Columbus Center: RIP | Back Bay

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Re: Columbus Center

People do care but there are people who are irrational that prevent any progress being made due to paranoia and whatnot.
 
Re: Columbus Center

Oh my goodness. This seems like more grasping at straws, or the same tired record. If they have most of the financing again in hand, they ought to say so. That would make the discussions about tax relief more meaningful.

The producers of American Pie are shooting a movie in Cambridge early next year titled The Harvard Zombie Massacre. Perhaps they ought to consider Columbus & Clarendon as a locale, given the living dead feel to this most recent supplication for help.

Columbus Center asks for boost of $40m

Says public funds could spur project

By Casey Ross, Globe Staff | July 3, 2008

The owners of the massive Columbus Center project over the Massachusetts Turnpike have gone back to city and state officials to request as much as $40 million in public funding to try to resurrect one of Boston's most ambitious developments.

A spokesman for WinnDevelopment and its partners confirmed the Columbus team has held a series of meetings to push for additional taxpayer assistance, despite lingering controversy over public funds that have already been awarded. Officials briefed on the talks said the ownership has discussed the idea of creating a special development zone that would give developers tax relief to pay for a deck over the turnpike and other upgrades.

Columbus Center is intended to be a $800 million hotel, residential, and retail complex that would straddle the turnpike and reunite two neighborhoods now divided by the highway. It would occupy four blocks between Clarendon and Tremont streets where the South Endborders Back Bay.

Construction of the long-planned project was halted abruptly in March after develop ers were unable to secure construction financing and about $35 million in state assistance. They now face an uphill battle to keep the project alive as capital markets have tightened and costs for fuel and building materials have soared. They have already sought to delay construction up to 18 months.

Alan Eisner, a spokesman for the developers, said executives have been negotiating for months to try to revive Columbus Center, which went through 11 years of permitting and neighborhood opposition. Projects costs have nearly tripled. He confirmed that officials met last week with state Senator Dianne Wilkerson, a Roxbury Democrat, to discuss ways to generate fresh public assistance.

"We've been meeting with various state and city officials to try to see what support is out there that can jumpstart the project once market conditions improve," said Eisner. "Anything and everything is on the table."

Eisner would not discuss specific proposals, but officials briefed on the talks, who were not authorized to comment on them publicly, said Columbus Center's owners have asked the city and state to consider designatingthe project a special development zone.

The arrangement, known as a District Improvement Financing agreement, allows developers to get an abatement on a portion of their future property tax bill now to pay for infrastructure upgrades.

Wilkerson did not return phone calls seeking comment. She has been a key supporter of Columbus Center on Beacon Hill, where a number of foes, including House Speaker Salvatore DiMasi and Representative Martha Walz, a Back Bay Democrat, have fiercelyopposed public funding for the project under the belief that the state should not be footing the bill for a private development.

WinnDevelopment is Columbus Center's managing partner in an ownership group that includes the California Public Employees Retirement System and MacFarlane Urban Realty Co. LLC, which invests in large urban projects nationwide. In 2007, construction financing fell through, delaying the project and raising questions about its viability. As a result, the state withdrew $20 million in potential job-creation grants, and the project never received $15 million in loans from MassHousing.

The prospect of a new tax relief plan drew contrasting reactions from the community.

"This is a great project to knit the city back together and it is critical to get some assistance for it," said David I. Begelfer, chief executive of the National Association of Industrial and Office Properties of Massachusetts, a business advocacy group that supports development incentives. "It does not have to be dead. If the developers can get a couple of years of breathing room, I wouldn't be surprised to see it back on the front burner."

But Walz said the project's survival should not be the public's responsibility. "This is another instance of the developer seeking relief from its financing problems with taxpayer money," she said. "It's not appropriate for taxpayers to be financing this project, and we've made that point to the developer time and again."

Overall, the public assistance being sought by the Columbus team is a small portion of the project's overall cost, but developers have made clear that the money is a crucial in tough economic times. Eisner said the project would produce public benefits, including four new parks, improvements to air quality in the MBTA's Back Bay Station, and better groundwater management in nearby neighborhoods that have struggled with flooding.

The City of Boston provided initial support for the project, including a package of tax deferrals, but officials said the city would be reluctant to grant further taxpayer assistance.

"We [will not] consider district improvement financing for this project," said Susan Elsbree, a spokeswoman for the Boston Redevelopment Authority, the city's planning arm. "The city has already given [tax incentives] valued at $14 millionover the life of the project."

The developers are also trying to renegotiate a lease with the Massachusetts Turnpike Authority to allow for a construction delay of up to 18 months; the authority owns the space above the highway where the complex will be built. Mac Daniel, a turnpike spokesman, said the talks continue as it works with the developers to clean up the area surrounding the inactive construction zone.
http://www.boston.com/business/articles/2008/07/03/columbus_center_asks_for_boost_of_40m/
 
Re: Columbus Center

Would some higher power please put this puppy to sleep once and for all?
 
Re: Columbus Center

The thread or the project?

I vote for both.

They are both sickly reminders of better times with no hope for redemption.
 
Re: Columbus Center

I'm all for taking this puppy out back and putting it out of it's missery. The project and the thread.
 
Re: Columbus Center

statler, does that mean you are for the proposed subsidy, or against it? I can't quite tell.
 
Re: Columbus Center

The thread or the project?

Well, I was refering to the project, but this thread could certainly use some hibernation for a while (although it has been an exciting trainwreck of entertainment).
 
Re: Columbus Center

Back again for more

Boston Globe ? July 4, 2008 ? by Globe Columnist Adrian Walker ? http://www.boston.com/news/local/massachusetts/articles/2008/07/04/back_again_for_more/

Real estate developers are a persistent lot. Especially when it comes to public money.

The Columbus Center project is a proposed $800 million hotel, retail, and condominium development at the border of the Back Bay and the South End.

It happens to be stalled. That is partly because the construction business is not so hot, and the market for high-end condos could be better, too.

But there?s another reason: The Patrick Administration backed off $20 million in public subsidies that had been promised by its predecessors.

That decision did not represent some big, brave stand. A piece of the project is in Sal DiMasi's district, and the speaker was not a fan. The project?s staunchest legislative advocate was state Senator Dianne Wilkerson, who, at that moment, the Patrick people happened to be mad at. It was easy to say no.

But the developers, Arthur Winn and Roger Cassin, have resurfaced. They?re back asking for the same money that was taken away less than a year ago.

To be fair, the project has its merits. It would be built in an area that certainly has room for improvement. It would create jobs, though, as with all projects of this type, just how many jobs is disputed. And, in developer?s parlance, it would ?knit together? the South End and the Back Bay. That rationale was also used to sell Copley Place in the 1970s, and before that, the Prudential Center. Apparently, we are anxious as a city not to leave any holes between neighbors.

The developers are under considerable pressure. When their public subsidies were withdrawn, the project?s financing collapsed. The land for Columbus Center is leased from the Massachusetts Turnpike Authority - it is to be built over the Pike - and those leases require action within a given time frame. But nothing is happening, and nothing is on the horizon.

Ah, but help could be on the way. The exact amount the developers are seeking is unknown, though it is definitely north of the $20 million they would have settled for previously. You don't get to be a big developer like Winn without an extra helping of chutzpah.

I have been critical in the past of pouring tens of millions of dollars of public money into what is, essentially, a project for rich people. But the developers, of course, don't see it that way.

One person close to the project explained that even though market conditions are plainly unfavorable now, it isn?t surprising that the developers are trying to make a deal.

?Even if there were a plan in place, they wouldn?t move forward now, because the market wouldn?t justify that,? he said. ?The idea is to get some kind of workable agreement with the state, something that both sides can live with, so when the market turns around, instead of beginning the process, you can be ahead of the curve.?

The official also pointed out, correctly, that public subsidies for big-ticket developments are far from unheard of. The arguments are always the same in those instances, that the public still benefits and that, over time, the project will be worth it in jobs and tax revenue.

But what about all the other things government can do with $20 million or more?

Columbus Center is not a bad project. But it is a terrible choice for spending massive amounts of public money that could go to so many more valid uses. Boston is not exactly short of pricey condominiums or hotels. Why should the public subsidize building a few more? If the developers have a good answer to that question, they?ve kept it to themselves, and people have been asking for more than a decade.

The state should stick to its guns and say no to a big handout for Columbus Center. If Columbus Center is the godsend it is cracked up to be, it will eventually get built anyway.

Even if state officials refuse to kick in public money now, they should brace themselves for more requests in the future. These guys keep asking until someone says yes.
 
Re: Columbus Center

At this point everyone involved is an asshole and they all deserve whats coming to them.
 
Re: Columbus Center

All the BANANAs, crooked politicians, dishonest lenders, lawyers, and Winn's bad PR department that held this project up to death deserve a flogging.
 
Re: Columbus Center

All the BANANAs, crooked politicians, dishonest lenders, lawyers, and Winn's bad PR department that held this project up to death deserve a flogging.
Alan Eisner who is the spokesperson for Winn-Cassin, is also the spokesperson for Battery Wharf. I don't know for certain, but an Alan Eisner was also managing editor of the Herald.
 
Re: Columbus Center

[size=+2]Wilkerson says she's
not seeking public funds for stalled project[/size]


Banker & Tradesman, 07 July 2008

Wilkerson.jpg


http://www.bankerandtradesman.com/pub/5_345/commercial/200266-1.html
 
Re: Columbus Center

Thanks, Ned. I had to chuckle seeing Winn's wife in a "glamour" photo in the Herald gossip page last week at the same time that hubby was trying to go on the public dole. Who does their publicity, Louis Seizieme?
 
Re: Columbus Center

[size=+2]Updates on 4 of Columbus Center?s business partners[/size]

ALAN EISNER ? California?s Columbus Center company pays Regan Communication Group?s Alan Eisner to speak for the project. Eisner is Massachusetts Hospitality Association?s Executive Director. He formerly held the positions of Reporter, Commentator, Education Editor, Managing Editor, and Editor-in-Chief ? all for the Boston Herald.

SENATOR WILKERSON ? For years, Senator Dianne Wilkerson has worked for Columbus Center, arguing that it would ?make? hundreds of permanent jobs, and thousands of temporary jobs, for people inside her District and inside Boston?s HUD-sponsored poverty zone.

She helped re-draw HUD?s poverty zone to include the turnpike from Allston to I-93, Back Bay, South End, and Bay Village as Boston?s new official ?poverty? zone, which got the project a $35 million federal-tax-free bond loan.

Wilkerson spent years negotiating a secret contract between Columbus Center and the poverty zone. Officials signed the contract last summer, but both Wilkerson and the poverty zone Board still refuse to let the public read it.

Most notable: although construction began in October 2007, Columbus Center never hired even one person from Wilkerson?s District, or from the poverty zone.

If the only bail-outs Wilkerson is now working on are ones that cost taxpayers nothing, then her efforts will fail, because there is no such thing. Taxpayers pay for all bail-outs, especially to projects in Columbus Center?s condition, and in markets such as today?s.

The project needs a bail-out because its new owners and the commercial world have abandoned it, and the only way to finance such an orphan is with dollars already pulled from taxpayer pockets.

ANGLO IRISH BANK ? Some forum members claimed that Columbus Center will still get its loan from the $95 billion Anglo Irish Bank ? ?just as soon as the market improves.?

If the bank ever had any hope of doing so, that chance is all but gone now. As one of the few U.S. financial institutions focused solely on commercial finance, a rare specialty, Anglo Irish is in trouble.

? Last week Standard & Poor?s gave Anglo Irish Bank an outlook rating of ?negative.?
? Citigroup recently downgraded Anglo Irish, with a recommendation of ?sell.?
? Anglo Irish declined to comment.​

In May 2006, Columbus Center paid the bank $25,000 for a form letter that could be attached to subsidy applications. California?s Boston-based managers claimed the loan in their 2005, 2006, and 2007 Massachusetts public subsidy applications, specifically naming Anglo Irish as Columbus Center?s commercial bank lender. Neither government nor media ever checked to see if the loan even existed, so all the right people got fooled ? until the MTA accidentally disclosed the secret during a routine public records request.

But Columbus Center never met the bank?s borrowing requirements, the theoretical loan described in the bank?s May 2006 form letter expired four months later, and it was never renewed, revised, or replaced.

Thus, bank financing did not ?fall through? as is commonly reported in the media, and repeated on this forum. There was nothing to fall through, as no loan was issued, approved, or even applied for. And that was when economic conditions were frothy.

CalPERS-CUIP-MURC ? At the end of 2007, the nation?s biggest pension fund had $24 billion invested in real estate. But with new home sale rates at their lowest point in 17 years, CalPERS lost confidence in seven of its joint venture real estate investments. Columbus Center is one of CalPERS? joint venture investments.

Not comfortable taking any more advice from its thousands of employees, CalPERS engaged global financial services firm Morgan Stanley to recommend what to do. Morgan Stanley?s advice to CalPERS can be inferred from what happened next.
? Columbus Center halted construction.
? Previously agreed upon funding wasn?t disbursed.
? Four months later, funds are still being withheld.
? Similar CalPERS decisions just drove another of its projects into bankruptcy. CalPERS chose to lose most of its nearly $1 billion investment because ? having already lost plenty ? the best way to not lose any more was to force its own project to go belly up.
? Between 27 May and 2 July alone, CalPERS lost $12 billion.
? Last month, CalPERS? local managers in Boston began shopping ? for other pension funds.​
 
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Re: Columbus Center

We provide letters confirming equity commitments to anyone who asks.....we just leave plenty of outs in the LOI so that either party can walk away.....hell, we don't even fully model deals before providing these equity commitments.

The developers then use our commitment letters to go get their public funding, and come back to us to see if we are truly interested once their get their funding.

This is no secret negotiations involved. A developer has to pick up the phone, call us, and send us a general pro forma. We don't normally issue a press release each time we do this.

And of course it expires before conditions are met. As described above, that is the intent of these LOIs, to protect both parties, and to help the developer to secure public funding. Why should any bank put themselves on the hook until the entire financing package is secured?

Also, how does a unbuilt building secretly negotiate with a federally defined zone?
 
Re: Columbus Center

We provide letters confirming equity commitments to anyone who asks . . .
You don?t identify who you mean by ?we?, so whatever point you?re trying to make isn?t quite clear. But Columbus Center?s Anglo Irish letter wasn?t an ?equity commitment letter?. Instead, it was an offer to allow the owners to apply for and maybe receive a construction loan, if they met 19 pages of requirements, which they never did.

Also, are you saying that your organization just gives an ?equity commitment letter? to anybody who wants one? If so, what organization is that? And if your organization sells such letters, as Anglo Irish does, then how does your fee compare to Anglo Irish?s $25,000?

. . . This is no secret negotiations involved. . .
No one said that the Columbus Center?s equity commitment letter negotiations were secret, so again, whatever point you?re trying to make isn?t quite clear.

. . . Also, how does a unbuilt building secretly negotiate with a federally defined zone?
It doesn?t. Neither buildings nor poverty zones ever negotiate anything, because an unbuilt building does not exist, and because a zone is only an inanimate, abstract concept expressed as boundaries on a map.

In the situation being discussed here, managers working for the owners of California?s Columbus Center negotiated with members of the HUD-sponsored poverty zone?s Board of Directors. The 2005-2006-2007 negotiations were kept secret, as was the 2007 outcome. As of July 2008, the contract?s contents remain secret.

But several things became clear over the last year.

● Federal officials at HUD deny having any copies of the contract.
● City redevelopment officials also deny having any copies.
● The poverty zone executive director, when asked, admits to the existence of the contract that Wilkerson negotiated for Columbus Center, but then denies having a copy, saying all copies were moved ?out of our custody?.
● Among the poverty zone?s Board of Directors, those who do have a copy of the signed contract refuse to release it ? even to their fellow Directors.
● Managers for California?s Columbus Center refuse all inquiries about it.

There?s no way to know if anything Senator Wilkerson promised the public ever made it into that contract. But residents of her district and the poverty zone know this: they were promised jobs, and none of them got hired.
 
Re: Columbus Center

"We", is the company I work for, who's identity is not revealed because specifically, my particular views on the variety of projects I post about may or may not coincide with my employer's views. I have no financial incentive in this project at the moment, as we have not been approached by the developers at this point.

And yes, I'm saying we give an equity commitment letter to almost anyone that provides anything resembling a financially feasible development. It is in every lenders best interest to provide such loosely-binding commitments if they are considering lending on a particular project, because the greater the public subsidy/funding, the less leveraged hard debt there is, which means less chance of foreclosure.

Do I charge $25k as an upfront fee? I don't think we ever have, but it could be reasonable if a substantial amount of diligence is involved to produce the required commitment letter. You can guarantee however, that I will include a fee to cover our work in providing that letter plus a nice premium if we actually end up lending on a deal.

My main point is, you continue to act as if every aspect of this deal is shrouded in secrecy, and only through your hard diligence, have you uncovered shocking revelations about this project. I contend that nothing you have presented as part of their financing scheme, or legal partnership structures is even noteworthy different than the dozens of deals I analyze on an annual basis, many of which include some form of public subsidy.

What makes this deal different is the scale, and the fact that it's in your back yard.
 
Re: Columbus Center

Hi Ned --

When I made this post back in April (here's your reply), I was referring to a larger, peer-reviewed epidemiological study, using longitudinal data on an array of respiratory ailments and cancers overlaid with a map of UFP pollution across all of Logan's flight paths (in the case of your neighborhood, from Runway 9/27).

WBZ-TV just ran this this report.

Any thoughts?
 
Re: Columbus Center

Hi Ned --

When I made this post back in April (here's your reply), I was referring to a larger, peer-reviewed epidemiological study, using longitudinal data on an array of respiratory ailments and cancers overlaid with a map of UFP pollution across all of Logan's flight paths (in the case of your neighborhood, from Runway 9/27).

WBZ-TV just ran this this report.

Any thoughts?


I'll opine. WBZ starts its story in Winthrop -- low planes skimming over rooftops -- yet then doesn't list Winthrop as a community with higher morbidity rates. The presumption that I draw is that Winthrop didn't fit the selective data set they were using to build a story. IMO, if you were doing a epidemiological study of health effects of an airport, you'd start with airport workers, particularly ramp workers, field maintenance workers, etc. They'd have the highest exposure rates of all.
 
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