Duke Energy Center - 48 Story Office Tower in Charlotte

[dubone]

See this on the UP Wiki: Wells Fargo 48 Story Office Tower in Charlote

Now that Wachovia has been purchased by Wells Fargo and will no longer be a head quarters building and condo tower no longer appears to be likely, I have archived the original discussion thread on the project:

http://www.urbanplanet.org/forums/Wachovia...ice-t33078.html

It is probably best to discuss all of the arts project in the thread that has always existed for them, but since the project is so integrated, as always it will be fine to occassionally discuss them in this thread. But here is the official thread for them:

http://www.urbanplanet.org/forums/Charlott...-Pla-t3509.html

Here is the initial thread when the project was just a rumor:

http://www.urbanplanet.org/forums/Wachovia...roj-t10860.html

As a summary the Wells Fargo tower will be 48 stories, 764' tall and will be second tallest tower in Charlotte. The project is expected to be LEED Silver certified based on the design and is expected to be completed in 2010.

The tax revenue from the office tower will pay the city back for the bonds on the integrated arts projects the African-American Cultural Center, the Mint Museum of Art, the Bechtler Modern Art Museum, and the Knight Theater.

[ROBERT2]

Hi I am a new to posting to urban planet. I have been watching whether this condo tower at the Wells Site would be postpone or Not.

The goverment bailed out these banks with Billions so that they could make loans that would stimulate the economy. If the Bank does not have faith in lending to its own project it does not bode well for other developers or consumers who are seeking mortgages or the economy as a whole. The project is still a great addition even without the condo.

[New Name]

Welcome to UP!

I assume Wells would opt not to build the condo tower simply because they do not feel the need for it - it has nothing to do with whether they "can" and more to do with "need." All indications are that Wells will not need house as many senior officials/consultants as Wachovia would have - as those officials/consultants may now need to be in Minnesota or San Fran. I guess we will see as the restructure comes down.

[dubone]

Also, in part the original intent of these luxury condos were to be for the fancy CIB bankers that would work late hours at the trading floor in the HQ tower and had an average annual income of 1/2M or more. Investment banking business has dried up and CIB as a department is being slashed and furthermore Wells (or Wachovia at the direction of Wells before consummation) has cut the trading floor from this tower. Therefore, the target market for the units in the condo tower is no more, and since sales never started, there are no general market buyers. Frankly, now is the worst time to add competition to the other towers. The best way to at least get the ones with partial sales through to completion is to have some towers not as far along to be put on hold.

In my point of view, just like what happened with Avenue, the spot Wachovia put aside for a residential tower on this block will eventually have one once the market has matured enough to bear it. Charlotte could not take a 35 story residential tower when IJL tower was built but it sure could in 2006-2008 when Novare came along and built a highly marketable one.

While most of us think that now is not the time for this tower, most still think that eventually there will be a market and lending again for new residential towers uptown. Who knows, though. We mostly need to be observers.

But one thing seems almost certain, even though it is not officially announced. Wells Fargo has absolutely no 'home town pride' on the line in Charlotte and will not do anywhere near the type of civic-minded lending (arena, HOF, AAA baseball, NFL, arts, etc.) that we saw Wachovia and BofA do here. It will sting a little bit, but maybe others will step up to the plate. The flipside, too, is that maybe some of those cool things don't happen any more and we just count our blessings that they happened for a decade or two.

[krazeeboi]

It's a shame that the ATM was taken out of Three Wachovia on the S. Tryon side just to gut that portion of the building to put the sales center for the condo tower in, and now the windows are papered up and no condo tower is getting built (at least for right now).

Anyway, here are the first photo contributions to the new thread. Taken 1/1:

[dubone]

Great pics krazeeboi! I haven't been down there to see in a month because of traveling, but the glass looks so much better now that it is 3/4 of the way up!

I agree on that old Wachovia branch location in 3W but now hopefully it can leased to general retail. OR who knows, maybe they'll keep it as a proposal but now simply require pre-sales and let the sales center stay open for the next couple years like all the other towers. If they do that, then they could be one of the few starting that process now reaching presales probably in a year or two and then construction targeted for 2011-2013 time frame. That seems like it makes sense an option. I mean, Wells Fargo's takeover doesn't mean they'll stop doing business here, but I think it will mean they won't take more risk than normal just because of hometown support like Wachovia did.

[atlrvr]

To all those optimist that felt the condo tower would happen, this is from last night's city council meeting. Bob Bertges has been Wachovia's head of corporate real estate executive heading the entire project.

Bertges confirmed the long-shot odds of the bank

[dubone]

Fair enough. I assumed it to be the case anyway.

Will the tax value of the new tower cover their minimum tax on the site?

[AuLukey]

I wonder how they are going to top off the Mint museum then. I wonder if they going to leave structural supports up on top to make building a tower later easier, or if will they cleanly finish it off for a more aesthetic look on the museum. I'd hate to have another TTT-esk look uptown.

[dubone]

I'm sure it won't be architecturally ideal as I bet it will have an extra floor than you might imagine to see on the Mint Museum. However, due to the lack of ownership issues like in TTT, I'm sure it will not be left bare.

[ASUman23]

Great pics krazeeboi

Im starting to forget what a nice sunny day like that looks like around here

[spagett]

My first post!

[dubone]

HA! It'll never come true, though. If Family Dollar ever cares to come uptown, they'd setup a sprawling spartan complex on the 10 blocks Danny owns in First Ward.

[monsoon]

To all those optimist that felt the condo tower would happen, this is from last night's city council meeting. Bob Bertges has been Wachovia's head of corporate real estate executive heading the entire project.

Well.... No surprises here at least to anyone who has been reading what I have been posting for a long time about skyscrapers. Charlotte will not see this tower built. This tower was the wet dream of a bank whose lending practices lead to a great deal of irresponsible construction in this country. Wachovia, aka Charlotte's First Union, is now just a memory because of it and this tower dies with the bank. The Californians and Minnesotans who control whats left of these assets, I am going to guess, has no interest in building yet another vanity tower in a Sunbelt city.

[49er]

Not so fast. I'm sure Wells Fargo is smart enough to see the value in a 6 story building with air rights and foundation to support a 42 story building. If they don't build it, they can surely sell the air rights to someone who can. Will it happen this year or in 5 years? Probably not due to the economy but who knows. I just don't believe the sky is falling...there will continue to be demand for all sorts of space at high densities in downtown whether it be civic, residential, office etc.

[spagett]

First serious post. If GMAC happens to relocate their HQ to Charlotte, it would be a shame if they didn't locate Uptown or at least along the light rail. A few floors of the Wachovia tower could be leased for their HQ, that is, if they aspire to become a real bank. Though I don't know how much more expensive Uptown space is relative to Ballantyne or their HQ's specific needs.

[Andyc545]

First serious post. If GMAC happens to relocate their HQ to Charlotte, it would be a shame if they didn't locate Uptown or at least along the light rail. A few floors of the Wachovia tower could be leased for their HQ, that is, if they aspire to become a real bank. Though I don't know how much more expensive Uptown space is relative to Ballantyne or their HQ's specific needs.

Certainly nothing is set in stone, but I don't believe Wachovia- errg Wells Fargovia has intentions of completely pulling out. The thing is, this tower will be owned by the institution, where the previous HQ (Wach 1) was a leased building as well as 2 Wach if I'm not mistaken. I think if we were looking at a former Wachovia tower having significant space available due to job cuts for a new HQ or business to move in, it would be one of the previous Wachovia buildings and not the brand new one going up now. Just an opinion but Charlotte, even in this economy, has an insanely low office space available which is why I believe if the GMAC thing goes through, they are looking where significicant space is available (Ballantyne).

[Guest]

Certainly nothing is set in stone, but I don't believe Wachovia- errg Wells Fargovia has intentions of completely pulling out. The thing is, this tower will be owned by the institution, where the previous HQ (Wach 1) was a leased building as well as 2 Wach if I'm not mistaken. I think if we were looking at a former Wachovia tower having significant space available due to job cuts for a new HQ or business to move in, it would be one of the previous Wachovia buildings and not the brand new one going up now. Just an opinion but Charlotte, even in this economy, has an insanely low office space available which is why I believe if the GMAC thing goes through, they are looking where significicant space is available (Ballantyne).

Local Analysts are expecting uptown vacancy to jump from 1.8% to 11% in the year and a half. So Charlottes Office Market will not be as tight as it was previously.

[monsoon]

There is an article in the Observer or WCNC, I don't remember which where they say if GMAC does come to Charlotte, we are talking about 3-4 floors in a building in Ballentyne. It certainly won't do anything, even if they did come downtown, to justify a skyscraper.

Some of you, BTW, seem to be confused as to the 48 story office tower versus the 42 story condo tower. It is the unbuilt condo tower that I am speaking of, not the office tower.

[Andyc545]

Local Analysts are expecting uptown vacancy to jump from 1.8% to 11% in the year and a half. So Charlottes Office Market will not be as tight as it was previously.

Well we'll see what happens, I'm assuming those figures came from cuts from Wachovia, but we don't know what will happen yet. I wouldn't deny that the vacancy rate is likely to increase though in this economy. Aside, it's true that whatever has been said about GMAC by the media only had them bringing a minimal amount of people relocating, if it happens. I just don't see a bank relocating in another banks tower. Isn't there some sort of security and privacy issues with this?

On another note, I was watching WBTV just now, which I never watch the local news on TV, but noticed they now feature this tower (Wells Fargo 48 story tower) in the background of the lead anchoring coverage. Thought of UP when I saw it .

[Charlotteman]

Local Analysts are expecting uptown vacancy to jump from 1.8% to 11% in the year and a half. So Charlottes Office Market will not be as tight as it was previously.

11.8% is still quite healthy, as far as downtown vacancies go. Many American cities routinely have center city vacancies of 20%+.

When vacancies go up, it's a golden opportunity to bring in new businesses!

[monsoon]

If local analysts are saying this, then I expect it to be worse than stated. There is a great deal of un-rented Class A office space in the city. I was speaking to my next door neighbor the other day who said their firm was closing up its downtown shop (located there in 1995) and moving to new offices at North Lake. There has been a lot of office building construction there, and the owners of these new buildings are offering deals on rent they could not pass up, especially in these tough times.

I don't know how it could be figured out how much there is, but the construction boom over the last 5 years has also resulted in a large amount of speculative new office space being built out on the perimeter of the city. These are mostly 2 - 10 story buildings that generally go unnoticed by the people here. There are a substantial number of new buildings at North Lake, Ballentine, in the University to Concord Mills corridor, W. Tyvola Rd., numerous points on all the freeways, etc.

I would not be surprised that an analysis would show there had been more space created in these places than in downtown Charlotte. Like the real estate market, there has been a lot of overbuilding versus real need. These places are offering firms rental deals that are very hard to pass up especially to firms looking to economize in these difficult economic times. There could be a substantial migration out of downtown office space as a result.

[southslider]

Local Analysts are expecting uptown vacancy to jump from 1.8% to 11% in the year and a half. So Charlottes Office Market will not be as tight as it was previously.

I guess all that freed up land along Stonewall near NASCAR will sit dormant for at least two more years. Go-cart track anyone?

[Spartan]

HA! It'll never come true, though. If Family Dollar ever cares to come uptown, they'd setup a sprawling spartan complex on the 10 blocks Danny owns in First Ward.

Hey, I resent that adjective.

[dubone]

Actually, I though the 11.8% vacancy was if all the Wachovia stuff vanished. People should know by now that that is not going to happen. It will be a merger and there will certainly not be the growth we saw before, and we'll likely even see declines of jobs here. Obviously there are big declines the top paying jobs, although there are still some. But realistically, John Stumpf and Wells Fargo in general have no inclination to decimate operations here. Wachovia was still a good company outside of the Golden West acquisition, and Wells will want to retain as much of that operation as possible. They will house their East Coast Banking HQ here, although will have newly relocated Wells people to head it, but much of the line of business operations for the the pre-Golden West Wachovia will remain here, below the top levels.

I could see them vacating One Wells Fargo (One Wachovia/One First Union), and see them move to less space in this new tower. But anyone who thinks that legacy Wachovia operations are going to wither down to zero here is deluded. Banks and communities are intrinsically tied. Wells now is a major bank to this community and will do everything it can to make the transition to be as little damage here as possible. They did so in Minneapolis and now have higher employment there than they did during the Norwest HQ days.

Wells Fargo was perhaps one of the most stable financial institutions out there before buying us. They bought Wachovia knowing its financials very well. They paid a very low price to compensate for losses, and got a favorable IRS ruling to allow for some accounting benefits to soften the blow of the losses. Combined, much of the business that was leaving Wachovia because of instability is now returning due to the new found stability. If the combined bank can grow business because of this effect, then as duplicate jobs are removed, new jobs can open up to serve the new business. On the flipside, if legacy Wachovia customers continue to leave in droves like before the merger, then we'll see the jobs for east coast operations decline fast far beyond the simple redundancy removals.

No one knows the number of jobs that will be here with Wells Fargo in the next few years, but anyone who thinks that Wells Fargo would slash the legacy Wachovia operations down to nothing does not understand mergers and does not understand business self interest in general.