CHICAGO | Waterview Tower | 1,047' Official / 1,035' Roof | 89 FLOORS |NEVER BUILT

[chrslyp]

Originally Posted by ChicagoChicago

$85 million in liens, minus the $32 million Teng itself filed on the project, equals $53 million. I say they foreclose on the property, sell it to a developer with deep pockets for $53 million (a bargain, really), pay off all the liens (excluding Teng) and watch this fucker be built. That would be justice.

am i the only one who believes this foreclosure is a good thing? the bank will obviously want to move quickly and surely there is a developer in chicago who can afford this building if it is sold at the $53 million some are suggesting. if $53 million turns out to be the correct range for the sale of this thing, i think that is a HUGE steal. hell, the beanie babies guy paid around $40 million for the spire penthouse, my point is, there is people with money out there who will see this as a huge opportunity to make money.

it's my opinion that if a developer were to come in and buy this building, a good amount of the original buyers might buy back into this project if it is to be completed as originally planned.

[Mojava]

Lets not forget that the financial model for this building to be successful from an economic standpoint was surely based on selling real estate (condos and a hotel) at a very high price. Today, that real estate is valued at approx 20% less then their initial projections because of the downturn in the economy and real estate markets. It will take a long time for those prices to recover. No one is buying high end new condos (see Trump). New developments are slashing pricing and auctioning off units (see Pure, Vetro, R&D). Condo developers don't build buildings with a 10 year expectation of selling out. Time is money and for every day/year units are vacant, the developer is losing money.

[chi-arch]

^Dead on. As an early buyer, I would not go back into this development unless the financial upside was commensurate with the risk. Not many of us risk takers left anymore.....

[harryc]

[SolarWind]

June 12, 2009

[Pizzuti]

Originally Posted by Mojava

Lets not forget that the financial model for this building to be successful from an economic standpoint was surely based on selling real estate (condos and a hotel) at a very high price. Today, that real estate is valued at approx 20% less then their initial projections because of the downturn in the economy and real estate markets. It will take a long time for those prices to recover. No one is buying high end new condos (see Trump). New developments are slashing pricing and auctioning off units (see Pure, Vetro, R&D). Condo developers don't build buildings with a 10 year expectation of selling out. Time is money and for every day/year units are vacant, the developer is losing money.

Well at this point I'd say it's not so much about turning a profit as minimizing loss. I don't know the exact breakdown of finances in these projects, but it seems like a huge chunk of the bill would be in the planning and designing, and then after that huge sums of money would be in the basement and lower portions of the building where concrete and structural elements are the thickest. The higher you go, the less an individual floor would cost, since it doesn't have to be a strong. Glass and cladding would be even cheaper than structural elements.

I'm assuming that's why it's rare to stop construction at a midpoint (unless the proposal was for twin towers and they end up building just one.) Of all the projects in the country that were active on the brink of the economic downturn, only a fraction have actually halted (unfortunately two of the major ones I can think of were in Chicago).

So in that case, they've already poured in so many resources into this thing that it's going to be a huge loss. Build enough to recoup some of those losses and you're still going to do better than leaving it now.

I think that's what many of us are thinking, although there's probably more than we know to this project and developers have good reason to back off. I have a strong inkling, though, that a huge part of the reason why this project is currently under suspension is that a lot of stakeholders are falling through in panic. If there were fewer entities with a hand in this there might be a greater likelihood that construction would be continuing.

[chi-arch]

The project stopped because of lack of financing. There is no "recouping" any costs or loss if you cannot raise the capital. The strongest financial position for this group of developers is now history, so it will take some big thinkers to get this building back in the game and that will continue to take some great measure of time to accomplish. A huge chunk of the bill, as you say, has been spent and is reflected in the $80 million dollars in liens or about one quarter of the development costs.

[Northwest]

Hadn't many many floors worth of cladding already been manufactured?
Is that stuff still sitting in a warehouse in the suburbs, and if so, who owns it? Will it be put to use elsewhere? Surely it will not be discarded.

[JMH_Architecture]

Not that I know anything but it seems to me that the banks and lien holders would have been better off financing the project in whole while it still had a hotel component and buyers on board now they have a 80 million dollar chunk of concrete which nothing can be done with it's dumb really.

[wrab]

Damn those views in Solar's pics are fine.

The foundation is in, and that is no small thing considering the site. And the views aren't going anywhere.

[Cadillac Jack]

Northwest: The cladding is custom. I doubt that anyone else would have a use for it.

[ardecila]

Thanks for the tip, and welcome to the forum, Cadillac Jack.

I don't think anything can happen on this project until all the legal difficulties are sorted out and the building is sold to somebody completely different.

Has Teng gone bankrupt? If not, then perhaps that is impending. This would then lead to a liquidation of assets (assuming Chapter 7). The market value of the property, and Teng's other assets, would then go towards paying the creditors for their unpaid work, with any unpaid balance being erased. Then, the property has a new owner, Teng is no longer involved, and the creditors have no claims over that new owner.

[Northwest]

Originally Posted by Cadillac Jack

Northwest: The cladding is custom. I doubt that anyone else would have a use for it.

Thanks for the information.
Sounds like this custom cladding will be sold off along with the rest of the property when it finally changes hands. I hope to see it put to use. If I remember right, it was a very attractive material, wasnt it glass, granite, and stainless steel?

[Cadillac Jack]

Northwest - Thanks for the optimisim. Your ouija board seems to work better than mine.

[chi-arch]

Several floors of the cladding are in a suburban warehouse. So we got that going for us

[Steely Dan]

^ which is nice.

(sorry, i'm incapable of not completing a caddyshack reference )



what i really want to know is why the crane is still up on site. we're way past june 5th now. i thought the city gave teng 90 days to take it down. maybe there are fines now being levied against teng for defaulting on the promise to have the crane down.

[chi-arch]

Ha! and it feels like Waterview Tower is at the bottom of this 10,000 foot crevasse.
You can bet that the City is sending out the fine notices. Whether Teng is paying them is another issue. What a monster screwup

[F1 Tommy]

Originally Posted by chi-arch

Several floors of the cladding are in a suburban warehouse. So we got that going for us

Someone said the cladding was in a warehouse near O'hare airport(Bensenville). I think this one will get built almost as is due to the cladding being mostly done. Im sure the cladding will be sold at a bargain to the new devoloper. The Asain company that made it does not want to pay storage fees forever.This was posted a long time ago many pages back.

[Mehow]

Originally Posted by Steely Dan

^ which is nice.

(sorry, i'm incapable of not completing a caddyshack reference )



what i really want to know is why the crane is still up on site. we're way past june 5th now. i thought the city gave teng 90 days to take it down. maybe there are fines now being levied against teng for defaulting on the promise to have the crane down.

Teng went to court and they were granted an extension to the end of June.
At the end of the month they have to try for another extension.

[nomarandlee]

http://www.suntimes.com/business/roeder/1625806,CST-FIN-roeder17.article

City wants high-rise crane removed
REAL ESTATE | Work stopped last year at Clark/Wacker site
Comments

June 17, 2009

DAVID ROEDER [email protected]
Impatient about the stillborn construction site on Wacker Drive, city officials are demanding the removal of the high-rise crane at the proposed Waterview Tower. No work has been done on the planned 90-story building since last year, and now it stands as a shell about 27 stories tall at the southwest corner of Wacker and Clark.

A spokesman for the city's Buildings Department said it is worried that an unused crane can pose a safety hazard. He said the agency has ordered its dismantling but has received no word on compliance. The developer, Teng & Associates Inc., did not return calls. In March, Shangri-La Hotels and Resorts withdrew from an agreement to open a posh hotel in the building, citing global economic difficulties. The property is deep in liens and foreclosure because Teng President Ivan Dvorak started construction before he had loans to finish it...........

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