BROADWEST (former West End Summit), 36 story Conrad Hilton Hotel/condo tower, 22 story/510,000 sq. ft. office tower, 4 story/125,000 sq. ft. retail/office, 1 acre plaza, 2,500 car garage, $490 million

[rookzie]

Here in San Antonio they can't demo a structure (historic) under demolition with new construction until their case for demolition has been approved (have to prove economic hardship redeveloping the existing structure; loss of structural and/or architectural integrity/significance; and that they've (developer or previous owner(s) have actively marketed the property with no one to purchase and rehab/redevelop). 

 

Once the case for demolition has been approved, they then get conceptual approval of a new design, then final approval later. Most of the time conceptual and case for demolition are at the same time (they'll show their economic ability in that).

 

Once that's taken care of, the actual demo permit isn't issued until they are ready for their actual foundation permit(s). 

 

It works pretty well and keeps the Palmers of the development world away from historic structures. 

 

 

But yeah, any property whether it be a completely derelict single family home or an old warehouse is worth much more with that structure than as an empty lot. Why kill your own equity in the hopes that financing will provide itself in the mean time? In some situations, developers (maybe Palmer) wanted to show his financial resources that he was for real and wanted to start construction to build anticipation and create a competitive market/domino effect with lenders within his development, but that's playing with fire as we all know. 

 

 

A property with a derelict structure on it is absolutely worth more without said structure on it. That just isn't true. Most people look at an existing building with issues as a detriment, not a benefit.

The definition of "historic" is being used loosely here. Any structure listed as "contributing" in Nashville can not be demolished without approval from the Historic Commission.

 

Don't want to challenge any reference to the Historic Commission and the interpretation of rules for declaring properties historic.  I do think that arkitekte has posted a response that pretty much answers what some of us are seeking, both as a matter of resolve, and as a general example of an alternative handling of a similar issue in a large city, generally desirable American city, even if it's a practice undertaken elsewhere.

 

Can't say that this kind of policy ever could be enacted in Metro Nashv'l, without some wholesale head-rolls (and knock-offs), as far as the Planning Commission and BZA are concerned, as the governance structure perhaps would require "too" much reorg.  Based somewhat on whether or not Metro actually owns the property, its playing rules seem to change on what mods and demos can be done on or to existing structures.  This I see as an inconsistency of interest and practice.  In reference to property that it still owns, such as the Ben West Library bldg., it legally and successfully manipulates with specific detail what can and cannot be done with a structure, simply because it still owns it.  If it does not own a property that it for eyes for some reuse, then either it attempts to contort the rules for what the owner can do with it, or it becomes the owner by eminent domain and then does what it wants (because it then has acquired the rights as the owner).  It all works in the overwhelming interest of the owner who then has nearly autonomous latitude for development, except for often inconsistent and arbitrary approval from some agencies as the MDHA.

Mentioned by others’ posts in some form or fashion, Metro does not want to change the rules that might discourage investors and developers, or to have to submit to litigation (and end up losing), especially if it threatens the mechanism of harvesting revenue.  So in the wake of this ongoing unprecedented windfall attraction of big business, why would the administration ever come even close to giving in to adopting such a paradigm as that of San Antonio?

 

As far as structure worth is concerned, compared to that of the property on which it sits, "value", applied to either intrinsic or historic, rarely ever can be reconciled with potential market price, which hinges primarily on dynamic factors.  Historic value is mostly a perception or extent that something is considered significantly, and extraordinarily memorable, particularly from a previously distant point in time.  I think the biggest concern in this particular discussion lies with a developer being able to simply tear down a structure prior to certain contingencies being in place, contingencies which address the issue of what some consider as a newly evolving "Land of 10,000 Lakes."  The current laws allow immediate tear-downs and “temporary” exposed excavations, even if this “recipe” results in the unintended consequence of indefinite inaction, which gives the appearance of abandonment.

 

It’s this local provision that seems to be disturbing to many readers and observers as a whole, whether a particular structure is considered historic or not.  Again at least what arkitekte has offered shows an M-O of how it has been handled differently, in what I consider a bustling city.  The process in Metro Nashv'l, as I see it, is simply broken.

-==-

 

[Guest]

It might not be the case in Nashville, but as a planner in San Antonio that reviews projects in both River Improvement Overlay districts and historic districts in the core, particularly those downtown, I can assure you that properties with the structure in tact are worth more.

I don't disagree that some view the structure as a burden, but that burden holds value...what they do with it determines what their planned development is and how much money they have. Most developers that can afford to rehab find the properties that will bring them the attention they want through that rehab. That situation keeps the development standard high.

I can assure you as a former developer and practicing architect that most properties in Nashville carry a lower value and higher burden if an existing building is in place. Much of this is due to the lack of quality old building stock, the new denser entitlements (which can't be realized with old low slung buildings), and a soaring property value that puts extreme pressure on maximizing SF. I'm not saying any of this is emotionally right, but it is the reality here.

[smeagolsfree]

We have all see that some developers will demo and pay a triple fine for not having a demo permit. It has happened more than once here. You have to have BIG penalties in place for that kind of action.

As far as Nashville goes, I don't think they will ever enact any ordinance here that would do what they are doing in San Antonio.

I wish they would.

[PruneTracy]

I don't disagree that some view the structure as a burden, but that burden holds value... 

 

The question is whether it holds value to the developer. There's no doubt that Palmer could have extracted value from the existing buildings on the West End Summit site, but it would have reduced the return on investment of his proposed development to build around them.

 

The ROI is the underlying factor in all of this. If you're buying and holding property with the intent to redevelop it maintenance is a sunk cost. Sure, it preserves the value of the property, but you're thinking bigger, and once the high-rise is in place tenants aren't paying more because a historic house previously stood there for a few months longer than it would have otherwise.

 

Fiscally, the ideal is an empty lot with minimum costs for maintenance, security, etc. while you're working out the details. And they often are worked out after the sale closes and the wrecking ball does its work, because real estate is a game of opportunity and financiers like to minimize hypotheticals (i.e., "if you give me money I'll build this on my property" sounds much more legit than "if you give me money I'll build this right after I maybe buy this property"). What you don't want to do is manage an aging property in the meantime, insuring buildings, kicking out squatters, and such, without the means either to monetize the property or to improve its value. (As I noted previously, you also don't want to dig a giant hole on it for no reason, but then most developers aren't Palmer.)

 

Understand I'm not advocating for the status quo, but there are logical reasons behind it other than just to spite preservationists. In any case, as was mentioned, Metro doesn't allow developers to demo buildings they officially (operative word) deem as historic without approval. It seems a more pointed action would be to start giving more properties this protection, using the existing codes. Of course, that opens another can of worms.

[arkitekte]

The question is whether it holds value to the developer. There's no doubt that Palmer could have extracted value from the existing buildings on the West End Summit site, but it would have reduced the return on investment of his proposed development to build around them.

 

The ROI is the underlying factor in all of this. If you're buying and holding property with the intent to redevelop it maintenance is a sunk cost. Sure, it preserves the value of the property, but you're thinking bigger, and once the high-rise is in place tenants aren't paying more because a historic house previously stood there for a few months longer than it would have otherwise.

 

Fiscally, the ideal is an empty lot with minimum costs for maintenance, security, etc. while you're working out the details. And they often are worked out after the sale closes and the wrecking ball does its work, because real estate is a game of opportunity and financiers like to minimize hypotheticals (i.e., "if you give me money I'll build this on my property" sounds much more legit than "if you give me money I'll build this right after I maybe buy this property"). What you don't want to do is manage an aging property in the meantime, insuring buildings, kicking out squatters, and such, without the means either to monetize the property or to improve its value. (As I noted previously, you also don't want to dig a giant hole on it for no reason, but then most developers aren't Palmer.)

 

Understand I'm not advocating for the status quo, but there are logical reasons behind it other than just to spite preservationists. In any case, as was mentioned, Metro doesn't allow developers to demo buildings they officially (operative word) deem as historic without approval. It seems a more pointed action would be to start giving more properties this protection, using the existing codes. Of course, that opens another can of worms.

 

No doubt. Our UDC here actually has language that addresses the ROI. In the case for demolition, if the developer can still turn a profit, even if it's not the largest possible, the reason for denying that request is available. 

 

It seems pretty oppressive, but developers redevelop existing structures downtown rather than demo them, or find structures that they know will have a legitimate case for demolition which in turn removes structures that need to be removed. 

 

Our UDC prohibits it, but surface parking at no time should be the primary use of a property, especially on a major thoroughfare or in the CBD or another district such as the Gulch. The main issue is that a developer can demolish an existing, vacant structure, construct a surface lot and then down the road not feasibly be able to develop the property. In that event you're left with a surface lot instead of an existing structure. Urban fabric can survive vacant structures in the block face, it can't survive surface lots. 

 

The developer's financial status post demolition (I can afford to build if it's not there) should never be a legitimate claim for the demolition of a structure whether it's designated historic or not. IMO, if the developer can afford it and has the ability to, funding will be there.

 

Of course every city is different, has different property values in the core and has a different amount of time/money that developers will spend with a specific property. 

[Paramount747]

Hey, c'mon now, that's pretty harsh. A meteor crater would at least serve as a decent tourism draw.

 

Drove by West End Sump this evening and it occurred to me that the excavation is so massive that even if the property were seized by Metro or sold to a willing developer it would require a substantial amount of construction (and cost) just to get it back to street level. So it's not as simple as just putting the property in different hands; anyone who throws money into it will have to go big to recoup the costs. He's not-quite-literally dug a hole he can't get out of.

I think the hole is 86 feet at it's deepest point. That is a lot of fill dirt. Back in 2010 when they were excavating for the MCC, rumor was they were going to fill this hole with rock from the MCC site, but they ended up using that rock to make concrete on site for the MCC which was a great idea. The hard lesson here is don't dig an 86 foot hole until you have a signed contract and lease for tenants. This has been 8 years. Time to fill the hole or sell the site.

 

I am assuming by now Intercontinental has decided to move on and is no longer considering Nashville? Does anyone know?

[titanhog]

I think the best we can hope for is that some other developer has his eye on the land and is just waiting to take it off Palmer's hands and can use the hole for parking.

[Guest]

I think the best we can hope for is that some other developer has his eye on the land and is just waiting to take it off Palmer's hands and can use the hole for parking.

Agree however lots have looked at it and several have even offered a reasonable price only to be turned away. He will not let go of it and he doesn't have the resources or the credibility to pull it off any longer.

[titanhog]

Agree however lots have looked at it and several have even offered a reasonable price only to be turned away. He will not let go of it and he doesn't have the resources or the credibility to pull it off any longer.

You would have to think the city would eventually make him do something with the land, though...right?  Surely they won't allow him to keep that huge, dangerous hole in the middle of the city...will they?  Or will they...

[Nathan_in_DC]

So, just spitballing here, but do we have any lawyers that could opine on whether or not the community could put together a lawsuit against Palmer for this? I mean, he's essentially created a public nuisance and an eyesore, not to mention health hazard, by leaving this in its current state.

[UTgrad09]

I'm sure you could adequately fill the hole with Alex's ego.

[troyboytn]

I'm sure you could adequately fill the hole with Alex's ego.

This is the statement of the year!

[MLBrumby]

So, just spitballing here, but do we have any lawyers that could opine on whether or not the community could put together a lawsuit against Palmer for this? I mean, he's essentially created a public nuisance and an eyesore, not to mention health hazard, by leaving this in its current state.

 

While I'm a Healthcare specialist.... I have worked a bit in Property (although not in a public sector case).  There is recourse for the city (if they deemed it enough of a political issue), from suing (Metro would have to point to violation of existing statute when the zoning was passed and what Palmer is committed to as a developer... e.g. "improvement" of property). Apparently (as noted above) there are no time requirements attached to this zoning. Of course, a better approach would be to assess fines based on the site being a hazard to the public... to condemnation if not improved.  I would also look at any tax incentives Palmer might have received or been on the hook for (I don't recall any). At the very least, if Metro wanted to tie up Palmer in litigation, they could to it... but it would be expensive and likely kill any/all possibility of the site being developed for years to come. Obviously, it hasn't become a political issue to the point that anyone in the mayor's office has seen fit to assist Palmer in getting the property developed.  I am a limited government guy.. so I would hope a resolution could occur without government.  Sadly, after a decade of this pit sitting there, it doesn't look hopeful. I would think/expect that his insurer(s) would be extremely nervous about that hole. Certainly it is a huge (private) liability for Mr. Palmer.  I can see an accident occurring and a resulting in lawsuit that could ruin him financially.  

[Nathan_in_DC]

While I'm a Healthcare specialist.... I have worked a bit in Property (although not in a public sector case).  There is recourse for the city (if they deemed it enough of a political issue), from suing (Metro would have to point to violation of existing statute when the zoning was passed and what Palmer is committed to as a developer... e.g. "improvement" of property). Apparently (as noted above) there are no time requirements attached to this zoning. Of course, a better approach would be to assess fines based on the site being a hazard to the public... to condemnation if not improved.  I would also look at any tax incentives Palmer might have received or been on the hook for (I don't recall any). At the very least, if Metro wanted to tie up Palmer in litigation, they could to it... but it would be expensive and likely kill any/all possibility of the site being developed for years to come. Obviously, it hasn't become a political issue to the point that anyone in the mayor's office has seen fit to assist Palmer in getting the property developed.  I am a limited government guy.. so I would hope a resolution could occur without government.  Sadly, after a decade of this pit sitting there, it doesn't look hopeful. I would think/expect that his insurer(s) would be extremely nervous about that hole. Certainly it is a huge (private) liability for Mr. Palmer.  I can see an accident occurring and a resulting in lawsuit that could ruin him financially.  

 

It has been my fear for a long time that a neighborhood kid would fall in to it. It's a freaking death trap. The amount of public scorn that he would receive in that situation, let alone the monetary damages, would likely force him to, at the very least, cease doing business in Nashville.

[captainwjm]

Not to defend Palmer, but how long has it been, has there been any situation where the current fencing, spraying, etc., has posed a harm to anyone? [There are no neighborhood kids.]  Apparently there are no code violations, either building or health, at the site. Metro permitted the excavation twice without imposing any completion requirements.  We're stuck with that. The simple truth is that there is nothing that can be done by litigation, legislation, or otherwise to make the hole go away. The only relief will come from development.  All other talk is barbershop pontificating.

[Paramount747]

Website has not been updated since 2008, hence it still shows the project under construction:

 

http://aspcompany.com/properties/under.htm

[SoundScan]

Not to defend Palmer, but how long has it been, has there been any situation where the current fencing, spraying, etc., has posed a harm to anyone? [There are no neighborhood kids.]  Apparently there are no code violations, either building or health, at the site. Metro permitted the excavation twice without imposing any completion requirements.  We're stuck with that. The simple truth is that there is nothing that can be done by litigation, legislation, or otherwise to make the hole go away. The only relief will come from development.  All other talk is barbershop pontificating.

 

Not entirely true. The city could exercise eminent domain and build a transit hub on the site (not my idea of "best use") or some other public use. Obviously Palmer would need to be compensated. This would no doubt lead to a protracted legal battle over how much compensation is required.

 

Or, one of us could build a hut on-site, live there for 20 years, and then claim title under Tennessee's adverse possession statutes. I doubt Palmer would even notice. Any volunteers?

Edited May 5, 2015 by SoundScan

[FromParkAveToTN]

Can the city use Enima Domain and take the land from Palmer?

[BnaBreaker]

Enema Domain?! Harsh!

[UTgrad09]

Enema Domain?! Harsh!

 

That whole section of Broadway needs one.

[rookzie]

That whole section of Broadway needs one.

BnaBreaker, on 06 May 2015 - 12:01 PM, said:

Enema Domain?! Harsh!

 

 

They say one of those does break up the blockage to the flow of "progression", you know.  I think that's what eating  Metro "government cheese" can do to you.

-==-

[jdavidf]

They say one of those does break up the blockage to the flow of "progression", you know.  I think that's what eating  Metro "government cheese" can do to you.

-==-

 

Don't knock the government cheese! mmmm...mmm  delicious! 

[smeagolsfree]

Can the city use Enima Domain and take the land from Palmer?

The "A" lex hole needs to be drained guys.

[titanhog]

Funny how Alex has become the "butt" of all of our jokes. 

[FromParkAveToTN]

OMG! I meant "eminent domain" you guys.