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Richard Lawson

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Everything posted by Richard Lawson

  1. Not a lease. Kimpton is the hotel manager and operator. I don't know this for sure but I think that part of the tower has a separate equity and loan structure. I think I recall that being the case. These mixed use deals get quite complicated.
  2. Yeah I'm working on it. If everything goes as I've planned it, we'll have something on our site and I'll be talking about it on News2 in the morning. I have to hand it to the guy, he certainly knows how to pull out the stops on the marketing. It will be a matter of whether it works or not. Frankly, I wouldn't be surprised to see the building go shorter depending on the sales. I don't know if that's an option built into the plans or not.
  3. Had MDHA not gotten wierd about the TIF because of the hotel, there would have been some "affordable" units in the building. As for the design, ultimately, unfortunately, buildings on paper look different once built. So it make work for downtown or it may not. But we won't know for three years. That's a helluva thing isn't it?
  4. The biggest negative -- won't use con because we are after all talking about developers -- is the price for the units. How deep is the market for $500 per square foot places? That's the big question that will be answered either way in the coming months. Debating the design and size is moot at this point since it's already been designed. Now it's a matter of whether it will actually be a go. Jeepers was busting chops on the hotel announcement. But they had to work out details of interior design and all that goes into the technical side of the hotel. Then there was working through the language of the operating agreement. Apparently, those aren't so easy to put together. The cost of the hotel alone will exceed $60 million.
  5. The design is a vast improvement over what the original one was 10 years ago. His first attempt looked like an upside down telescope. My initial reaction on this design was it looked like a French Tickler. I'm not sure how the vanity buildings can look any better. They all seem to borrow from some other design somewhere. The ones in Asia seem to be about the only really different ones, but in the U.S. there's more pragmaticsm with efficient use of space pretty much driving design.
  6. That's kind of how I've been playing it with this project in particular. It's tough to speculate how the market will reacte to Sig Tower. The prices are a good bit higher than current stuff. I'd say it's a riskier bet for a buyer with this one than others because of the prices. They are banking on the market being in at least the $500 per square foot range, preferably higher, when and if the tower is built. As I've written, the next few months will give the picture.
  7. I appreciate the compliment. When I was at the paper I noted the difference between hard contract and reservation all the time and always asked about the expected conversaion rate. With the Veridian the actual conversion was higher than typical. And they started Encore without presales. I haven't taken that on yet with the Sig Tower in part because of other stories chiefly the Sounds debacle. I don't remember what the reserved number is but it's mostly the high dollar units that have been reserved. Still, as you've noted, there is a difference between reservations and hard contracts. The proof will be in the pudding over the next several months. In a different post, you mentioned Las Vegas. I don't know that market but isn't it getting killed right now with overbuilding? That sucks about your friend, getting caught in the construction cost squeeze. But it sounds like, too, that the developers didn't take heed of the potential rise in costs. I don't think that the rise in construction costs was a blind side to anyone. That is, it wasn't an overnight happening. They were rising at a pace that should have had developers cautious, especially in markets that were much hotter than Nashville.
  8. Nobody was over a barrel with the recent stuff. But no one made a big deal out of it either, although I didn't see what the City Paper wrote. I briefed it as did the Tennessean. Still, the key is balance. There have been critical voices out that who we all quote. But in some of those cases those critical voices are selling condos themselves. The fact is he gets covered because so far, in the past decade, he's shaken off doubters by producing most of what he's pitched. The Cumberland was a rough start, occupancy was troublesome etc. But so far no other developer has built two tall buildings downtown, has a third on the way and has proposed an even bigger one downtown. I wasn't here when he took a huge amount of heat for tearing down the office building with the Tennessee Theater or when he left town for a bit because of the bankruptcy. It's only been in the past few years that he has been able to shake some of that stuff. In his case, you have to balance the coverage over the past 15 years. It's not that he gets a pass by the media. I'm not completely certain what you expect the media to do -- stories that simply state that he can't do it, prices are too high, the deal is too complicated, he can't get the equity, bank loans, the market can't handle it? On the whole, all of those questions have been asked at some point or another. He pushes the risk on the development side, albeit with someone else's money, more so than others so that gets him more attention. The next few months are crunch time where his feet will be to the fire.
  9. You are correct. There's a fine line. But the developers who can't handle the bad with the good aren't usually overly successful ones. The challenge is to get info out there but not mess up a deal. Of course, it depends on the deal, too. If rezoining is involved, then the gloves are absolutely off. There are plenty times I've ticked a few off developers by writing stuff that is critical of a deal. For example, doe anyone remember the big retail development that was going to go in the Gulch? The developers out of Maryland made the annnouncement just before the Las Vegas shopping center show. That's a little trick developers do to show momemtum and get press clippings for the show, dangling it all in front of potential tenants. I wrote a story pointing that out in relation to the announcement. The developers were much ticked that the major daily did that story because that wasn't what they wanted to show. Meanwhile, HG Hill Realty presented at the show and only told anyone after the show. Look what's being built. Hill Center and not the Gulch deal. Business reporting is a lot like political reporting, on a tight rope so that you get good stories most of the time.
  10. As to your comments, I understand you think Tony is too personally invested for his efforts to be unsuccessful. However, several much larger industry titans (Jorge Perez, Donald Trump, etc.) have recently folded projects where they've spent a multiple of Tony's pursuit cost so I don't really buy your premise that it must succeed because he has bet his reputation that is will. But by foregoing the opportunity to educate the buying public and the public at-large how these deals fundamentally piece together, again, I think our media fails in its duty to inform...and the ad nauseum puff pieces (pr disguised as articles) subject you and your peers to fair criticism (I think) that despite 3 years of heavy development activity you're still completely unable to zero in on and report about the key facts and deal points that remain to be accomplished. Again, "done deal" and "as if there was any question" suggests a certainty about the outcome that I don't yet think is warranted. I agree that Tony's reputation hinges on this project succeeding but too much media cheerleading may also diminish your future credibility if things don't go as you apparently think they will. Thanks again for responding. I like the back and forth. I don't think I've been cheerleading on this. I think you have an expectation that the media must report every deal point. That's tough to do when most people really don't care. They either want to see it done or not done. They don't really care about the details. When I get asked about this stuff on TV I can't go into a laborius discussion about specific deal points, equity to debt ratios, construction pricing factors, etc. Eyes glaze over. It's all bottom line. And the bottom line with respect to the tower involves sales. And I've said over and over again that it has to have a certain level of pre-sales before construction can begin. Whether I think it will get there or not is another question. And all I've said to that is they are higher priced that what's there now and that may be a challenge in sellling. On a lot of this stuff, we really won't know until we know. It's a big project and I don't think 3 years is out of the question. Clearly, there were pieces that had to be put together in the hotel deal before the operating agreement was signed. My reference to "done deal" and "as if it were a question" referred specifically to the agreement with the hotel, nothing more. The latter phrase was intended to show the release for what it was, something that had already been set in stone. I've been critical of TG plenty over the years, forcing him to admit things he hasn't wanted to admit. The first was when he had to fire the initial leasing company on The Cumberland close to the opening because it wasn't doing the lease up. He hates it whenever I mention his past bankruptcy in print. But as to reputation, he's no Trump. Trump can withstand the hit apparently when he pulls out of a deal. Rather, it doesn't hurt his rep. With TG, I think a failure on this project would do tremendous harm to his rep. I wasn't trying to establish a premise. I was just pointing out that he wants this to happen, probably more than any of his other projects. This is his second attempt at the property with a condo tower. His first was brief around the time of The Cumberland opening.
  11. Fair enough. The construction loan won't come until the solid reservations are in place. He has a relationship with Wachovia. That bank refinanced the parking lot earlier this year. And you're right, we don't always report what we know. A lot of times that has to do with the nature of what's going on. If things aren't solidied, reporting does more harm than good. It's a fine line sometimes and sometimes it gets crossed in the wrong way. This project has a lot of moving parts for sure. TG only recently got the construction pricing in place. I know he wants to get this thing done. Suffice to say, no matter what he's done to this point, his reputation is definitely on the line with it.
  12. We treated it as routine. The hotel was a done deal last July. But the details in such things still had to be worked out. It does show confidence that the tower may actually get built. Here was how I jumped into the news: "As if the matter were ever in question, developer Tony Giarratana has made it official that Kimpton Hotel & Restaurant Group will have a Hotel Palomar in the planned Signature Tower." I think he has the equity or at least certainly close. The guy working on that is the same one who did The Cumberland, a guy out of Chicago who is connected to the General Dynamics fortune if I recall correctly. That was the equity that went into The Cumberland anyway. And it was a slow news day. We all know our readers though. People are very interested in every little thing on this project. Look for something from me later this week that really will be news on the project.
  13. Tony G. Not as bad as it sounds. I'm having a little fun with the words.
  14. I haven't followed this thread very closely. I just happened to start looking through tonight. I for one try avoiding the spoon fed stuff, trying instead to get out ahead of everyone. But right now with the project, it is still a work in progress. Everyone, I think, should know that the architects do one thing and then the GC looks at the drawings to set the construction price. Things always change in projects especially of this magnitude. I haven't talked to Tony in some time about the project, primarily because I've been focused on the Sounds debacle. TG just opened the sales office and the general contractor was working on the final construction price. In the next few weeks, look for something big on the marketing front from TG. Let's just say there's a lot of hot air involved. I'll leave it at that.
  15. And they have a choice of bathing facilities -- there or in front of the courthouse
  16. Yep... Tony G. withdrew from the Tif because MDHA was having a conniption over the hotel being adding to it. MDHA doesn't give TIF on hotel projects, even though TG tried to explain that the TIF wouldn't be on the hotel portion. But MDHA didn't see it that way.
  17. Good questions... I went back and looked at notes on the reservations, and he said 60% under contract. So I may have to go back and clarify that. I was having a bit of trouble connecting with him today. But then he said that leaves 121 to be pre-sold. So there seemed to be some interchangability. Clearly, there is a difference between reservations and contracts and upon looking back at it, it's not 100% clear. I suspect me means hard contracts. I'm not sure about the deposits required. I need to circle back around with him on that, probably closer to the opening of the sales office. I can't recall on the building permit. I'm pretty sure I would have seen it.
  18. Here's my update on Sig Tower. It's up for free so take a look. http://www.nashvillepost.com/news/2007/1/1...re_construction
  19. Oh yeah... Not the best work. They kept showing the Viridian construction, too. I sent an email to someone over there to get the name correct on the web site.
  20. Actually, it's 135... 300 is what is available. I goofed in looking at the columns of numbers on the excel sheet I was sent.
  21. The "help" he got on Cumberland was actually a detriment. He had hired Julian LeCraw and Co. to advise on amenties for the apartments, which turned out to be nothing special, and pretty much failed in the lease up mode. TG fired the group quickly but it had setback the leasing effort. His equity money for that development came out of Chicago. The same source may be involved with Signature Tower. TG got smart and teamed with someone. As he tells it, he had sought advise from Novare on Viridian not a partnership. But the eventual partnership is probably what helped that project along more quickly. Supposedly, Signature has 300 reservations on its units, according to a Downtown Partnership report.
  22. I would agree. The Miami market has gotten overbuilt with condos. The market is sucking wind.
  23. NT ever read Jean Baudrillard? Check out what he said about what Disneyland says about people in this under the heading hyperreal and imaginary. http://www.stanford.edu/dept/HPS/Baudrilla..._Simulacra.html
  24. You deserve that was a good darn guess, unless you had some good inside info.
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