Soleil Center I & II at Crabtree

[JeffC]

anyone know if they have a construction loan currently outstanding? If so, they may be undertaking actions such as "marketing" units by putting into MLS in order to meet covenants in the loan, even if the financing/ongoing viability of the project has collapsed. Sort of the final struggle to prevent foreclosure, or at the least the loan being sent to workout...

[Jones_]

not to sure, but I do know that they required a certain percentage presales before they were able to line up all of the financing that they needed and start construction, so my guess would be that they are at least 50-75% sold at this point.

For a multi-component project like this, just the hotel signing off on the deal could have been enough to secure financing. Quorum sold all its office condo space and got started with very few residential condos sold. They are still only at around 50% sold on the residential the last time I counted. In the "old" days of financing, I got the impression, 50% of a total project needed to be sold/committed or otherwise accounted for with a lease etc. before the bank would sign off.

[CHGuy]

Not to mention that the foundation work is complete. The foundation for this project is very expensive. If they do not have financing for this project, then they have made a very strategic error and they will lose their shirts. I find it hard to believe that they would have gone ahead with the foundation without financing. The only project that I remember around here that has gotten this far and then cancelled is the Capital Center Phase Two. On that building, they completed the foundation and then stopped work and covered it over. That's when Harold Lichtin ran into money problems back in the 90's recession. That could be what's happening here, but nobody really knows except for the Soliel Group. We'll find out if they don't begin construction within the next 30 to 45 days as they stated in Triangle Business.

[RALNATIVE]

Not to mention that the foundation work is complete. The foundation for this project is very expensive. If they do not have financing for this project, then they have made a very strategic error and they will lose their shirts. I find it hard to believe that they would have gone ahead with the foundation without financing. The only project that I remember around here that has gotten this far and then cancelled is the Capital Center Phase Two. On that building, they completed the foundation and then stopped work and covered it over. That's when Harold Lichtin ran into money problems back in the 90's recession. That could be what's happening here, but nobody really knows except for the Soliel Group. We'll find out if they don't begin construction within the next 30 to 45 days as they stated in Triangle Business.

I think that we both agree in this regards. They have taken too many steps forward and have put too much out there in the public spotlight, to not have financing secured. Keep in mind, these are not novice business people running the show. I trully think that they know what they are doing.

[ChiefJoJo]

I think that we both agree in this regards. They have taken too many steps forward and have put too much out there in the public spotlight, to not have financing secured. Keep in mind, these are not novice business people running the show. I trully think that they know what they are doing.

Yet, I'm sure many people said the same for the developers of the Park and 210 Trade condos in Charlotte, both of which are sitting with construction partially completed with no end in sight... one with foreclosure pending, the other with multiple lawsuits and countersuits filed in federal court... and this was in DT Charlotte, which has a larger residential market than Crabtree or DTR. Now Jones' theory may have been right (only needing 1/2 financing for mixed use project--not individual components) prior to one year ago, but I can't see a bank in this marketplace forking over ~$200M for this tower without proof of at least a certain number of condo sales, which we still have not seen.

If they really are going to construction, check the permits. They can't begin without approved building permits for the shell and interior of the building.

[JeffC]

My point was not to suggest whether or not they have financing, but rather that if they DO have a construction loan, it probably has certain milestones or covenants in the loan they have to meet, and that these feeble marketing efforts, despite the obvious lack of activity at the site, may just be an attempt to meet some of these milestones or covenants and therefore, avoid starting down the road to the big mess described above for those projects in Charlotte...

[CHGuy]

"If they really are going to construction, check the permits. They can't begin without approved building permits for the shell and interior of the building."

They have had an approved building permit since January 11.

http://onlinedevcenter.raleighnc.gov/devse...onNumber=194452

[Subway Scoundrel]

I had heard through some contruction industry types that they were looking to hire a new contruction company. What that means I am not sure. I think one company came in and did the foundation and another is to build the building.

Who knows but if that is the case, it takes time.

[Jones_]

I had heard through some contruction industry types that they were looking to hire a new contruction company. What that means I am not sure. I think one company came in and did the foundation and another is to build the building.

Who knows but if that is the case, it takes time.

I am not sure how this contract is structured, but I am guessing design-build with subs working through the prime I am not sure if its even possible to take bids on 100% plans for a tower like this. Does anyone do multi-prime contracts through a coordinating design engineer or architect for office buildings? How this all structured will determine how fast or slow changing contractors could be. My background is in municipal infrastructure which has its own laws and regs governing how it is done.

[vitaviatic]

Still think there is too much focus on the condos, since I believe that the condos were icing on a hotel cake. What really is cause for concern is that since the boys in the awl bidness both in Houston and Dubai have decided to gouge for everything they can get in Bush's last days, the airlines (and the hotels by extension) are getting pushed over the cliff along with the US dollar. The liquidity crisis here in the US is well-known, but in Europe and Asia (where the money is) nobody is going to send capital into: 1) a depressed housing market; 2) a depressed commercial market; and 3) a market of any type based on a devaluating currency.

So, even though I thought that Soleil was a clever and feasible project (even if not well-liked), I now think that the haters might just get their wish -- and have a ditch and a skeleton by one of the city's main commercial centers due to this double-whammy. In Denver, we have a few start-stop cranes working too. They seem to be getting finished sooner or later, but the developers are stuck in a crunch. People actually do want to buy these units, but they just don't want to pay top dollar for them in a down market, and who can blame them? So the builders are paying higher steel and concrete charges at the same time they are having to ratchet down the unit prices. The two forces might meet at the breakeven point, maybe not.

But again, I think the condo sales are the least of Soleil's problems. When RDU loses two or three legacy carriers (more imminent than most people think), that will be small potatoes, compared to a nosedive in the travel market.

[dmccall]

The devalued dollar was by design in this administration. Their goal was to keep American exports strong, which they have.

[Jones_]

The devalued dollar was by design in this administration. Their goal was to keep American exports strong, which they have.

Its a consequence of spiraling debt, mostly the additional war debt. The foreign economies providing the dollars we borrow also consume the materials we need for projects like Soleil. The two factors combined are driving up the price of everything...oil being your prime example.

[sax184]

I've long been a detractor of this project, which no matter how many concierges they put at the front door, remains the wrong building in the wrong place. Maybe they'll backtrack and build a hotel with only a few condos. The number one rule in real estate remains location, location, location. And while the fittings may be brass and the counters Corinthian marble, you still can walk out side (and if you're lucky not to get run over) and get to...the Crabtree food court.

For the record, while I'm not a fan of this project, I'd rather a full building than a half-built eyesore.

[dmccall]

And while the fittings may be brass and the counters Corinthian marble, you still can walk out side (and if you're lucky not to get run over) and get to...the Crabtree food court.

How is this different than any condominium up the hill from this project or behind the Marriott? I've yet to see an argument against this project that has any impact beyond tallbuildingsmustlivedowntowntallbuildingsmustlivedowntowntallbuildingsmustlived

owntowntallbuildingsmustlivedowntown.

[DCMetroRaleigh]

How about the tall buildings should not be in a valley bowl or the new development should not be in one of the Mid-Atlantic's most notorious floodplains arguments?

[ChiefJoJo]

The Crabtree Place project (formerly Galleria, Crabtree Creek, & Crabtree Towne Center), as last envisioned, was a mixed use project that would be at least somewhat self sufficient and walkable by itself... containing office, retail, residential on 20+ acres of land that is not in a flood plain and fits well within it's surroundings.

Soleil Center, by contrast, is in a flood plain, thus had to be built on what amounts to stilts (6 levels of parking before any sort of activity); is completely out of context with it's surroundings (42-story bldg not downtown=albatross); and the project's mere existence is due to the blatant trampling of both the comp plan and zoning code, under the supervision of our 2005-07 city council. Not to mention, the project doesn't make a whole lot of financial sense, as we are clearly seeing now. Big difference in the two projects.

My arguments against Soleil haven't changed in almost three years, and still, there's little evidence that anything is ever going to be built there. Like Reynolds and their elusive quest for a major office tenant in the Hillsborough, if Soleil had simply proceded with a rezoning in 2005 to allow them to redevelop the entire (5-acre?) parcel in proper form (say up to 15 stories with hotel, office, condos) they might actually have a project underway now, and I would have been much more inclined to support it.

[sax184]

How is this different than any condominium up the hill from this project or behind the Marriott? I've yet to see an argument against this project that has any impact beyond tallbuildingsmustlivedowntowntallbuildingsmustlivedowntowntallbuildingsmustlived

owntowntallbuildingsmustlivedowntown.

Ahh, but aside from the floodplain issue, that's the point that is perhaps most relevant to the sales weaknesses of this project. How many other condos up the hill or behind the Marriott are being built in SKYSCRAPERS?

The point of the skyscraper in traditional terms (not in terms of ego, architectural statement, etc) is to confer the benefits of the high-value assets at the base of the building upon as many people as possible by stacking many people vertically above the base of the building.

If you are a buyer seeking a skyscraper dwelling unit for the traditional benefits conferred by a condo 37 stories up, Soleil cannot deliver compared to its competition, the RBC Centura buildings, and other tall luxury or semi-luxury buildings downtown.

Low-rise and mid-rise condos in suburban locations nearby are part of a broader market of suburban condos where what's at the base doesn't matter because it's a building form for automobiles. There is no significant variation in a critical attribute of another more conventional suburban condo nearby. For those projects nearby that have a more urban flavor, ChiefJoJo said it better than I could.

[dmccall]

If you are a buyer seeking a skyscraper dwelling unit for the traditional benefits conferred by a condo 37 stories up, Soleil cannot deliver compared to its competition, the RBC Centura buildings, and other tall luxury or semi-luxury buildings downtown.

Some people do not ever want to live downtown.

Are these condos shamefully withdrawn from the street experience and urban context? If so, then why do they have a magnificent track record of occupancy over the last 25 years?

Is it right to build a 12-story hotel on Soleil's site?

Is this building built in its context?

[architect77]

I appeal to everyone to STOP BASHING the construction of a 4-star Westin HOTEL at Crabtree Valley Mall, where millions come to do their big-city shopping every holiday season. This area has been much more a part of visitors' Raleigh experience than downtown ever was.

1) A Hotel next to a huge upscale mall with a McCormick and Schmicks, 250 stores, endless fast food options...What a NOVEL IDEA!...Might even become a recommended place to stay while in Raleigh... (Only for those who can swim, of course)<<<Sorry, I have strep throat, feels good to be a smart ass tonight>>>>

2) The Perkins+Will designed tower will win awards worldwide guaranteed, and will exude more elegance than any building in Atlanta, period.

3) If you're going to continue with the lame creek floodplain argument, then start petitioning the city to condemn everything already there, and notify merchants that the mall will soon be closing and they must relocate. Also, wouldn't a highrise be the SOLUTION to the floodplain issue rather than the problem? And how often does it flood there on average?

4) If you think this gorgeous design will be an albatross... I don't agree, and its substantial height will be mitigated by the fact that it is in a valley.

5) If views are an important aspect of high-rise living, residents of the RBC Center will see NOTHING in the distant horizon. Soleil residents will enjoy the twinkling lights of the downtown Raleigh skyline.

6) If I could, I would give this man (developer of Soleil) a hug. Upon completion of this project, Raleigh will have removed its overalls and now be sporting an Armani suit.

[Captain Awesome]

How is this different than any condominium up the hill from this project or behind the Marriott? I've yet to see an argument against this project that has any impact beyond tallbuildingsmustlivedowntowntallbuildingsmustlivedowntowntallbuildingsmustlived

owntowntallbuildingsmustlivedowntown.

Tall building must live downtown is a valid land use and anti-sprawl argument.

[DPK]

Is this building built in its context?

Actually that is not a valid point because the building you cited is proposed for Dubai (note the palm shaped island in the background, more specifically I think that's Palm Jumeirah, the second in a series of three palm islands in Dubai). Dubai has a lot of money and are building on the backs of their own people for tourism when oil ceases to make them any profit. Everything in Dubai is not in context so therefore that building is in context with the city.

[Jones_]

I appeal to everyone to STOP BASHING the construction of a 4-star Westin HOTEL at Crabtree Valley Mall, where millions come to do their big-city shopping every holiday season. This area has been much more a part of visitors' Raleigh experience than downtown ever was.

1) A Hotel next to a huge upscale mall with a McCormick and Schmicks, 250 stores, endless fast food options...What a NOVEL IDEA!...Might even become a recommended place to stay while in Raleigh... (Only for those who can swim, of course)<<<Sorry, I have strep throat, feels good to be a smart ass tonight>>>>

2) The Perkins+Will designed tower will win awards worldwide guaranteed, and will exude more elegance than any building in Atlanta, period.

3) If you're going to continue with the lame creek floodplain argument, then start petitioning the city to condemn everything already there, and notify merchants that the mall will soon be closing and they must relocate. Also, wouldn't a highrise be the SOLUTION to the floodplain issue rather than the problem? And how often does it flood there on average?

4) If you think this gorgeous design will be an albatross... I don't agree, and its substantial height will be mitigated by the fact that it is in a valley.

5) If views are an important aspect of high-rise living, residents of the RBC Center will see NOTHING in the distant horizon. Soleil residents will enjoy the twinkling lights of the downtown Raleigh skyline.

6) If I could, I would give this man (developer of Soleil) a hug. Upon completion of this project, Raleigh will have removed its overalls and now be sporting an Armani suit.

I am not outspoken one way or the other, but from what I have read, nobody is bashing the Westin portion of this project...just the false belief that people will pay $2million for a condo next to the mall. Thats a big difference over paying $400 a night for a hotel room. Nobody has yet to try to prop up Soleil Groups belief that there is demand for such housing units in this city.

[DCMetroRaleigh]

Everything in Dubai is not in context so therefore that building is in context with the city.

Love that.

[sax184]

Some people do not ever want to live downtown.

Are these condos shamefully withdrawn from the street experience and urban context? If so, then why do they have a magnificent track record of occupancy over the last 25 years?

Is it right to build a 12-story hotel on Soleil's site?

Is this building built in its context?

1. You're right. Some people do not want to live downtown. Most of those people are also in the "do not want to live in skyscrapers" box. The key mistake the Soleil developers made was thinking there were enough people in the former group who DO want to live in skyscrapers who will pay their prices rather than by a high-end single-family home. While time may prove otherwise, it does not look like there are enough people who fit in both boxes to fund this project.

2. Yes, from an urbanist perspective, those condos are lousy. They're suburban buildings in a suburban context. The buffering from the neighboring sites is ridiculously bad urban design, even if there are some streams we cannot see from the sat photos that may have dictated the arrangement. Their stellar occupancy performance surely has to do with being comparatively close-in for Raleigh and that they are much closer to jobs and amenities than equally anti-urban neighborhoods further out in the suburbs. Also, their price/value ratio is surely very reasonable compared to Soleil.

But this is getting away from the key point. The skyscraper is an urban, and not a suburban, building and living arrangement. There are some considerable downsides to living in one, and some upsides. The people willing to trade off the downsides of living in a skyscraper will do so for an urban life, where one experiences much of the world on foot. They generally won't trade the skyscraper negatives for a suburban life.

3. Twelve-story hotel with six stories of parking to avoid the flood lines? Still seems a little suboptimal to me.

4. Dubai. Whoever said there is no context nailed it. Dubai is taking a one-shot attempt to diversify its economy from a primary resource that will soon be gone, and has very few comparable socioeconomic, cultural, or climactic similarities to our area.

I concede that the design of the Soleil tower itself is striking, I don't think anybody has argued with that. I do think that "more elegant than any building in Atlanta" may be a superlative akin to "more intimidating than Duke football on the road," but that's just one person's opinion.

[dmccall]

I am not outspoken one way or the other, but from what I have read, nobody is bashing the Westin portion of this project...just the false belief that people will pay $2million for a condo next to the mall. Thats a big difference over paying $400 a night for a hotel room. Nobody has yet to try to prop up Soleil Groups belief that there is demand for such housing units in this city.

I agree with you on this point, Jones. The problem is that the running theme in this thread is that Soleil should not happen via a top-down approach. IF the market can't handle it organically, then it shouldn't be built. However that's up to the developers to decide, not us. When we start deciding we start running into quagmires like:

* It's OK to build a 12-story hotel in the flood plane, but if you put 10 stories of condos on top, it's not, regardless of the building's massing.

* It's OK to build a 12-story hotel in the flood plane and to build 40 spread out condos in the floodplane on 4X as much land, but you can't put the condos on top of the hotel.

* Land needs to be conserved in the suburbs, but you can't build tall outside of downtown

* The only place people should be able to live above the treeline is downtown

* It's OK to build condos and apartments that require the use of a car, so long as they aren't noticeable from down the street.

* Buildings cannot sharply be taller than other nearby buildings

* It's OK for existing buildings to sit in a floodplane, but new buildings cannot be built. (we end up with second rate, inappropriate buildings remaining in the plane)