The Dillon: Kane's first downtown mixed use project

[RALNATIVE]

Here's the news that we've been waiting for:

 

http://www.bizjournals.com/triangle/blog/real-estate/2015/01/john-kane-proposes-big-tower-project-atdillon.html

[RaleighHeelsfan]

Here's the news that we've been waiting for:

 

http://www.bizjournals.com/triangle/blog/real-estate/2015/01/john-kane-proposes-big-tower-project-atdillon.html

 

 

I got all excited...13-20 stories...booo

 

Whatever it is...hope it's nice.

[Jones_]

Don't want to sound like a NIMBY but anything taller in a warehouse district would feel out of place. 

[Justin6882]

Agreed, even though it's a lower lying area, I think 20 is about as high as it should go.

[RALNATIVE]

Agreed, even though it's a lower lying area, I think 20 is about as high as it should go.

 

Didn't Hatem announce that he was interested in building a 30 story tower in the Warehouse District? Maybe it was smoke and mirrors as usual?

[Green_man]

Hatem (Empire) was rumored to be working on a 30 story bldg nearby at 600 W. Hargett [ http://www.newsobserver.com/2014/10/08/4218123/citrix-systems-injects-new-blood.html ], but I seem to remember a subsequent article mentioned he would be limited to something like 12 floors due to the existing capacity of the storm and/or sewer lines.

 

I wonder if that has any effect on a 20 story bldg at the Dillon site.

 

In my opinion, 20 floors at Dillon and 12 at 600 W. Hargett would be a good start for the vertical phase of the Warehouse District

[RALNATIVE]

I'm just excited that Kane has made an entry into the Warehouse District and hasn't written downtown off as we previously suspected. If he doesn't build a tall skyscraper at this location, there is hope that he may build one in another downtown location.

[Justin6882]

Didn't Hatem announce that he was interested in building a 30 story tower in the Warehouse District? Maybe it was smoke and mirrors as usual?

 

He did, but per the usual with him, I'm sure it was a publicity ploy. As my grandmother says, "I'd rather see it than hear tell of it."

Edited January 14, 2015 by Justin6882

[Jones_]

Pipe dream on the 30 stories (pun intended I suppose) was what I think the general UP consensus was even before the sewer capacity note came up. Sewer capacity could be a concern all over the area...I don't know the layout but I imagine the Park Deveraux/Dawson/Hue line can be reached from this site with a parallel or new line shooting down Martin St. The former City of Raleigh Deputy Utilities Director works for me now and has said most of downtown is well equipped with the needed lines to match the zoning. This is cool to me, but some are even reversible to send flow down to Rocky Branch or Pigeon House as needed. 

 

And regarding the warehouse district going vertical, I've always considered the Cambell/Reynolds lot to the be northeast corner of the warehouse district and as such we'd be getting three mid/high rise buildings. It'll be a nice smattering height all over western downtown taken with the likes of Quorum, West, and Holiday Inn

[CHGuy]

Hatem doesn't have the where-with-all to do something truly big.  Kane will get it done.

[Spatula]

This is great news. It's a good size for the area and it signals that Kane is considering building downtown now.

[RALNATIVE]

This is great news. It's a good size for the area and it signals that Kane is considering building downtown now.

 

At the end of the day Kane is a business man and has the resources to seize on a good opportunity like these sites. I wouldn't be surprised if he wins a potential bid for the N&O site if/when that goes up for sale.

[Jones_]

At the end of the day Kane is a business man and has the resources to seize on a good opportunity like these sites. I wouldn't be surprised if he wins a potential bid for the N&O site if/when that goes up for sale.

I would prefer him to Sandreuter or White Oak or any of the other schlock (remember that word?) apartment builders entering our downtown game recently. 

[RALNATIVE]

I would prefer him to Sandreuter or White Oak or any of the other schlock (remember that word?) apartment builders entering our downtown game recently. 

 

Me as well. At this point we have a good sense of Kane and his desire to improve the overall urban fabric in Raleigh --- midtown and now downtown. I can't say the same for those others.

[DanRNC]

From Wikipedia:

 

 

Schlock is an English word of Yiddish origin meaning "something cheap, shoddy, or inferior (perhaps from German Schlag, Yiddish shlak, meaning 'a stroke'; also possibly from German "Schlag"/"Schlagsahne", whipped cream)"

In the field of science, "schlock" refers to shoddy methods or unreliable results.

In art, "schlock" is sometimes used as a synonym for kitsch.

 

I would add: anything designed by  J Davis or envisioned by Gregg Sandreuter. 

[RALNATIVE]

 

I would add: anything designed by  J Davis or envisioned by Gregg Sandreuter. 

 

 

Let me add a caveat: anything designed by J Davis or envisioned by Gregg Sandreuter that actually sees the light of day.

[Gard]

N&O had an article on this today as well to which Kane is quoted in it as wanting to preserve as much of the current building there as possible, so I'm assuming what is there will somehow be incorporated into the larger building that will be constructed.  There was this nice tidbit as well:

 

 

 

“I think we’d try to do something that would fit into the warehouse district. Something that would feel a little out of the box, not your traditional office tower,” Kane said. “Something a little bit different. Maybe not as out there as Citrix, but something that would fit.”

 

 

Read more here: http://www.newsobserver.com/2015/01/14/4475827/kane-realty-seeking-to-redevelop.html?sp=/99/104/#storylink=cpy

Edited January 15, 2015 by Gard

[RALNATIVE]

After spending some time thinking about why developers such as the 2 previously mentioned would build crap on prime downtown land, I think that I may have an explanation. If these guys can buy these parcels at a very good price now, they know that the land will be much more valuable in the future. They're really not concerned about what sits on the land at this point, because their focus is on obtaining the land and holding it until downtown real estate prices go through the roof. Which in a city like Raleigh, is almost certain to happen.

 

The building of these crap developments on that land is just a way to generate revenue to pay for the cost of the land, taxes, and generate little profit. Since these guys are in it just to secure the land for future appreciation, it wouldn't make sense for them to spend huge amounts of money and acquire lots of debt on a significant development, when they can get away with building something cheap that the city council will easily approve.

 

For them, this is a smart business model, but for the city and the citizens it's a raw deal.

[Jones_]

^ I think that's what people renting parking spaces were doing in the 80 and 90's (Valentine comes to mind). Bad as these buildings are, even the stick built ones should last 50 years. It'd take one hell of a jump in land prices for say the Edison Apartments to get knocked down in the that timeframe for the 50 story scraper. It could happen, and similar things have happened all over, but I'm not feeling like that is the absolute target approach behind these projects. 

As an aside, I am sad to report, that Edison is in fact stick built on a concrete pedestal. It'd be a candidate for such a plan if any were. Link and Gramercy look like all concrete plates and columns and as such are being built to last ad infinitum (and Skyhouse). 

 

Regarding Kane and leaving as much of the warehouse as possible, I am betting it ends up more like Citrix than he thinks it will....maybe all LEED extras get left out...perhaps it be more demolishing like say Liberty Warehouse in Durham, as opposed to less like say the Stones Warehouse proposals here, but my gut says it'll be between those two extremes which is about where Citirx's approach was. 

[Green_man]

Downtown land prices are already extremely high.  Its more about the cheap construction but selling the location to make them "luxury" apartments.

[RALNATIVE]

Downtown land prices are already extremely high.  Its more about the cheap construction but selling the location to make them "luxury" apartments.

 

Extremely high as compared to...Smithfield? Well yeah in that case they are extremely high. These developers have a sense of what's coming and they're all trying to get in on the early action. It's all about appreciation.

[Green_man]

Well its already gotten to the point where property is being sold on potential worth rather than actual worth.  This site for example:  $11 million for 2.5 ac. when likely much of the existing structure will be demo'd.

 

Its been my opinion that we would have a much fuller, denser, and more vibrant downtown if the current underutilized property owners weren't driving prices up to cash in on their lots.  (I.e. the high land prices have either made some projects infeasible and not built at all, or have limited the scope and floors after extra money had to go to land purchase).

 

I guess its understandable that they want to make a bigger buck.  But I think its why you haven't seen many small scale developments (projects like those happening on Hillsborough St would be happening on the edges of downtown).  It basically has to be massive and cheap construction to make the numbers work.

[RALNATIVE]

Exactly. And in order for a developer to be able to deliver a sizeable project they are going to need deep pockets or have a partner who has deep pockets. That's why when I hear Hatem, Sandreuter, and some of the others claim that they are considering towers above 10 stories I start to cringe. This was the main issue with the Reynolds proposal.

 

Kane, on the other hand, does have the resources (an probably the lines of credit) to deliver a large development on his own.

[Jones_]

Well its already gotten to the point where property is being sold on potential worth rather than actual worth.  This site for example:  $11 million for 2.5 ac. when likely much of the existing structure will be demo'd.

 

Its been my opinion that we would have a much fuller, denser, and more vibrant downtown if the current underutilized property owners weren't driving prices up to cash in on their lots.  (I.e. the high land prices have either made some projects infeasible and not built at all, or have limited the scope and floors after extra money had to go to land purchase).

 

I guess its understandable that they want to make a bigger buck.  But I think its why you haven't seen many small scale developments (projects like those happening on Hillsborough St would be happening on the edges of downtown).  It basically has to be massive and cheap construction to make the numbers work.

Unfortunately the going rate for the choicest lots downtown now is around 4 million an acre. This is just a tad over that. And its not just people holding out for top dollar....its the people who paid that top dollar...the people with the biggest projects and deepest pockets are at least, or possibly more to blame. I blame tall buildings first and foremost because they generate the most revenue per acre. Eventually your downtown can only exist as a skyscraper laden, class A office rent producing area. This forces out anything that cannot match that income production, so mom and pop pizzerias, middle class rentals and owner occupied residences, small art galleries etc etc. Poof. Gone. And that's where we're going.

Interestingly things like the historic renovation tax credits help attenuate this situation when eligible buildings are in play, but those expired this year. This was Hatem's business model and his approach has been instrumental in bringing downtown back. Seriously, if all of Hargett st were demolished for a giant skyscraper, I'd say f*&% this place and move. 

[RaleighHeelsfan]

I got all excited...13-20 stories...booo

 

Whatever it is...hope it's nice.

 

 

I am happy with the announcement. Just not the article. When I see a title that reads "BIG TOWER" I am expecting something bigger than 13-20 stories. I was sooo excited then read the article.