whoever they might be) decide to ditch the offer going forward. Of course, anyone who has already executed a contract with the guarantee is protected.
“Our whole focus all along was to step up sales effort for right now, when the building is finished,” says Steve. “This program will be a real benefit as we move forward.”
Indeed. Museum Tower is hosting a private New Year’s party Thursday night, and the RSVPs have been so overwhelming the party is sold-out. Not to worry, Steve tells me he has already had to plan for a second party because of more big news….