SweetHomeColorado

I also work in real estate finance and was in a structured financing group for a time. The Mezz lenders are essentially buying into the idea that the project will go very well and increase in value during the term of their loan. A construction lender (75% LTC or LTV) is generally just taking the risk that the project will be completed and meets lower expectations. For this project for instance, the construction lender needs perhaps 65% or 70% of the units to sell for them to be paid off, while a mezz lender would need it to sell up to perhaps 90% or higher. The hotel component plays in there as well in terms of how strongly it performs and how easily it could be refinanced once it is up and running for a year or two. So, a mezz lender needs to believe pretty strongly in the depth of the condo market in Nashville since they are taking a good bit more risk. I know that my company is pretty much no longer doing loans for condo development in coastal cities or areas that have seen significant building in the last year or two. So, Nashville's growth in this market to date and currently in progress may be the thing that creates some concern for a project of this scale being successfull if the market is perceived as being overbuilt. As a side note, I have heard of some European lenders doing large projects in the U.S. now due to a very favorable exchange rate. So, they are willing to be a bit more aggressive.

Has there been any additional reaction to the opinion pieces done last week on the Performa project? Beyond the questions about the developer, I drove through the site a couple of weeks ago, and honestly it does not seem like a very ideal place to put it. It is bounded by the convention center and the elevated highways. Perhaps it is convenient and cheap; however, it has no connection to other potentially viable parts of downtown and it will be a destination unto itself, not supporting other surrounding businesses. I would much prefer to see something like this closer to the Alabama Theater or Civil Rights Museum. Conventioneers can walk more than two blocks for their drinks... Plus, I think locals would be more likely to go there as well.

As for the entertainment district, has anyone been to "4th Street Live" in Louisville? I see this as a very similar type or project. Conventioneers obviously need some convenient places to go that have a little local flavoer, but I think the regional people have to support it for it to work. How many convention people does Bham bring in anyway? Even with growth, I don't see that as being enough. The place can't be a no man's land when there isn't a major convention in town. So, what do we see in this District? Dreamland BBQ? A concert venue/bar playing up the American Idol connections? An SEC Sports Bar? A grand meat and three?