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

[JeffZurn]

I know I am checking this page every 15 minutes, today is the day correct?

[sugit]

Yep, something should happen today.

[Majin]

Originally Posted by JeffZurn

I am checking this page every 15 minutes

I'm doing the same thing

[snfenoc]

Saca misses CalPERS buyout deadline
Sacramento Business Journal - 2:06 PM PDT Friday, May 25, 2007
Developer John Saca will not meet Friday's deadline to buy out The California Public Employees' Retirement System's $25 million investment in the Towers on Capitol Mall project, Saca said on Friday.

Saca, the managing partner of the project, had worked out a deal last month to pay back CalPERS, which had pledged $100 million overall. The two partners have been at odds on how to proceed under cost overruns that are estimated between $70 and $100 million.

"We're still working on it," Saca said of dissolving the partnership with CalPERS and securing new financing. "We're not going to pull it off today."

CalPERS spokeswoman Pat Macht said there are no provisions to extend the buyout agreement beyond Friday.

"If he doesn't act on his option today and has another idea he wants to come back with, that will be considered," Macht said. Saca likely will have to pay more money for a new option if he pursues one, though Macht declined to discuss any possible terms.

In the meantime, Saca and CalPERS remain estranged partners.

The Towers on Capitol Mall is a 53-story, 800-unit condo development that broke ground last year. Work stopped before the foundation was poured.

Saca indicated earlier this year that the project is $35 million in debt, including a $22 million loan for the land purchase and a owed to contractors who have done site work.

The project has defaulted on that loan, but a real estate investor who holds the loan for the land purchase said Friday that he has no plans to foreclose on the project.

[snfenoc]

If you can't do the project, you can't do the project. Get off the stage already.

[sugit]

I guess its not a shock cosidering what we have heard here in the past couple of weeks, but it still sucks. I have to imagine another option will be had and it isn't dead yet, but this doesn't help. A missed deadline is a missed deadline.

[TowerDistrict]

it really sucks because this giant hurdle has nothing to do with the actual
project itself. i mean, once (if) this issue is cleared up, then the problems
of a giant budget gap and a declining interest are still looming.

[dcox20]

Originally Posted by snfenoc

If you can't do the project, you can't do the project. Get off the stage already.

seriously Saca - it's over buddy... let someone else jump in and finish it.

does Saca have cash anywhere else or would this bankrupt him? assuming he can't repay the loans and the creditors/debtors come after him personally...

I have nothing against Saca, but you can only reach into the hat so many times without pulling out a rabbit before the crowd starts to leave.

[TowerDistrict]

I was under the impression that it's CalPERS debt to deal with? Other than the million or so to jump start construction, that is... no?

[dcox20]

it was my understanding that CalPers has given $25m to the project (Saca) so far... so If I'm CalPers I want my money back one way or another... unless they can write it off as a loss and move on, which is doubtful.

[TowerDistrict]

hmmm.. i figured they would have to write it off as a loss, deal with Saca, or file some sort of lawsuit as they are the party not following through. remember the first deal was for CalPERS to buy Saca out, not the other way around.

[sugit]

Given the only way (maybe there are others) CalPERS gets their money back is if Saca buys them out, I wonder if Saca should try and negotiate a lower amount. I'm sure CalPERS (and its state employees) would want something rather than nothing back....

[Phillip]

People keep forgetting that CalPERS $100 million investment was contingent on Saca finding another equity partner to provide the other $400 million, which Saca never found. CalPERS totally lived up to their end of their bargain.

If CalPERS had delivered the $100 million a $400 million or more shortfall would still exist.

If CalPERS now tells Saca "You can have the $25 million we spent as a gift. We don't want a penny back." a funding shortfall of at least $475 million will still exist.

From my perspective the lack of progress is not CalPERS fault at all.

[innov8]

Originally Posted by Phillip

People keep forgetting that CalPERS $100 million investment was contingent on Saca finding another equity partner to provide the other $400 million, which Saca never found. CalPERS totally lived up to their end of their bargain.

If CalPERS had delivered the $100 million a $400 million or more shortfall would still exist.

If CalPERS now tells Saca "You can have the $25 million we spent as a gift. We don't want a penny back." a funding shortfall of at least $475 million will still exist.

From my perspective the lack of progress is not CalPERS fault at all.

I'm suprised the Bee has nothing on this today

Phillip, Saca has Deutsche Bank waiting in the wings for the Towers to sell
50% of the unites before Saca would have access to the $370 million. The City offered an
$11 million grant when the building was close to completion. If Saca could find a new
equity partner, the project would still be short $159 to $169 million after everything is
paid due to the rising construction costs.

Regardless, millions and millions are needed to fill the gap.

Yesterday when I heard the news I got a lump in my throat, man… the fat lady has
almost sung. I wonder if some big developer is waiting in the wings to take over
the project? That would be a great end to this crazy story. Sorry John

[Sacdelicious]

NM, info already posted.

[enigma99a]

Originally Posted by innov8

I'm suprised the Bee has nothing on this today

Phillip, Saca has Deutsche Bank waiting in the wings for the Towers to sell
50% of the unites before Saca would have access to the $370 million. The City offered an
$11 million grant when the building was close to completion. If Saca could find a new
equity partner, the project would still be short $159 to $169 million after everything is
paid due to the rising construction costs.

Regardless, millions and millions are needed to fill the gap.

Yesterday when I heard the news I got a lump in my throat, man… the fat lady has
almost sung. I wonder if some big developer is waiting in the wings to take over
the project? That would be a great end to this crazy story. Sorry John

Well.. Yep it's over pretty much. Maybe Trump or some other big namer would come in. A project this size is going to need a lot of cash in hand.. something John just doesn't have.

[kryptos]

Originally Posted by enigma99a

Well.. Yep it's over pretty much. Maybe Trump or some other big namer would come in. A project this size is going to need a lot of cash in hand.. something John just doesn't have.

its a wrap...

he should just build one tower instead of 2...atleast it would be something

[brandon12]

I'll be the first to admit I was wrong and several of you were right all along, but I don't think we're quite there yet. For example, look at the roller coaster of a ride that has been Aura. And after all this time, it's chances look better than they have in a long time. The same might come true for the Towers.

But I am ready to admit this much: Obviously this project was never as much of a slam dunk as I once thought. So to those out there who have argued that point with me- you win.

All I can say is that hopefully I get the last laugh. But at the end of the day, it's just one (or two) buildings. Unfortunately, I think Saca is a great guy and I hate to see him struggle. For his sake, more than anything, I hope this project finds a way to pencil out.

[kryptos]

Originally Posted by brandon12

I'll be the first to admit I was wrong and several of you were right all along, but I don't think we're quite there yet. For example, look at the roller coaster of a ride that has been Aura. And after all this time, it's chances look better than they have in a long time. The same might come true for the Towers.

But I am ready to admit this much: Obviously this project was never as much of a slam dunk as I once thought. So to those out there who have argued that point with me- you win.

All I can say is that hopefully I get the last laugh. But at the end of the day, it's just one (or two) buildings. Unfortunately, I think Saca is a great guy and I hate to see him struggle. For his sake, more than anything, I hope this project finds a way to pencil out.

its not likely to happen now...i think where he went wrong was trying to make the project so big...if it would have been just 1 tower at 50 stories instead of 2, the funding would have been there and we would be watching it grow right now..it could have been something like nashvilles 70 story "signature tower" (pictured below) which would have been just fine, instead of that dirt pit thats there now...he should scrap the twin towers plan, and start over with a 1 tower plan, and with anew design...after all what else is he going to do with that property?
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[econgrad]

hmm...I see several posts stating he should have done a smaller project. Yes, smaller projects have more of a chance of being built, but lets not start believing Sacramento can't get large projects done, I mean, let us hope not. I would like to see something even bigger than the Towers someday soon... Here's hoping.