Virginia empty nesters find city living to their liking

by Rob Walker
For Virginia Business
August 2005

James E. Kane Jr. and his wife Maureen raised three children in Richmond’s comfortable West End suburbs but that chapter in their lives is about to end. Kane, who works at Morgan Keegan in a downtown high-rise, finds the new condominiums outside his office window to be increasingly attractive. “We were looking around Urbanna for a place at the river, but we’d like something here, what the French call a ‘pied-a-terre’ in the city,” says Kane. “You have restaurants and shopping close by. There’s a community atmosphere. It’s almost like Manhattan only in Richmond.”

The Kanes are part of a new and, until recently, unlikely cohort. They are migrating into Virginia cities that are being transformed by and for them. Call them urban seniors, they are people in their 50s and 60s whose busy retirement or preretirement plans seem suited to city life.

The movement is being driven by a confluence of circumstances beginning with the aging of the population that will accelerate for another decade. This population includes a lot of people who share the good fortune of owning homes whose values have skyrocketed. They have equity aplenty and interest rates are still low.

As Michael Campbell, Richmond vice president of Daniel Corp. — which is developing two high-rise condominiums on the James River — notes, “These are people who want to downsize, not downscale.”

The city offers new appeal to empty nesters, says David H. Downs, who holds the Alfred L. Blake Chair of Real Estate at Virginia Commonwealth University. “The kids are grown so all those amenities that attracted us to the suburbs aren’t so important any more,” he says.

There are practical reasons for moving in town as well. Gasoline prices keep rising, and the grass keeps growing. “If I want to go to a concert or a play or I want to enjoy the nightlife downtown, I’m not schlepping all the way out to Goochland when I’m done,” Downs says. “I’m going to my palace overlooking the river.”

Some of Richmond’s leading citizens are part of the movement. Septuagenarian Mayor L. Doug Wilder, for example, lives in hip Shockoe Bottom. James Ukrop, chairman of First Market Bank and a senior member of Richmond’s prominent supermarket family, is shopping for a riverfront condo. “It would be nice to walk to work,” says Ukrop, whose office is just a few blocks from Riverside on the James, Daniel’s 122-unit condominium complex that opened in July. “One hundred years from now, historians are going to look at the 1950s to 2000, at the cul-de-sac society, and they’re going to ask, ‘What were those people thinking?’” Ukrop says. “This is a different experience.”

Interest in the city experience is not confined to Richmond. Urban seniors are flocking to new downtown developments in Norfolk and Roanoke.
On Granby Street in Norfolk, developers have planned 31-story Granby Tower, which would be Virginia's second-tallest building. Hundreds of buyers reportedly have signed up to buy 309 condominiums — priced from $250,000 to $2 million — in the $125 million mixed-use project. However, next year's construction schedule is now in question. At press time, the U.S. General Services Administration had expressed interest in obtaining the 1.7-acre downtown parcel through condemnation for use in expanding a federal courthouse.

In Roanoke, scaffolding went up recently around the venerable State & City building, and work is under way on the Colonial Arms building. Both are being converted from office space to condominiums.

With prices in the hundreds of thousands per unit, many of the prospective buyers are people in their 40s, 50s and up, says Rob Glenn, managing partner of Issues Management Group, developer of the State & City project.

While Virginia’s cities are returning to life, reports of the demise of the suburbs clearly are premature. Downtown Norfolk and downtown Richmond have shown dramatic growth rates recently, but the suburbs dwarf their totals. During the last five years, Richmond added about 3,000 residents downtown, Norfolk, 2,800, and Roanoke, 350.

From 2000 to 2003, by contrast, suburban Henrico County added 9,000 residents; York County, 4,500; and Roanoke County, almost 2,000.
In fact, Richmond’s overall population continues to decline, despite the influx of downtown residents, according to Census estimates.

Aubrey Layne Jr., president of Great Atlantic Management — one of Hampton Roads’ largest multifamily housing companies — says there is “no major shift” in housing patterns. “As the cities add infrastructure and jobs, they will attract people, including older people, who want that sort of community, but they’re not the first choice for most people, and they won’t be for a while,” says Layne.

Nonetheless, the new downtown demographic has caught the eye of the real estate industry. Daniel Corp.’s Campbell says Riverside on the James was planned as apartments, “but we had so many calls from people who wanted to own that we decided to make it condominiums” priced from $140,000 to $595,000. Within 90 days, all the units were reserved.

Daniel announced a second tower, the 162-unit Vistas on the James, this spring. Like Riverside, it boasts upscale city living with dramatic views of the river and the skyline. It was booked within five days. “The standards you are seeing in new buildings for these buyers are beyond anything that has been on the market before,” says William White, president of Joyner Fine Properties, which is handling Daniel’s two projects.

These are not the bohemian tenements of the past. The new developments come with fitness clubs, spas, rooftop pools, doormen and concierge service. “There’s greater depth to the market for this kind of property than we had expected,” White says. “It’s a real mix of younger professional singles and couples, empty nesters and older people. It’s going to be an interesting community.”

Leonard I. Ruchelman, professor of urban studies and public administration at Old Dominion University, is elated about what’s going on in downtown Norfolk. “Norfolk has managed to create a critical mass of activities, from MacArthur Mall to the opera and symphony and theater,” he says. “The old religious institutions are here. There’s a sense of security now. All this is attractive to older people. I know a lot of them. This is what they want.”

Expansive views of the Elizabeth River, a central location and a complete menu of amenities are the draw for this more mature market, says Jason Dodd, vice president of marketing for Marathon Development, the developer for Granby Tower. “The demand is clear when other downtown condominium developments are being reserved and purchased before construction can even begin.”

If it proceeds, Marathon anticipates the development will attract a mixed clientele with active seniors and empty nesters making up a significant share.

Its neighbors on Granby Street will include Harry and Sue Cohen who are moving this summer from the home where they spent 27 years raising a family. The Cohens, who will continue running their furniture business, are moving from their 4,000-square-foot house into an 1,800-square-foot co-op. “Our temple is right across the street and we’re not far from the rest of our family,” says Sue Cohen. “The building is very well built, and we have a garage and private elevator. We can walk to the grocery and shops. We like to get up and out.

“The best thing is we got top dollar for our house so we could afford something nice like this,” she says. “It’s a great place.”

Likewise, Douglas Wills and his wife Wanda moved into Eight Jefferson Place in downtown Roanoke two years ago and they are “having a great time,” he says. “We’ve seen a lot of younger people move in and out” of the building but now, older people are moving in and staying.

Wills, 62, is retired from the U.S. Postal Service, and Wanda walks to work at Carilion Roanoke Community Hospital. “We use the car less each month. That is a pleasure,” he says.

Their apartment is in the former Norfolk and Western office building, which was built in 1896. The 87 units boast what the marketers call “the grandeur of the past.” It is in a prime location near the hospital, the Hotel Roanoke, the lively Market district and the Higher Education Center. “We like the mix of people of all ages, races,” Wills says. “We have lawyers and doctors and then there are postal workers. It’s a metropolitan place.”

Jennie Dotts, executive director of the Alliance to Conserve Old Richmond Neighborhoods, says civic organizations like ACORN love these newcomers. “They totally throw themselves into all aspects of the community,” she says. “These are people who want communities and relationships that are not dependent on the car. We appreciate their energy and vision.”

Glenn, the Roanoke developer, agrees that urban seniors are a positive influence. “Having these people take an equity stake in property in the city can do nothing but good,” he says.

John Woodward, Richmond’s director of economic development, says the new interest in city living “is organic and unprecedented. People who have spent much of their lives in the suburbs are realizing downtown cannot be replicated. You can live 10 stories up. You can walk and enjoy rich architecture, white water, shops and restaurants. There are all kinds of people along the way. This is unique.”

Dozens of downtown residential projects designed for this more mature market are on the way in cities across the state. “This is going to be a big win for cities,” says VCU’s Downs, “and the commercial real estate players have recognized that.”