Demand for condominiums in downtown Tampa is on the rise — and driving up prices to the point that the urban core could see new construction within the next year.

The most encouraging sign in the market is so few units up for sale, said Dave Traynor, development services director with Smith & Associates Real Estate in Tampa.

"When only 4 percent of the total market is for sale, that’s a big deal," Traynor said. "The majority of that is in Grand Central. If you take away the units from Grand Central, it's less than 2 percent of the market."

The residential market in downtown Tampa has grown by a few thousand apartments in the last three years. No new condominiums have broken ground in downtown Tampa since before the recession.

But several factors in Tampa urban core are adding up to create a favorable environment for condo development in the coming months. New rental developments are thriving, averaging 94 percent occupancy. Sales of existing units are strong. Grand Central sees average sales prices of $280 per square foot; Skypoint, $370 per square foot; Towers of Channelside, $354 per square foot; Ventana, $240 per square foot; and Plaza at Harbour Island, $444 per square foot.

The average sales per square foot price in the Plaza is particularly encouraging for condo developers, as units have to sell for $400 to $500 per square foot for new construction to be profitable.

New construction would be a leap of faith, though, given that there are no comparable sales of new condos in downtown Tampa to look to for guidance. But Traynor said he's seeing more interest from developers, and he expects a new project to be in the works in the next 12 months.

"We’re starting to see developers who are looking right now to do new construction," he said, "and what they thought they were going to do as luxury apartments — they're starting to believe new condominiums makes sense."

Grand Central at Kennedy, the mixed-use towers between Kennedy Boulevard and Madison Street, wrapped up construction in the depths of the recession. Its developers, Tampa-based Mercury Advisors, rented out the units that couldn't be sold.

But when Publix Super Markets Inc. confirmed plans to build a grocery store across the street from Grand Central, Mercury Advisors decided to put the remaining units up for sale. There are about 50 units up for sale, said Traynor, who's marketing the property.

Those units are available as the rental leases on them expire. Since launching a new sales campaign in February, two units have been sold, Traynor said.

"It's what we had hoped for," he said. "When we looked at the past three years and each time a new was proposed, the question is brought up, understandably, 'Is this oversaturation?' But every one has become even more successful."