Signature Tower

[ariesjow]

Sure, we'd rather have 3 towers instead of one...but not three 450 footers. Of course, we'd gladly take them but we already have plenty of those and one more about to start rising (Pinnacle). I'd actually love to trade you guys in Memphis a 450 footer or two for just a few historic buildings and little smidge of your urban fabric. Please?

Nashville's skyline has been pretty level for a while. It's a nicely balanced skyline but many also perceive it as flat. A new tower to break the plane would be just what the doctor ordered. It doesn't necessarily have to be a supertall. I'm sure most of us would have been more than pleased with the original Siggy height of around 800 ft. But Tony G. wants a supertall and we'd also be more than happy if it makes its' way to fruition as the proposed site seems just about perfect for the city's next tallest.

[nashvylle]

i want this tower to go up in Nashville so bad. Let's get this built!

(does the podcast only have sound? or is it a video that my computer isn't showing??)

[franktown]

Well that was a pretty long piece of fluff! I was interested in the information about the North Gulch site and the new tower he wants to launch in SoBro. I like his idea of building a parking garage in it for the city.

[ATLBrain]

So how can a permit be pulled without a dollar value specified? I thought they all had to have the detailed plans submitted for a permit... doesn't that include cost? This could just be the Tennessean being typically lazy.

http://www.tennessean.com/apps/pbcs.dll/ar.../711120339/1003

[Flowers]

Well that was a pretty long piece of fluff!

i agree. it sounded more like an infomercial than an interview.

a friend of mine that works for a very large local gc said his company recently decided to decline tony's request to price the project. among the reasons he stated...it would cost them 400-500 thousand to estimate it...they also expected it to take 4 years to build it rather than the 3 that tony was hoping for. based upon my conversation with him and turner bailing i think tony may have a very difficult time getting another gc to bite.

[nashvylle]

sales are most important to this project. Once enough sales have happened so a loan is given, a general contractor won't be as hard to find.

[nashpredator]

does anyone know when the sobro project is supposed to be announced?

[ATLBrain]

Watching this project from afar, I did not hear anything new in this interview. It was reported that Mr. Giarratana was involved in a replacement proposal when the Sounds project in Sobro went down earlier this year. SBE&R, Tower, and Giarratana and his partners were all mentioned to be in the running for the (Sounds) riverfront site. That's actually where I expect him to put the project he mentions in the interview. However, I'd be surprised if this happens for at least a couple of years. At that location, I don't expect it to be a tower. He didn't mentioned that his second Sobro project would be a tower. Did he? From what I understand about the Nashville DT market, I do think he's dead-on about the demand outstripping supply for the next few years. Of course, it's important to know where those various levels of demand are, but that's why they're developers. They have more chutzpah than I.

I think it's also important to know what the definition of downtown is (WRT: those statistics). Is the Gulch included in DT? Germantown? Midtown? Music Row? Near East Nashville? All of those areas have a stunning amount of housing under construction, and may dampen the future perceived demand for apartments and codos in the CBD. Also, Giarratana mentioned that there are about 1400 units currently u/c, but I thought that Rolling Mill and Encore alone would have more than that... and is Icon included? Terrazzo? I'm repeating myself.

Meanwhile, I expect him to continue focusing on Signature tower. With his hotel on the hook and commitments for 100 or so apartments, I expect that he'll come out soon with a scaled-down version of Signature to get it going. I think it will still be the tallest in Nashville, but maybe 300-400 feet shorter than this plan. I can't explain it, but since everyone else is speculating, I'll do it too. I haven't done that until now.

[titanhog]

Watching this project from afar, I did not hear anything new in this interview. It was reported that Mr. Giarratana was involved in a replacement proposal when the Sounds project in Sobro went down earlier this year. SBE&R, Tower, and Giarratana and his partners were all mentioned to be in the running for the (Sounds) riverfront site. That's actually where I expect him to put the project he mentions in the interview. However, I'd be surprised if this happens for at least a couple of years. At that location, I don't expect it to be a tower. He didn't mentioned that his second Sobro project would be a tower. Did he? From what I understand about the Nashville DT market, I do think he's dead-on about the demand outstripping supply for the next few years. Of course, it's important to know where those various levels of demand are, but that's why they're developers. They have more chutzpah than I.

I think it's also important to know what the definition of downtown is (WRT: those statistics). Is the Gulch included in DT? Germantown? Midtown? Music Row? Near East Nashville? All of those areas have a stunning amount of housing under construction, and may dampen the future perceived demand for apartments and codos in the CBD. Also, Giarratana mentioned that there are about 1400 units currently u/c, but I thought that Rolling Mill and Encore alone would have more than that... and is Icon included? Terrazzo? I'm repeating myself.

Meanwhile, I expect him to continue focusing on Signature tower. With his hotel on the hook and commitments for 100 or so apartments, I expect that he'll come out soon with a scaled-down version of Signature to get it going. I think it will still be the tallest in Nashville, but maybe 300-400 feet shorter than this plan. I can't explain it, but since everyone else is speculating, I'll do it too. I haven't done that until now.

I hope you're wrong about him scaling back, but it would better than nothing at all. I guess a 700' tower would be ok.

[Onyte9]

Im not sure scaling back is an option. It would probably void the contracts he has already and cause him to start all over again on the marketing front. I like many other people would love to see this tower built, but like most I'm a skeptic because of the nature of the project. It just seems unreal to ride by the Nashville skyline and imagine a 1000ft+ skyscraper. But I do believe that our market could asorb the units and if Tony's new marketing tactics and low interest rates payoff, we could see this thing rising next year. Lets only hope.

[dxartist]

i agree. it sounded more like an infomercial than an interview.

a friend of mine that works for a very large local gc said his company recently decided to decline tony's request to price the project. among the reasons he stated...it would cost them 400-500 thousand to estimate it...they also expected it to take 4 years to build it rather than the 3 that tony was hoping for. based upon my conversation with him and turner bailing i think tony may have a very difficult time getting another gc to bite.

wow, that is a chunk of money. Did your friend say how long it would have taken to estimate?

Meanwhile, I expect him to continue focusing on Signature tower. With his hotel on the hook and commitments for 100 or so apartments, I expect that he'll come out soon with a scaled-down version of Signature to get it going. I think it will still be the tallest in Nashville, but maybe 300-400 feet shorter than this plan. I can't explain it, but since everyone else is speculating, I'll do it too. I haven't done that until now.

I agree. A scaled down version may be the only way he gets this up and running. A 700 ft tower obviously will not have quite the impact on the skyline like the 1000 footer. However, it will still easily be the tallest even at 700. Not only that, it will take much less time to build. If the project is scaled down, how many of those sold will try to get out of their contract because of it? Then again, how many will buy because of a shorter time table? Like some on this board, we would rather see a smaller version than nothing at all. This building is too nice not to get completed.

[elvigy]

wow, that is a chunk of money. Did your friend say how long it would have taken to estimate?

I agree. A scaled down version may be the only way he gets this up and running. A 700 ft tower obviously will not have quite the impact on the skyline like the 1000 footer. However, it will still easily be the tallest even at 700. Not only that, it will take much less time to build. If the project is scaled down, how many of those sold will try to get out of their contract because of it? Then again, how many will buy because of a shorter time table? Like some on this board, we would rather see a smaller version than nothing at all. This building is too nice not to get completed.

About those contracts, I'm wondering if anyone knows the wording of them? Is it specified that you're buying into a specific size tower (i.e. 1000+ feet) or does it say just something along the lines of Nashville's tallest? Or maybe there's no specification at all beyond the obvious "This contract is for a 1 bedroom 1 bath, 700 sq. foot condo in whatever building we slap up and call the Signature Tower"? Basically, my question is how much wiggle room is there in the contracts? With everyone speculating that people who currently have contracts would bail out due to changes in the building, I'd love to know if that would even be possible.

[Plasticman]

wow, that is a chunk of money. Did your friend say how long it would have taken to estimate?

I agree. A scaled down version may be the only way he gets this up and running. A 700 ft tower obviously will not have quite the impact on the skyline like the 1000 footer. However, it will still easily be the tallest even at 700. Not only that, it will take much less time to build. If the project is scaled down, how many of those sold will try to get out of their contract because of it? Then again, how many will buy because of a shorter time table? Like some on this board, we would rather see a smaller version than nothing at all. This building is too nice not to get completed.

I highly doubt he will scale the tower back and start over. The only way that could happen is if there is a clause in the contracts allowing it. And if he does somehow manage to scale it back, I would doubt it to be down to 700' because by the time you knock off the first 120' for the hotel and even if you reduce the spire to 100' (which would look awful), that wouldn't leave but about 480' worth of condos maximum and is hardly worth the effort. And then it would no longer be unique outside Tennessee. The whole purpose in this tower is to be a groundbreaking move of national proportions. If he is able to scale back I could forsee it being more like 850' - 900' as the original "redesign" had it at. An 850' tower is still a monster and something any city would love.

But all the speculation about scaling back isn't even being mentioned in any reports via paper or electronic media that I've found. I still believe he is hedging his bets on the very likely event that once the ground starts moving and he can actually move the project to "under construction" status, the sales will escalate exponentially and the current 1,030' tower will be just fine. Just remember we are only talking 400 units (be they high-priced on the upper floors or not). That really isn't a drop in the bucket for a city that has barely begun to tap into the obvious demand for DT living accmodations.

[Plasticman]

About those contracts, I'm wondering if anyone knows the wording of them? Is it specified that you're buying into a specific size tower (i.e. 1000+ feet) or does it say just something along the lines of Nashville's tallest? Or maybe there's no specification at all beyond the obvious "This contract is for a 1 bedroom 1 bath, 700 sq. foot condo in whatever building we slap up and call the Signature Tower"? Basically, my question is how much wiggle room is there in the contracts? With everyone speculating that people who currently have contracts would bail out due to changes in the building, I'd love to know if that would even be possible.

This is all more of my opinion but I would venture all or nothing, particularly on the upper floors. Currently the penthouses top out at around 850' in the air or so. This makes them some of the highest elevated penthouse at least in the nation. The price the buyers are paying is no doubt largelyl based on the uniqueness aspect of it and the breathtaking and totally unobstructed view you can have in all directions. Any condo sitting 700' or above is likely under no threat of being obstructed anywhere on the horizon. Change the design by scaling back and the building now becomes a totally different building with the condo heights now at or below current buildings, the views are now potentially obstructed and the uniqueness is off the radar. From that the values drop exponentially.

All or nothing IMO

[monsoon]

About those contracts, I'm wondering if anyone knows the wording of them? Is it specified that you're buying into a specific size tower (i.e. 1000+ feet) or does it say just something along the lines of Nashville's tallest? Or maybe there's no specification at all beyond the obvious "This contract is for a 1 bedroom 1 bath, 700 sq. foot condo in whatever building we slap up and call the Signature Tower"? Basically, my question is how much wiggle room is there in the contracts? With everyone speculating that people who currently have contracts would bail out due to changes in the building, I'd love to know if that would even be possible.

My guess is that if there are binding purchase contracts, they are for a specific unit on a specific floor as the height, orientation and even minute details of adjoining units are going to affect the purchase, appraisal (needed for loan), and other factors that buyers consider when buying a property. If they don't have this nailed down then I can't imagine that a bank would be willing to qualify a buyer for a unit.

[Flowers]

wow, that is a chunk of money. Did your friend say how long it would have taken to estimate?

I agree. A scaled down version may be the only way he gets this up and running.

he did not but i would think it would take several months to spend half a mill in preconstruction costs.

i agree with the scaled down comment if it is that simple. not sure what he paid for the dirt but i assume economics rather than ego or greed were driving his need to generate so much revenue out of an acre, even if greed and ego got him started with the idea. if he really has a hundred binding contracts after a few years of marketing and almost a year of opening a sales center then it sounds like the market is telling him that at those prices it should be 200 unit tower instead of 400. it seems like if he forges ahead for the big tower he risks losing as many or more buyers as he stands to gain.

[Plasticman]

he did not but i would think it would take several months to spend half a mill in preconstruction costs.

i agree with the scaled down comment if it is that simple. not sure what he paid for the dirt but i assume economics rather than ego or greed were driving his need to generate so much revenue out of an acre, even if greed and ego got him started with the idea. if he really has a hundred binding contracts after a few years of marketing and almost a year of opening a sales center then it sounds like the market is telling him that at those prices it should be 200 unit tower instead of 400. it seems like if he forges ahead for the big tower he risks losing as many or more buyers as he stands to gain.

I take it you don't agree with several of our assertions above that he cannot scale it back without having a clause in the contracts. You could be right as we all are only speculating. It isn't likely that an "escape" clause exists that would allow a scaled down tower, especially several hundred feet shorter. Once it is shortened, the value of each penthous drops drastically with each subsequent floor dropping in value as well. The bottom floors probably 40 and below would not lose as significant a value but would lose some because of the fact that the tower is no longer anything significant outside of Nashville but would only be a nice but still run-of-the-mill condo tower. So it would be likely that any major changes in height would void the contracts.

He hasn't actually been marketing for years but rather for months. His marketing effort was mollasses until May and even then it wasn't all that. Only in the last couple of months has his effort even began to resemble something complimentary to a project that size. and I don't think hot air balloon rides, while fun, are going to do it. The Lexus offer might spark some sales but who knows.

I would think he can't drag his feet much longer or the buyers he does have will leave of their own accord using whatever timeline that would allow them out of their contracts. That alone would put him back at square one and he would have to rethink the whole project. He either has to find a private financier (not likely), sell half the units, or convince the banks that getting the project moving would escalate sales (HIGHLY unlikely in this market).

Oh well, hopefully some news, good or bad, will surface soon. I hope it flies and still have some level of confidence he has knowledge we don't have but if not Nashville maybe TG could make it happen down here in Buckhead.

[Flowers]

^actually, i wasn't disagreeing with your assertion as much as i was giving tony the benefit of the doubt. candidly, i think a major change in the tower would probably be considered a material change and allow all of the current buyers an out.

as to how long he's been marketing the project i was only trying to make the point that his poor sales are not the result of a lack of awareness. whatever some might think of his development or marketing capabilities he has certainly succeeded in making signature tower the most talked about real estate development in the history of nashville. just as hillary can't expect to improve much on her name recognition signature probably isn't going to find many new qualified buyers that haven't already heard about the project.

[elguapo731]

Some quick questions....

1. Was it a 60% sold cap that Tony self imposed on the project before he'd commit to building (based on financial benchmarks his team crunched for financing)? If so, being around 55% means he's almost there since it's my understanding that these units have been converted from reservations to sold - this is an assumption based on the the Tony podcast and from the information the receptionist gave me about the March 08 Delay clause in the contracts of those who purchased.

2. Tony dosn't need a GC before starting excavation correct? I figure this may not the the conventional way of doing things, but AP seems to have had some success with this approach. By the way has anyone heard who is AP's GC or who is financing the WES, or is he P.O.ed at the media and we'll find out when somone puts a sign up on the fence? But Tony probably shouldn't be following in AP's footsteps on a project this large....

3. Will Tony really have trouble finding 5 mil for excavation? Personally I don't think so, in the scheme of things, 5 mil is a decent chunk of change but small enough in the grand scale and ealily managable for local banks. Now the bank would never loan me 5 mil, but Tony G... I think he has a good shot....

4. What is the cost comparison between the WES and Siggy?

[nashvylle]

scaling down a building is a lot more complicated than people think. No one knows what Giarratana is truly thinking, but if it is nowhere stated that a scaled down version is possible, speculation is just speculation.

[nashvillwill]

not sure what he paid for the dirt....

I think i remember that he paid $9 million for the land. If i remember correctly this was the highest per/sq. ft. purchase in TN history. I might be way off on that second part, but i''m pretty sure it was 9 mil.

[ATLBrain]

I seem to recall that Mr. Giarratana bought the property where Signature would go over a dozen years ago. I don't think the price was anything near $9 million. Granted, I was living in NC at the time, but I visited Nashville lots of times during that period. Seems like he's had that property, and actually had an earlier proposal, for a long time.

[Flowers]

metro's website shows he (signature holdings, inc) paid $9,084,075 for 1.22 acres on 12/19/05. even though this was 2 years ago i think it may still be the highest psf paid for dirt in nashville. to atlbrains point he may have been in the land with partners years ago who had to be bought out. i haven't seen the records but someone in my in my office said that he pledged this property a year ago for an $11 million loan with wachovia. if this is true that may explain why he's trying to raise cash to start digging. if his plans are as far along as he says it seems he really does have 22 mill invested in this deal. yikes!!

[dxartist]

Some quick questions....

1. Was it a 60% sold cap that Tony self imposed on the project before he'd commit to building (based on financial benchmarks his team crunched for financing)? If so, being around 55% means he's almost there since it's my understanding that these units have been converted from reservations to sold - this is an assumption based on the the Tony podcast and from the information the receptionist gave me about the March 08 Delay clause in the contracts of those who purchased.

3. Will Tony really have trouble finding 5 mil for excavation? Personally I don't think so, in the scheme of things, 5 mil is a decent chunk of change but small enough in the grand scale and ealily managable for local banks. Now the bank would never loan me 5 mil, but Tony G... I think he has a good shot....

No, he's nowhere near the benchmark of selling enough condos to get started. The 55% is actually the percentage of the 200 units he needs to sell to get a loan. In reality, he only has about 110 units of the 400 sold.

Apparently he is having problems finding the $5 mil. He commented in the podcast that he sent out a memo to potential investors specifically for the excavation cost.

[Nashville_maestro]

Ok, I have some comments on this. First, to answer some things; yes atlbrian you wernt immagining things. I dont know anything about that report saying that he bought the land in '04 but there was an interview on Fox news where he said that he did buy the land in 1994. It's considered the most valuable lot in Nashville due to it being smack in the middle of the heart of the skyline. I dont know what he paid but I'll believe that 9million figure. And yes Flowers he has already sunk around 20 million into this project (and he better get ready to sink in more if he wants this thing built) which he also stated in the interview on fox. That is the sole reason he is continuing to push this project i'm guessing. He also said that he cant scale back because the current design was approved unanimously by the metro development council (or whatever you call it) but if it comes down to it I'd guess he'd be willing to and try to get the updated model re-approved. All of this of course, was a public interview so he was most definately giving out nothing but good PR. You can see the video on fox17.com maybe. You'll have to find it and it was aired a while back so it might be removed already. Give it a try though.

Anyway, personally I think we're all a little ready and anxious about this project so we're over analyzing it a bit. A lot of the things mentioned in this thread were probably nitpickey issues out there that got blown way out of proportion in here. I really do think that he and the team are going to have to up it's advertising a lot. Everyone else has ads in the paper, the Nashville Scene (some are also in All the Rage too), and signs on billboards. I think he needs to advertise the hell out of it in the Williamson AM paper and the Brentwood Journal supplement as well as in the Nashville Scene. I was in sales for a while (not real estate though) and there was a tearm we used called "sizzle the deal" when we were attempting to close a deal. Basically it's creating an image that REALLY brings out the benefits (the difference of saying "Would you like a slice of pie?" vs. "Would you like slice of fresh baked pie? They're still hot and gooey.). I really think that tony needs to somehow bring out the benefits in the advertising of living downtown. We all know it's a tall building but what about some of the other benefits and luxeries? You'd be close to everything, including work (possibly) and culture, you'd live in the heart of Nashville so franklin, la vergne, hendersonville, mt. julliet, etc are all equal distance away, etc. Things like that make the difference in sales. I'm sure tony and his team know how to sell once the person is in the sales center but bring out some things in the ads to get them in the sales center. Merely slapping a picture and saying "from 400,000" hasnt cutted it very well until now. Time to change the approach.