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Old December 2nd, 2009, 01:41 AM   #9221
BVictor1
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Unions pension funds could never come up with the billion dollars necessary to fund this. Moreover, notwithstanding unions' self-interest in creating construction jobs, no fiduciary would commit pension funds for a pie in the sky real estate project -- particularly after the Dubai default.

I thought that this thread was closed or was that just "damage control" to stop posts about this project's death?
I don't think that it was ever mentioned that union pension funds would be financing the entire project. What their investment could do is give the project a kick in the ass. Also, remember that construction costs and materials aren't as expensive now as during the major boom years. With this investment, they wouldn't need as much money from other entities.
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Old December 2nd, 2009, 03:08 AM   #9222
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if i were the developer of this building, i would just go ahead and build it and not worry of financial trouble. i mean when this thing is built, all of the world will be in awe and it would be the best building in america for decades to come. it is definately worth the risk. i am actually willing to bet that this building will pay for itself in no time.
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Old December 2nd, 2009, 06:30 AM   #9223
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Just to finish off this thread before it's locked again:

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Old December 2nd, 2009, 07:23 AM   #9224
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Quote:
Originally Posted by WiGgLz01 View Post
if i were the developer of this building, i would just go ahead and build it and not worry of financial trouble. i mean when this thing is built, all of the world will be in awe and it would be the best building in america for decades to come. it is definately worth the risk. i am actually willing to bet that this building will pay for itself in no time.
A condo purchased today will likely be worth 2-3 times more in 30 years. So, yeah, a buyer will almost certainly make money if they hold on to it simply due to inflation. But there's not a developer in the world that's got a billion dollars lying around in a bank somewhere to build this thing. (Well, maybe in China). But certainly not in the USA.

Kelleher by no means is a lock to make money on this thing. Construction costs are down now, but is it enough? Will he make enough sales to payoff the loans he'll need to build this? Will even the existing sales he has, actually close on the home when this is finished? Lots of unknowns in this one.
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Old December 3rd, 2009, 06:49 AM   #9225
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i don't know how many units they have to sell to break even but i would think that they don't intend to loose money on this project. So if they all the condos they will make money right?
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Old December 3rd, 2009, 06:53 AM   #9226
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Wow, I would have rather had the Olympics than the Spire, but this is not a bad consolation prize. I hope this is true!
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Old December 3rd, 2009, 08:35 AM   #9227
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i don't know how many units they have to sell to break even but i would think that they don't intend to loose money on this project. So if they all the condos they will make money right?
Typically in a project like this, it's the last 10% of the units that are the profit for a developer. 90% sold would basically mean they broke even.

It's a tough business.
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Old December 3rd, 2009, 05:01 PM   #9228
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Wow, I would have rather had the Olympics than the Spire, but this is not a bad consolation prize. I hope this is true!
agreeed!

not to mention, I was way off lol. I thought this only had a chance if we won the Olympics, not lost. lol
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Old December 3rd, 2009, 08:15 PM   #9229
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and they have only sold about 30% till now? let's hope the housing market improves, I would hate not seeing this thing build
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Old December 3rd, 2009, 08:52 PM   #9230
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Dec 3

From above

higer res 2007 series - 2008 Q1 series - 2008 Q2 series - 2008 Q3 & 4 series - 2009 series

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Old December 3rd, 2009, 10:21 PM   #9231
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Ok, looks like there is cause for some cautious optimism. Especially considering there aren't too many other really high end residential towers on the books for construction in chicago in the next couple years. Unless you consider the Ritz Carlton residences.
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Old December 4th, 2009, 01:09 AM   #9232
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the spire was dead
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Old December 4th, 2009, 04:03 AM   #9233
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spire >>>>> olympics
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Old December 4th, 2009, 02:44 PM   #9234
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Thanks for the pictures again harry, it's hard to get spire updates in europe
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Old December 4th, 2009, 04:36 PM   #9235
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Quote:
Originally Posted by WiGgLz01 View Post
if i were the developer of this building, i would just go ahead and build it and not worry of financial trouble. i mean when this thing is built, all of the world will be in awe and it would be the best building in america for decades to come. it is definately worth the risk. i am actually willing to bet that this building will pay for itself in no time.
This is exactly why you are not a developer, lol. You don't throw money at what you want and you never let your heart dictate a business decision. It can be the best building in the known universe but if it is going to be empty or lease at rates that will not pay for construction loans it isn't going to be built.

If this building were going to pay for itself over time the financing would be there and it would be built. Right now the developer would take a huge loss if he were to try to build this. Everyone who knows the business knows that and that is why there is a giant hole out there and nothing else. I am afraid this one is dead. It was a product of a real estate market that is dead and gone and will not be back again for years, if ever. The per square foot pricing needed to build this is just not going to happen. The economics simply no longer work.

In the current market the only (with some exceptions of course) apartment/condo projects being built in the US are those that have tax credits attached to them. Meaning that a bank is enticed to invest in a project via a "sale" of tax credits through a state agency. The bank pays a certain price on the dollar then writes the whole dollar off its tax return, the developer gets some free money, and in some cases that is enough to augment private financing and get the project built. The drawback, if that is the right word, is that these credits are reserved for low income developments.
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Old December 5th, 2009, 08:43 AM   #9236
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There may be hope here: Kelleher needs the $170 million to resolve outstanding disputes and lawsuits so he can move forward with the bigger financing package he'll need to build the Spire. At the same time, Wall St. has looked favorably on REITs even as the commercial credit mess gets worse and that could mean a deep-pocketed entity like Vornado or Boston Properties taking an interest in the Spire. Even if the union he's negotiating with turns him down, others might not. This is an iconic project that could open just as Chicago comes out of the doldrums and with little other competition since so many other projects have been cancelled or scaled down. If the financing arrangements are done right, Kelleher just might be ordering steel. It's only money.
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Old December 5th, 2009, 09:16 AM   #9237
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Quote:
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Condo prices also are way down. When this thing was proposed before the crash, they spoke about prices that simply were unheard of in Chicago. (I think in the range of $4,000)/sf. They could never get that when the world economy was booming. Trump Chicago has had an extremely difficult time at $900/sf for a tower that's no less luxurious.

It would be like Hines stating that they need to secure pricing of $15,000/sf in order to break even on the Torre Verre. It won't happen.
No less luxurious? The Spire would make the Trump look like any typical condo building. Also, the Spire would be a piece of art where the trump is just another tall building, not to take anything away from Trump, it's a beautiful building. I think the Trump was selling well until everything went so or maybe a little before.

Anyway, although I love the design of the Spire I always thought it was too tall for it's location. The very first version was and will always be my favorite. If it dies, which I think it will, I won't be too sad, something better will probably come along in the future. I don't know what's going on behind the scenes but from what I do know, I don't think things are looking too good for the Spire. I'd give up the Spire in a heart beat for Waterview and Walfdorf Astoria or even just for one of those two.
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Old December 6th, 2009, 02:28 AM   #9238
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Quote:
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How are the Spire's apartments more luxurious than Trump's? Do they have gold walls and platinum fixtures?
Depends on your opinion of luxurious, if gold and platinum is your thing, stick to Dubai.
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Old December 6th, 2009, 02:33 AM   #9239
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Forgot to post this. I was at the CAF's Model City exhibit two weeks ago just in time to see a surprise appearance by the Spire :

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The Spire wouldn't normally be in the Model City - I asked & was told that it occasionally gets trotted out on request for special events. Looked like some kind of educational youth tour going on that day.
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Old December 6th, 2009, 03:36 AM   #9240
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Quote:
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How are the Spire's apartments more luxurious than Trump's? Do they have gold walls and platinum fixtures?
"Luxury" is maybe too subjective a qualifier - but unlike Trump, many of the Spire's units include Calatrava-designed, site-specific furniture & layouts; the galley units especially are floor-to-ceiling Calatrava, right down to the sleeping pods. Not necessarily more luxurious than Trump, but probably more "collectable".
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