While there seems to be a proliferation of new condominium projects, some Phoenix business leaders are saying the total number of condo units is small when compared to the 60,000 new homes added to the metro region each year.

Industry experts say some of the condo projects may never materialize. However, construction on at least two of the projects is set to begin in early 2006.

KML, a partnership that early this year announced plans for two Valley condo projects, this week confirmed it has plans for a high-rise building on the city block between Third, Fourth, Roosevelt and Garfield streets.

The project still is in the design stage, so KML's partners are continuing to discuss the number of buildings, residences and floors.

KML's attorney Charles Huellmantel of the Phoenix law firm of Withey Anderson & Morris, said the company originally was considering a 40-story project, "and that's still within the ballpark on the project we're looking at."

However, that height would require city approval, so discussions with the city council about the height of the project and its number of buildings are expected.

"We're looking to do something fairly tall," and more details are expected to be ready for discussion in public hearings in 2006, Huellmantel said.

Although the proposal's details aren't ready to be shared yet with downtown officials, more residential is wanted, said Downtown Phoenix Partnership President and Chief Executive Brian Kearney.

"We would be very supportive of residential at that location, and certainly there is room for height and density at that site," Kearney said.

KML's other two projects include a 6-acre site at the northwest corner of Central Avenue and McDowell Road and a property in Tempe at Ash Street and University Drive.

The company also is scouting the Valley for additional sites. KML is a venture involving Doug Kowallis and John Mackey of Kowallis & Mackey Development in Boise, Idaho, and the father-son team of Charles and Justin LaMar at NAI Horizon Commercial in Phoenix.

Of KML's three properties, the one closest to breaking ground is the Tempe site, where the 207-foot-high, 17-story building will have retail and a grocer on the ground floor and from 150 to 200 units.

A price range is not yet available.

The design is going to Tempe for final approval in January 2006. The architect is OTAK Inc. in Portland, Ore., but a contractor has not yet been hired. Construction is projected to start in mid-2006, with a sales center opening in the first half of 2006.

The Central and McDowell site, because of its 6-acre size, will take more planning and design.

"It is a huge site and right on the light rail line," Huellmantel said. "We're early in the development stages. It's such a unique site that it offers us an open palette, so we're taking time to study what works best on that parcel. It is probably the best and largest undeveloped site downtown."

Two other condo projects expected to get under way soon are the work of the father-son team of Richard and Joshua Oehler at Arcone Associates. One of the buildings is called M Tower, a 23-story building with one level of retail, six levels of parking and 108 units on the 16 upper floors. The building is planned for the northwest corner of Third and Garfield streets, across from the block along Third Street recently purchased by KML.

Oehler also is doing the Cosmopolitan Towers, a 16-story building with 88 units at 701 N. Third St. The price range is $153,000 to $2.4 million.

The proposal is under review by city planners, and Richard Oehler said construction is projected to start in January 2006. He said about 60 percent of the units have been sold with virtually no marketing.

Although reports about new condo buildings seem to surface almost weekly, suggesting a glut of condos, the condo developers simply are responding to a growing market fueled by buyers and investors familiar with high-rise living in other states, said CB Richard Ellis Director Pete Bolton.

Kearney agreed.

"Although no one knows where the bottom of the (condo) market is throughout the Valley, I believe that with the sheer size of the Valley and the amount of growth that's occurring, there's a good chance that we've only tapped the surface of what the demand could be," Kearney said.

"When you look at the number of new housing units that are completed every year, and then look at the number of condo units on the drawing boards, it's a very small percentage of the overall market," he said.

Over the past five years, about 200,000 new homes were added to the metro region, compared to about 4,000 condos during the same time, said broker Keith Mishkin, whose Cambridge Properties specializes in condo sales.