Sacramento: 301 Capitol Mall: A New Plan for The Towers Site - Page 86

SacTownKing916 · #**1701** Posted **Feb 17, 2007, 7:20 AM**

Quote:

Originally Posted by brandon12

I've heard from a very reliable source that CALPERS is definitely not talking to Trump (which, I'm sorry to say Urban, I never thought possible), but they are talking to another player that everyone on this thread would know of.

but, according to my source, it's all irrelevant because it's not Saca that will be getting out of this project.
If the Towers could talk, they might quote Mark Twain: "The rumors of my death have been greatly exaggerated"

So are you saying that your source said Saca is definitely staying and CaLPERS is out?

brandon12 · #**1702** Posted **Feb 17, 2007, 7:37 AM**

^Yes. I wish I could say more, but it sounds like it will all be made public in the not too distant future.

SacTownKing916 · #**1703** Posted **Feb 17, 2007, 7:41 AM**

Quote:

Originally Posted by brandon12

^Yes. I wish I could say more, but it sounds like it will all be made public in the not too distant future.

So with what you know, does it sound promising that Saca can get it done.

brandon12 · #**1704** Posted **Feb 17, 2007, 7:45 AM**

It's a big project that will be tough to do, but it sounds like he's well on his way to bringing someone else in. I asked my source how sure he was that CALPERS was on its way out and he reponded that he was "positive". I can't remember him being wrong about anything he's told me yet, so I have no reason to believe he's wrong about this.

foxmtbr · #**1705** Posted **Feb 17, 2007, 7:46 AM**

I hope you're right Brandon...

ltsmotorsport · #**1706** Posted **Feb 17, 2007, 7:48 AM**

Well that is certainly good news, if that is the case. Man, it's been a weird few weeks for Capitol Mall.

brandon12 · #**1707** Posted **Feb 17, 2007, 7:53 AM**

^very weird!

innov8 · #**1708** Posted **Feb 17, 2007, 8:05 AM**

waiting... just waiting

SLO · #**1709** Posted **Feb 17, 2007, 2:04 PM**

I cant imagine someone like Saca, quitting on this project without a monumental fight. This is probably the pinnacle of his career. People like that keep pushing forward, especially w/400 presales. Calpers is just along for the ride or maybe not.....

joninsac · #**1710** Posted **Feb 17, 2007, 8:05 PM**

Quote:

Originally Posted by brandon12

I've heard from a very reliable source that CALPERS is definitely not talking to Trump (which, I'm sorry to say Urban, I never thought possible), but they are talking to another player that everyone on this thread would know of.

but, according to my source, it's all irrelevant because it's not Saca that will be getting out of this project.
If the Towers could talk, they might quote Mark Twain: "The rumors of my death have been greatly exaggerated"

Replace PERS with STRS, maybe? Or Tsakapoulos? I guess it doesn't matter who the new investor is as long as they share Saca's vision of what the Towers should be, have the money to make it happen and are trusted by Deutsche Bank.

If this works out and Saca remains in control, what a feather in his cap it would be to have stared down CalPERS and come out on top.

ltsmotorsport · #**1711** Posted **Feb 18, 2007, 12:44 AM**

No kidding. That would be a huge accomplishment.

foxmtbr · #**1712** Posted **Feb 18, 2007, 1:23 AM**

Maybe we should all go down there and buy the 14 units so the DB loan kicks in...

But hopefully we will hear some good news soon.

enigma99a · #**1713** Posted **Feb 18, 2007, 2:23 AM**

Well, they did sell 6 units in Jan, which is pretty good I think!

urban_encounter · #**1714** Posted **Feb 18, 2007, 2:27 AM**

Quote:

Originally Posted by brandon12

I've heard from a very reliable source that CALPERS is definitely not talking to Trump (which, I'm sorry to say Urban, I never thought possible), but they are talking to another player that everyone on this thread would know of.

That was more or less just wild and fun specualtion on my part. As I said i wouldn't have been surprised to learn
that they were talking to Trump. But i would have been extrememly surprised if Trump had actually stepped in...

Maybe Cal Pers has BCN in mind to construct Epic at 301 CM???
(Though their comment that the Developer has extra money leaves out Craing Nassi)...

There's Tskakopoulos, but he's not a "world class developer".. Same goes for David Taylor..
(Plus knowing Taylor he would let the site sit idle until the market turned around....)

Quote:

Originally Posted by brandon12

but, according to my source, it's all irrelevant because it's not Saca that will be getting out of this project.

I really admire John Saca and his vision for Sacramento. But I'll go on record now and say that if he successfully
buys out Cal Pers as a partner, 301 Capital Mall will probably be as good as dead. Secondly it would be many years
before anything is built on that site.

He owes approximately $35 million dollars for work already completed on site and for the land (and that is the approximate
total of liens now filed against him).. Cal Pers is also in for $25 million dollars, but as noted in recent comments, they
are looking for a profit on their investment..

So the total is up to minimum of $60 million and probably factoring in the return Cal Pers will be seeking for
their investment, the total is probably closer to $65 or $70 million Saca would need to come up with...

DB is still willing to loan up to $400 million with the City of Sacramento kicking in $11 million on a $570 million dollar project

That's $159 to $169 million that Saca is coming up short after everything is paid; (not factoring in the additional
$30 million to give the construction budget some breathing room). So a new equity partner would need to be willing
to put up as much as $200 million (+), to buy in to this project (minimum).

I hate to say it, but Saca's probably reaching the point where this just wont pencil out. Even if Saca does find the
money to pay off the $60-$70 million now owed, where would he find (or) who would he find, willing to step in with that kind of money..???

Sorry without Cal Pers, I just don't see this happening. With Cal Pers there is a chance, that a quality project will be
constructed in the next couple of years..

SacTownKing916 · #**1715** Posted **Feb 18, 2007, 2:36 AM**

^ I dont think that Saca would buy out CALPERS to have nothing in the end. If he buys them out then obviously he has found additional money to continue the project not just let it sit empty. So basically i hope he buys them out and if he does i know he will finish the project as planned.

foxmtbr · #**1716** Posted **Feb 18, 2007, 2:50 AM**

^ Good point. Saca is not going to buy out CalPERS if he knows that will kill the project's chances. If he buys them out, he will have a good reason to do so (a new, reliable investor with tons of $$$).

urban_encounter · #**1717** Posted **Feb 18, 2007, 2:59 AM**

Quote:

Originally Posted by foxmtbr

^ Good point. Saca is not going to buy out CalPERS if he knows that will kill the project's chances. If he buys them out, he will have a good reason to do so (a new, reliable investor with tons of $$$).

As I said, with costs continuing to escalate, it's becoming less likley to pencil out...

Saca's best chance is to bring in a partner who is as committed to (his own vision of Sacramento)... Like Alex Spanos......

It's all specualtion...

Although i hope you all turn out to be right, I wont hold my breath that Saca can do this without a major equity partner.. A major equity partner who will be willing to invest in a project whose budget has gone up 50% and in very slow housing market.

Sounds very unlikely to me.

POGO · #**1718** Posted **Feb 18, 2007, 4:29 AM**

Very doubtful Saca can find anyone to take out CalPers. More likely scenario is that CalPers forces Saca out and brings in a developer that can contribute equity in a big way and can get it done.

Maybe Lend Lease (Bovis' parent company)

How bout Rob McGuire (one of the former owners of the kings - Big LA developer)

Or Shorenstein from SF.

Trump? No way. This isn't even close to anything Trump would touch.

We don't even know if the project still pencils out at the prices that they have already sold units for. They may choose to put the whole project into bankruptcy, reject all the sales contracts and start over at higher prices. Not likely becuz they would piss off their existing customers who probably wouldn't buy again, but it is one option.

Anything could happen, but its not likely that Saca will continue without some major squeezedown of his equity share.

POGO · #**1719** Posted **Feb 18, 2007, 4:58 AM**

So, since the financing was not fully in place on 12/31/06, the developer now has the option to cancel all of the sales contracts. I think you are going to see CalPers force this issue, then start over. Different design, different developer, and a phased approach (which is what Saca should have planned for to begin with). I think one of his bigger mistakes was to try to go whole hog at once. If he had proposed a phased approach, his lender probably would have only required sales of 50% of one tower before allowing him to go forward. Then once it was actually under construction, sales would become a little easier since potential buyers could see something was actually happening.

dcox20 · #**1720** Posted **Feb 18, 2007, 5:02 AM**

Quote:

Originally Posted by POGO

So, since the financing was not fully in place on 12/31/06, the developer now has the option to cancel all of the sales contracts. I think you are going to see CalPers force this issue, then start over. Different design, different developer, and a phased approach (which is what Saca should have planned for to begin with). I think one of his bigger mistakes was to try to go whole hog at once. If he had proposed a phased approach, his lender probably would have only required sales of 50% of one tower before allowing him to go forward. Then once it was actually under construction, sales would become a little easier since potential buyers could see something was actually happening.

Totally agree.