Is the stalled Grand Avenue project showing some life?

Much of the $3-billion mega-development remains on hold, but plans are being considered for a residential tower that had been originally tied to a later phase of the project. The tower would be located on Grand Avenue, where there's currently a surface parking lot. The developer, Related Cos., faces a Feb. 15 deadline to break ground, but that's not going to happen, and Related has been pushing for a two-year extension. From the Downtown News:

The site was environmentally cleared for two condo towers of up to 35 stories. But Related, which is working with the CRA on schematic designs for the tower, now envisions a shorter apartment tower, likely between 20 and 23 stories, [said Bill Witte, president of Related California]. Twenty percent of the units would be reserved for affordable housing.

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While demand in the condo market doesn't support the cost of new construction, current economics may support a purely rental project, said Witte. He pointed to 717 Olympic and the Watermarke Tower in South Park as examples of recent new rental projects that have worked in Downtown. There remains no concrete timeline or budget for the new proposal. The new tower, which does not yet have an architect, would still require financing.

It's not a perfect solution. As a rule, apartment rentals are considered less desirable than condos. Buyers pay for their units up front and are more likely to stay awhile. Renters tend to be transient, which means apartments can sit empty for months at a time and not generate enough cash to pay off the debt service. Higher turnover also results in heavier wear and tear.