Jeeper12

It seems to me that part of the problem is that we have at least two camps of people on this forum: those who are interested in discussion about some of the finer points (nuances if you will) of what is necessary to get a project like this off the ground and those who simply want to see only posts that are positive in all respects about ST's prospects. If I read someone remind us that ST "is not a slam dunk" or something to that effect one more time I think I'll commit Harry Carry!! Some forumers have expressed an interest about details that may seem boring or irrelevant to others. My advise to those that only want it in black and white (verifiable proof, quotes with sources. etc) is to simply wait for the updates to come out in more traditional media outlets. Or at least refrain from taking so much of this personal. And by all means, for those of you who do feel so offended there are probably more useful and healthy things that you could be doing with your time. Quite frankly, it's a pity that these discussions so often deteriorate into personal pissing contests. It should be fun evocative discussion. There's an old saying about how you can disagree without being disagreeable. Seems like good advice for all of us to try and heed.

Sorry, I'm obviously techically challenged: see my responses below in bold.

I'll take a shot a ask that Gaushell or anyone else with better info edit as they see fit. I don't see it likely that Tony will put a shovel in the ground for 6-9 months. Here's why: if his DD's (design development drawings) are going out today his contractor will need at least 4-6 weeks to get through the pricing and probably another month or two beyond that to work through value engineering issues. Gaushell didn't say but I assume all pricing previous to now has been based upon Schematic plans, a mere portion of DD's (which are a mere portion of Construction Drawings a.k.a. CD's). If this is true then the reliability of Tony's previous estimates are probably questionable. I say this not to discredit the effort but rather to point out that lots of time and energy are likely to be required to get the project's cost budget where it needs to be, especially such a big project. That's why I think 4 months is a best case scenario. Once there is a high confidence that costs are under control a foundation permit could be applied for and obtained within 30 days thereby allowing some sitework to commence. All of the above assumes that all the revenue bases are covered. Unless I missed an announcment this is not the case. In order for a project of this magnitude to get airborne someone is going to have to start spending some real money on the marketing. With all due respect to Gaushell $300 million projects don't fly on the wings of a website and a remote office. For this deal to even have a chance at success someone is going to have to develop a sales office that's a showstopper. How can Tony expect to do less than Terrazo, Icon, Adelicia, etc. while charging prices almost twice as high ? Even Mr. Palmer (who gets a fair rash on this site) is building out a 7 figure sales center in Palmer Plaza as we speak replete with kitchens and baths and hotel rooms. When Tony comes to this realization and/or obtains the funds to do this and generate the high end collateral materials to accompany it he will need 6 months from the time he has identified his location to design, build and furnish this facility. At that point tack on as much time as you think it will take for him to sell a few hundred units at $550 plus a foot at terms (deposit amounts) that are acceptable to his yet to be identified lenders and partners. You can agree or disagree with my 6-9 months but as I see it the only way he gets to the front side of that range is if he starts doing all of the above (along with finding partners and lenders) concurrently. And there doesn't seem to be much evidence of this so far. Remember, since May he has taken some reservations, priced schematics (presumably) and generated a bunch of publicity. I'm afraid the lifting gets much heaviers from here. Hope this is helpful.

I recall a silly post by someone a few months ago that pronounced Tony's project dead with an obit to follow in a week or two. I don't think anyone took that post seriously and it probably surprises no one that we haven't heard a peep from them since: beware of the new member prognosticators!! As to Charles and Tony I hope no one mistakes my previous posts as an attempt to personally discredit them or even suggest that they are spreading falsehoods. That said, I think we all need to recognize that they have fish to fry and need to promote positive buzz as much as possible (I don't expect Charles or Tony to log on and update us with setbacks and problems until they have no choice). This forum on the other hand (as I understand it) is not about promoting or discrediting projects. Rather, its purpose it to discuss them and exchange information and ideas about them. Occassionally, you will read about things on this forum before they becomes a press release or a newspaper article. I suspect that is one of the reasons our friends William and Richard tune in from time to time. Finally, the more objective we can all be about our posts the more useful, informative, and fun I think everyone will find the forum.

I assume this post is directed to me...I would have to breach a confidence to reveal the source of my information. I realize that some want instant verification of both good news and bad news about projects. This is not always possible or practical. I also disagree with the assertion in a previous post that only developers and media sources (and hotel employees who know them) can be a credible source of information about a project. In fact, there are scores of individuals (bankers, contractors, subcontractors, engineers, appraisers, etc.) that have "inside" info on these projects. As Gaushell stated, some team members are paid to keep the buzz going regardless of whether there is any substance behind the pr or not. We can't fault them for this but just as we should be skeptical of naysayers there ought to be some skepticism about what the paid advocates have to say as well. Rather than demand instant verification of all posts I would suggest that forumers use common sense and logic to evaluate posted information. If a poster develops a track record of being "off track" more than "on track" readers should take note. As I have said before, time will answer all our questions and reveal who among us is credible and who is not.

Actually, it makes perfect sense for him to have turned it down. The $12 million on the table would have cost just as much in lost revenue due to the difference between his $550/sf proforma and the $225/sf that he would generate selling 80 units. I'm sure he wants the TIF but he just can't "afford" it; pardon the pun. Hope the math is clear enough for everyone to understand.

I'm sure he still needs routine cooperation on utilities, easements and the like but you don't waste time and money lobbying the Kiwanis club for that. To my knowledge, there are no height, density or other approvals (needing council or planning commission stamps) needed other than MDHA's blessing which they've either already given or would be expected to. Which begs the question: why all the worry about community support at this point ? I think it is a fair question after the article and one that only Tony (sorry Gaushell) can answer. And indeed, at some point he will.

Gaushell, I'm a fan of your work but I think you're just rearranging deck chairs on the titanic. Time will tell.

Does anyone know when they will get rid of that dreadful 8"x8" tile and install some decent carpet in the Southwest terminal ? A peoplemoving escalator in the center of the aisle would be helpful too. I always dread being in the last gate.

I heard today from a pretty good source that Tony's hotel deal is now on life support.

Any news from anyone on what occurred at this invitation only event ? Did it occur or was it cancelled or rescheduled ?

Hankster, you've somehow misunderstood me again. Let me try once more: securing a credit worthy hotel tenant (or office tenant for that matter) to lease developed space is not what's occurring with ST and WES. In both cases there is no guaranty of anything (other than perhaps a modest amount of key money) to the developer once it's built... management and a flag is all the hoteliers are offering. All the risk remains with the developer once he builds the space (unless he brings in a hotel partner). No lender is going to give Tony 100% of the $50m (to use your number). He will have to come up with at least $10-15m in equity to attract the remaining proceeds needed to fund the hotel construction. Then there's the other $300m for the condos. If he can presell at least $200m in hard contracts with substantive deposits he'll need to find at least an additional $60m in cash equity to satisfy the contruction lenders equity requirements for the balance of the project. So, as we sit here today it appears to me that he probably has about 10% of the contracts (accepting the convention that 20% of refundable reservations stick) he needs and by his own account still lacks a source for the $70-$80m in total equity that he needs before he can really even begin a serious dialogue with lenders. Given Tony's lackluster track record on past projects where he didn't have experienced partners leading, who on earth do you think will give him this kind of money ? Hopefully, I've explained my reasoning in a way that everyone can understand. From there, everyone can make their own assessment.

Whether you agree or disagree with my assessment that Tony will need public assistance to make his numbers work I'm curious how many on this board think he should get tax dollars for ST if he ultimately asks for it. Can someone more techically proficient than I organize a simple poll ?

Were they mocking us ? I didn't expect that to start happening until after ST is shelved.

Hankster, with all do respect, I think you're misreading the current information we have about ST. I haven't heard a reservation count in a few weeks but last I heard he had only about a dozen more than a few weeks after his "launch" in April/May...125???. Typically, only about 20% of reservations secured by very small non-refundable deposits convert to contracts. Hence, Novare usually has reservations for 1500 to 2000 units for a 400 unit job which generally gets them to 75-85% (in their heyday anyway). If you do this math that equates to only 25-35 sales. Who knows how Tony's will convert but at his $500/sf prices in Nashville I think it would be logical to assume a higher fallout rate than what the Novare's of the world experience. As I understand it the "already secured" hotel tenant has committed no significant money to the project. Rather, they've agreed that IF Tony can go out and find equity to build a hotel that meets their standards they will agree to flag and manage it for a fee of 4% of the gross revenues (not profits) for 10 or 15 years. This is similar to what Palmer has from Intercontinental; no skin in the game from Palomar. Other than that, after 5-6 months of commencing sales he's basically where he was a month into his effort only now with a lot of newspaper clippings he can show his grandchildren. If this is a 1/3rd of a billion dollar effort where is the sales center, where's the kitchen, where's the model? where's the equity partner ? where's the lender ? Seems very mickey mouse to me at this stage of the game. Finally, if you're right and I'm a gloom and doomer looking at things irrationally I'm sure you and others will let me have it for days and weeks on end. However, I'm just calling it like I see it and imo he's in a ditch and will ask the city for a last ditch bail out before the end of the year.

I wouldn't get your hopes up. If that were true Tony wouldn't have hidden it from Mr Sisk. I think monsoon is probably right about Tony wanting/needing public money to get the project done. He won't be asking for TIFF again unless he can do so without building all the affordable units. But all his pr efforts in the face of anemic sales have the whif of a guy trying to sell Nashville that it needs the ST so bad for its image that it ought to kick in $15 or $20 million (with no strings) to help plug the profitability hole he is encountering. I could be wrong but my gut tells me this is what he's up to. We'll all find out soon enough.

Just for grins I called the sales agent and he said Trump was not going to use Turner Construction as previously announced but that they are close to announcing who the new contractor will be. Is Tony still using Turner ?

As we debate the likelihood of these big projects moving forward I thought some of you might find this Feb article regarding Trump's 55 story Tampa tower interesting. The market there has softened but as of this Feb they had 75% of the units sold with 20% deposits and had begun site prep. It's apparently a big mystery as to why there still has been no progress on construction. http://sptimes.com/2006/02/01/Business/Whe...ump_Tower.shtml

If Tony had been largely responsible for these projects I would agree with you but the folks I know at Novare indicate he's had only front end city approval involvement on those projects. And he's also handled the sales much as Village or Zeitlin would for other projects. All development and financing activities have been handled by Novare in Atlanta. The cold hard truth is that the last project Tony had sole responsiblity for was the Cumberland 10 years ago. Although Cumberland got built it was not a success in the eyes of it's lenders and partners. That said, I think Tony deserves a lot of credit for partnering up with more capable firms to do Viridian, Encore, Benny Dillon & Harris Teeter in Belle Meade. As a result of his partnering decisions I expect all of these projects to be successful. The big question is whether Tony has the experience in-house to pull off a project as ambitious as the ST on his own. Is he whistling past the grave yard where other more experienced players would be more cautious ? No one knows this answer but my sense is that this project will ultimately cost too much and sell for too little in order to justify a start. If and when that becomes apparent to Tony I expect him to again partner up with Novare on a project that is more scaled to the Nashville market. As much as I think it would be neat to have the tallest building in the south I just don't think it's in the cards. If I'm wrong about this I know you guys will be kind enough to remind me of my errant prognostication. But please try and resist the urge to do so until excavation (not the groundbreaking party) begins.

Ever ?? Using this logic one would never question the viability of a project until the developer himself announced it was dead. That seems quite courteous even in the south. Why do so many on this board get a twitter when anyone engages in rational discussion about certain steps and hurdles that a prospective development must overcome. It doesn't need to be an emotional discussion. I hate to break it to some but no excessive amount of optimism or pessimism on this board is going to influence a go no-go decision on this tower.

If Tony is as far along as he says he is the goals should no longer be self imposed. He apparently needed to "project" his equity and deposit requirements when he began the reservation process in the spring but he should have those commitments firmed up by now. Given the housing crash occuring around the rest of the country I think interested buyers will want some assurances that Tony has a clear handle on the specific hoops he must get through to get started. Articulating the specific steps that remain at his luncheon will go along way to quieting his critics. On the other hand, if the gathering is simply another ceremonious affair that's more fluff than substance I think the skeptics will start coming out of the woodwork.

Isn't this like the 3rd ir 4th luncheon in the last year to unveil the project ?

Wow, 100%?? I hope your firm isn't depending too heavily on that to happen. Most of the larger local subs I've talked to haven't even been willing to price it deeming it too much work for too little chance of happening. This project will be driven by costs, sales and financing. Contrary to Nashville Bound's post costs are most certainly not going down and sales seem to have been tepid at best. Novare typically kicks off with reservations 3-4 times its number of units and only actually sells between 50 and 80% of its units when contracts start. Trump sees a similar pattern on its projects. Adelecia had 400 reservations and remains only 65-75% sold. Considering that kind of reservation attrition I don't see how Tony hits a 50% presale requirement in time to start before late summer of 2007, if he starts at all.

They were quoted yesterday as saying they were still at 115 reservations. Seems weak considering that's about the same number published 6-7 weeks ago, especially given all the national pub last month. My architect and banker friends tell me that big condo projects are starting to get shelved left and right around the country, including Atlanta due to weakening sales, more stringent lender requirements, etc. I've also heard that 500k plus condo sales around Nashville have softened despite the steadiness of the market in general. Anyone else heard anything similar ?

Did anyone get clarification on Cherriokid's question ? Looks like price's went up from $465/sf to about $500/sf Will the early bird's get the benefit of being early ?