[chi-arch]

It's easy sometimes to forget how powerful the Chicago River is in it's impact on the organization of Chicago Architecture and some of these historic pictures strip out the newer architecture for a more raw look at earlier times. Did you notice the trains on the North side of the River in the first photo I posted? Still have my hopes of getting this building to rise on the river and seems I'm one of a few with my deposit still sitting there...... Oh well.

[X-fib2]

Did you notice the trains on the North side of the River in the first photo I posted?

We sometimes forget that it wasn't all that long ago that much of the near north was heavilly industriallized. Still amazing how much the area has changed since, with or without WV!

[ChicagoChicago]

A little late for the info, but I spoke with a insurance guy that deals with Teng, and he did say that the project was winterized in the fall. He also said Teng is capable of sitting on this project until the markets improve.

I read that to mean that they aren’t looking to sell at this point.

[Tom In Chicago]

A little late for the info, but I spoke with a insurance guy that deals with Teng, and he did say that the project was winterized in the fall. He also said Teng is capable of sitting on this project until the markets improve.

I read that to mean that they aren’t looking to sell at this point.

Yeah. . . well they own the property so I don't see what the rush is in this. . . er. . . soft market. . .

[Steely Dan]

^ there's still the issue of that crane though, those things aren't exactly cheap to rent. is it possible that teng has bought the crane outright in case they really do intend to sit on this half-built property for the long haul?

[Tom In Chicago]

Ah yes. . . about the crane. . . hmm. . . now THAT is a good question!

[chi-arch]

I have heard that the crane is costing Teng $30K a month in rent.

[Steely Dan]

I have heard that the crane is costing Teng $30K a month in rent.

yikes, i knew those things weren't cheap. if that $30,000/month figure is correct, then teng has already flushed $270,000 down the toilet on the crane since the work stoppage in may of last year. if they're planning to sit on this thing until a market recovery, let's say that's 2 years away for the sake of argument, that'd be another $720,000 dollars in rental fees, so we're talking about a million bucks for nothing. in the grand scheme of things i guess a million bucks can be swallowed by a project of this magnitude, if they can eventually pull it off. but what if they can't?

anyone know the costs to purchase a tower crane of this type? i'm guessing that they're probably still more than a million bucks to purchase outright.

[chi-arch]

Dan,

My understanding is the crane is really stuck where it's at and it will take a crane to remove the crane or build up three floors to get to it to remove it. Just another poor planning aspect of the project and unfortunately both of these options to remove it are in the millions, so best to keep paying rent I guess :)

You are right, however, and at some point they will have paid enough to purchase it. Perhaps the $1 buyout after 2 years has now been negotiated :shrug:

[ChicagoChicago]

yikes, i knew those things weren't cheap. if that $30,000/month figure is correct, then teng has already flushed $270,000 down the toilet on the crane since the work stoppage in may of last year. if they're planning to sit on this thing until a market recovery, let's say that's 2 years away for the sake of argument, that'd be another $720,000 dollars in rental fees, so we're talking about a million bucks for nothing. in the grand scheme of things i guess a million bucks can be swallowed by a project of this magnitude, if they can eventually pull it off. but what if they can't?

anyone know the costs to purchase a tower crane of this type? i'm guessing that they're probably still more than a million bucks to purchase outright.


It's a Potain crane (owned by Manitowoc).

Similar to this one. This one is used at $1.45mm.

http://www.cranenetwork.net/search/model_results.asp?model=MR%20605B-H32

[Mojava]

Yeah. . . well they own the property so I don't see what the rush is in this. . . er. . . soft market. . .

I doubt they outright own the property. I'm sure they have a hefty mortgage on it so they would have to be keeping up payments. If they are unable to make payments to the lender (as they have no current funding) then they are at risk of foreclosure.

[Tom In Chicago]

^Teng purchased the property over 8 years ago

[Mojava]

^Teng purchased the property over 8 years ago

Tom - This is a quote from a story by Crains back in November when the Chinese bank pulled out...

"The bank’s refusal to approve a $400-million construction loan for the condominium-and-hotel high-rise reduces the already slim chances that the building’s current developer, a group led by Teng & Associates Inc. President and CEO Ivan Dvorak, will be able to finish the luxury project. And it increases the odds that Bank of America Corp. will move to foreclose on the property at 111 W. Wacker Drive."

http://www.chicagorealestatedaily.com/cgi-bin/news.pl?id=31683

[andydie]

Just wondering if I understand it right. If BofA forecloses this would BofA be the new owner of the Waterview shell? Would they sell it or maybe try to finish the Building themselves? Thanx.

[ChicagoChicago]

Just wondering if I understand it right. If BofA forecloses this would BofA be the new owner of the Waterview shell? Would they sell it or maybe try to finish the Building themselves? Thanx.

It would depend on whether BAC (Bank of America) had “first lien” (primary mortgage holder) on the project. If they foreclosed, it would wipe out all other liens on the project. If BAC were a secondary lien holder, that primary lien position would still stand and they would need to make that primary lienholder whole prior to doing anything with the property.

In any case, I doubt BAC is in a position to develop anything. They’ve received TARP funds, and the last thing they would want to do is make headlines building a couple hundred million dollar building for a bunch of rich people while they are in possession of those funds.

[Tom In Chicago]

Tom - This is a quote from a story by Crains back in November when the Chinese bank pulled out...

". . . And it increases the odds that Bank of America Corp. will move to foreclose on the property at 111 W. Wacker Drive."

Interesting. . . so they took a mortgage out on the property??? I guess that's how you do it, but the news from 1999 simply mentioned that the lot at 111 was sold to Teng. . .

. . .

[Mojava]

Most developers dont pay cash for the property. Regarding the Spire, remember that Shelbourn took out a $60+M loan to purchase the property from Fordham.

It seems like every day there is story mentioned of a developer going into foreclosure on property that it cant make payments on. My guess is that these banks will stock pile properties and sell them at a later time.

[budman]

I think the crain's article is talking about the $20 million bridge loan from LaSalle Bank, which has since been purchased by BofA. When I got my money back, I was told that the developer has a good relationship with BofA and that foreclosure was not realistic.

[chi-arch]

^^Agree with Budman and don't think this property will see foreclosure either. ....and you can guess which bank is holding millions of dollars in escrow deposits right now on the units under contract. ;)

[honte]

Interesting. . . so they took a mortgage out on the property??? I guess that's how you do it, but the news from 1999 simply mentioned that the lot at 111 was sold to Teng. . .

. . .

That was my understanding too (that they owned the land outright). They probably mortgaged the land when they finally got the bridge loan.

Then again, I was the one who forgot that Kelleher had a loan on his land.

[Ch.G, Ch.G]

http://www.nytimes.com/2009/02/04/business/04chicago.html?pagewanted=all

February 4, 2009
Two Chicago Towers Fall Victim to Scarce Financing
By ROBERT SHAROFF

CHICAGO — Back in 2006, at the height of the real estate boom, two projects here stood out as harbingers of a bright future for residential development.

The first and most significant was the Spire, a twisting lakefront condominium tower designed by the renowned Spanish architect Santiago Calatrava. At 150 stories, it was to be the tallest building in North America. (The current tallest, the Sears Tower, is also in Chicago.) The developer of the Spire is Garrett Kelleher of Shelbourne Development, a firm with offices in Chicago and Dublin as well as several other cities.

The second project was Waterview Tower, a 90-story mixed-use hotel and condominium building in the Loop, the central business district. It also was to be among the 10 tallest buildings in the city. The developer is Teng & Associates, a local firm.

Both projects got off to fast starts in terms of sales and construction, but both have now ground to a halt amid the many mechanics’ liens filed by subcontractors as the developers struggle to find additional financing.

At the padlocked lakefront site of the Spire, a seven-story-deep hole is ringed with 34 massive caissons that go down to bedrock.

The Waterview site on Wacker Drive, meanwhile, is even more unsettling. Workers had completed the first 26 floors of the building before they stopped work for good late last summer.

Taken together, the two are the most visible signs of the financing squeeze that has all but paralyzed the real estate market here over the last six months.

“If I’d known in July of 2006 that the world would be where it is today, I would have done a lot of things differently,” Mr. Kelleher said.

Both Mr. Kelleher and Teng ran into trouble because of a practice that, while unconventional, had become more accepted in the later years of the boom. In their haste to start building, the developers used money from their own pockets to finance the early stages of construction rather than go through the lengthy process of securing a traditional construction loan. The expectation was that further financing would easily be obtained at a later date.

Jim Loewenberg, a co-chief executive of the Magellan Development Group, the developer of the multibuilding Lakeshore East mixed-use residential project directly across the Chicago River from the Spire, said neither Mr. Kelleher nor Teng & Associates necessarily did anything wrong.

“I think that developers inherently are risk-takers and in many cases begin their projects before every t is crossed and every i is dotted,” he said. “So they lead themselves down a path, and sometimes it works out wonderfully and sometimes it doesn’t.”

Mr. Kelleher said: “It was about getting started. I needed to demonstrate that I was committed to the project.”

So far, Mr. Kelleher has invested about $250 million in the Spire; $180 million was cash from his own holdings and $70 million was in the form of two loans from the Anglo Irish Bank in Dublin.

When construction started, the plan, while aggressive, made sense. Total condominium sales were estimated at $3.4 billion, against total costs of $2.3 billion.

The project initially did well, selling just over 30 percent of its 1,194 units in the first eight months, at prices ranging from $750,000 to just under $40 million. The latter — for the 10,000-square-foot penthouse — is the highest price ever paid for a condominium in downtown Chicago. The contracts extend until the fourth quarter of 2013, and deposits are held in escrow until then.

Also significant was the fact that more than half of the sales were to individuals or entities outside the United States. “We launched in January” of 2008, Mr. Kelleher said, “and went to Beijing, Singapore, Hong Kong, Dubai, London and a number of other markets.”

In late September, Mr. Kelleher announced the penthouse sale — to Ty Warner, founder of the company that makes Beanie Baby toys. Since then, “things have slowed down,” he said.

Mr. Kelleher estimates it will take about $1.75 billion to complete the Spire and says he has had conversations with numerous financial institutions, both in the United States and around the world, over the last 18 months. “There’s no financing available to build the Spire today,” said Mr. Kelleher. “It’s a matter of waiting. And that’s what the plan is.”

Specifically, Mr. Kelleher is waiting for next fall, when the city will learn whether it will be the site of the 2016 Olympics. “If Chicago lands the Olympics, it will certainly be a boost to the local economy,” Mr. Kelleher said.

The situation is similar at Waterview Tower. Executives at Teng & Associates declined numerous requests for interviews, but reports about the project’s troubles circulated widely last fall.

The $500 million mixed-use project began construction using internal financing from Teng and a $20 million bridge loan issued by the Chicago-based LaSalle Bank, which is now a division of Bank of America.

The plan called for 200 hotel condominium units as well as 233 residential condominiums on its upper floors. About 40 percent of the hotel units and 67 percent of the residential condominiums were sold, the latter for an average of $800 a square foot.

“Waterview had some of the best prices out there in terms of what you actually got, and sold very well,” said James Kinney, president of Rubloff Residential Properties, a large downtown brokerage firm.

Last April, Teng announced that the Export-Import Bank of China would be providing the $400 million needed to complete the project. The loan was facilitated by Beijing Construction, a Chinese firm that was expected to take over as the building’s general contractor. The deal, however, eventually fell apart.

“It’s not really too hard to determine why the bank got cold feet,” said Zac Henson, chief executive of Beijing Construction’s United States division. “The economic news over the summer got worse and worse and never really got better.”

According to Mr. Henson, the bank has yet to formally cancel the loan, but he conceded that at the moment the bank’s appetite for the project was “questionable.”

Steven DeGraff, a lawyer who specializes in real estate workouts, says there are few good options in the current environment. “It may be cheaper to tear it down,” he said, “or it may be cheaper just to leave it in its current state.”

In the meantime, there are many more condominiums in the pipeline in Chicago.

The city added 4,600 new condo units in the downtown area in 2008, with another 4,700 units scheduled to be completed this year. The rate at which these new units are being occupied is lagging, however.

“Absorption last year was terrible — probably around 1,000 units,” said Gail Lissner, vice president of the Chicago-based Appraisal Research Counselors, which tracks downtown condo sales. “It’s going to take some time to work through this inventory.”

The upside, she adds, is that only 500 new units are expected in 2010 and fewer than that in the following years. “Any project that is not out of the ground now is going to have a very difficult time getting financing,” she said.

Prices, meanwhile, are down anywhere from 5 to 25 percent, depending on location and amenities. “The more generic, the more negotiable,” Mr. Kinney said. “If you want a two-bedroom two-bathroom plain-vanilla condo in downtown Chicago, I can get you a very good deal.”

[Busy Bee]

Dear God.

Does anyone else feel like they're being stabbed in the heart while reading this? The thought of demolishing the base as a 'reasonable' option makes me want to heave.

[Kamuix]

Kind of reminds me of Metropolitan Life Building in new york back in like 1934 :dead:

[Ch.G, Ch.G]

Dear God.

Does anyone else feel like they're being stabbed in the heart while reading this? The thought of demolishing the base as a 'reasonable' option makes me want to heave.

Keep in mind, that's just the opinion of a real estate lawyer who is as far as I can tell in no way related to the development.

[chi-arch]

Keep in mind, that's just the opinion of a real estate lawyer who is as far as I can tell in no way related to the development.

"Or it may be cheaper just to leave it in it's current state"

I'm sorry, just what is he saying with that comment?, cheaper than what?, current state for how long? What a dork. :koko:

[jjk1103]

..............how long can the structural elements remain exposed before there is serious damage ?

[Stratosphere]

..............how long can the structural elements remain exposed before there is serious damage ?
Well, the Ryugyong Hotel was on hold for 16 years. Now they are working on it again.

http://i42.tinypic.com/2ebbvgy.jpg

[ardecila]

Yes, but there is evidence that the Ryugyong Hotel had shoddy concrete to begin with. The cladding is being done as a cosmetic thing to improve the image of Pyongyang. The whole environment in North Korea is so weird and surreal. The closest thing I can compare it to is "1984" - the image of a strong and healthy country is more important than the reality.

At Waterview, the concrete shouldn't suffer too much damage in the immediate future if the site is secured properly. At some point, the concrete will need to be painted or otherwise sealed to preserve it for future construction. I hope the city will step in with the money to do this, in the interest of helping this project meet fruition at some point in the future.

The other alternative is wrapping it in plastic, like at Staybridge Suites.

[wrab]

Or, they or a 3rd party could skin, open & operate the completed garage sections, to generate some revenue...

[BVictor1]

Or, they or a 3rd party could skin, open & operate the completed garage sections, to generate some revenue...

the tower crane would have to be removed for that. remember, it goes directly through the ramp floors.

[ardecila]

Yes, and to safely remove the tower crane a few more floors will need to be poured.

There are so many parties that still have a stake in this that the status quo is untenable. The crane company will want their crane back, the city will not want an unfinished building crumbling away, the buyers will want their units (although I assume most have asked for their deposit back), the city will also want the sidewalks re-opened, etc.

Because of this I think that money will come from somewhere to bring the project to a logical stopping point, pouring the extra two floors (or pouring something temporary) to remove the crane, doing some kind of finishing (painting, cladding, etc) and potentially operating the garage.

[chi-arch]

To further complicate the garage issue and bringing this aspect of the project on line, is the fact that many of the parking spaces are under contract as well. Teng would essentially have to abandon the project and return any outstanding deposits before proceeding to move to this next step. The parking also is only up to 12 with the hotel floors above that to the current 26th floor. Certainly, this is an option, but complicated and would probably preclude ever seeing a tower on this building.

[Nowhereman1280]

I don't believe that "the only way to get the crane out is to build up 3 floors". We are human beings and very ingenious, it seems to me that there is nothing preventing us from finding a different way to get it out. I'm sure they could just demolish some of the half completely pillars on the edge and then stick a dereck up there and just pull the crane out...

[Mojava]

To further complicate the garage issue and bringing this aspect of the project on line, is the fact that many of the parking spaces are under contract as well. Teng would essentially have to abandon the project and return any outstanding deposits before proceeding to move to this next step. The parking also is only up to 12 with the hotel floors above that to the current 26th floor. Certainly, this is an option, but complicated and would probably preclude ever seeing a tower on this building.

I'm sure that the public garage (hotel and pay per use) is seperated from the deeded spots (condo owners). This is probably just by floor numbers but I understand what you're getting at.

[Brian.]

I don't believe that "the only way to get the crane out is to build up 3 floors". We are human beings and very ingenious, it seems to me that there is nothing preventing us from finding a different way to get it out. I'm sure they could just demolish some of the half completely pillars on the edge and then stick a dereck up there and just pull the crane out...

And to prove that you are correct I will show you what us humans could do to get that crane down to the ground.

http://img22.imageshack.us/img22/5674/captured20055100005xp6.jpg

[honte]

^ Exactly. I don't buy the simplified "crane is stuck" business either. It might be stuck, but the reasons are probably more complicated (as in contracts or liquidity etc.)


At Waterview, the concrete shouldn't suffer too much damage in the immediate future if the site is secured properly. At some point, the concrete will need to be painted or otherwise sealed to preserve it for future construction. I hope the city will step in with the money to do this, in the interest of helping this project meet fruition at some point in the future.

The other alternative is wrapping it in plastic, like at Staybridge Suites.

I presume you know all of this because you have looked closely at the concrete mix design of this particular project?

[Mehow]

I don't believe that "the only way to get the crane out is to build up 3 floors". We are human beings and very ingenious, it seems to me that there is nothing preventing us from finding a different way to get it out. I'm sure they could just demolish some of the half completely pillars on the edge and then stick a dereck up there and just pull the crane out...

If Central crane needed that rig on another project,it would be down by now.

[Tom In Chicago]

I hope the city will step in with the money to do this, in the interest of helping this project meet fruition at some point in the future.

The city of Chicago won't spend one god damned dime of my money to "help" Teng or any other inept developer with their luxury condominium projects. . . you must be living in some sort of fantasy land to think that would ever happen. . .

. . .

[Rilestone75]

If Central crane needed that rig on another project,it would be down by now.

Central Crane may be keeping that crane there because it is FREE money. There is currently no wear & tear on it and they have probably "weatherized" it somehow, so they are just collecting (if they are able to collect) $$$ each month as stated previously on this thread.

[lawfin]

The city of Chicago won't spend one god damned dime of my money to "help" Teng or any other inept developer with their luxury condominium projects. . . you must be living in some sort of fantasy land to think that would ever happen. . .

. . .

Hear, Hear....

though they do aid in some instance with TIF's do they not....prior to construction

I am unclear on TIFS

[Tom In Chicago]

Hear, Hear....

though they do aid in some instance with TIF's do they not....prior to construction

I am unclear on TIFS

TIFs are a slightly more complicated issue though and another topic altogether ;)

. . .

[FlashingLights]

Why should taxpayer dollars go towards someones major screw up?

I agree no way the city will help out, nor should they.

If you made a real estate investment and it went sour, would you expect the government to bail your out? Nope...

[MrLakepoint]

Why should taxpayer dollars go towards someones major screw up?

I agree no way the city will help out, nor should they.

If you made a real estate investment and it went sour, would you expect the government to bail your out? Nope...

I am sorry to report that when you or any company that files for bankruptcy the government funnels the capital, which of course comes from taxes dollars. so, one way or another you and me, who pay taxes pay for all of the screw up's individually or for any company. This is where the government should stop this B.S. of raising taxes to bail out "ANYONE". If you go broke you should have to pay it back one way or another, or simply you cannot build it until the capital is there. Milton Friedman method follows the correct way that any country should live in a free society and stop raising taxes on the rich, it does not nor will it ever work for more B.s. entitlements. Good example is this utterly , stupid, ridiculous, TARP fund that is going through congress. :notacrook: :notacrook:

[Nowhereman1280]

^^^ Amen, Milt is probably rolling in his grave!

I know people in the business of buying distressed properties and they say banks are just about giving away properties to them because they know they can just go apply for TARP funds on their loss and save themselves the trouble of negotiating...

If Central crane needed that rig on another project,it would be down by now.

Oh I'm sure of it.

Why should taxpayer dollars go towards someones major screw up?


Haha, I was asking this last spring when they started getting involved in propping up bank deals!

There are some potential customers out there for stalled projects like this. There are very large REITs with all cash and no equity who can buy something like this and just sit on it. These sharky types typically make an offer to a developer that is something like .30 on the dollar and the developer angrily rejects it. Then these guy go "ok, I'll be buying the property for .20 in a few months when you are really in trouble". Then the REIT waits for the developer to cave, which usually happens, and then they get a wicked deal on the property. I don't know if Waterview would be a target for one of these funds, but I would think they would go for it (I'd truly be surprised if they hadn't made a lowball offer yet) if the price were right and Teng was desperate enough...

[MrLakepoint]

[QUOTE=Nowhereman1280;4072365]^^^ Amen, Milt is probably rolling in his grave!

I know people in the business of buying distressed properties and they say banks are just about giving away properties to them because they know they can just go apply for TARP funds on their loss and save themselves the trouble of negotiating...



Oh I'm sure of it.


Nowhereman...I just fell in love with you (not literally of course). I didnt think that there was another uncle milti fan out there....but thanks for the confirmation. I am so sad that this project didnt finish. I really would like to see another supertall here. I am sure that someone will come along and finish it up, but it may take a while because the banks have used all of that TARP money to shore up their balance sheets for now, but in a year or so you may see this have a re-birth at some point.

[Buckman821]

I thought I was the only milton friedman lover. This is crazy. "Capitalism and Freedom" is sitting on my desk right now.

Anyway, I would agree that there is no need for the government to intervene in this.

I think the real question in all of this is what is going to happen to the buyers in this building. Will they look at the spire or will they be too gun shy about buying in a building that is yet to exist?

[ardecila]

I presume you know all of this because you have looked closely at the concrete mix design of this particular project?

Concrete needs to be sealed, yes? If the concrete is designed to be cladded (and it is, on Waterview) it makes sense that the builders would use a weak sealant to protect the concrete for a few months only.

The city of Chicago won't spend one god damned dime of my money to "help" Teng or any other inept developer with their luxury condominium projects. . . you must be living in some sort of fantasy land to think that would ever happen. . .

Remind me again how many different sources of aid the city is giving to Joseph Freed for Block 37..... It seems like the city is very much in the business of bailing out struggling developments with taxpayer money, especially when the developers are politically connected. If you've been reading the news, you'd see that Teng is very much politically-connected. :haha:

[honte]

^ Yeah, actually, I agree with what you're saying. It's not as far-fetched as it sounds, as terrible / excellent as that may be.

Concrete needs to be sealed, yes? If the concrete is designed to be cladded (and it is, on Waterview) it makes sense that the builders would use a weak sealant to protect the concrete for a few months only.

Sorry if I sounded snide in my last post.

Most of the sealing bit is pure myth. In some cases, it can actually do more damage than good.

There are many, many factors that govern whether or not concrete will be a good performer in the elements, including mix design, cover, admixtures, orientation, and type of reinforcing. Most of the painted concrete high-rises in Chicago do not need paint for structural performance.

Now, on your second point, I agree with you: Given the nature of the concrete at Waterview, there is a good chance that one would like to protect it from the elements. But we cannot say that without knowing more specifics. I think if the exposed bars are kept from corroding, the structure would probably suffer almost no damage for the next several years. Pooling on slabs would be the biggest concern, and I don't know how much paint would really remedy that, since not all are pitched.

[alex1]

cross post (CS thread):

well, push things along from a mass media angle, the NY Times ran an article on Waterview and the Spire a few days ago. The article ran prominently in the business section, with two large photos.

http://www.nytimes.com/2009/02/04/bu...20spire&st=cse

[chi-arch]

Repost^

[Nowhereman1280]

Oh yeah guys, being an econ major I am naturally very libertarian, therefore I very much appreciate Milton Friedman, even in todays climate.


Re: weather proofing the structure, well remember, this is almost entirely garage which was made with the green rebar to prevent rust, I'm sure it won't be to big of an issue seeing as how the garage was probably designed with full, non painted, exposure to salt and rust in mind...

[chi-arch]

It's not almost entirely garage. Garage last floor is eleven.

[Tom In Chicago]

Remind me again how many different sources of aid the city is giving to Joseph Freed for Block 37..... It seems like the city is very much in the business of bailing out struggling developments with taxpayer money, especially when the developers are politically connected. If you've been reading the news, you'd see that Teng is very much politically-connected. :haha:

Block 37 is a perfect example of why the city won't be giving Teng any money to finish Waterview. . . however your assumption that they are at all similar is flawed. . . Block 37 was much more complicated site that the city acquired after the failure of Joseph Freed's original proposal to come to fruition. . . however the city did NOTHING to see that original plan get built. . .

. . .

[chi-arch]

This project is as good an example of any that deserves a "construction loan" from a US bank right now. It will put people immediately back to work, bring a higher tax base to that property into perpetuity, create another 5 star hotel for the city along with jobs associated with that, beautify that corner, etc.
I swear some of you would just as soon see this thing torn down and returned to a parking lot out of spite. :shrug:

Maybe we can enclose it under Obama's weatherization program. :yes:
This thread is drifting again and should be locked down until some new news.

[harryc]

Jan 30
http://lh6.ggpht.com/_8TC_VUmf9Fw/SY7xVBHv3fI/AAAAAAABFZY/2onxyjPnI0Q/s800/P1220941.JPG

Feb 6
http://lh6.ggpht.com/_8TC_VUmf9Fw/SY7xW_3YurI/AAAAAAABFZk/L_TQ-KxkjSY/s720/P1240176.JPG

[mempko]

Oh yeah guys, being an econ major I am naturally very libertarian, therefore I very much appreciate Milton Friedman, even in todays climate.


Re: weather proofing the structure, well remember, this is almost entirely garage which was made with the green rebar to prevent rust, I'm sure it won't be to big of an issue seeing as how the garage was probably designed with full, non painted, exposure to salt and rust in mind...
Its to be expected that economy students are indoctrinated into Milton Friedman's ideas. From my experience there is not much variety of thought in economic courses.

They economic incentive that I can see why the city would help out is because property values will go down and therefore city revenue. Unless chicago proper doesn't do property taxes.

[Nowhereman1280]

Its to be expected that economy students are indoctrinated into Milton Friedman's ideas. From my experience there is not much variety of thought in economic courses.


Well you must not have had experience with a very good Econ school then. My school has classes in everything from basic Micro and Macro to classes that specifically tackle Keynes, to classes on mundane topics like Futures markets...

Ironically I'd never heard of Friedman before I did reading about him myself about 2 years ago, its strange, but they almost never mention him in 200 level econ classes, or even 300 level micro and macro. They mention that moron Laffer far more than they mention Friedman...

[chi-arch]

Outside of The University of Chicago is there another top 5 Econ school in the midwest?
...might as well continue to drift off topic....

[Steely Dan]

^ no, no more off-topic stuff. if you guys want to talk econ 101, go start a new thread.

[chi-arch]

ok, sorry.....:D

[chi-arch]

...........

[Mehow]

This project is as good an example of any that deserves a "construction loan" from a US bank right now. It will put people immediately back to work, bring a higher tax base to that property into perpetuity, create another 5 star hotel for the city along with jobs associated with that, beautify that corner, etc.
I swear some of you would just as soon see this thing torn down and returned to a parking lot out of spite. :shrug:

Maybe we can enclose it under Obama's weatherization program. :yes:
This thread is drifting again and should be locked down until some new news.

Latest news = City of Chicago walks through building with citation book and damn near runs out of ink.
1) Board up ALL elevator shaft openings for safety.
2) Replace/repair all blue safety netting around building from top to bottom.
3) All material on site needs to be moved into core and secured.
4) If crane will not be used soon, remove it. To remove "it" shoring needs to be installed five floors below to set the pieces of crane on it while disassembling. BIG MONEY!!!

[ChicagoChicago]

Latest news = City of Chicago walks through building with citation book and damn near runs out of ink.
1) Board up ALL elevator shaft openings for safety.
2) Replace/repair all blue safety netting around building from top to bottom.
3) All material on site needs to be moved into core and secured.
4) If crane will not be used soon, remove it. To remove "it" shoring needs to be installed five floors below to set the pieces of crane on it while disassembling. BIG MONEY!!!

Good. Shit or get off the pot.

[chi-arch]

If Central crane needed that rig on another project,it would be down by now.

So what is BIG MONEY(point 4 in your post above) to get the crane down now? 500K? one Million? Got a clue/guess? :shrug:

[Plokoon11]

Me thinks this will become some unfinished landmark that we will all grow to like it along the city buildings at that particular area and then in 20 years there going to try to save it but end up knocking it down.

[Mehow]

So what is BIG MONEY(point 4 in your post above) to get the crane down now? 500K? one Million? Got a clue/guess? :shrug:

I would think with all the reshore install/removal, installing a derick to remove the crane, paying U.S.A. Hoist to jump the skip to the top floor (to remove the derick) it would go for 100-200K. I believe they would have to go with the derick vrs. a 500 ton hydro or fixed boom crane because there are vaults under clark and lower Wacker under Wacker drive.

[jjk1103]

Me thinks this will become some unfinished landmark that we will all grow to like it along the city buildings at that particular area and then in 20 years there going to try to save it but end up knocking it down.

.....unfortunately, I think I agree with you (bummer) :( :( :(
......can't they just turn it into a multistory parking garage ?

[the urban politician]

So when does this project get landed in the "Never Built" category? :(

[jcchii]

can't blame the city for jamming them

[JDRCRASH]

So when does this project get landed in the "Never Built" category? :(

I don't know if it should be called "Never Built", because at least part of it was completed.

[brian_b]

can't blame the city for jamming them

Nope, it's a good thing.

Teng is just sitting on the project because it doesn't want to turn paper losses into actual losses, and as long as someone allows them they're going to delay in the hopes that some sucker comes along and makes them whole on the project. In the mean time you've got a construction site that poses a danger to the general public. The city allows such a thing as long as progress is being made, but clearly that's not happening and shows no sign that it will happen in the future as long as Teng is allowed to stall.

Sell the thing at whatever the market will bear and admit you lost money.

[Tom In Chicago]

So when does this project get landed in the "Never Built" category? :(

When Teng sells the property? I suspect they're going to sit on it and wait out the storm. . . might be on hold for a while though. . .

[Mehow]

A lot of vehicles on site Thursday and Friday, hoist running, making repairs per city request.

[harryc]

Feb 23 - am - a quite site - aside from the faint tinkling of saftey straps in the wind.
http://lh6.ggpht.com/_8TC_VUmf9Fw/SamUloZ6MeI/AAAAAAABHIg/94nwto11hf8/s720/P1260659_60_61.jpg

Feb 23 - pm - catching some rays.
http://lh3.ggpht.com/_8TC_VUmf9Fw/SamUm6O6NsI/AAAAAAABHIs/Il0ByOuvMVU/s800/P1260674_5_6.jpg

Feb 26 - a rainy day.
http://lh3.ggpht.com/_8TC_VUmf9Fw/SamUonbvPzI/AAAAAAABHI4/7teHUwwH9C4/s800/P1270254_2_3.jpg

As reported work was going on Friday with rolls of new blue fence/cloth stuff and stacks of plywood, there was much hammering and sawing coming from inside. (click on thumbs for full size )

http://thumb5.webshots.net/t/63/763/7/36/18/2400736180102798085zEYtpQ_th.jpg (http://good-times.webshots.com/photo/2400736180102798085zEYtpQ) http://thumb5.webshots.net/t/63/763/9/24/97/2344924970102798085RxdqEz_th.jpg (http://good-times.webshots.com/photo/2344924970102798085RxdqEz) http://thumb5.webshots.net/t/52/752/5/5/93/2803505930102798085jCfgBW_th.jpg (http://good-times.webshots.com/photo/2803505930102798085jCfgBW) http://thumb5.webshots.net/t/73/173/8/87/2/2953887020102798085GqSArc_th.jpg (http://good-times.webshots.com/photo/2953887020102798085GqSArc) http://thumb5.webshots.net/t/74/74/2/87/41/2037287410102798085kiVQRR_th.jpg (http://good-times.webshots.com/photo/2037287410102798085kiVQRR) http://thumb5.webshots.net/t/74/74/6/13/14/2475613140102798085zUGwTF_th.jpg (http://good-times.webshots.com/photo/2475613140102798085zUGwTF)

the end of a busy week.
http://lh6.ggpht.com/_8TC_VUmf9Fw/SamUq6HRNJI/AAAAAAABHJE/YxuJV7tP3Co/s800/P1270350.JPG

[Mehow]

Awesome pictures Harry C. !!!

[observer]

Teng should just try and find $2,000,000 so they can put two parking elevators and two exit stairs (that's at a huge discount of what they would normally cost...but they should benefit from sinking comodity prices and hungry contractors). They could undercut adjacent parking garages and still make $100,000 a month (400 spaces x $14/day x 20 days a month - opperating costs)....that would give them income to take crane down and tidy up a bit....as well a means to pay back 2 million dollar loan...and then god forbid...start paying there bills from the contractors who built what they have out there now. This would also give them time to wade out the financial storm.

[aaronrosen26]

I'm not a contractor nor an architect, but I would imagine there's probably a lot more systems besides the elevators that would have to be in place (lots of electrical work, lighting, parking infrastructure like gates and boothes, a contractor to run the lot, etc.) and that this is much easier said than done in what amounts to little more than a concrete shell disconnected from the grid.

[ChicagoChicago]

I'm not a contractor nor an architect, but I would imagine there's probably a lot more systems besides the elevators that would have to be in place (lots of electrical work, lighting, parking infrastructure like gates and boothes, a contractor to run the lot, etc.) and that this is much easier said than done in what amounts to little more than a concrete shell disconnected from the grid.

I've got to believe much of that would be required to finish the building anyway, such as sprikler systems, plumbing, lighting, exterior paneling to obscure the garage, etc. But it would likely be well north of $2M.

[EarlyBuyer]

Published today in a hotel industry trade journal:

Shangri-La Hotel, Chicago Hotel Project Suspended


March 2, 2009

"Shangri-La Asia Ltd’s wholly owned subsidiary SLIM (USA) Inc. signed contracts with Waterview LLC, the project’s developer, to provide pre-opening technical assistance services and later to operate the Shangri-La Hotel, Chicago . Under the current economic environment, regrettably, the implementation of the hotel project has been suspended with no indication of when activities will resume. Accordingly, SLIM (USA) Inc., in exercise of its contractual rights under the agreements, has served a notice on the developer terminating its contracts relating to this project. Shangri-La’s commitment to the North American market remains strong. The group’s first North American property opened on January 24, 2009 in Vancouver."

http://www.hotel-online.com/News/PR2009_1st/Mar09_ShangriLaChicago.html


.

[jcchii]

I hope they look at other chicago projects

[chicubs111]

I hate this developer for not working there ass off when the times were better for getting a loan.... never in my dreams did i think this project would not get built after it got out of the ground... IM so mad :hell: :hell:

[emathias]

I hope they look at other chicago projects

Isn't there a newly-available hotel slot in Aqua ... ?

[EarlyBuyer]

:previous:

The press release states their first hotel in North America is in Vancouver, a city in which Fairmont Hotels dominate. The Fairmont family of brands includes (Fairmont, Delta, Swissotel and Raffles). Shangri-La's launching of its first North American hotel there was a likely a shot across the bow.

emathias' question above does raise a point for thought. The vacant hotel space (whomever fills it), will play nose-to-nose with the Fairmont and Swissotel (one way or another) and they'll be physically connected via the new pedway. Remember, the hotel space at Aqua was designed with significant input from the Fairmont Chicago's owner-Strategic Hotels as well as Fairmont management to have been a new upper echelon addition to the existing hotel.

SLIM (USA) does not state they no longer believe Chicago is a good market, however instead because of the economics the Waterview Tower is facing they pulled out. The new Roundy’s grocery at the Lakeshore East Market Center was picked-up following a falling out of the same grocer at a previously committed-to West Loop location.

[Mojava]

I hate this developer for not working there ass off when the times were better for getting a loan.... never in my dreams did i think this project would not get built after it got out of the ground... IM so mad :hell: :hell:

I find it hard to believe that Teng wasnt work hard to get a loan. I heard through many sources that the financials just didnt work for this project to fund. Overbudget and not efficiently designed.


I think it will be very difficult for this tower and Aqua to fill up the hotel space. (Aqua may be easier though). Both of these projects were specifically designed/built-out for a specific hotel operators program.

[ChicagoChicago]

Everything I’ve read says that Shangri-La won’t be filling Aqua. It’s not even an option because of Aqua’s ceiling heights.

[andydie]

Imho now that Shangri La has pulled out this tower sadly is Dead:(

[Dirt Lawyer]

Here's another story on the project: http://tinyurl.com/c64wcx

“Under the current economic environment, regrettably, the implementation of the hotel project has been suspended with no indication of when activities will resume,” the Hong-Kong-based luxury hotel company said in a statement.

[intrepidDesign]

Imho now that Shangri La has pulled out this tower sadly is Dead:(

I don't know if this is altogether a bad thing. The whole hondo (condo/hotel) idea was flawed from the start. Now with Shangri La out of the way, a traditional hotel can come in that wont rely on selling condos to be viable. I guess I'm just trying to see the silver lining.

[spyguy]

http://www.chicagobusiness.com/cgi-bin/news.pl?id=33200


Waterview developer loses Shangri-La hotel
By: Alby Gallun March 04, 2009

Shangri-La Hotels & Resorts has officially dropped its plans to open a hotel in a stalled high-rise development on Wacker Drive.

The Hong Kong-based luxury hotel chain had planned to open a 200-unit hotel in the 90-story Waterview Tower at 111 W. Wacker Drive. But the developer, an affiliate of Chicago-based Teng & Associates Inc., ran out of money and stopped construction last year.

“Under the current economic environment, regrettably, the implementation of the hotel project has been suspended with no indication of when activities will resume,” Shangri-La said in a statement. “Accordingly, (Shangri-La’s U.S. subsidiary) in exercise of its contractual rights under the agreements, has served a notice on the developer terminating its contracts relating to this project.”

---
Edit: I see it was already posted above. Terrible news anyway.

[BuildCTPlace]

So how long will that empty shell stand there?

[Steely Dan]

So how long will that empty shell stand there?

who knows, how can anyone know the answer to that question at this point in time? 6 months? 3 years? a decade? all are plausible at the moment.

[chicubs111]

Man...this just pisses me off...once this building started i felt very confident there would be no problems...i mean what are the options now?... I honestly thought shangra la would hold out longer...I remember an article a little while back stating there commitment to waterview...i mean they really had nothing to lose right? not like they can get anything else started in chicago for awhile anyway. :shrug:

[Jibba]

I can't help but feel that Teng blew this somehow. The sales were there, the location is fantastic, Shangri-La was in...what the hell happened? I can't even explain how much I hate the fact that there is a fat-ass parking garage sitting on Wacker Drive.

[the urban politician]

Never Built

[left of center]

damn shame. i loved this building... the height, the design, everything about it was gorgeous. hopefully it gets built later on according to plan, without too many value engineering design changes or a decrease in the amount of floors... ugh.

[ChicagoChicago]

damn shame. i loved this building... the height, the design, everything about it was gorgeous. hopefully it gets built later on according to plan, without too many value engineering design changes or a decrease in the amount of floors... ugh.

Someone is going to take this thing off of a bankrupt Teng's hands if they don't build it. It has the foundation of a 90 Story building. The plans are there. Prior to last year, the hotel market supported a high end hotel. It will be built. I just hope Teng wises up and dumps the site and gives someone else a chance to produce Chicago's next supertall.

[chi-arch]

Teng will go down in history as the biggest amateur developer on the planet. Great project and just poor poor management all of the way around. They literally killed the golden goose on this one and let their own greed get in the way of a proper financial approach at the beginning as they waited to capitalize on the loan arrangements. I doubt another hotel operator will look at the project and it may revert back to office use and apartments if anyone is silly enough to buy out the project and give it another go.

[lawfin]

Someone cue Taps....and point the gun salute at Teng:twoguns: :twoguns:

[bnk]

Go to Blair's site to comment on this.



http://featuresblogs.chicagotribune.com/theskyline/2009/03/uh-ohour-no-2frozen-supertall-skyscraper--not-the-chicago-spire-but-the-waterview-tower-and-shangri-la-hotel--just-went-d.html



http://extras.chicagotribune.com/blogs/Skyline.jpg

Originally posted: March 5, 2009

What to do with stalled Waterview Tower?

Let's hear your ideas

Uh, oh. Our No. 2 frozen-in-place supertall skyscraper--not the Chicago Spire, but the Waterview Tower

...

I just walked by Waterview on the way into work and they've obviously got some housekeeping to do: The construction marquee along the sidewalk is plastered with advertising for the Shangri-La, which now looks foolishly out of date. Meanwhile, the tower's exposed concrete frame is just sitting there--there's no construction going on and the 26 completed floors (out of a planned 90) are looking very lonely.

Clearly, the sloping lower floors could be put into service as a parking garage, which is the purpose for which they were designed...

...

[JDRCRASH]

Someone is going to take this thing off of a bankrupt Teng's hands if they don't build it.

And who exactly is gonna fill the shoes in this economy?