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What housing downturn? 

The much-hyped resurgence of Rochester's downtown is being built on housing, both new developments and conversions. So any hint of a slowdown in the housing market is worrisome.

But the January 3 article in the Wall Street Journal, "Luxury Apartment Boom Looks Set to Fizzle in 2017" shouldn't overly concern Rochester officials, says Heidi Zimmer-Meyer, president of the Downtown Development Corporation.

For one, the story is focused on hotter housing markets in major cities, including New York and Dallas. Rochester's housing market lives in a difference universe, Zimmer-Meyer says.

The story blames the downturn on a glut of supply. Zimmer-Meyer says that's less likely to happen here because developers in mid-size cities such as Rochester are more conservative.

"You're not going to get superrich overnight here, but you're also not going to lose your shirt," she says. "We tend to be fairly steady, which is why we didn't get hit as hard between 2008 and 2012. We're careful. We don't overbuild. We don't overestimate."

And "luxury" means something much different in Rochester than in New York City, Zimmer-Meyer says. In Rochester, "luxury" tends to mean the higher end of market rate, and those make up a much smaller percentage of the overall market than they do in New York City.

But that doesn't mean that Rochester shouldn't watch the housing market carefully, Zimmer-Meyer says. Nearly 50 downtown buildings have been converted to housing since 2000, and more than 1,600 units are due to come online over the next few years. That's a lot, Zimmer-Meyer says.

"Still, everything is leasing," she says.

The most recent RDDC numbers show a downtown vacancy rate of 2.1 percent for market-rate housing downtown. A healthy vacancy rate is about 5 percent.

One example: Tower280 on the old Midtown Plaza site is 95 percent leased and 90 percent occupied a little less than a year after it opened – much faster than the developer expected, Zimmer-Meyer says.

"We're hearing that in project after project," she says.


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