Granby Tower

[NorfolkGal]

I'm glad to see some healthy pessimism on this board...I was beginning to wonder if one of you guys was actually Gaddams trolling with happy thoughts about GT.

[Sky06]

I'm glad to see some healthy pessimism on this board...I was beginning to wonder if one of you guys was actually Gaddams trolling with happy thoughts about GT.

"Healthy pessimism?" Give me a break. That's all we have in this town. It's decidedly 1-sided toward the negative. Just read the comments on pilotonline. (As long as you don't mind being dumbed down.) That's why I came to this site in the first place: to get the other POV for once. It's nice to know that I'm not the only one in this town who thinks HR isn't the worst place in the history of mankind, which is what you seem to get from some people.

As for vdogg's comments on being frustrated with always hearing "1 or 2 weeks," I understand your point. But that's simply Gaddams saying that's what he hopes. This stuff is so complex, no one ever knows exactly how long it will take. He's just responding to what the media asked. So, he can either say "I hope by end of week" or "Soon." Personally, I'd prefer to hear "I hope by end of week" even if that timeline is not met. At least it gives me more detail than vague statements like "soon" or "someday."

From this article, I'm very optimistic.

[scm]

I'm glad to see some healthy pessimism on this board...I was beginning to wonder if one of you guys was actually Gaddams trolling with happy thoughts about GT.

Buddy Gaddams, just like every real estate developer, has never driven on anything but a straight road. The personality type is hardcore Pollyanna -- and has to be. The good ones, the ones that have staying power, surround themselves with hardcore cynics as balance, because cynics have credibility with finance guys. What you are seeing in the lazy VP is a one sided story -- Pollyanna the developer, the Mighty Oz (who has put the city's money on the line), and no voice of the necessary cynic, because that would take some digging to find. The VP would have helped the debate had they contacted some industry experts to see what the climate for funding this type of project -- to have gotten some cynical voice so you can discern where the middle is. They didn't, and that makes it easy to be a pessimist. It might not be so bad after all, but when the only voice on the subject is Straight Road Buddy, you tend to be the cynic all by yourself.

[Chesapeake Pirate]

I'm glad to see some healthy pessimism on this board...I was beginning to wonder if one of you guys was actually Gaddams trolling with happy thoughts about GT.

I've heard of "healthy skepticism" (not just accepting something at face value), but never have I heard of "healthy pessimism".

Pessimism is the tendancy to take the gloomiest possible position on an issue or subject. I don't think there is much healthy about that.

I retain all of my happy thoughts about Granby Tower, continue to think it is a great idea, and continue to hope it will be built.

And I am not Buddy Gaddams.

[vdogg]

I'm glad to see some healthy pessimism on this board...I was beginning to wonder if one of you guys was actually Gaddams trolling with happy thoughts about GT.

If you are referring to my "skepticism", then yes it is indeed healthy. I have always been skeptical of comments like these from Gadams because they almost never wind up to be true. I am not, however, being "pessimistic". If I were a pessimist I'd rail on and on about my "tax dollars at work", or chant "throw the bums out!", or say "who will buy these?" or make really uneducated, ignorant comments about public/private partnerships only benifiting the rich, and how there is no benefit to the community at large. I'd probably rant and rave about repairing some sidewalk in my neighborhood, or demand that every dime be spent on essentials, but only things that I see as essential, and everyone else be damned. To put icing on the cake i'd then threaten to "leave the area", or say "This area will never change". But at the end of the day, if I were a pessimist, I'd then promptly get off my keyboard, turn on the tv, sit on the couch for hour after hour eating junk food and getting fat, and not lift one finger to change any of the things that I complained about. I would probably never venture outside to see all the truly wonderful things that HR has to offer, or go to downtown Norfolk and realize that it really has changed in the 20 years since I last visited. I say none of these things, but the pilotonline comments section is overrun with statements just like these. So no maam, i'm not a pessimist. I truly want Granby Tower to be built, and feel it will be, just not in the timeframe that Gadams is offering.

[spiker3]

Additionally, and i'm one of the largest skeptics of this project, Gaddams has to be held accountable. While obviously i don't work for Marathon or oversee the company or project, it needs pointing out the all of the times that this project has been inflated with false hope due to press quotes coming from Buddy Gaddams. At some point, after hearing one thing and seeing something completely different, a mind set has to change. Yes, GT is a gorgeous projectt. Yes, GT would and will be a vital cornerstone to development in downtown and help generate development north of Brambleton. And yes, GT is absolutely a place i would live in at the drop of a dime (could i afford it). However, potential positives do not sell a project. The developer sells the project. Can anyone honestly tell me that if it were LTD or Fuller or Armada Hoffler as the principal developer on this project we wouldn't have a building at 30 - 40% completion at this point?

That's the biggest point. Marathon and Gaddams have bungled this project from day one. In spite of all the excuses, GSA, housing downtown, financing, etc. Of course i hope they get financing and build a fine, high quality building that becomes a crown jewel in downtown Norfolk. Why would i not? But they were not capable of delivering on a project of this scope when it was announced, and have struggled for three years to even become capable at delivering the promised product. For all their cockiness and stubbornness, had Armada Hoffler developed this project, we can all agree that in February of 2006 when GSA officially decided to remove the GT site from consideration, construction would have began with a vengeance. There would have been no issues with financing as its a proven company, and the biggest difference, when words come out of their CEO's mouth, it's not complete bull or smoke and mirrors.

Yes the article inspires some confidence, but every article that quotes Buddy Gaddams inspires confidence. Even when there was zero progress on the site, Buddy Gaddams was confident in promising construction would begin 'in a few weeks.' And sure enough, some 65+ weeks later, construction started (February 2006 to May 2007) And here we are, in October 2007 with a pit, one section of crane, three idle pile-drivers and one solitary pump running. And the only thing to believe that that's imminently changing is Buddy Gaddams? Yes...skepticism and pessimism is deserved and justified.

[Telmnstr]

I know you all think I'm the most negative person in the world, but *I* think I'm just realistic. I want good things for the country and the region, as long as they come from the country and the region and aren't smoke and mirrors. I don't see having the young people saddled with huge debt loads for life to support spending spree habits of the older. I could rant about US corporations sending jobs overseas, being short sighted, poor education for the poor, etc. etc. But that can go in another thread or at a get together, not that there are any UP get togethers that I know of, because Norfolk is weak.

I also don't think it's the cities place to tax the snot out of the citizens and fund private projects. Socialize risks, privatize profits is bad. Remember, housing prices are false, and the local gov'ts have budgeted themselves based on these high property values. The US gov't is trying to prop it all up, but it's not going to work. There is some *VERY* nasty things going on now with large banks and the fed and all of that.

I don't think that big golden buildings make up a city. I think the people do. And until I see cool stuff coming from local people, I'm not convinced the city is great. And don't get me wrong, I try to do cool stuff when I can.

Let's go back to that thing that someone posted on here about purchasing the land and announcing condo building, with the sole intention of driving up the value of the land so the gov't would pay more for it. That was... odd and oddly interesting. Things that make you go hmmm.

I wouldn't think they would go through with the sales trailers and all that if they were just trying to ramp up the land value.

If the whole thing falls through, would they be able to recoup money spent on advertising, acquisitions and everything else by selling the property?

[spiker3]

Questions Building over Granby Tower Project

The supporting cast for Granby Tower has been in place for some time - the architect, general contractor and a sales-and-marketing firm, among others.

What's been missing? A lender.

When plans for the downtown Norfolk condo project were announced three years ago, its developer predicted that Granby Tower would be finished by 2007. The date was pushed back to 2008, then to late 2009. With each delay, skepticism about the future of the $180 million project has grown.

A well researched article, examining the national markets and condo trends while still applying to our local market. Stays away from doom and gloom, but presents the facts and the difficulties in the market, while also highlighting the shortfalls of Marathon and the existing market for high end condos. Nice to see Gaddams still playing coy with his financing...

"Because we're in the middle of closing on our loan and there is so much paper going back and forth, it would be premature" to talk about it, he said. Earlier this year, Gadams said that he was seeking a $145 million loan for the project.

[vdogg]

These two quotes give me some confidence though that there are contingencies. It shows there is a real effort to get this tower built, even if the primary means of building it are unattainable.

Peter G. Decker Jr., a prominent Norfolk attorney who has reservations for two units on the building's 23rd floor, said he had no doubt that Granby Tower will be built. Decker said he understood that "three different companies are interested in financing the project."

One scenario, mentioned by others, is that if Gadams fails to line up financing for Granby Tower, it's possible that a partner with much deeper pockets could be brought in.

Lincoln property company anyone? Maybe even Armada Hoffler might take a bite, they've already demonstrated their ability to get things done.

[wrldcoupe4]

His largest project to date was in Richmond, where he converted a 120,000-square-foot bakery building into 77 condo units.

If this is supposed to show a proven track record.... while the project was completed, it was close to a failure. Months after the project was finished, something like only 25 units had been sold. It then reverted to "leasing the condos." It's just interesting to me because while other projects in Richmond were selling out and doing fine, this one struggled to gain traction.

Great article though...

[Padman]

I still think that is was a big mistake not having a large lounge/common area on one of the upper-most floors. Why would I buy a condo in a tower with little more than a view of Brambleton Avenue or the grey wall of the soon to grow Federal Building, knowing that the fat cats above me are having all the fun? Surely it's not too late for such a modest design change?

[Image5]

2 years ago, on this forum, Buddy Gaddams was the savior of Norfolk who could do no wrong. Today he is the village idiot and nothing but an unsuccessful regional condo flipper. My guess he is somewhere in-between; a good man who is skilled, passionate, visionary, and who has bitten off far more than he can possibly chew.

I wish cities (especially Norfolk and Portsmouth) would quit dangling redevelopment properties out to their buddies, and instead acquire, rezone, and sell for market value on the OPEN market. Both cities have spent fortunes with Ray Grindoz to design their future (all sarcasm intended), yet don't do the basics of due diligence and stewardship of OUR resources when it comes to public/private partnerships. Many people think VA Beach sleeps with the devil in Armada-Hoffler (me included), but the stuff gets built. The Westin is getting ready for occupancy. It and Granby Tower should have opened simultaneously.

Not a hater by any means, but I think voters need to think broadly about their cities, ask tough questions, and vote intelligently for those who are managing their local economic futures. Stewardship over self-interest. Now that's Pollyanna.

[rusthebuss]

2 years ago, on this forum, Buddy Gaddams was the savior of Norfolk who could do no wrong. Today he is the village idiot and nothing but an unsuccessful regional condo flipper. My guess he is somewhere in-between; a good man who is skilled, passionate, visionary, and who has bitten off far more than he can possibly chew.

I wish cities (especially Norfolk and Portsmouth) would quit dangling redevelopment properties out to their buddies, and instead acquire, rezone, and sell for market value on the OPEN market. Both cities have spent fortunes with Ray Grindoz to design their future (all sarcasm intended), yet don't do the basics of due diligence and stewardship of OUR resources when it comes to public/private partnerships. Many people think VA Beach sleeps with the devil in Armada-Hoffler (me included), but the stuff gets built. The Westin is getting ready for occupancy. It and Granby Tower should have opened simultaneously.

Alot of us on here question the cities passing things off to their buddies. I question Norfolks leadership all the time. I think we need new leadership in Norfolk. I just don't see anyone steping up that will change things. We need to get the good ole boys out of there and some of the racist pigs like Riddick out of there. We need to look at the city as a whole. We need to see what is good for all the citizens. Better the NPS school system, the libraries, and push more technology in the city. Teach people to not depend on the govt. to make it. We need to look at urbanizing(word?) the entire city. Norfolk should be the leader of the region but its sitting in limbo just like the rest of the cities.

We are not selling Gadams out just skeptical. His action is what is driving his this attitude towards him. People think that he has lied about securing the loans. Alot of people think he is over his head for this and he is proving it by not having loans secured before it got to this point. I really think he has good intentions for this city.

[vdogg]

We are not selling Gadams out just skeptical. His action is what is driving his this attitude towards him. People think that he has lied about securing the loans. Alot of people think he is over his head for this and he is proving it by not having loans secured before it got to this point. I really think he has good intentions for this city.

Yep, that pretty much sums it up. I'm tired of the misinformation, but i'm really rooting for this project to succeed.

[hoobo]

Before the REIT bust in the late 90's VB had a company lined up to do the Town Center completely privately and Norfolk had a deal with a Miami company to build a power center at Downtown Plaza. Both deals fell through. VB eventually got a public/private deal with AH which turned out very well. Norfolk's downtown has done well in its own right.

As for Granby Tower, now we have problems in the loan industry especially residential lending. Maybe the financing will get secured. Maybe it will fall through and something else will come along in 5 years when the lending markets rebound. Who knows. I think if the financing isn't secured that if a commercial component, hotel or office, were added, financing would be found. The market is just better for offices and hotels.

[Telmnstr]

I seem to remember AH was headquartered in Chesapeake, VA. If I'm not mistaken, I think AH won contracts with the City of Chesapeake to complete the jail? I think there was a big stink over the jail not being done right or something, and then AH jumped to Virginia Beach.

As far as GT... put a fork in it. It's done. They will *never* sell the other units. So what if Decker bought two units? It didn't even say it was for residence.

They can't lower the prices, but they need to. The normal thing is to try to throw in concessions, to hold the sale price up but the buyer gets lots of inflated priced things like grante counters, swimming pools, maybe a car. But there is only so much you can do with a 1200 square foot apartment. Uhhh you get fancy doorknobs. If they drop the prices, it will de-value it for those that already have a deposit, and then they could walk.

The people that already have a deposit may require the sale of an existing home to complete their purchase. If this is the case, the housing market has slowed significantly. So this could cause some huge issues. I don't think they have buyer contingencies, but who knows. The article said the deposit is 10%, so buyers to be could have HELOC'ed $50K out of their existing property to drop on their new $500,000 apartment.

If the building is half sold and complete, and the condo fees are $500/month, it could likely revert to $1000/month for the people that have moved in, until other units are sold. I've been reading that this is not un-common. There are cases where storm damage to condo buildings has resulted in a bill to all residents where they've been expected to each pony up $30K+ to assist with repairs and what not. It opened my eyes. I believe GT is rated for category 2 hurricane (the windows).

Something that baffles me... I would expect construction materials cost to have dropped. I've seen mention that the raw price for wood is way down, but not sure how that works. It would seem like the cost to build it should be cheaper by the time they get underway.

Overall, while I'm sure there are people that can afford to live there, there is a very large amount of high end housing on the market in Hampton Roads and the nation. Many of the US banks are showing signs of massive failure from the loans that have already been made. If loans are extended to build GT I will be surprised. Look at Bank of America, Wachovia and others over the past few weeks. There are these odd stories that seem to creep up every few days about the fed pumping money into banks overnight. They are on life support, injured by pure greed.

Remember, our region is marketed to potential new businesses in that there is a cheap workforce and cheap cost of living. High housing costs will deter new businesses. Right now Raleigh would be a better bet for many businesses that doesn't have a specific need.

[Glassoul]

Something that baffles me... I would expect construction materials cost to have dropped. I've seen mention that the raw price for wood is way down, but not sure how that works. It would seem like the cost to build it should be cheaper by the time they get underway.

Overall, while I'm sure there are people that can afford to live there, there is a very large amount of high end housing on the market in Hampton Roads and the nation. Many of the US banks are showing signs of massive failure from the loans that have already been made. If loans are extended to build GT I will be surprised. Look at Bank of America, Wachovia and others over the past few weeks. There are these odd stories that seem to creep up every few days about the fed pumping money into banks overnight. They are on life support, injured by pure greed.

Remember, our region is marketed to potential new businesses in that there is a cheap workforce and cheap cost of living. High housing costs will deter new businesses. Right now Raleigh would be a better bet for many businesses that doesn't have a specific need.

The housing market's main raw materials are wood and concrete, both of which have seen sharp falls in prices. How much wood do you think they're using to build Granby tower? I certainly hope not a lot. Steel? Yes. China and India need steel and other raw materials? Yes. Europe's economy finally picking up? Yes. That's why raw material prices haven't collapsed.

American banks on life support? No. The aforementioned banks just setup a joint $75 billion fund to support investment banks. and subsequently mortgages lenders. They're not in trouble. Like I said previously, you could end up with one or two large investment (hedge) funds going under, but the big boys will absorb the losses with little effect. Without getting into the details, one of the things you're overlooking is that increase in credit derivatives has helped to spread financial risk across a much larger size area, such that big meltdowns by a single individual company are much smaller than even 10 years ago. The effect is that more companies feel the pain, but few so much so as to cause death. Don't limit your thinking to the U.S solely either, the spread of risk has taken place on an international scale. When the Fed pumped $$$ into the banking system a few weeks ago, the ECB was not far behind. International banks, such as Royal Bank of Scotland, HSBC, and others are also looking into contributing into the joint fund.

[urbanlife]

so how much site work has already happened for this tower anyway?

[Telmnstr]

so how much site work has already happened for this tower anyway?

They cleared the lot, moved utilities, and after a delay started driving piles. It looked like it was going to go through, then work abruptly halted.

[Telmnstr]

The housing market's main raw materials are wood and concrete, both of which have seen sharp falls in prices. How much wood do you think they're using to build Granby tower? I certainly hope not a lot. Steel? Yes. China and India need steel and other raw materials? Yes. Europe's economy finally picking up? Yes. That's why raw material prices haven't collapsed.

American banks on life support? No. The aforementioned banks just setup a joint $75 billion fund to support investment banks. and subsequently mortgages lenders. They're not in trouble. Like I said previously, you could end up with one or two large investment (hedge) funds going under, but the big boys will absorb the losses with little effect. Without getting into the details, one of the things you're overlooking is that increase in credit derivatives has helped to spread financial risk across a much larger size area, such that big meltdowns by a single individual company are much smaller than even 10 years ago. The effect is that more companies feel the pain, but few so much so as to cause death. Don't limit your thinking to the U.S solely either, the spread of risk has taken place on an international scale. When the Fed pumped $$$ into the banking system a few weeks ago, the ECB was not far behind. International banks, such as Royal Bank of Scotland, HSBC, and others are also looking into contributing into the joint fund.

These SIVs are going to be used to try to move the garbage off of their books. They are definitely in trouble. Look at BoA's last quarterly report! 32% decline in profits! Yowers. Yes, the credit mania is international. .eu, .au, .nz, .es, .ca all have seen huge run-ups in housing prices, many like us.

As far as the big boys eating all the losses, we will see. It could be lots of pension funds and other retirement funds invested in this garbage. Who knows. It looked good when things were marked to model versus market, and everyone wants the highest return on their investment. We will see where it goes. For some reason, I just don't see wall street eating the losses. I'm fairly certain that it will end up on the little people somehow.

Also, check out www.ml-implode.com . They have been keeping track of the sub-prime lenders, and who's gone under.

Also, like you said. It's national. If these other countries dump their US dollars, watch out.

[scm]

I wish cities (especially Norfolk and Portsmouth) would quit dangling redevelopment properties out to their buddies, and instead acquire, rezone, and sell for market value on the OPEN market. Both cities have spent fortunes with Ray Grindoz to design their future (all sarcasm intended), yet don't do the basics of due diligence and stewardship of OUR resources when it comes to public/private partnerships.

How do you come to the conclusion that Portsmouth, which accepted Lincoln Properties' offer to redevelop the HI site, over the offer of well connected local black leaders -- and weathered much heat over it -- "dangled" it to "their buddies"? Same thing goes for the old Norcom HS property -- accepted the offer of one of the SE's leading retail developers -- not one of "their buddies".

I don't know enough to know if Norfolk is guilty of what you charge. As a person invested in Portsmouth -- in money and emotion -- I find that a pretty baseless accusation.

[Henry_Ryto]

Isn't "Granby Tower Progress" an oxymoron?

[vdogg]

LOL, until I see the headline "cancelled" progress will remain in the title.

[NSUREDD]

May not have to wait long.......

[Sky06]

It may take a little longer, but I believe this project will resume. If it makes anyone feel any better (and I doubt it will), there were a few workers on the site on Saturday. Just talking but talking as if they were maybe prepping for a restart. As for the misinformation: yes, there has been some, but mostly it's been a lack of information. But for people to claim that Gaddams never had a loan in the first place, I find that ridiculous. Even the paper said the loan fell through. If it was never in place, then what fell through? Certainly there have been challenges, but I wish the absurd claims could be left for pilotonline.