Developers of 1600 Pacific cry foul at subsidies for Continental Building
12:38 PM Wed, Oct 07, 2009
Rudolph Bush/Reporter
http://cityhallblog.dallasnews.com/a....html#comments
Last month, the city's Economic Development committee proposed altering a subsidy deal with Forest City, developers of the rehabbed Mercantile Building, so they could rehab the nearby Continental Building as well.
The total tax increment subsidy (plus interest) for the Continental adds up to $22.5 million.
Now, two men who were turned down for millions in TIF subsidies to redevelop the LTV Tower at 1600 Pacific want to know what's up with that.
Curtis Lockey and Craig MacKenzie sent a letter to council member Ron Natinsky spelling out why they think this deal wasn't as good as theirs.
"I can only conclude that the City is continuing in its pattern of inconsistent dealings. It is becoming increasingly obvious that the City is involved in favoritism, discrimination, and preferential treatment, at the very least. At the very worst, it may be something much more dark and sinister. Should your name be "Hamilton" or "Forest City", it looks like the City of Dallas is "ready to serve", and previous commitments and obligations can just be modified/discarded to suit the current desires of City politicos," Lockey wrote.
...
But the Hamiltons and Forest City already have a proven track record with these kinds of projects. Since they are asking for OUR money (as taxpayers), I'd rather work with people I trust (although, after reading the letter, there are probably a few questions that need to be answered).
Last edited by lakewoodhobo; 07 October 2009 at 03:11 PM.
Plus, the City has the right to make all kinds of considerations in these decisions. The Forest City project in particular is in a more desirable location to link up with the rest of the success off Main St.
Cry me a river, the Hamilton's have done so much for this city and almost single-handedly turned downtown into what it is now. They took risks no other developer was willing to take and damn right they the deserve 'special treatment', perceived or not! Hell, they deserve an award! Besides, the 1600 pacific developers were asking for WAAAAAY more.
There's a TIF board, and they voted to approve one group and not the other. I wonder if they thought by releasing the letter something magical would happen to get their deal done. Wouldn't it be better to go address the city council directly?
Weren't these guys firing off similar letters a month ago? How'd that work out for them.
As others have said, Forest City & the Hamiltons have a track record along with Tim Headington who did the Joule. The city can't commit that type of money without some history of said company doing those types of deals.
Founder of dallasprogress.blogspot.com/
What was Forest City's "track record," in Dallas, prior to the Merc?
A wise man speaks because he has something to say; a fool because he has to say something. - Plato
^ Obviously, this is their first project in Dallas. I was referring to the fact that they've built/owned/managed quality real estate across the country.
Founder of dallasprogress.blogspot.com/
I agree about the track record explanation but i also think that the goal here is to create a domino effect so we don't keep putting money into these projects and they just go on their own. So what domino do you push to have the biggest cascade effect? With our investment in Main Street Gardens and the Merc already the clustering of Hamilton's project and this Forrest City project make a lot of sense.
1600 Pacific Avenue May Still Get Do-Over
By Robert Wilonsky in News You Can Actually Use, Actually
Tue., Dec. 8 2009 @ 10:55AM
http://blogs.dallasobserver.com/unfa..._may_still.php
When last we heard, plans to redo the old LTV Tower at 1600 Pacific Avenue were indefinitely put on hold when developer Curtis Lockey filed for Chapter 11 bankruptcy protection a few months ago. But City Hall was determined not to give up on the project, some of which was to be devoted to affordable housing: As Karl Zavitkovsky, head of the city's Office of Economic Development, told Unfair Park in June, "This is an important building, so we want to explore every option." And it would appear another has arisen.
A look at the agenda for Thursday's meeting of the Downtown Connection Tax Increment Financing District's board reveals that the city's in possession of a development agreement with something called Ricchi Dallas Investments LLC to redo 1600 Pacific. (Update: According to the Texas Secretary of State's records, Ricchi Dallas was formed in September -- and is actually based in McAllen and managed by grocer Leobardo Trevino.) The agreement, of course, does include TIF incentives worth almost $13 million, including interest, for redevelopment of eight floors; the old LTV spans 33 floors, so not sure exactly how this'll work. (Messages have been left all over City Hall; will update accordingly.)
...
Maybe they can restore the light feature that drew little sailboats and bells at night:
Anyway, I suppose developing 8 stories is better than none at all. Anyone who lives in the Merc probably knows about the basement vault, which is still a construction zone.
they should renovate the TOP 8 floors, not the bottom 8? That way they could utilize the roof.
They can develop the first 4 floors, which will have better access to the pool, ground retail and the tunnels, and the top 4 floors, which of course will have the best views. Any future phases would just fill the space in-between.Originally Posted by xen0blue
Here's an update from the Observer:
http://blogs.dallasobserver.com/unfa..._good.php#more
He says that while he's already emptied the hotel of its old furniture, and that plans are underway to begin gutting the building, he won't actually begin building out the rooms till the condos are sold.
"We're going to do it in phases, floor by floor," he says. "We don't want to overload the building with condos. We presale them, then build them. We're removing all the asbestos, putting in new elevators and redoing the lobby areas. We're keeping the bank lobby, and that'll be where the hotel operations will be based." ...
"We're going to remodel the building, but we're planning to preserve the original facade," Trevino says. "We'll restore it. It's very valuable for the history of Dallas. We'll restore the building outside and convert the inside. ...
He's smart enough to build-to-order, but not smart enough to have learned the "condo market in downtown dallas" lesson.
http://cityhallblog.dallasnews.com/a...e-the-gra.html
1600 Pacific to become The Grand Ricchi, open in 18 months, developer says
4:22 PM Fri, Dec 11, 2009 |
A San Antonio developer plans to restore the old LTV Tower at 1600 Pacific into a commercial, hotel and residential project. Leobardo Trevino said his company, Ricchi Dallas Investments, will preserve the appearance of the building's exterior and its elaborate, wood-paneled second floor.
The rest of the building will be completely renovated, he said. The first four floors of the project will be complete in 18 months and will include a bank, two restaurants, a bar and a gym, he said. The remainder of the building will be converted into a hotel and residential condominiums, he said.
The condos will be built as they are sold, although some units will be built. "The customers we're targeting are people from Mexico who are interested in luxury condominiums in the United States," he said.
Trevino is seeking $13 million in subsidy from City Hall to help with the project, a far lower sum that previous developers have said they would need to turn around the building. Trevino said a group of private investors have already secured financing for the difference in the project's cost.
Workers are even now bringing equipment into the building to begin asbestos abatement and other preliminary work that should be complete in 6 months, he said. The building will be renamed "the Grand Ricchi," Trevino said.
"Dallas in our perspective has always been about wealth, he said.
Interesting... let's see if it actually happens this time.
I'm more excited about the first four floors being completed and seing the base of this bldg come to life. I'm not sure how I feel about the condos, seems like apartments would make more sense. But if he can bring some retail here and maybe an L.A. Fitness or 24 HR gym I'm happy. The base of this place has been an eyesore for way too long. Dinner in Campisi's is depressing just looking at this dump.
I'd love to see this tower redone, but I just can't picture the hotel+condo-in-phases model. If they can get this done for $13M in TIF money, it will be a bargain for the city.
Wow, talk about a quick turnaround. Wasn't it just a month or two ago that the previous developer gave up on the building?
I'm overwhelmed by the classiness of the name. "Grand Ricchi". Is this guy from New Jersey or something?
San Antonio.
I would suggest they reconsider the naming of the project if they ever plan on selling any condominiums in this city
Well since the target consumer is wealthy people from Mexico, maybe the name is appropriate. I find it interesting that a San Antonio developer wants to rename the building because he thinks "Dallas is all about wealth". I lived in San Antonio for 10 years and the consensus is that Dallas people are pretentious. So maybe he's acknowledging that stereotype.
I just think the name sounds cheesy. I don't care what they name the building though, as long as they finish the project.
The Observer says this guy's main business has sales of $300,000 a year and 4 employees. This is all bogus. Not only is it an uneconomic plan but the guy has about as much chance of getting to Mars. Total fiction.
I also think this sounds too good to be true, but they already own the building (according to DCAD) so the guy somehow got financing somewhere.
http://www.dallascad.org/AcctDetailC...00100876000000
I think the observer is wrong.
I read that he is behind some condo developments already in the Rio Grande Valley, including one called The Vantage that is a mile or so from my parent's house.
The developments they build are hotel-condominiums targeted towards Mexican nationals. The Vantage sold 95% of the units before the foundation was even poured. It seems like a professional company, and the original Observer article linked this man to this company.
This is the development company website:
http://www.infinityglobalus.com/
The Vantage hotel-condos:
http://www.infinityglobalus.com/vantage/main.html
The Mirage hotel-condos:
http://www.infinityglobalus.com/mirage/principal.html
So does this mean we are going to have a skyscraper full of illegal aliens? Just asking...
It's for the Mexican Mafia, they'll be legal all right.
If you have money, then you're legal. What could be simpler?
For the inquiring mind. . .
Leobardo Trevino updated this today:
http://www.manta.com/coms2/dnbcompany_7j7jr8 | Profile/More Info
Location of Providencia Fresh :
http://maps.google.com/maps?f=q&sour...&start=60&z=16
They had fencing around the Pacific St Side of the building which is new... Something more than the recent trash removal is going on.
How are they gearing it towards rich mexican nationals?
Who do you think empties the trash and cleans the bathrooms every night at the skyscrapers downtown?
Isn't Museum Tower being pitched to rich foreigners as well? This project may sound a bit shady, but at least the owner is starting work right away (I noticed the lights on in the lobby the other day).
Why does everybody think this project "sounds shady." Just because in addition to development he owns a produce company? Or is it something else?
I have already posted links to the developments he has done in the RGV, and the condo complex he just completed is very good looking, well priced, and 4 units shy of being SOLD OUT. That's more than some "non-shady" Dallas developers can say about their projects.
Again, here is the link the condo development in Mission, TX that he was one of the developers of:
http://www.infinityglobalus.com/vantage/
And a few photos:
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Last edited by Matt777; 19 December 2009 at 11:33 PM.
^Maybe "shady" is the wrong word, but those are renderings and not actual photos. We've seen too many renderings of buildings that never get done, so to me this sounds like another developer asking for investors. Then again, he did get enough money to buy the building and start work on the lobby so this could very well happen.
I think they will go ahead and do what they have promised. The timing is right since the owners have been served notice to birng this building up to code or face fines and litigation
Take in mind that Dallas is a very popular place for wealthy Latinos to come to shop, dine and be entertained. The person I used to buy clothes from at Neimans downtown said at least 30 percent of his book of business was from this subset of people. He mentioned people regularly flew their private jets into Love Field from Mexico and then went shopping Downtown and in the shops at Northpark.
I argued this is how they should have sold Museum Tower residences all along... It was the only high priced US residential project that I never saw in foreign based publications... much less the damn WSJ or US edition Financial Times.
I have to agree here. Dallas may not be Miami, but we should be able to tap into the Latin American market in a much more substantial way then we do. There's also something interesting about the way this project is being done--in small segments.
That suggests to me that this is a cash deal. If you bought the building with an equity investment and then have sufficient cash to rehab part of the building, you can sell those condos and then use that money to do some more rehab.
This isn't a usual model here in the U.S.A., where we depends a great deal on bank financing (or other lenders), but it isn't that unusual in other places in the world. Since work is starting (immediately after acquiring the building) and the developer isn't waiting for financing, I think that's what is going on.
If so, then I give this project a pretty good chance of success, although build out may be slow, depending on how fast the units sell. But if you aren't paying interest, holding costs aren't that high and this is a viable financing model.
So your saying the developer is actually spending his money and not just putting the project on his credit card hoping. That's why people here don't trust him here, in America everything is charged to our credit cards so when someone spends money they might actually have we freak out.
Just noticed they have all the lights on inside the ground floor lobby on Christmas Eve Day.
They've got the breezeway all buttoned up and interior roped off. When I stopped and spoke with a worker, he said they've started "demo on all floors" and that "asbestos removal is next."
Justin Terveen
Urban Fabric Photography
wow so this is really happening? thats good news...
^^^
Looks good!!! Hopefully it comes to fruition.
Nice rendering, though I'd much rather see what it's going to look like inside. Also, seems like they plan to remove the ivy that's taken over the side of the building.
Here's a "before/after" shot, for reference:
^There's NOTHING "grand" about that entrance to me, at all.
A wise man speaks because he has something to say; a fool because he has to say something. - Plato
Grand Ricchi doesn't sound as good as The Pinstripe Building
it's a whole hellavu lot better than what's there now...
I really hope that project does well. If it does, then perhaps this guy can be like the Hamiltons. I say this, since they've done so much for downtown living themselves.
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