Quote:
Originally Posted by Tom Servo
It's a steel frame building. It's not impossible.
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Being built over active railway tracks? I sincerely doubt they can get it done in less than that. Like I said though, if they start by April or so, then yes, it is doable, but after that I really doubt they can get it done in the less than 30 months that will remain. Site prep and cassions alone will probably take 6 months on this site give the constraints. Then you are talking another 6 months of dicking around building the plaza level just like at River Point. then they can finally start working on the tower. Suppose that takes 12-18 months to top out and clad. another 6-12 months to finish interior build out and you are talking a minimum of 30 months if you don't run into any delays. Perhaps they could get some of the lowest floor tenants spaces ready in a hair under that timeframe, but that's really pushing it. They haven't even got a loan or permits yet so they must be planning on getting both of those damn soon if they want to have this done by then which is the main point I am trying to make.
Also, as a landlord you are always conservative about your planned delivery. You need to be very careful about when your leases begin because you can take massive losses if you can't deliver the space in time. You will be on the hook for huge damages if you cause a tenant like William Blair to go into hold over on a 300,000 SF lease. Holdover is typically 150-200% the normal rent. By the end of their lease Blair is going to be paying no less than $30/SF/YR NNN, but probably much higher like $40/SF+. If you set that at say 175% holdover rent that means the rate will bump up to $50-$70/SF/YR range and the judge will hold you responsible for the difference between that and the new rate you are paying (probably like $36/SF for a AAA tenant taking so much space) so you are talking about damages in the range of $3-4/SF/Month on 300,000 SF which is obviously millions of dollars in losses if the developer fucks up just for missing with ONE tenant. Imagine similar damages on however much other space they fail to deliver on. Trust me, they are not going to fuck around with their delivery date which is why a 30 month schedule or less is very ballsy, unless, of course, they are planning on starting like this month in which case we are talking 32-33 months schedule which is fairly comfortable.