Pictures of the hubris of the housing boom

Savannah River Landing — the big empty spot at the east end of River Street next to the Marriott — is by far the most visible sign of the real estate bust in the Savannah area. It’s also an area that has been in the news for other reasons, especially the $20 million in bonds that the city of Savannah floated for road improvements that should have been paid for by the tax allocation district. The TAD would have funneled increases in property tax revenue to paying off the bonds.

But no increases in value, and no money to pay off those bonds.

Weeds and broken street signs around the unfinished Amenities Center at the Reserve

Savannah River Landing wasn’t the only overly ambitious move by the city and county in recent years. The Reserve at Savannah Harbor — a planned 91-acre, 800-home, high-end development on Hutchinson Island — is also dead in the water. It was obviously a private venture for the most part, but was supported with city staff time and infrastructure.

I had some friends staying at the Westin last week, so I had my camera and took a few pics.

Even if the economy had not gone into recession in 2007, we would still have seen some major developments like this one fail. It was always simple math. There are about 60,000 owner-occupied residential units in Chatham County, and at the height of the bubble, developers had plans for 20,000 or more additional ones in the next decade or so — all priced far above the existing median. Did that ever make any sense? No. Did anyone do the math? Apparently not.

Hard to get a sense of scale unless you go to the Reserve's northern edge -- that's the Amenities Center in the distance

The most comprehensive recent summary of the status of the Reserve at Savannah Harbor can be found in this thorough piece by Adam Van Brimmer in last February’s Savannah Morning News. Contrast that with this upbeat piece from 2004. Check out the confidence about various high-end developments, including Savannah River Landing and the Reserve, even into 2008: Future of downtown luxury living; Developers say downtown real estate market will outlast current trends.

A few finished homes and townhomes are near the entrance closer to the bridge. Note all the infrastructure for utilities in the foreground.

I’ve made a sort of mea culpa a couple of times in my column, but let me repeat it here. While I was way ahead of the curve in foreseeing what was about to happen, and while I was probably the first public voice in Savannah to point out that none of the housing confidence made any sense and none of the numbers added up, I could have been much much more aggressive and faster in raising concerns about the waste of public infrastructure money and the deleterious effects of vastly expanded inventory on existing home prices.

Nimby Drive? Really? Who buys a home on Not-In-My-Back-Yard Drive?

So what’s next for the Reserve? In the absence of easier access to downtown Savannah, it will never be an attractive place for most buyers, no matter how much money they have and no matter how much they love golf. I have discussed these access problems before. A second vehicular bridge to Hutchinson connecting to the Truman Parkway would certainly help, but the only access solution that I have heard that makes any sense at all is a pedestrian bridge.