As stingy lenders and soft home sales delay Triangle condominium projects, one high-profile plan in downtown Raleigh is pressing forward, condos and all.

The developers planning Charter Square -- a two-tower project on the site of the old convention center on Fayetteville Street -- expect to forge ahead with the first building, despite speculation that proposed condominiums would stall its start.

The 20-story tower is to include about 300,000 square feet of offices, ground-floor shops and at least 30 condominiums.

Sluggish home sales have made lenders increasingly wary of most projects that include condominiums. Their skittishness has delayed at least two projects planned on city land -- Empire Properties' 22-story Lafayette and a 25-story tower planned by the Reynolds Co. at Hillsborough and Dawson streets. But those projects include condominiums above hotels.

And while lenders haven't committed to Charter Square, its developer -- a group including Craig Davis Properties, White Oak Properties, East-West Partners and Beacon Street Development -- isn't worried. Their source of confidence: offices.

Lenders probably are more comfortable financing condominiums above offices as travel wanes and as demand for downtown offices grows. Downtown's office vacancy rate was a decade-low 5.2 percent at the end of June, according to a Highwoods Properties market survey.

Charter Square's offices face competition from Empire's L Building, being built nearby. But Charter's developers are heartened by negotiations that could fill more than one-third of their offices, says Jack Dunn, president of Craig Davis Properties. He wouldn't name the prospects.

Such preleasing would make it easier for lenders to take the plunge, setting into motion the next phase of a three-year-old agreement between the city and the developers.

The city is involved because it is selling the 1.75-acre development site. As part of the deal, the city imposed deadlines to keep the project on track.

A 550-space parking deck is due to wrap up in March. Then the developers must move forward with the first tower by June.

Still in the air is the timing and format of the second tower. There's no city-imposed deadline on that building, which must include at least 155 residences.

That's a key slice of negotiated flexibility that would have benefitted Empire and Reynolds. The city, in an effort to spur downtown's revival, imposed development deadlines on those projects. Their delays have led to deadline extensions -- and politicized ultimatums.

Charter Square's second tower escaped all that. And, as the market changes, so might that tower. When it was proposed, the housing market was revving, and condominiums were planned. Condominiums are still an option. But the timing could be a bit off, as the developers consider alternatives that could incorporate apartments or hotel rooms. "A hotel-condominium combination would be interesting for that site," Dunn says.

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Another downtown office-condo tower got a boost Wednesday.

Law firm Williams Mullen said it would move its North Raleigh offices into 75,000 square feet at RBC Plaza, the 33-story tower Highwoods is building at Martin and Fayetteville streets. The tower's 275,000 square feet of offices are now 95 percent preleased.

The firm will move late next year, when its 51,000-square-foot lease expires at Highwoods Tower I in northwest Raleigh.

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