Downtown Downer

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Wallach met with Orpheum residents before the land sale went through, in January. While he wasn't sure of the final price per spot, he says he was pleased to offer Orpheum residents a chance to reserve parking spaces within the first phase.

"I thought it went well," Wallach says. "The overwhelming majority of people were excited about having a permanent place for parking, and that they'll have title to it."

But many residents describe their feelings much differently.

"After parking in the lot next door for two years, thinking it was ours, it was shocking to find out differently," says Ty Brown, a mortgage broker who owns a unit in the building. "And now it's a huge issue because a lot of people can't afford it. We were promised one thing and given something else."

"Everybody's upset," says Regan Rhodes, a strategic sourcing manager for a Fortune 500 company. "Ask any person who bought a place: What person in their right mind would be okay with this?"

The heart of the problem is that this isn't Manhattan, or even San Francisco. You can't live in downtown Phoenix without a car. And, to Orpheum residents, it seems impossible that you can buy a condo here with zero disclosure that parking isn't included.

As it turns out, you can.

The Orpheum Lofts' neighborhood is zoned "urban," says the city's downtown development director, John Chan. That zoning, unlike others in the city, requires no parking, whether it's for shops or condos.

And TASB may have covered itself, legally. In one of its disclosures, the developer noted that the surface lot "may be developed in the future for any use" permitted by the city, including a parking garage or a mixed-use development. While the main point of the disclosure seems to be that residents can't sue if they suffer damages during construction of a garage or other development, the developer could surely use the language to argue that it made no promises. (It doesn't help that residents had to initial the bottom of the page.)

But there's also plenty of evidence that TASB was far from upfront about the tentative parking situation. In 2003, the developer asked the city for a variance for valet parking, explaining that "condo units would be a hard sell without convenient parking," according to city records.

There's also the building's "reserve" study. In it, analysts hired by the developer note that the homeowners association will be responsible for seal-coating the parking lot every three years. And real estate listings all show the units as having parking spaces included. So do county assessments.

City officials say they're concerned about the situation and hope to find a way to help the residents. In an e-mail, Scott Phelps, spokesman for Mayor Phil Gordon, says that the mayor's goal is to "work with the developer or a financial institution" on financing options. "We want to find a solution that works," he writes, "and will work hard to get there."

The councilman whose ward includes the Orpheum Lofts, Michael Johnson, was sufficiently concerned to attend its homeowners association meeting last week.

Johnson called the matter a "very serious subject" that has City Hall's attention. "I don't know of any other residential structure in Phoenix that doesn't have parking," he said, suggesting that the neighborhood's "urban" zoning may be an inadequate holdover from the days when downtown had no residents.

"I can't see building residential units without a parking structure," the councilman added. "It's almost impossible to think that would happen."

But it's one thing to express sympathy; it may be another one entirely to find a solution. It's hard to imagine a way out for the building's residents that doesn't include considerable expense — and Johnson certainly didn't have a plan to offer at Wednesday's meeting.

Some residents say they have no choice but to buy a space from Wallach in the parking garage he'll be building next door. It's not ideal, they say, but what choice do they have?

Wallach says that he won't be making money off the deal. Thirty thousand dollars per spot barely covers his costs.

"I will do everything in my power to help the residents make their units more marketable," he says. "I just want to help them."

But Wallach, whose résumé boasts that he's developed more than $100 million of real estate, is in a different place from many Orpheum owners. He suggests that getting a $30,000 loan — $200 a month for 30 years — should be no difficult task.

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Sarah Fenske
Contact: Sarah Fenske