Signature Tower

[titanhog]

Question for Jeeper, Metro and everyone else with developer insights: If Siggy were just a huge hotel or office bldg, would this thing be more likely to happen...or is the condo tower the most likely to find financing?

[ATLBrain]

I think that just depends on the market conditions at the time the building is conceived/developed. Like so many things (especially with high risk like this) it's demand driven. Somehow, Nashville is awakening from a long slumber in which no large office buildings were built. Always risky, even with a large tenant signed, office towers are probably the most rare in midsize markets. I think the condo stuff is simply a wave of a nationwide trend and demographic shift that Nashville was late in getting, but rapidly catching up. Hotels are weird altogether and depend heavily on many other things beside a dense CBD. Look at New Orleans and see how the tourist trade has caused a lot of very tall hotels to be built there. So I don't think there's a clear cut answer to your question.

Being specific to Nashville's DT in the year 2007, I would think that condos have the best chance. After the Convention Center is built, then it may become hotels (what 2-3?)... or as current stock of office gets older, then it may become more office buildings. Also, Nashville needs to stem the tide of companies bypassing its DT for suburban locations. Just my two cents.

[satalac]

Maybe this deal is contingent on the project actually moving forward.

which is exactly why this deal IS moving forward.

[Jeeper12]

Question for Jeeper, Metro and everyone else with developer insights: If Siggy were just a huge hotel or office bldg, would this thing be more likely to happen...or is the condo tower the most likely to find financing?

Not sure I understand the question but I'll try and answer anyway. Tony would have less chance of getting a comparable office project off the ground than a condo because office buildings are always tenant driven. And tenants are much more sophisticated than condo buyers when it comes to signing on the dotted line. I think most local office brokers would tell you that Tony lacks the credibility to be seriously considered as an office developer. The fact that he's never developed one and apparently went bankrupt the only time he ever tried probably has something to do with that.

ST wouldn't work as a stand-alone hotel for different reasons. Luxury brand hotels rarely underwrite (cost to build relative to ADR) anywhere these days without some uber luxury condo component to help offset the hotel's development cost. Hence, AP needing to get 50 WES buyers to pay $750/sf (a $250-350/sf premium) to be under the same roof as the hotel. Frankly, I think Tony would have had a better shot had he not fallen into the "tallest building in the south" trap and just tried to do a 35-45 story hotel/condo that was 80% hotel and 20% condo. It would have been easier to pioneer his condo prices at 80-100 units rather and almost 400. Not to say that would have been easy either though. I know there are many downtown bulls on this board but I still don't think the super rich or trendy hotel patrons are dying to stay or live on Church Street. One day they may but I don't see it happening anytime soon.

[Plasticman]

but I still don't think the super rich or trendy hotel patrons are dying to stay or live on Church Street. One day they may but I don't see it happening anytime soon.

Huh? 140 reservations isn't a sign? That may not be "dying" but it is solid interest. Granted the "real" interest will be when the conversions are rolling along. Once those happen, there are no doubt others who will jump aboard once the project appears increasingly certain.

Give the developer a little credit for some sense. The project is approved, he is promoting it as best he can, and I am certain there are many more possibilities about the financing of this project going on behind closed doors that just aren't known and/or haven't been covered. He had to have done some homework.

If by July the conversions just haven't happened and nothing more than a ribbon cutting occurs, then we can most likely write this one off as very doubtful.

[monsoon]

Question for Jeeper, Metro and everyone else with developer insights: If Siggy were just a huge hotel or office bldg, would this thing be more likely to happen...or is the condo tower the most likely to find financing?

The conditions are the same. i.e are there enough paying customers to justify the construction of the place. Corporations, and still some banks, used to build towers as a symbol of their success. But in the last 15-25 years shareholders have demanded that companies focus on their core businesses and they have moved away from building super talls unless they really need the space somewhere. Many companies that have build towers, IBM would be an example, have dumped their real estate and now lease much of their space.

Hotels are a special case in that logistically a tall building does not work that well and there is a lot of pressure on price, especially in the business market. Financing of hotels can be complicated since it has to be paid for when built but it will take years to make the money back on room rentals.

[Plasticman]

Hotels are a special case in that logistically a tall building does not work that well and there is a lot of pressure on price, especially in the business market. Financing of hotels can be complicated since it has to be paid for when built but it will take years to make the money back on room rentals.

I'd agree with that point. However, Nashville isn't exactly overflowing with world-class hotels and a Kimpton is just that. Given the city's rising status as a major center for business relocations and just as a tourist destination (remember this IS music city), I would say a hotel of this magnitude is probably 20 years overdue.

Now we just have to see if any potential hotel investors feel that way. If so, the hotel portion might be what pushes the $$$ over the top.

[Jeeper12]

Huh? 140 reservations isn't a sign? That may not be "dying" but it is solid interest. Granted the "real" interest will be when the conversions are rolling along. Once those happen, there are no doubt others who will jump aboard once the project appears increasingly certain.

Give the developer a little credit for some sense. The project is approved, he is promoting it as best he can, and I am certain there are many more possibilities about the financing of this project going on behind closed doors that just aren't known and/or haven't been covered. He had to have done some homework.

If by July the conversions just haven't happened and nothing more than a ribbon cutting occurs, then we can most likely write this one off as very doubtful.

If Tony had kept a lid on everything until a week ago and he had 140 reservations overnight, I would agree with you. But since he announced 120 a year ago all but about 15-20 of his reservations appear to be about a year old. It's common for those with "flip" interest to hold a risk free "place in line" by putting down a refundable $5 or 10K just to see how things unfold. The overwhelming majority of this interest usually doesn't step up but I conceed it's theoretically possible that they could. As to your "closed doors" comment, I think I've already previously addressed why it's to a condo developers disadvantage to sit on good news.

I do think we're basically in agreement though in terms of the next month or two being make or break for Tony. These condo projects are all about momentum. Terrazzo suffered greatly from a flat opening (which probably says something about the depth of the market for $500k plus price points) even though they only needed to sell about 50. It took them almost a year to do it despite being almost $200/sf cheaper than ST. So how long might it take to sell 260 units (Tony's stated presale req'mt) ? I guess we're all going to find out.

[MTSUBlueraider86]

I would not be surprised if Tony starts regardless of what his reservations to sales ratio is and breaks ground in July as he publically stated. He would most likely use his own money like he has done with the Cumberland, Viridian, and Encore. Astute business people always reinvest their money into their company. Many successful Nashville business people have done that and that is the reason they built fortunes. Live modestly and invest aggressively.

[chris holman]

Does the model of Sig Tower represent the tower at 65 stories or at 70 stories I can't remember.

[Hankster]

Does the model of Sig Tower represent the tower at 65 stories or at 70 stories I can't remember.

The Sig model does show 70 stories. In fact, Tony counts the two level 64th floor as only one floor. If it were me, I'd count them as two floors, making it 71 floors in all.

[chris holman]

One of the pic from the advertising for Signature that I received in a e-mail.( Nothing new) but Could you Imagine how this view would be?

[thanner]

One of the pic from the advertising for Signature that I received in a e-mail.( Nothing new) but Could you Imagine how this view would be?

Whenever I see this picture in the City Paper, I want to yell "Don't jump!" at that little lady in the black cocktail dress. It looks like an ad for depression counseling.

[Plasticman]

I would not be surprised if Tony starts regardless of what his resevations to sales ratio is and breaks ground in July as he publically stated. He would most likely use his own money like he has done with the Cumberland, Viridian, and Encore. Astute business people always reinvest their money into their company. Many successful Nashville business people have done that and that is the reason they built fortunes. Live modestly and invest aggressively.

But does Tony have the kind of ready cash or even the equity in his other ventures to raise said cash? If the reservations translate into 50% sales that would be roughly $56,000,000 (75 units at an average $750,000). If the hotel partner injects cash which would probably be another $50,000,000, that would still leave $100,000,000 to put down in order to attain the 50% of cash.

For me, I am optimistic and believe the news will be better than the above and the project will fly as planned. Atlanta has no trouble getting large projects launched all the time. Surely Nashville can get this one premiere project off the ground, even as big as it is. As stated previously, we'll know much more after the planned groundbreaking.

[MTSUBlueraider86]

I saw the balloon this mornig! Pretty cool!

[Onyte9]

July is fast approaching. July 4th is do or die time. If ground is not broke in July (a real ground breaking not a Terrazzo ground breaking) then the moral potential future tenants may drop a few notches. When I see a man spending millions of his own money I have to belive in my mind that the project is moving forward. So I do believe there is a good chance that this project will soon become a reality. However I know jack about building a skyscraper. But I would say that if we have a real ground breaking in July its go time. But if another date is announced I would belive that the chances would definitely decrease. I know there are many projects in other cities that take a very before that start construction but for some reason I dont really see this project in that light. Do or die? I think so. But hey what do I know? Im just a public works employee that did good to bring home 30k last year.

[nashscan]

July 4 is not a do or die date. Tony wants to break ground on Independence Day, but if he doesn't have everything lined up by the 4th the project is not dead.

Also remember that Chuck Norris doesn't wait till he has 50% of units reserved. He roundhouse kicks the bank executives until they fork over the dough.

[MZT]

But since (Tony) announced 120 (pre-sales) a year ago all but about 15-20 of his reservations appear to be about a year old.

This statement sure sounds a lot like what was said in the thread for 'The Park' in Charlotte, for 2 years. The Forumers posting in that thread had become so jaded they just greeted fresh announcements with fat rasberrys. I think one Forumer (an Admin now) called it "The project we all love to throw darts at". It goes to show how as a plan grows old, it creates a tide of skepticism to overcome.

The ultimate result being, ironically - that it did get built. But a conventional steel construction 20ish story condo, in a market with similar sized buildings that sold out, could attract the outside funding that it needed. Financiers aren't as likely to jump into the breach to build a "tallest ever".

[dan326]

When does this tower beakground? I don't even live there but this project has me excited.

[cheeriokid61]

It's supposed to break ground July 4.

[chris holman]

When does this tower beakground? I don't even live there but this project has me excited.

I'm excited as well. I fell like a kid on Christmas Eve when I think about this tower. And If everything goes well ground breaking being so very soon.

[chris holman]

Has Tony decided on the final design of the Crown of the tower? The last time I've talked to him he said he was still working out the final details of the crown of Sig. He sound like he was undecided on the final crown design. (I could be wrong ) Does anyone know the facts on this?

Pic of the Building's current design: Sig Tower pic

I keep forgetting how massive this tower will be.

[showtime21]

Well, I don't know about the final design of the tower but News channel 5 reported tonight that the Airport will have to make some changes in the runway lay-out next month because of the Siggy..

link

http://www.newschannel5.com/Global/story.asp?S=6611725

[nashvillwill]

Well, I don't know about the final design of the tower but News channel 5 reported tonight that the Airport will have to make some changes in the runway lay-out next month because of the Siggy..

So, if this is not going to happen, why would we get the FAA involved? I'm half-prodding to see what kind of response i can get out of this, but really, is this a premature move by the airport authority or not?

[showtime21]

Well, the statement from the news said the airport was going to start the changes next month. I believe it will start and what a perfect day July 4th. You get to see the start of a new era that day and ofcourse one of the best fireworks shows in the country. I just know that I will be in Downtown Nashville that hopefully historic day..