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  #7481  
Old Posted Sep 17, 2019, 10:47 PM
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SacTownAndy SacTownAndy is offline
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Still uncertain what they will do with the site, but some news at least.


CalPERS selects Hines for 301 Capitol Mall project

https://www.bizjournals.com/sacramen..._news_headline

Last edited by SacTownAndy; Sep 17, 2019 at 11:08 PM.
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  #7482  
Old Posted Sep 17, 2019, 11:16 PM
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Not sure if this is a good thing or a bad thing?
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  #7483  
Old Posted Sep 18, 2019, 12:13 AM
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I think Hines is in the running to be the developer of the Aggie Square project in Oak Park as well.
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  #7484  
Old Posted Sep 18, 2019, 3:28 AM
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Quote:
Originally Posted by Majin View Post
Not sure if this is a good thing or a bad thing?
Well good or bad it’s back to the drawing board. Hopefully the third time is a charm.

As a side note my prediction that the project was dead was clearly off. It just goes to underscore what I always say; NOBODY knows less about Sacramento area development than me. I am always wrong.
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  #7485  
Old Posted Sep 18, 2019, 3:09 PM
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They'll spend a couple million dollars drawing pictures and then tell everyone it's too expensive to build.
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  #7486  
Old Posted Sep 18, 2019, 3:11 PM
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Any news on the new courthouse building? I can't find anything new about this project.
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  #7487  
Old Posted Sep 18, 2019, 3:47 PM
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https://www.wsj.com/articles/calpers...el-11568755606

It appears CIM’s ouster was because of a lack of performance.

According to the Wall Street Journal, an outside consultant expressed concern about the
former developer CIM performance. CIM failed to deliver as much as $41 million in
rebates that were negotiated as part of the nine-year-old agreement. In addition, about
$41 million, a previously unreported figure, remains to be paid by CIM Group to Calpers
on a total $50 million in fee rebates promised under a 2010 agreement.
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  #7488  
Old Posted Sep 18, 2019, 5:29 PM
Korey Korey is offline
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Welp more bad news folks, it looks like Cresleigh is either going apartments for 10 years and trying condos afterwards for the N & 14th site (Vantage), or might just sell the land back to CADA for the purchase price.

http://www.cadanet.org/wp-content/up...21-Vantage.pdf

I was also poking around Vrilakas Groen's website because I heard a rumor that they were designing something for that large empty lot on Broadway and 34th. Didn't see anything about that (anyone else know anything about that property's future?), but did catch these renderings for a project across the alley from the Westminster Church, on 13th and O kitty corner to the Vantage site.

http://www.vg-architects.com/westmin...yw9nahqq5fz9bx

Looks pretty good actually, I hope it gets built and the fate of the Vantage site doesn't have repercussions for that section of the neighborhood, along with the other planned CADA small unit project nearby (The Courtyard?).
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  #7489  
Old Posted Sep 18, 2019, 9:12 PM
novatone82 novatone82 is offline
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Quote:
Originally Posted by Clinton Robinson View Post
Niiiice Novatone!!!! You posted some good pics!!! I want to first off thank you and secondly want to say that I myself had some pics of DT that I wanted to post but got frustrated over the difficulty involved with posting and said F""k it! Anyway thank you VERY much! I look forward to seeing any other pics of DT SAC!!!

NO PROBLEM if the weather permits i will try to get some new pictures snapped, inno8 has some skills on the photo taking, hope to see some new ones.
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  #7490  
Old Posted Sep 18, 2019, 11:21 PM
novatone82 novatone82 is offline
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Quote:
Originally Posted by sactivity View Post
Any news on the new courthouse building? I can't find anything new about this project.
Clarks construction website saying expected to break ground October , not sure how accurate that is though
https://www.clarkconstruction.com/ou...nto-courthouse
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  #7491  
Old Posted Sep 19, 2019, 12:42 AM
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Originally Posted by Korey View Post
Welp more bad news folks, it looks like Cresleigh is either going apartments for 10 years and trying condos afterwards for the N & 14th site (Vantage), or might just sell the land back to CADA for the purchase price.

http://www.cadanet.org/wp-content/up...21-Vantage.pdf
I was skeptical that this project would get off the ground when Cresleigh was picked for the developer of the site.
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  #7492  
Old Posted Sep 19, 2019, 12:49 AM
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urban_encounter urban_encounter is offline
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Quote:
Originally Posted by innov8 View Post
https://www.wsj.com/articles/calpers...el-11568755606

It appears CIM’s ouster was because of a lack of performance.

According to the Wall Street Journal, an outside consultant expressed concern about the
former developer CIM performance. CIM failed to deliver as much as $41 million in
rebates that were negotiated as part of the nine-year-old agreement. In addition, about
$41 million, a previously unreported figure, remains to be paid by CIM Group to Calpers
on a total $50 million in fee rebates promised under a 2010 agreement.
I read that in the print edition today as well. It sounds like a smart move by Cal PERS since they are in the business of maximizing their investment portfolio.

I also think it makes a project at 301 CM more likely at some point; although who knows whether it will be before the next economic slow down or what the Hines proposal will look like. If I were to bet though I suspect it will be something a bit less ambitious or risky for this market than ‘Tower 301’. I would be stunned if they came back with the same proposal.
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  #7493  
Old Posted Sep 19, 2019, 12:51 AM
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Originally Posted by sactivity View Post
They'll spend a couple million dollars drawing pictures and then tell everyone it's too expensive to build.
Yeah considering that they’ve (Cal PERS) have spent over $70 million dollars and have nothing to show for it, that’s what I’m afraid may happen. But as I say over and over, I am never right when i make predictions either way, so hopefully we’re wrong.
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  #7494  
Old Posted Sep 20, 2019, 12:10 AM
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Quote:
Originally Posted by novatone82 View Post
Clarks construction website saying expected to break ground October , not sure how accurate that is though
https://www.clarkconstruction.com/ou...nto-courthouse
Yes, i've been to their site. But it has said that for quite a long time now. I was hoping to set something through other channels. But it's been real quiet.
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  #7495  
Old Posted Sep 23, 2019, 3:17 AM
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Quote:
Originally Posted by Korey View Post
Welp more bad news folks, it looks like Cresleigh is either going apartments for 10 years and trying condos afterwards for the N & 14th site (Vantage), or might just sell the land back to CADA for the purchase price.

http://www.cadanet.org/wp-content/up...21-Vantage.pdf
Doesn't worry me too much actually as this is fairly common with many projects and will give Cresleigh HUGE liability coverage for those 10 years. I believe 16 Powerhouse is mapped for condos but they have not been put on the market due to the 10-year liability term in CA.
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  #7496  
Old Posted Sep 23, 2019, 5:50 PM
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Originally Posted by urban_encounter View Post
I read that in the print edition today as well. It sounds like a smart move by Cal PERS since they are in the business of maximizing their investment portfolio.

I also think it makes a project at 301 CM more likely at some point; although who knows whether it will be before the next economic slow down or what the Hines proposal will look like. If I were to bet though I suspect it will be something a bit less ambitious or risky for this market than ‘Tower 301’. I would be stunned if they came back with the same proposal.

Exactly! And I’ve said many times that I could not care less if a tall tower gets built at that site. If Hines can deliver a smart mix-use mid-rise I’d be more than happy, probably more so than yet another boring 9 to 5 office building on the mall.
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  #7497  
Old Posted Sep 25, 2019, 7:58 PM
Clinton Robinson Clinton Robinson is offline
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Thanks Novatone82... I think those pics you posted are of really good quality and you did a great job capturing the scale of the projects! Hopefully we will get some more ground breaking soon! Sac has been growing man and is a Major City! Hopefully we get some more quality highrise development that REFLECTS accurately the strength of the city just a little more! I actually like the Natural resources building just wish the would have added a hundred feet or more to the overall height! Anyway thank you once again very much! Look forward to seeing some new pics and new developments!!
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  #7498  
Old Posted Sep 26, 2019, 2:33 AM
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Quote:
Originally Posted by ozone View Post
Exactly! And I’ve said many times that I could not care less if a tall tower gets built at that site. If Hines can deliver a smart mix-use mid-rise I’d be more than happy, probably more so than yet another boring 9 to 5 office building on the mall.
No way a simple mid rise goes on this lot. Far too much money has already been sunk into it. They basically have a 70 million dollar piece of land right?
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  #7499  
Old Posted Sep 27, 2019, 3:07 PM
Son of Travis Son of Travis is offline
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No way a simple mid rise goes on this lot. Far too much money has already been sunk into it. They basically have a 70 million dollar piece of land right?
Hello everyone. Haven't been here for awhile. A few comments.

I think the above is probably correct. CalPERS is still an investment fund that has to deliver a target return to demanding investors. Mid-rise probably won't get them there. We know high-rise anything is pretty risky in Sacramento, so I'd look for heavy office with smaller residential and commercial components. Something along the lines of 65% office, 30% residential, 5% commercial. this mix assumes that, as we've been told, anchor tenant already in place (and no way they announce who that is until deal is done). A move of that magnitude needs early commitment and plenty of lead time, so I wouldn't expect Hines to sit on site for too long before moving forward. I wouldn't be surprised if this anchor tenant pressured CalPERS to replace CIM for lack of progress and threatened to go elsewhere if no movement.

High-rise with that mix probably still doesn't pencil, so expect Hines to demand a significant waiving of City fees to reach viability.

City desperate to get that site filled, so I imagine they'll find agreement.

We should all be delighted that Hines replaced CIM. I've had minimal acquaintance with each, and that was awhile ago now, but the Hines teams were always among the sharpest I'd ever encountered.

Absolutely first-rate personnel and no reason to think that's changed. They don't like to screw around either. They'll drive a hard bargain with the city, and that could cause some delay, but overall I'd say the chances of something good happening on this site just went way up.

Quick point about apartments instead of condos. It's just too expensive and difficult to build mid-priced condos in California anymore. Everything to do with building in California, from fees to taxes to construction costs, is obscenely expensive and cumbersome, but the coup de grâce that prevents condo building in California is liability. The legal lobby in our state makes it far too easy to sue, and keeps the developer and builder on hook for far too long.

This results in only two types of product: Luxury, where you can better absorb costs through high prices and HOA fees, and publicly-supported, low-income housing. Please also note that even in this latter category, government demands, rules and regulations can often put your per/unit costs to over $500,000. That's not a typo, I've seen plenty of "low-income" projects that had a per unit cost of that or higher.

Also note that with low-income housing, the rules are so byzantine that there are few players involved and those that are are typically very "cozy" with local/state authorities. This burdensome and expensive process also impacts supply as with costs so high, it makes little sense to train a even a talented team to, in essence, learn "on the job" while they navigate the process. It's a classic barrier to entry that plays a role in even this market being addressed in California.

The result, with some exceptions of course, is few middle-class condos built in California now. It is particularly frustrating when you contrast the number built with demand.

So, to fill the need for housing, at least partially, you have little choice but to build apartments instead.

Just a quick example re costs - to get some multi-family projects insured today, you have to stipulate that you won't even put a map on it for 10 years (liability period). So you can't even take the first step to a for-sale product without incurring significant additional costs. This is just one of a thousand things, big and small, that drive up the cost of housing in California.

Vote for whomever you want everyone, but don't pretend for a moment that who's in the Capitol and City Hall doesn't have a severe impact on housing costs, affordability, and supply.

If you're still renting after 10 years in a good job, this is why.

As far as what type of product "should" go on what site, just remember that it doesn't matter what the developer thinks should go there, what the city thinks should go there (unless it's prepared to write a huge check), what activists think should go there, or what those of us who enjoy forums like this think should go there.

All that matters is what the lender thinks should go there, and as noted before, they are risk-adverse.

As always: here comes the caveat. I could be 100% wrong about all of this. There are few industries as easy to be wrong in as development.

So yeah, Hines tomorrow could announce twin 1000' towers and another Amazon HQ to fill one and condos starting at $325k to fill the other.

Should that happen, I will celebrate with you...
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  #7500  
Old Posted Sep 28, 2019, 2:06 AM
Bubb90 Bubb90 is offline
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Does anyone have any recent news on the California fruit building hotel conversion? I have been searching and can't find anything
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