A young Midwest company specializing in urban infill projects sees Tampa Bay as its next stronghold. Will it outlast the eventual market downturn?
Views at North Hyde Park, a new townhome development in Tampa’s tony Hyde Park neighborhood, would fit right in among the art deco and ultra-modern funkiness of South Beach.
But common for Miami is decidedly uncommon for this side of the state.
“The inspiration for it was to do something unique and different in the market,” says John Bain, executive vice president of operations for Onyx + East, the Indianapolis-based company developing Views at North Hyde Park. “Something that’s modern and trendy but still has a classic feel to it, to the point where hopefully in four or five years it’s not out of date.”
“We really believe in the location. It’s at the epicenter of the urban renaissance that’s happening in Tampa.” John Bain, executive vice president, Onyx + East.
The $15 million, 37-unit project — with its minimalist, boxy lines and chic rooftop terraces offering, you guessed it, spectacular views of downtown Tampa — is a splashy way to enter the Tampa market for Onyx + East, which, in its brief history hadn’t been involved in any projects outside Indianapolis. Two years ago, the company was spun off from Millhouse Properties, a developer of multifamily properties that operates in 11 U.S. states and primarily focuses on the rental market.
Onyx + East, as a standalone company, has chosen to specialize in urban infill projects, mainly condos and townhomes in pedestrian-friendly, amenity-filled areas in and around the downtown core of Indianapolis. When the company decided to expand outside its home base, Tampa, and Hyde Park, became a prime target.
“We really believe in the location,” Bain says. “It’s at the epicenter of the urban renaissance that’s happening in Tampa, and within close proximity of many things that people will want to do, like parks and restaurants … the access to the lifestyle that it creates was what attracted us.”
Onyx + East wasn’t the first developer to take an interest in the 1.3-acre site at 405 N. Oregon Ave. The first would be Renier and Michelle Gobea, who acquired the land from New Salem Missionary Baptist Church in 2015 and had intended to build a townhome community called Las Azoteas — similar in design to Views at North Hyde Park — on it before moving on to other opportunities.
Onyx + East, Bain says, had been eyeing opportunities in the Tampa Bay area for a while, and bought the parcel from the Gobeas for $2.8 million. St. Petersburg-based Peregrine Construction Group has been contracted to construct the five buildings and two single-family, detached homes that will comprise Views at North Hyde Park;
The townhome units will be priced in the $400,000s; sales are under way with a couple of deals already pending. Bain expects the units to be move-in ready within eight to 10 months.
While some housing analysts believe the multifamily sector, after a long period of growth, could be headed for a correction, Onyx + East officials are confident in their Tampa timing. Bain, for example, rattles off numbers in a variety of categories, ranging from available housing supply to median income level and even more esoteric stats, like rate of household formation, to justify the firm’s decision to head south.
“When we looked at the macroeconomics of the Tampa market, we felt very confident,” he says. “Tampa behaves like a Midwest market, to a certain extent, so it’s very familiar to us. With this project, but even in a broader sense, we are making a commitment in the Tampa/St. Pete market. We feel it’s a good market for us, now and well into the future.”
Adds Bain: "Construction is cyclical. You know and anticipate there’s going to be some correction. We’ve been on a long run of positive growth, one of the longest we’ve had as an industry, but we feel this project is positioned well and priced competitively, so that even with a market correction, we are very confident in it.”
Without divulging specifics, Bain says Onyx + East is “in active pursuit” of additional property development opportunities in the region. He hopes to have at least a couple under contract and started in 2019.
“All the numbers [in Tampa Bay] look very good, very promising for us from a market perspective,” he says. “We have a pretty well-defined matrix that we go through when we’re evaluating a market and Tampa clicks off a lot of those boxes.”