News ONLY Columbus Center Thread

[statler]

Re: Columbus Center

STATE: AIR-RIGHTS DEVELOPERS NEED TO DISCLOSE FINANCIAL DATA
Boston Globe
Author(s): Chris Reidy, Globe Staff Date: March 20, 2003 Page: C4 Section: Business
The developers of Columbus Center, a mixed-use project in the South End that proposes to span the Massachusetts Turnpike, must disclose more information about the air-rights project's economics if they want to win state approval of their current design, the state Executive Office of Environmental Affairs said yesterday.

Lindsey Cronin, a spokeswoman for the developers, said, "It's premature to comment at this point." Between Arlington and Clarendon streets, the development team of Cassin/Winn Associates and Winn Development Co. envisions a $400 million complex of three buildings with 207 hotel rooms and 519 housing units, along with a public park. The tallest building would be 35 stories.

Neighborhood groups have proposed something smaller and lower.

The developers contend a downsized project would be economically unfeasible, and have released some financial information to support their position. But in reviewing their draft environmental impact report, Secretary of Environmental Affairs Ellen Roy Herzfelder wrote that the developers have yet to disclose enough information to make their case.

The Massachusetts Environmental Policy Act requires the developer to "include information regarding project economics in the draft environmental impact report submission," Roy Herzfelder wrote. "This important information was not included."

In years of wrangling, several variations of a Columbus Center design have been offered. In drawing up the final environmental impact report, the developers must consider only two - the latest proposal and the one put forward by the neighborhood groups, she noted.

Roy Herzfelder commended the developers for funding an independent consultant to perform an economic analysis of the project, but in their final environmental impact report, the developers need to detail why the financial reasoning of their proposal makes sense and why the proposal by the neighborhood groups does not.

"The underlying assumptions in making such a determination must be included in the final environmental impact report," Roy Herzfelder wrote.

At the Conservation Law Foundation, an environmental advocacy group, acting president Stephanie Pollack said, "I think the state did the right thing by telling the developers of Columbus Center that they have a lot more work to do before they can go ahead and build this project."

The developers also need to address traffic and parking concerns raised by the public, Roy Herzfelder wrote.

Chris Reidy can be reached at reidy@globe.com.

IN OTHER NEWS . . .
Boston Globe
Author(s): STEVE BAILEY Date: March 28, 2003 Page: C1 Section: Business

The Romney administration last week jolted the developers and encouraged the critics of the massive Columbus Center project, proposed atop the Massachusetts Turnpike at Clarendon and Berkeley streets. In particular, Romney's Office of Environmental Affairs adopted the line of critics, which is that the developers, Roger Cassin and Arthur Winn, need to more fully disclose the economic assumptions that are driving the size of the project.

One developer with more than a casual interest in all of this is John Rosenthal, who has been designated to build on three parcels over the turnpike near Fenway Park. Rosenthal is not the least bit put off by what the state is asking.

"As the next guy on deck, I have no problem with it," he says. "The community has focused on the numbers, and I hope we will be able to share our financial pro-formas in their entirety. And what the community will learn is that the financial feasibility of air rights development is very, very difficult. In fact, when all the information is understood, the numbers will justify the density needs for the financing."

Steve Bailey is a Globe columnist. He can be reached at 617-929-2902 or at bailey@globe.com.

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PANEL BACKS SOUTH END PROJECT
Boston Globe
Author(s): Thomas C. Palmer Jr., Globe Staff Date: June 6, 2003 Page: E3 Section: Business
The controversial Columbus Center mixed-use project in the South End won a 7-4 vote last night from the 11-member Citizens Advisory Committee set up to determine whether it benefits the neighborhood and should be approved by the city.

The approval came despite continued vigorous opposition from some neighbors and community groups, which argue that the hotel, residential, and parking garage project at - 988,000 square feet and a maximum of 35 floors - is too large. The project, developed by Cassin/Winn Associates, is proposed for space over the turnpike between Clarendon and Tremont streets. The development team was chosen by the Massachusetts Turnpike Authority in 1997 in a noncompetitive process.

Despite more than 100 public meetings and a significant number of changes to the original plan, the Neighborhood Association of the Back Bay and the Ellis South End Neighborhood still oppose the project.

Both the Back Bay Association, representing businesses, and the Bay Village Neighborhood Association issued statements in support of the project yesterday.

"It's time for this to move forward," said Meg Mainzer-Cohen, president of the Back Bay Association. "The developer has answered all of our questions and then some."

In a prepared statement, the Bay Village Neighborhood Association said its executive committee unanimously supported the $400 million Columbus Center project, which would have a 207-room hotel, 520 residential units, and parking for 633 vehicles.

"We believe that the proposed positive effects on the two abutting residential neighborhoods far outweight any loss of sunlight or increase in local traffic," the statement said.

At a packed auditorium at the Franklin Institute last night, dozens of signs carried messages of opposition, such as, "Columbus Center is way too big."

But a computerized presentation of a "virtual walk" through the three-building project and its parks by the developer was well received.

Proponents appeared to outnumber opponents among the crowd, and also among the 60 people who signed up to speak, causing the meeting to run well over its allotted two hours.

Committee members debated the project before taking a vote.

"Will we have a better community?" asked John Neale. "I believe we will."

But Fred Mauet said, "The most unhappiness is coming from people who directly abut the project. There has to be a reality check, as wonderful as these buildings look on video."

Tony Gordon, agreed. "We don't have it right yet," he said.

Joy Conway endorsed the considerable addition of housing included in the project, and architect David Hacin said, "I actually did see an urban vision for this part of the city."

Thomas C. Palmer Jr. can be reached at tpalmer@globe.com.

GIVE ME MORE
Boston Globe
Author(s): Chris Reidy, and Thomas C. Palmer Jr., Globe Staff Date: June 15, 2003 Page: J1 Section: Real Estate
By one count, the June 5 presentation was the 120th public meeting in 28 months on Columbus Center, but there's still a way to go before the developer can begin construction on the controversial 35-story mixed-use project over the Massachusetts Turnpike in the South End.

At the meeting, developer Roger M. Cassin gave an eye-popping virtual tour of his $400 million vision in an effort to win over local residents. Thanks to a digitally animated video that cost more than $100,000 to produce, viewers were taken on a stroll from Arlington Street to Clarendon Street. They could see buildings, town houses, and a grocery store that one day may span the turnpike. There were virtual cars, virtual pedestrians, even a virtual dog out for a walk. Like a hostage bartering for his release, Cassin also promised the neighborhood one of the most comprehensive packages of benefits Boston has seen. It includes parks, subsidized rent for small businesses, 50 units of on-site affordable housing, $800,000 for job training and housing funds, a new enclosed Orange Line entrance on Clarendon Street, shuttle buses to the airport, more than 500 subsidized MBTA passes, 10 Zipcar spaces, secure storage areas for 150 bicycles, and more than 200 new parking spaces for Bay Village and the South End.

Critics who say the current design is just "too big" were not won over. But later, a citizens' advisory group voted to endorse the project, which would be built using leased turnpike air rights.

Afterward, Cassin described himself as shellshocked and likened the arduous negotiations to a food fight. "I don't know what more we could have done," he said. "Process - sometimes there's too much of a good thing."

And maybe the community benefits are also too much of a good thing, some critics say. Now part of the cost of doing business for a Boston developer, these benefits take a variety of forms, ranging from sidewalk landscaping to subsidies for scholarships, small theaters, even a bait shop for recreational fishermen.

The process works this way: In return for permission to build, a developer promises to provide the government and the host neighborhood with amenities that "mitigate" the negative impacts of the project. In a perfect world, all sides are happy, and the project moves forward. But in a city with a reputation for making development difficult, it rarely works out that way. At times, neighborhood requests for mitigation benefits have all the subtlety of a ransom note. And as the city's budget shrinks, neighborhoods have become more dependent on developers to finance and maintain their sidewalks, street lights, and parks. One way for neighborhoods to demand more benefits from developers is to hold up their projects, either through lawsuits or seemingly endless public meetings.

Urban designer Shirley Kressel, a frequent critic of Boston's development process, said negotiations between a developer and a neighborhood are often a "benefits bazaar."

Benefits get swapped for permission to build a taller tower, and debate focuses more on the wish list of amenities than on the merits of the project. In this scenario, neighborhoods aren't so much hostage-takers as supplicants pleading with developers to give them what they once got from the city.

Developer Dean Stratouly of Congress Group Ventures is sure of one thing: Those who want to build things in this city face increasing demands.

"We've seen a constant upping of expectations," he said, adding, "If you want your project permitted in a reasonable amount of time, you have to satisfy the community group or regulatory agency. So you get caught in a vicious cycle, a regulatory process combined with special interests, and at the end of the day, the solution is money."

Politically wired South Boston got plenty of money when it perfected the art of bargaining with developers. In the late 1990s, it negotiated directly with waterfront developers, and critics cried foul. The benefits were excessive, they complained, and other neighborhoods were left out. Changes were made, and the result is a process that is more "consistent, predictable," and "transparent," said the Boston Redevelopment Authority's director, Mark Maloney.

But with fewer financial resources available to the city, the process has also had to evolve. "We have to be more creative and ask developers to balance the impact of their projects with the current needs of the neighborhood," Maloney said.

For those trying to get the most benefits, stalling tactics remain highly effective. Above all else, developers crave certainty. Anything that drags out the process adds to their uncertainty and expense.

"If a community wants something, the best strategy is to raise a political stink," said Peter Catalano, a Fenway activist who has opposed big projects in his neighborhood. Catalano is no fan of mitigation, a wonk's word for community benefits; to Catalano, mitigation is "a bribe that allows a developer to do something that is not in the community's best interest."

Yet mitigation isn't the only way to squeeze a developer. In one recent case, a private citizen used legal action to get results in a most unusual way. Stevan Goldin, who was displaced from Boston by urban renewal and now lives in Rockport, said the BRA failed to deliver on promises made to honor the memory of the West End, a cause he holds dear. To prod the BRA, Goldin challenged a proposed project the BRA had endorsed, a mixed-use complex on D Street in South Boston. Rather than risk years of delay, the project's developer, Joseph F. Fallon, agreed to donate $25,000 to a building fund for a West End museum several miles away and $10,000 toward a study of air pollution in Boston Harbor, another Goldin interest. Goldin then withdrew the challenge.

"A clever fellow filed a last-minute lawsuit, which would have slowed down the project," the BRA's Maloney explained. "And Joe [Fallon] - wisely, I think - settled it to avoid delay."

A lawyer who represents developers, Matthew J. Kiefer of Goulston & Storrs, said clients have sometimes asked him about the legality of the demands for benefits that neighborhoods have made.

"A developer says, `They're asking for this. Is it legal?' I say, `Yes.' I say, `You can have a project or a lawsuit. Which would you rather have?' "

In some quarters, there is a perception that development takes too long in Boston and that developers are asked to do too much, both in providing community benefits and in changing their designs.

"We're going to get to the point where a developer will walk into a public meeting with a blank piece of paper and say, `What are we allowed to do?' " said Meg Mainzer-Cohen, president of the Back Bay Association, a neighborhood business group.

But state Representative Byron Rushing said developers who listen long and carefully to neighborhood concerns ultimately design the best projects.

"If developers don't want to talk to anyone, they should build in the middle of nowhere," said Rushing, a Democrat who lives in the South End. "If they want to be Daniel Boone developers, then they have to go find a wilderness."

Meanwhile, remarks made by the BRA's Maloney last year suggest it isn't just the neighborhoods that have grown more dependent on developers; it's also the city. With budgets tight, the city wants developers to assume many jobs it once performed, especially in areas where the infrastructure is modest, such as the South Boston Waterfront.

"Roads and parks and sewers - we can't pay that," Maloney said, referring to Fan Pier. "We're making them [developers] pay for it. That's the way the city does development now."

And so plans for the Fan Pier project, a $1.2 billion mini-city that would be jointly developed by Hyatt Development Corp. and Spaulding & Slye Colliers, include plenty of sidewalks and sewers, along with a marina and a recreational fishing area with a bait shop. There's also an agreement to provide a long-term land lease for the Institute of Contemporary Art.

Fan Pier won't be the first project to be a patron of the arts. Atelier- South End condominium project from the Druker Co., includes an adjacent pavilion that will house two spaces for live theater.

Not everyone is comfortable with developers becoming the go-to guys for so many community needs. To pay for all these extras, developers may have to expand their projects so they bring in more revenue. Shifting civic responsibilities onto developers will result in costly trade-offs, warned Fred Mauet, a resident of the Back Bay who has served on several project review panels.

"At the end of the day, if they're being asked to do a laundry list of things that government said they don't have the will to do anymore," Mauet said, "the net effect is going to be larger, bigger projects."

Chris Reidy can be reached at reidy@globe.com; Thomas C. Palmer, at tpalmer@globe.com.

 

[statler]

Re: Columbus Center

HANCOCK AGREES TO SELL 2 PARCELS - BUT HOLDS 1
Boston Globe
Author(s): Thomas C. Palmer Jr., Globe Staff Date: June 20, 2003 Page: C1 Section: Business
John Hancock Financial Services Inc. has agreed to sell the Hard Rock Cafe property and an adjacent parking lot to a team of New York and Boston companies - but is holding on to a small piece of land long sought by the developers of the neighboring Columbus Center project.

John Hancock announced yesterday that 131 Clarendon, housing the Hard Rock Cafe, and an 18,000-square-foot surface parking lot next door are expected to be sold in about a year to Related Cos. LP, based in New York, and Beal Cos. LLP of Boston. Financial terms were not announced, but a person in the real estate industry with knowledge of the deal said it was in the low $30 million range.

"This will be housing, and we're looking also at the possibility of a hotel," Robert L. Beal, president of Beal Cos., said yesterday. "At this point, it's not office," he added, alluding to the current poor leasing market.

Beal said there would also probably be a retail component to the development. Related Cos. is a major developer of mixed-use properties in the United States, including the 2.8-million-square-foot, $1.7 billion AOL Time Warner Center complex at Columbus Circle in New York City. The company is the second-largest owner of multifamily rental apartments in the country.

Ken Himmel, a managing partner at Related, helped develop both Copley Place and 75-101 Federal St. in Boston. Himmel also is a managing partner of the Back Bay steakhouse Grill 23 & Bar, and he recently opened Excelsior restaurant at Heritage on the Garden with his business partner, chef Lydia Shire.

But Hancock did not agree to sell an 11,000-square-foot parking lot on Stanhope Street next to Mistral restaurant. Cassin/Winn Associates had hoped to include that lot in its $400-million mixed-use Columbus Center project. That pie-shaped parking lot, accessible from Clarendon Street next to the Hard Rock building, presumably would be sold separately.

"Until now I thought there was at least an even chance this parcel might come back to us," Cassin said yesterday. But he added: "We obviously made a smart decision a year and a half ago to go forward without it, knowing we could incorporate it if we ever acquired it.

Although all three Hancock properties were up for sale, John Hancock announced the sale of only two yesterday. Cassin said that if he were eventually able to buy the parking lot it could become a cafe adjacent to his planned hotel.

Rob Griffin, president of Cushman & Wakefield of Massachusetts Inc., handled the sale for John Hancock and said there were about a half-dozen interested parties. "It was very highly sought after by high-quality bidders," he said.

Also up for sale is the US Postal Service building at 390 Stuart St., next to the parking lot Hancock sold yesterday. The Postal Service wants to stay there under a lease but sell the building for development above it.

Asked if Related and Beal were interested in buying the building, Beal said: "I can't comment on that."

Beal's nephew, Bruce A. Beal Jr., is an executive vice president at Related in New York, and the two companies will share equity in the development that will be located on the Hard Rock and parking lot sites.

"We're acting with them; they're the lead developer," Robert Beal said. "We're thrilled."

The Beal Cos. is a general real-estate business that owns and develops office, industrial, retail, and apartment properties. The company was founded in 1888, and Robert Beal is the fourth generation to operate the business.

John Hancock's press release quoted Deborah McAneny, executive vice president, as saying: "Given current market conditions . . . this makes it an excellent time to sell these properties."

A Hancock spokesman said the company has not said what it intends to do with that property.

The Cassin/Winn team was under the impression in 1997 that the Massachusetts Turnpike Authority owned the small parking lot, because MTA officials had indicated they did. A later title search determined that Hancock still owned the small parcel. After that confusion became public Hancock has consistently refused to sell the lot. Columbus Center has been through a grueling process of community scrutiny, with more than 100 public meetings, and still has not received its final city approval for its $400 million mixed-used project slated to be built along Columbus Avenue and over the turnpike.

Meanwhile, Beal said yesterday he hoped to cooperate with neighborhood representatives. "I've worked quite well with the neighborhood before," he said.

Asked about the parking lot that is missing from the sale, Beal said: "I'm not involved in that."

In the press release, Himmel said: "The opportunity to develop hotel, residential, and retail mixed-use projects in Back Bay Boston is a rare find . . . and these sites are as close as you can get to the heart of Back Bay/Copley Square."

The sale of the two Hancock properties comes just three months after Hancock sold its signature Boston officer tower and two nearby company buildings to Beacon Capital Partners LLC for $910 million. Hancock is leasing back space for its headquarters.

Thomas C. Palmer Jr. can be reached at tpalmer@globe.com.

COLUMBUS CENTER GETS ENVIRONMENTAL OK
Boston Globe
Author(s): (Thomas C. Palmer Jr.) Date: July 2, 2003 Page: D2 Section: Business
Columbus Center, a $400 million, mixed-use project planned for air space over the Massachusetts Turnpike between Clarendon and Tremont streets in Boston, has won approval from the state Executive Office of Environmental Affairs. Secretary Ellen Roy Herzfelder's six-page decision said the environmental impact report that developer Cassin/ Winn Associates submitted "adequately and properly complies" with the Massachusetts Environmental Policy Act. The project will include substantial improvements to public space but, as high as 35 floors, is considered by some neighbors to be too large. The project awaits city approval.

SOUTH END PROJECT SCALED BACK
Boston Globe
Author(s): Thomas C. Palmer Jr., Globe Staff Date: July 9, 2003 Page: C3 Section: Business
Developers of the controversial Columbus Center mixed-use project in the South End yesterday agreed to slice three floors off one of their proposed mid-rise buildings and contribute more than $1 million to the city's affordable housing fund.

Those concessions, worked out in discussions with City Hall officials and made public yesterday by Mayor Thomas M. Menino, are expected to lead to approval of the $400 million project at tomorrow's Boston Redevelopment Authority board meeting. Cassin/Winn Associates is proposing to build a hotel, residential complex, parking, and retail space over the Massachusetts Turnpike east of Clarendon Street. The development team agreed to a 30,000-square-foot reduction in the 990,000-square-foot project after some in the neighborhood continued to protest that it would be too large.

A planned 35-floor tower would remain at that height. But a 14-floor residential building along Columbus Avenue is to be cut to 11 floors under the agreement with Boston officials, reducing it to 127 feet from 149 feet.

Cassin/Winn also will increase the number of affordable housing units to 15 percent from 10 percent of total housing, which equals 75 units instead of 50. Fifty of those would be within the project, and 25 would be built elsewhere in the city with the developer's $1.3 million contribution.

Informed of the agreement, David Mundel, a resident of the Ellis neighborhood and a critic of Columbus Center's size, said, "It is moving in the right direction." He said the 35-story tower is too large but was relieved that another building would be reduced in size.

Roger Cassin, a managing partner of Cassin/Winn, said the reduction of the smaller building will mean more to nearby residents than lopping off some of the tower.

"It's meaningful," Cassin said. "This is right on the local sky plane. When you look at it as a `before' and `after' it really makes a difference."

Cassin said he was "delighted to have the mayor's support" for his project, which has undergone a long and contentious process of community review since Cassin/Winn was designated as the developer of the space by the turnpike authority in 1997.

The developers will also contribute $50,000 beyond previous commitments to transit improvements in the area.

The project is to be built on the edge of the South End, next to the Back Bay and Bay Village. Menino, in a news release, hailed the revised project for "reknitting the three neighborhoods back together."

Thomas C. Palmer Jr. can be reached at tpalmer@globe.com.

BRA BOARD APPROVES COLUMBUS CENTER PLAN
Boston Globe
Author(s): Thomas C. Palmer Jr., Globe Staff Date: July 11, 2003 Page: C4 Section: Business
[A PUBLISHED CORRECTION HAS BEEN ADDED TO THIS STORY.]
After 120 community meetings over 30 months, several redesigns, and a two-hour presentation before the Boston Redevelopment Authority's board of directors yesterday, the $400 million Columbus Center mixed-use project got a unanimous vote of approval.

But that does not necessarily mean construction may begin. Because the project being proposed by Cassin/Winn Associates is to be built in the space over the Massachusetts Turnpike roadway, it remains uncertain whether Boston's zoning code applies. So Columbus Center may or may not have to come before the Boston Zoning Commission later.

Having passed through a city process almost identical to the one that most large development projects undergo, Columbus Center won approval yesterday, following comments from supporters and opponents. Some in the community say that with a 35-story tower it is still too large; Boston City Councilors James Kelly and Michael P. Ross agree. [CORRECTION - DATE: Saturday, July 12, 2003: * CORRECTION: BECAUSE OF A REPORTING ERROR, A STORY IN YESTERDAY'S BUSINESS SECTION ON THE BOSTON REDEVELOPMENT AUTHORITY'S APPROVAL OF COLUMBUS CENTER MISSTATED CITY COUNCILOR JAMES KELLY'S POSITION ON THE PROJECT. HE SUPPORTED IT.]
But board chairman Clarence Jones surprised the room when he said that, despite the vote, there would continue to be public hearings on the project.

The project has a few minor city permits left for approval, but BRA and Massachusetts Turnpike Authority officials confirmed that the major sticking point is their disagreement over whether Boston zoning rules apply to turnpike air-rights development.

That disagreement must be resolved, they agreed, before the developer can proceed.

The BRA and the turnpike authority signed a memorandum of understanding in the late 1990s that resolved a number of issues surrounding air-rights development. The turnpike has a zoning exemption, but there is disagreement about whether these projects along the turnpike extension corridor are also exempt.

Asked whether his project must comply with Boston zoning, Roger M. Cassin, a managing partner of Cassin/Winn, said: "Not necessarily." Cassin has relied so far on the document citing a turnpike zoning exemption, but this is the first project of its kind.

BRA director Mark Maloney said his agency is talking with the turnpike authority about whether Columbus Center must conform to Boston zoning - and also is involved in a broader discussion about hammering out an agreement that would govern future air-rights projects in the city.

The turnpike authority's chief development officer, Stephen J. Hines, said, "We'll have to have some more discussions with them."

State Senator Dianne Wilkerson, a Roxbury Democrat, spoke in favor of Columbus Center. "It's tough and rough, and we're not finished," she said of the public approval process, but, "I am supportive of this project."

Thomas C. Palmer Jr. can be reached at tpalmer@globe.com.

Christ folks, I didn't realize there was this much information on this project when I started this. I'm still only on July of 2003 in the Globe archives. There is still the BBJ, the Herald and B&T archives to go through. I'm taking a break for a while.

 

[atlantaden]

Re: Columbus Center

SOME HAIL, OTHERS DOUBT COMMUNITY'S INFLUENCE IN PROJECT

Boston Globe
Author(s): Thomas C. Palmer Jr., Globe Staff Date: December 10, 2002 Page: C4 Section: Business
A week from today, the developers of proposed Columbus Center are scheduled to hold their 109th meeting with community groups or public officials in less than two years.

City officials hail the process as one in which neighbors and other interested parties have virtually become the designers of the $400 million mixed-use addition to the South End, set above the gaping channel cut by the Massachusetts Turnpike extension and railroad track beds. "It's almost a model process," said Matt Kiefer, a lawyer with Goulston & Storrs, which represents Columbus Center's development team, Cassin/Winn Associates and Winn Development Co. "The developer was really patient and shared lots of financial information. He spent a lot of money. He's almost set a new standard."

But Ned Flaherty, a computer consultant who owns a home on Clarendon Street, between two of the three Columbus Center air-rights development parcels, and some others in the South End strongly disagree.

"The process is illegal, and the proposal is unacceptable. This is all just for show, to make people feel like there's a public process," Flaherty said. "They have not yielded on anything in terms of the impact of anything they want to do or they're going to do."


Ned, you had your heels dug in well over 5 years ago...even after the Columbus Center proposal was changed/downsized several times over the previous years before this newspaper article was printed. You seem to have been against this project from the beginning and nothing that the developers or the city did, short of abandoning this project, would satisfy you. Just a quick question, would the views from your home have changed if CC was built?

 

[Ned Flaherty]

Re: Columbus Center

Can we put this topic to sleep for a while, until there's actually something new to report?

Hello, Ron. I thought the last couple of members at least deserved replies to their questions.

Also, unresolved core issues are best discussed during quiet periods; it?s nowhere near as productive when newspapers keep interrupting with frequent changes. And speaking of news:
1. MTA seems to be losing patience with its uncooperative tenant (see below).
2. More news has already occurred, set to appear around mid-week.

 

[statler]

Re: Columbus Center

Folks, it's all but dead.

State pulls $10m slated for Columbus Center

By Thomas C. Palmer Jr., Globe Staff | April 8, 2008

In what may be the death knell for the problem-plagued Columbus Center project over the Massachusetts Turnpike, the state said yesterday it is withdrawing a $10 million grant the developers were counting on.

Though state funds are a relatively small portion of the overall financing, the developers contended that the $10 million - and a second $10 million grant they applied for - were crucial to making the project financially feasible.

Columbus Center developers received preliminary approval from state officials for the first $10 million, known as a MORE grant, last year, but the state did not act on the second request. MORE stands for Massachusetts Opportunity Relocation and Expansion Jobs Capital.

"The administration is redirecting those funds to other projects that will result in more immediate job growth and economic development," Kofi Jones, spokeswoman for the Executive Office of Housing and Economic Development, said yesterday. "The developer can apply for funding in the future, but no commitments are being made," she added.

Construction on the $800 million hotel, residential condominiums, and retail project between the Back Bay and South End, which struggled through 11 years of permitting and vigorous opposition, has been on hold since last month.

The developers had not yet received any of the grant money, plus another $15 million loan from MassHousing, and asked Turnpike officials for permission to suspend work for up to 18 months, pending either approval of the funds or an improvement in the economic climate.

The request for the construction delay "triggered our decision" to withdraw the funds, Jones said.

But it remained in dispute yesterday which came first - the request to delay construction or the state's decision not to provide the $20 million.

"We needed to know how and when the funds that were previously committed to the project would kick in," said Alan Eisner, a spokesman for the developers, a team including the local firm WinnDevelopment and the California Public Employees' Retirement System and its investment advisers.

The project's estimated cost has zoomed from $350 million to $800 million since planning began in 1997.

Gregory P. Bialecki, state-permitting ombudsman, who was involved in negotiations, said the grant money was redirected in part because the developer could not guarantee it would start on the Columbus Center buildings soon after it finishes the deck over the roadway that will serve as the foundation.

"We asked them to demonstrate to us within the last 60 days it was really true that if the MORE money came through, everything else was all set," Bialecki said. "At a meeting, I was not persuaded."

In any case, the decision not to award the $10 million may spell the end for Columbus Center. That prospect - like the project itself - drew contrasting reactions yesterday.

"This is a shame," said David I. Begelfer, chief executive of the National Association of Industrial and Office Properties. "You have one of the better urban projects I've ever seen."

"Most any other city or state would be tripping over themselves to make this happen," he said. "To take the money away at the end is unconscionable."

However, state Representative Marty Walz, a Boston Democrat, was relieved Columbus Center would not receive public subsidies. "I'm delighted," she said. "I thought this was an inappropriate use of taxpayer money. If this developer can't or won't go forward, the process should start all over again."

Another critic of the state funding for the project, House Speaker Salvatore DiMasi, said in a statement: "The Columbus Center project appears to be facing extreme financial difficulties . . . high-priced, luxury condominium projects of this kind should not benefit from state subsidies."

Massachusetts Turnpike Authority executive director Alan LeBovidge yesterday said the agency had recently reached a lease agreement with the developers to build the project on air rights over the Turnpike. But, before that lease could be finalized by Governor Deval Patrick, he heard back from the developers. "We got notified that they were stopping because of the MORE grants not being available," he said.

LeBovidge said the authority told the developers it was willing to negotiate a delay in construction of up to 18 months. But he also said he is concerned about what the developers will do in the interim, with an idle work site holding a substantial amount of equipment and materials.

"They've got to do something with all the things dug up, partial walls ripped down," LeBovidge said. "I don't want to leave it there for 18 months."

After a construction loan fell through last year, the developers decided to start work anyway, funding the construction on the deck with their own money, and even going so far as to give the Turnpike Authority a $270 million guarantee that it would be completed. Eisner said WinnDevelopment has already spent about $40 million on the project and the California pension fund has spent about $70 million.

Columbus Center was one of 23 projects that received preliminary approval for a total of $87.9 million dollars in job-creation grants. "This is the only one where the preliminary award has been redirected," Jones said.

Thomas C. Palmer Jr. can be reached at tpalmer@globe.com.

Say goodnight, Gracie.

I think we, as a city, need to refocus our ideas about private property and public space.

The North End is about 99% private property and is probably the best public space in the city. The same could be said about Beacon Hill and to a lesser extent the Back Bay.

 

[stellarfun]

Re: Columbus Center

Interesting.

City: Dormant site needs a cleanup
By Scott Van Voorhis
Wednesday, April 9, 2008

Columbus Center developers recently halted construction on their $800 million air-rights project in Boston. Now, they are being asked to clean up after themselves.

John Palmieri, chief executive of the Boston Redevelopment Authority, yesterday called on project executives to restore the construction site to its original state.

The demand comes just a few weeks after Columbus Center builders Arthur Winn and Roger Cassin temporarily shut down work on the project, saying millions in promised state financing was slow in coming.

The move raised concerns among some state officials about the status of a project that had been in planning stages for more than a decade.
Patrick administration officials responded to the construction shutdown by pulling back a promised $10 million grant.

Now, Palmieri, the BRA?s new chief, wants Columbus Center developers to replant trees on Cortes Street near the site of the proposed project, which would be built over the Massachusetts Turnpike between the Back Bay and South End and would include a high-rise hotel, condo and retail complex.

Palmieri also wants the developers to restore parking for businesses and residents and clean up construction debris. Columbus Center developers had begun some preliminary work around the site, tearing up streets and putting up barriers, but no construction had begun on the deck over the Pike itself.

?I ask that this process begin immediately to help allay any fears the work site will sit as a dormant eyesore,? Palmieri writes.

George Regan, a spokesman for Columbus Center, said project developers are now considering the city?s request. But they have not thrown in the towel and still hope to resume construction.

?We want to say unequivocally we have no intention of abandoning this project,? Regan said. ?We have 13 years and lots of money invested. We are not going to give it up.?

http://www.bostonherald.com/business/general/view.bg?articleid=1085918

 

[TedG]

Re: Columbus Center

This is an editorial from today's Boston Herald:

Taking back a giveaway

By Boston Herald editorial staff | Wednesday, April 9, 2008

http://www.bostonherald.com | Editorials

In this dismal economic climate taxpayers shouldn?t tolerate gratuitous handouts to wealthy private developers. The Patrick administration did the right thing when it yanked a $10 million grant from the Columbus Center development, which it never should have awarded in the first place.

Yes, the $800 million hotel/ condo/retail development that was to be built over the Massachusetts Turnpike had great potential - and may still, if the developers can line up all of the necessary private financing.

But the construction of high-end condos in one of the city?s ritzier neighborhoods was hardly an appropriate use of the grant money, which was designed to encourage the creation of new manufacturing jobs.

It?s not as if the state hadn?t already stepped up to support the project. Before the $10 million grant, officials had already agreed to federal housing grants, low-interest housing loans and tax credits - not to mention the sweetheart deal that developers secured for the right to build on a deck over the Pike.

But the cash grant originally approved by the administration - which infuriated House Speaker Sal DiMasi and other lawmakers, who had previously rejected an earmark for the project - was an open-and-shut case of corporate welfare. And if the developers were unable to patch together the financing without a handout from taxpayers who are having trouble paying their own mortgages, well, that?s really just too bad.

The withdrawal of funds may kill a promising project, and that?s unfortunate. But the taxpayer money can now be directed to worthy projects that may in fact create valuable permanent jobs.

Article URL: http://www.bostonherald.com/news/opinion/editorials/view.bg?articleid=1085896

 

[statler]

Re: Columbus Center

Banker & Tradesman - April 8, 2008

MassHousing Withdraws Funding For Columbus Center
By Thomas Grillo
Posted 4/8/08 @ 2:50 PM

This artist?s rendering depicts Columbus Center, the controversial 1.5 million-square-foot project to be built above the Massachusetts Turnpike in Boston.

Another state agency has abandoned Columbus Center.

MassHousing, the state?s affordable housing bank, has withdrawn $20.6 million in loan commitments for the controversial project that was to be built above the Massachusetts Turnpike in Boston?s South End.

The loans, pledged in 2006, would have been used to leverage 44 affordable condominiums in the mixed-use project near the turnpike entrance by Columbus and Arlington streets. But the loans were never issued.

MassHousing?s determination comes on the heels of the Patrick administration?s withdrawal of a $10 million Massachusetts Opportunity Relocation and Expansion Jobs Capital (MORE) grant for Columbus Center. The Boston Globe reported today that the state decided against funding the project after months of delays.

"When the state withdrew its commitment of MORE money, we felt we could not proceed with closing the MassHousing loan," said Thomas Farmer, a MassHousing spokesman.

Construction was expected to begin in 2005 for the $800 million air-rights project that would be built ?in the air? on a deck over the highway and railroad tracks near the Back Bay MBTA station. When completed, the proposal would have included a 35-story glass tower and four 11-story buildings housing 451 condos, a 180-room hotel and a parking garage.

Funding problems have plagued the massive development as construction costs soared.

A state official said WinnDevelopment?s managing partner, Roger Cassin, has failed to demonstrate that his company had the financing to make the project a reality. ?It began to look like a house of cards,? said the official, who did not have authorization to speak for the state. ?Every funder has gotten cold feet and wants out.?

Cassin said he was unaware MassHousing had pulled its funding. He told Banker & Tradesman that he plans a meeting with public and private funders to the get the project back on track.

 

[statler]

Re: Columbus Center

I missed this correction to the B & T story:

B & T - April 9, 2008

MassHousing Will Not Close On Columbus Center Commitments


Due to a misstatement from MassHousing, it was reported Tuesday that the state?s affordable housing bank had withdrawn $20.6 million in loan commitments for the controversial Columbus Center development in Boston?s South End.

MassHousing said Wednesday the agency has not withdrawn its commitment. But they will not close on the pair of loans because the state withdrew a $10 million Massachusetts Opportunity Relocation and Expansion Jobs Capital (MORE) grant for Columbus Center.

The agency stressed it may reassess the situation should it change in the future.

?MassHousing has considered the commitment of public money from the state crucial to the success of Columbus Center,? said Thomas Farmer, a MassHousing spokesman.

 

[Mike]

Re: Columbus Center

Mayor asks abutters for patience with Columbus Center
By Thomas C. Palmer Jr.
Globe Staff / April 11, 2008


Mayor Thomas M. Menino yesterday asked neighbors of the messy Columbus Center construction site to be patient for a few weeks while the developers try to find financing to restart the troubled project.

Menino said one of the local partners from WinnDevelopment is in California talking to executives of the state pension fund that is backing the project about putting the pieces back together, only days after Massachusetts state officials pulled $10 million of grant money, which could kill the mixed-use project.

"Some of you may not agree, but I think this is a good project for the city," Menino said, walking along Cortes Street above the Massachusetts Turnpike, which divides the Back Bay from the South End. "It plugs the hole."

More than a dozen residents joined Menino and other city officials, expressing frustration over the idle construction site, with equipment and materials scattered about.

"It's a disaster here," said Mark Dimino, a Berkeley Street resident. "We also lost parking spaces, and a sidewalk is [temporarily moved] out in the street."

All the residents who spoke said they support Columbus Center, the $800 million hotel, condo, and retail project that has been 11 years in planning and the subject of fierce opposition from some.

"We were very committed to seeing this project finished," said Lynn Andrews, a Cortes Street resident who thanked Menino for coming. "This has been sort of a neglected street for a long time."

WinnDevelopment spokesman George Regan said, "We've spent a lot of time and money on this project, and we're going to make it happen. . . . We want people to bear with us. We're working very hard to get this done."

Menino said he spoke with Governor Deval Patrick last week and Patrick did not rule out restoring funds to Columbus Center "if they get their financing in place."

Menino said construction workers would be particularly unhappy if the project died. "I think they're trying to get the unions on board as well," he said, making it "much easier for government to come up with additional financing."


Link

 

[TedG]

Re: Columbus Center

From The South End News

Columbus Center hits more snags
by Linda Rodriguez
managing editor
Thursday Apr 10, 2008


With construction on the site stopped - and local residents worried that they?ll be looking at seven acres of rubble and dirt for the next year and a half - the developers of the beleaguered Columbus Center have another problem to deal with: state funding for the project has collapsed.

On April 7, the Patrick administration denied the project?s application for $20 million in Massachusetts Opportunity Relocation and Expansion Jobs grants, better known as MORE grants. The grants are earmarked for projects that benefit publicly owned infrastructure in some way. In June 2007, the Columbus Center project, though the application requested $20 million, was awarded a $10 million grant on a preliminary basis, and invited to submit a more in-depth application for the second round of considerations. That application was "unsuccessful," according to Kofi Jones, spokeswoman for the Executive Office of Housing and Economic Development, which administers the grant.

"We are redirecting the $10 million MORE grant [to other projects]," Jones said. "What prompted the decision was the developer requesting an 18-month extension on the terms. It was clear that they were not ready for immediate work on the project. They can apply for funding in the future, although we have made no commitment to the funding."

The developers of the project, jointly Winn Development and California Urban Investment Partners (CUIP, a joint venture of California Public Employees Retirement System and Johnson/MacFarlane Partners), requested an 18-month moratorium on construction on March 20. Construction on the massive project, which straddles the Massachusetts Turnpike between the South End and the Back Bay, had already begun in November 2007.

At the time, Alan Eisner, a spokesman for Winn Development said that they requested the delay because they were waiting on state funding, specifically the MORE grant and a loan from MassHousing (see "Construction on Columbus Center Halted," March 27). Asked then what would happen should the grants not be awarded, Eisner said that he didn?t want to speculate on "hypotheticals."

The administration?s denial of the MORE grant has also impacted the other potential state funding. MassHousing, which had agreed to $20.6 million in loans to the project, said April 9 that at this point, it will not close on the loans.

"MassHousing has considered the commitment of public money from the state crucial to the success of Columbus Center," the agency said in an e-mailed statement. "When the state withdrew its commitment of MORE money, we felt we could not proceed with closing the MassHousing loan. MassHousing will continue to assess the situation at Columbus Center."

Representative Byron Rushing, who has long been a critic of the project, which borders his district, said that he was pleased that the administration had denied the project?s application for the MORE grant. "I understand what the Governor has said and done is that we?re not going be held hostage [by the developers], so you have to do this without a guarantee you?re going to get anything from the state," he said.

Moreover, said Rushing, "I don?t know how this small amount of money becomes a deal breaker for [the developers]. I don?t think these grants are preventing them from moving forward, it has to be other funding."

Funding has been a major concern for the project, which has ballooned in cost from $300 million in its initial proposal to its current estimated $800 million. In the last two years, Anglo Irish Bank, a major funding source for the project, backed out of a $437 million loan, forcing the developers to find other investors. In November 2007, the MTA gave the developers an ultimatum: Secure $500 million in funding by Jan. 15 or risk having the project suspended. When the developers missed that deadline, the Massachusetts Turnpike Authority (MTA) gave them a 30-day extension. By Feb. 15, the developers still didn?t have the funding. When asked in March how much funding the project had accrued, spokesman Eisner said that the developers had secured around $310 million.

The inability for the project to secure funding and the loss of the state subsidy are two major blows to its future.

"This is like a perfect of storm of financing that?s going against it. As far as we?re concerned it?s a big obstacle, but we?re not going to give up. It?s a very tough time," said George Regan, another spokesman for the project, adding that current concerns about the economy are adding to their problems. "It?s sort of like a 9/11 of financing."

Regan also said that the developers have no intention of selling the project - and its approvals and permits - to another developer. "We?ve had 13 years into this, that?s a substantial amount of time and money. It?s a challenge but we?re not dead," he said. "We?re going regroup, talk to all our lenders, work with city and state officials, and come back again with a new helmet on."

Still, some believe there?s more at work here than just the loss of funding.

"I think there?s something else going on and we don?t what that is," said Rushing. "And we might not know what it is until people start suing each other."

In the meantime, residents and their representatives are concerned about the site itself. Brian Boisvert, president of the Bay Village Neighborhood Association, said that while the neighborhood generally supports the project, "to have it already have begun and to have a big gap in between where nothing much happens is kind of disappointing."

Boisvert said that while representatives of the developers recently came to the neighborhood association meeting to discuss the situation and have been responsive to their concerns, a resolution is still pending.

House Speaker Sal DiMasi, who has long opposed public funding for the project, sent a letter to the developers and the MTA on Wednesday, asking that if the project is to be delayed, that they clean up the current construction site.

"The situation is a mess," said Aaron Michlewitz, aide to the speaker. "While we are happy that the MORE grant will be used for more appropriate projects in the state than luxury condos, the mess that has been created by the beginning of construction and now the stopping of construction leaves many in the community in limbo."

Michlewitz said that his office has received multiple calls from residents concerned about the status of the construction, given that the developers had already begun excavation when they stopped construction. Rep. Rushing said that he?s also heard and has similar concerns.

On Tuesday, Boston Redevelopment Authority director John Palmieri issued a similar letter to both the MTA and the developers, asking "that interim measures be taken to preserve the integrity of the neighborhoods surrounding the project while the development team works through the delay in construction."

Mac Daniel, spokesman for the MTA, said that the Authority will be working with the developers on the terms of the proposed moratorium, which will include restoring the Turnpike and surrounding area back to its original condition.

"We still want to and need to negotiate the terms of the 18-month moratorium. We are in contact with the developers and both sides seem to be willing to sit down and talk, so that?s positive news on both sides," Daniel said, adding that negotiations have not yet begun.


Linda Rodriguez can be reached at lrodriguez@southendnews.com

 

[nedev18]

Re: Columbus Center

Menino says he?s awaiting answers from Columbus Center developers

by Linda Rodriguez
managing editor
Friday Apr 11, 2008

With the future of the Columbus Center in question, Mayor Thomas Menino and several city officials paid a visit to the dormant site of the massive project Thursday afternoon. District 2 City Councilor Bill Linehan, Transportation Commissioner Tom Tinlin and Boston Redevelopment Authority director John Palmieri joined the mayor in speaking with the residents of Cortes Street, whose homes all overlook the stalled construction site, now shrouded in chainlink fence and green netting.

"I think the best we can do with you folks is make it as easy on you as we can," he told the residents, adding that his office will be in talks with the developers to determine the next course of action.

Construction on the long awaited Columbus Center project began in November 2007, but stopped at the end of March, because, developers said, they were waiting on funding from the state. On April 7, the Patrick administration announced that because the developers had halted construction, that funding would not be available. In specific, the $10 million MORE grant, which developers had claimed was an essential part of their "capital structure," would be disbursed to other projects in the state (See "Columbus Center Hits Another Snag," April 10). On the heels of that announcement, MassHousing announced that it would no longer be closing on $20.6 million in loans it had previously approved for the project.

"Right now, as I understand it, Roger Cassin [member of Columbus Center development team] is in California to try to work with the funder to try and resurrect the funding that has been put on hold," Menino told the residents, later clarifying the funding he referred to came from California Urban Investment Partners (CUIP, a joint venture of California Public Employees Retirement System and Johnson/MacFarlane Partners), partner to Winn Development on the project. "We have to get some kind of answer from them when they get back from California."

Standing at the corner of Cortes and Berkeley Streets and surrounded by concerned residents, Menino emphasized that while he didn?t have any answers now, he would be getting back to the community soon.

"You can?t expect people to live with heavy equipment and sand," he said, adding that he and his staff are continuing to monitor the situation. In a conversation at City Hall before the tour, Menino told South End News that he hoped to at least put the neighborhood back in its original condition. "You can?t just say, ?I?m walking away for two years,?" he said.

Asked by the South End News if he thought the loss of the state funding for the $800 million project would signal its end, Menino said, "I think that was the gap financing that was needed to make the project work." Later, he said that the state funding, which at most would have consisted of a $20 million MORE grant and $20.6 million in loans, was necessary to bolster the project, given the rising construction costs. He also said that he had spoken with Governor Deval Patrick regarding the grants and was told that if the Columbus Center developers were able to get their financing together, the governor would "give his piece."

During the tour, Menino was asked by a resident how the project could have started without the financing in place. "I haven?t got an answer for that," he said, "it?s not for us, it?s for the developer to answer that."

Still, Menino supports the project, saying, "It?s the right deal at the right time."

Asked by the South End News if he felt the project would still move forward, he said, "I think the project is going to be delayed 18 months... I think pulling the plug at this time, it?s half baked."

Later, on Cortes Street, he added, "The project?s out of hand, we?ve got to get it back into hand ... I just wish we had some certainty to the project, right now, there?s so much uncertainty."

Other city officials accompanying Menino expressed a similar cautious hope about the future of the Columbus Center. Linehan, whose district includes the site and parts of the neighborhood surrounding it, said, "I?ve been in city government a long time and things change. I?m very hopeful [about the project]. I?ll do everything I can in my capacity to see that it happens.

"It?s an important project," he said, adding, "it?s got to happen."

Palmieri is more concerned about the general financing of the project, loss of the state funding aside. "I?d like to think it?ll happen, it?s tough to know right now," he said, explaining that his office is in communication with the developer and are asking "what plan he?s identified to fill the [financial] gap."

Asked if he thought the developer might sell the approvals and the permits for the project, he said, "I?d prefer not to project out on that,? adding that any buyer would likely face the same obstacles.

"This has been kind of sudden. We?re all a bit surprised," he said.

Though encouraged by the mayor?s and the city?s attention to the issue, residents of Cortes Street, many of whom support the project, are still frustrated with the rubble in front of their homes.

"We are so thrilled you came out here today," Lynn Andrews, a Cortes Street resident and a supporter of the center, told the mayor. Later, Andrews said that if the center isn?t built, "They can?t jut put it back the way it was," she said, adding, "They should build it back to something nicer than what it was."

Brian Boisvert, president of the Bay Village Neighborhood Association, said that while the neighborhood still supports the project, they?d like to see the parcel at least returned to what it was before construction began. "Ultimately, if this becomes the Columbus Center, then it?s a pain worth going through," he said. "But we?re in a definitely frustrating situation."

Link

 

[statler]

Re: Columbus Center

Banker & Tradesman - April 14, 2008

Cassin Vows Columbus Center Project Remains Alive and Well
By Thomas Grillo
Reporter

Despite financial setbacks and a work stoppage, Columbus Center?s developer says the $800 million project is not dead.

?We have no intention of abandoning it,? Roger Cassin, managing partner of WinnDevelopment, told Banker & Tradesman in a rare interview. ?We have serious impediments to overcome, but we?ve invested more than $100 million in it and we?re not going away.?

At stake is the controversial, 1.3 million-square-foot mixed-use development to be built on a 7-acre deck above the Massachusetts Turnpike straddling Boston?s Back Bay, South End and Bay Village neighborhoods. The project consists of 443 condominiums, a 162-room hotel, three parks and 39,400 square feet of retail space. After a five-year delay, construction began earlier this year, but funding woes have brought construction to a standstill.

Last week, Banker & Tradesman reported on its Web site that MassHousing, the state?s affordable housing bank, would not close on a pair of loans totaling $20.6 million for the project. The money would have been used to leverage 44 affordable condominiums in the mixed-use project near the turnpike entrance by Columbus Avenue and Arlington Street.

The decision by the quasi-state agency followed the Patrick administration?s withdrawal of up to $20 million in Massachusetts Opportunity Relocation and Expansion Jobs Capital (MORE) grants for the development.

In a prepared statement, the agency said, ?MassHousing has considered the commitment of public money from the state crucial to the success of Columbus Center. When the state withdrew its commitment of MORE money, we felt we could not proceed with closing the MassHousing loan. MassHousing will continue to assess the situation at Columbus Center.?

Thomas R. Gleason, MassHousing?s executive director, declined repeated requests for further comment.

?It?s a ripple effect,? said Boston Mayor Thomas M. Menino, who remains a strong supporter of the project. ?When the governor said he would not provide the MORE grant, MassHousing said they won?t do their part. But if the governor changes his mind to provide the funding, MassHousing will follow.

?Still, it?s unclear to many observers why the lack of $40.6 million in grants and loans could derail a project that could have a price tag of nearly $1 billion if it?s completed,? the mayor added.

?A Perfect Storm?

Cassin offered the following explanation.

?It?s a perfect storm of negative events,? he said. ?Everybody wanted to be the last money in, so nothing was closed; it?s all in limbo. We are spending $5 million a month on this and I thought we had hit our stride. But none of the state monies have been nailed down and that?s in the face of the capital markets window shutting, and the private funders are saying they?ve got a fiduciary obligation. So we have the unfortunate result of suspended construction. I?m trying to get everybody together and see if we can?t resurrect this thing.?

Cassin was expected to meet late last week with private and public funders to get the project back on track, he said.

Menino met with a carefully selected group of neighbors at the construction site last week that did not include any opponents. Some neighbors have insisted the project is too dense and that Cassin has reneged on a promise not to seek public financing.

?I still think it?s a great project,? said Menino. ?It fills in a hole in our city, brings jobs and tax revenues. The development makes a lot of sense for this community. It?s the right deal at the right time. Right now, there?s all kinds of uncertainty, but Roger Cassin is a good developer and a good guy. It?s just that the project is out of hand and we need to get it back into focus to figure out where we are going with this.?

Despite the fact that five years have lapsed since the Boston Redevelopment Authority approved the project, the BRA?s director, John Palmieri, said Cassin needs more time to secure the financing. ?It?s a complicated development with multiple sources of funding, grants, state monies and tax credits,? he said. ?Costs have skyrocketed and this has exceeded anything the development community could have anticipated.?

Two of the project?s most vocal opponents, state Rep. Martha M. Walz and House Speaker Salvatore DiMasi, could not be reached for comment by press time.

 

[sidewalks]

Re: Columbus Center

In the article below, which appeared in yesterday's Boston Globe, ubiquitous Columbus Center Critic Ned Flaherty is identified as an "urban planner". Perhaps my memory has failed me, but I didn't think that Ned was an urban planner by profession. If I am correct that Ned is not an urban planner, and I apologize if I'm mistaken, what gave the reporter such an idea? Shades of corkscrew landings and sniper fire...

Neighbors lament Columbus mess
By Christina Pazzanese, Globe Correspondent | April 20, 2008

News that the ill-fated Columbus Center project has once again stalled over financing problems has residents of Back Bay, Bay Village, and the South End questioning whether they'll be stuck indefinitely with an abandoned mess that cuts an ugly swath through their neighborhoods.

Jessica Hoffman Davis, president of the Pope Condominium building on Columbus Avenue, said that like many, she hopes the project hasn't been permanently derailed.

"It took a long time for people to get used to the idea, it's been so beleaguered," she said, adding that she thinks neighbors are feeling a little shortchanged.

Last month, developers of the $800 million hotel, retail, and luxury condominium project planned to be built over the Mass. Pike between Tremont and Clarendon streets asked the Turnpike Authority to approve an 18-month moratorium on construction work in order to sort out financing or ride out tough economic times.

Early this month, the state pulled back $10 million in grant funding.

A prior request for another $10 million in state funding was initially approved last year but never given out.

Mayor Thomas M. Menino toured Cortes Street in Bay Village on April 10, assuring residents that once the project's status becomes clearer in the next few weeks, the city would take steps to make sure the project's staging areas are properly cleaned up during the delay.

"Before they approve any delays, the developer should have the common courtesy to restore the neighborhood to a useable form," said Anthony Gordon, a developer and Stanhope Street resident who served on a citizens advisory committee in the early days of the project.

Gordon says while neighbors have been very cooperative about the ongoing construction, the loss of sidewalk access and on-street parking because of project fencing has really hurt nearby restaurants.

"At a bare minimum, the Turnpike and the city owe us to get the boundaries of the site intact," he said.

Bruce Pettingill, whose Cortes Street home overlooks one work site, said he hopes the city will at least put things back to their before-construction state. His suggestions: Get rid of green construction fences that block a sidewalk and narrow the roadway, restore about a dozen street trees that were cut down to erect the fence, and fix a broken sidewalk ramp and missing stop sign at Arlington Street.

Peter Pogorski, a South End architect who served on the citizens advisory committee and is on the Ellis Neighborhood Association's board of directors, said the delay is a disappointment to many who fear the project won't happen as planned.

For the short term, the city's focus should be on restoring the streetscape for pedestrians and drivers, he said.

"The immediate would be parking; we lost a lot of parking" on the Berkeley Street bridge, said Pogorski.

According to a Boston Redevelopment Authority spokeswoman, officials would be meeting with the Cassin/Winn Development team this week to discuss the developer's financing and moving the project ahead.

"It will probably take a month to work through the issues," Jessica Shumaker said Tuesday. "The construction equipment will not be removed and the parking will not come back until we work to see if the developer can get this project back on track.

"In the meantime, the area has been cleaned up by Cassin/Winn - and if the project does not go forward, the sidewalk on Cortes Street will need to be rebuilt and put back in place. The trees will also need to be replanted," said Shumaker.

But with commercial lending requirements tightened and other funding sources dried up, while costs have more than doubled since the project began, Ned Flaherty said he doesn't believe a few more weeks will make any difference to the project's ultimate fate.

"I laughed out loud" at the mayor's request for patience, said Flaherty, an urban planner and cofounder of the Alliance of Boston Neighborhoods, who has been closely watching the project for many years.

"The developer has been saying 'a few more weeks' for 13 years." Flaherty said three other smaller condominium projects underway in the area - the Clarendon, the Bryant, and 285 Columbus - are "all moving along nicely" and thankfully "not dependent" on the success or failure of the Columbus Center.

Restoring equipment to power about 75 road lights over the Mass. Pike that have been dark for months because of the construction will likely be part of upcoming negotiations with the developers, said Mac Daniel, a Turnpike Authority spokesman.

Shumaker said plans for putting a city park on Parcel 16 - the triangular land between Stanhope Street and Columbus Avenue - remain intact.

"This park will get built whether or not the Columbus Center project goes forward, because the funding is in place for it," said Shumaker.

"I think the children who are planning to use that playground will be adults by the time it gets built," said Gordon.

"I'd like them to finish the project," said Lynn Andrews, who serves as a Cortes Street representative with the construction firm. But if it doesn't happen, she said, she'd like the city to involve citizens in whatever becomes Plan B.

"It'll take millions to restore this. We might as well put it back to something nicer than it was."

Christina Pazzanese can be e-mailed at cpazzanese@globe.com.

 

[Ned Flaherty]

Re: Columbus Center

. . . Ned is not an urban planner . . . what gave the reporter such an idea? (?Neighbors lament Columbus mess?, by Christina Pazzanese, Boston Globe Correspondent, April 20, 2008)

I am not an urban planner, and I never told anyone that. When the Globe correspondent contacted me for her story, I told her to use my identity ? urban planning activist ? as reported everywhere else: Banker and Tradesman (15 January 2007), South End News (2 August 2007), Boston Herald (10 November 2007), and Massachusetts Lawyers Weekly / Exhibit A (27 November 2007).

The Globe goofed. I notified the reporter and her editor the same day.

My identity was clearly stated in the latest editorial, which many forum members have not seen yet, but which the Globe reporter reviewed with me while writing her story:

The Columbus Center debacle: how did it happen?
by Ned Flaherty, South End News Contributing Writer ? Thursday, Apr. 10, 2008

After 13 years of re-proposals and missed deadlines, the massive Columbus Center project is taking its own life. A letter on the editorial page of last week?s South End News asked: How did this happen? The public was betrayed by its own government, that?s how. Here is some of what I discovered through years of fighting for public records followed by painstaking analysis to connect the dots.

On Dec. 18, 1996, James Kerasiotes, Chairman of the Massachusetts Turnpike Authority (MTA) gave local developer Arthur Winn perpetual control of air rights, with no competitors, and no disclosure. Kerasiotes, in trying to raise cash, hide Turnpike finances and escape a fraud conviction, was caught, convicted, and resigned. But Winn?s deal remained.

Much of what followed never added up and, in fact, grew increasingly suspicious.

The Boston Redevelopment Authority (BRA) let Winn fund the $250,000 cost of the public review process, and thereby control the schedule, agenda, and meeting minutes. BRA and Winn also hired technicians who secretly recorded the public meetings. After I bought the recordings and compared them to the printed minutes, there was no denying that the BRA edited the printed minutes to shrink unfavorable comments and expand favorable ones.

On Dec. 20, 2000, Mayor Thomas Menino appointed 11 people to his Columbus Center Citizens Advisory Committee; seven were chosen for him by MTA, BRA and Winn; four were nominated democratically by their communities. The seven voted ?In Favor? and the four voted ?Opposed.?

Despite Menino?s promise to refuse cash from anyone currently doing business with City Hall, on Dec. 11, 2002, the Boston Globe reported that he accepted a $50,000 ?campaign donation? from the Columbus Center team while reviewing their approval.

And that wasn?t the first time the team offered campaign donations to politicians with influence on the project?s approval. On Sept. 29, 2000, Governor Paul Cellucci accepted a $10,000 ?campaign donation? from Winn. Four days later, the MTA announced Winn?s deal.

From 2001 through 2003, Winn proposed a skyscraper nearly triple the 150-foot height permitted by the Turnpike Master Plan, argued that the triple size would pay for all costs, profits, and benefits, and then promised to seek ?not one penny? of public subsidy. Because the tower is 420 feet, the Turnpike Master Plan requires a two-acre park, but Winn replaced that park with a 633-car garage, 134 more luxury homes, and another $300 million in sales.

Committee members asked for proof of costs and profits. The MTA, BRA, and Winn had the data, but withheld it, and refused to prove anything.

And despite promises to own and operate the project for decades, on Mar. 15, 2006, Winn sold Columbus Center to the California Public Employees Retirement System (CalPERS).

On May 2, 2006, the MTA Board ignored its own Advisory Board?s recommendations, which argued against signing the lease with the Columbus Center, and signed a 99-year lease benefitting the new owners of the project, CalPERS, at Massachusetts? expense and based on faulty information. The terms of that lease were based on a 120-page ?fair-market-value? property appraisal. Page 45 shows total building size at 1,455,131 square feet, but page 113 calculates rent value for only 1,000,000 square feet, thus reducing California?s rent by 31 percent. MTA refused to correct the error or raise the rent. It didn?t matter ? the developers soon defaulted on that lease, and attempted to negotiate a lease with looser terms, lower rent, and larger subsidies.

Moreover, after promising to seek no public funds, the Columbus Center team asked for 15 subsidies totaling $246 million: $55 million in loans plus $191 million in grants and tax breaks that would pay both their costs and their profits. The agencies didn?t verify the applications, and the developers told conflicting stories. Construction loans from Anglo Irish Bank, for example, were claimed in 11 public subsidy filings ? even those filed long after the bank had left the project. No construction loans were issued by any bank and no subsidy agency ever even checked. Most agencies weren?t even aware of all the other subsidies for which the developers had applied.

On May 10, 2006, Councilors James Kelly, Michael Flaherty, Stephen Murphy, Mike Ross, Maureen Feeney, Rob Consalvo, Jerry McDermott, and John Tobin voted in favor of a 19-year property tax break, which the Mayor and BRA said would cost only $14 million. Councilor Chuck Turner and I asked for the formula that determined the $14 million figure, but no one at City Hall would release it. The councilors who voted in favor never saw the calculations, refused to ask for them, and still think they lost only $14 million. But when the same application came before Governor Mitt Romney?s Economic Assistance Coordinating Council, several pages had been replaced, costing the City ? but benefitting the developers ? tens of millions of dollars over 19 years. The developers admitted to the Council that no subsidy was needed, but the Council waived $7.5 million in state income taxes anyway. When Shirley Kressel and I told the Council that the tax break calculation pages had been replaced, a Council lawyer warned that if we uttered another word he would have us removed by state troopers who were already lined up for the task.

Governor Deval Patrick said on April 8 he?d let the developers reapply for the $21 million in MassHousing loans and $20 million in M.O.R.E. grants that he redirected to other applicants. That?s unlawful, because those loans are only for affordable rental apartments (not luxury condominiums) and those grants are only for publicly owned infrastructure (Columbus Center?s tunnels, buildings, and parks are all privately owned). Will Governor Patrick approve the next nine subsidies to pay $116 million of the developer?s costs and profits with Massachusetts dollars? And will he guarantee that cash, as the developer demands? Or will he accept the Inspector General?s confirmation that the project was proposed and approved as subsidy-free?

This debacle was arranged by our own governments. Not all of government failed us, however. Applause goes to City Councilors Turner and Charles Yancey and former councilor Felix Arroyo for opposing the City property tax break; to state Representatives Byron Rushing, Marty Walz, and House Speaker Sal DiMasi for opposing subsidies to this project; and to the U.S. Treasury for twice disapproving a $59 million income tax break. Inspector General Greg Sullivan protected us by confirming that Columbus Center was proposed and approved as subsidy-free. The MTA?s outside Advisory Board made recommendations that were responsible. And Secretary of Transportation Bernard Cohen and MTA Executive Director Alan LeBovidge say they?re trying to reform the MTA.

At this point, construction on the project ? if it resumes at all ? won?t finish until 2016. The subsidy applications said if taxpayers didn?t chip in, the project would die. That?s untrue. Right after losing $41 million in subsidies this week, the developers said they?re plowing ahead anyway, which proves that the subsidies were never critical at all. They won?t stop asking for Massachusetts dollars so long as they keep getting them. Governor, just say ?no!?

MTA should grant no more extensions, evict its un-funded tenants, restore and secure the property, treat air rights as a public asset, follow the Turnpike Master Plan, and obtain multiple, competitive bids with public audits. Anything less would be criminal.

Ned Flaherty, former neighborhood association vice president and Alliance of Boston Neighborhoods co-founder, has studied Turnpike air rights since moving to the South End 18 years ago. He strongly supports air rights development, but opposes the public process failures that resulted in the Columbus Center disaster.

 

[JimboJones]

Re: Columbus Center


I?ve seen the future and it?s not a parking lot
by John A Keith
Contributing Writer, South End News
Thursday Apr 24, 2008

Recently, I was at a neighborhood event and remarked to a friend, ?You know, I hope they end up building Columbus Center.?

His response was, ?Well of course you do, it?s to your benefit.?

Ouch. I was like, ?Say what??

?Sure,? he said. ?You?d be able to sell some of those condos. It?s to your benefit, but it?s okay, I understand.?

Wow. While I?ve heard this argument before, I couldn?t believe that someone I knew so well thought that my motives were shaped so selfishly. In fact, my friend was mistaken. I, like many residents, support development all over the city - because it?s not just me who would benefit from some well-planned new development, but nearly everyone who lives in the city of Boston. I?m more concerned about the future of our city than the thinness of my wallet.

So, what does ?new development? represent to me? Improvement. Progress. Ideas. Creativity. Vitality.

What does no development mean to me? Well, Woody Allen may have put it best. To paraphrase him, ?A city is like a shark. It doesn?t live unless it moves forward.? We don?t want a dead shark on our hands, do we?

Of course, living in Boston and being in support of the ?new? is a lost cause, some of the time. After all, neighbors, residents and visitors say that what makes Boston distinct from other US cities is its ?character,? its ?history? - but sometimes, that?s just a nice of way of saying ?stodgy and resistant to change.? Sure, I can appreciate Boston for what it is - I live in an historic neighborhood full of beautiful homes. But there?s more to a healthy city than pretty architecture.

And that?s why I was disappointed to read that the Columbus Center project has been delayed, once again.
Columbus Center, of course, is the massive 1.3 million-square-foot mixed-use development that is to be developed on decks built above the Massachusetts Turnpike. As proposed, the project would include condos and a hotel, as well as parks and retail space. At the end of March, the developer stopped construction. Then, two weeks ago, the Commonwealth of Massachusetts pulled public funding for the project. On the heels of that, MassHousing withdrew a loan commitment.

Just the latest in a long history of problems with a project that?s been in the works for over a decade.

Across the city, you could hear cheers and applause from the usual suspects - from public officials who?ve never support any new building of any size, as well as from a local cast of characters , residents whose favorite response to any proposal seems to be, ?No I don?t support that, and here?s why.? I think I even saw the ghost of Jane Jacobs, patron saint of the condemnation of urban renewal, rise above Clarendon Street and give her blessing to the pious few who congregated below to give thanks.

But, one thing that really bugs me is that the opponents of Columbus Center have been so selective in memory.

Eighteen years ago, there was a lot of anti-building sentiment when a developer proposed putting up condos at 75 Clarendon, which towers directly across the street from where Columbus Center will one day rise. At the time, abutters said that the building would be ?too tall? and ?out of scale? with the neighborhood. Sound familiar? Today, it?s residents of that ?too tall? and ?out of scale? building that are among the most vocally opposed to the Columbus Center project. Ironic? Yes, and I think, sad. I guess it?s just another case of, ?I?ve got mine, but you?re out of luck.?

But let?s be clear before anyone has delusions of grandeur. Columbus Center is not in mothballs because of any community opposition. It is on hold because the developer couldn?t get the money together to move forward, a situation that does rightfully require scrutiny by the community and elected officials.

Still, despite that somewhat major issue, the Columbus Center is an essentially good idea. Really, what?s not to love about Columbus Center? You have a hotel that brings in business people and tourists - two groups of people who spend lots of money, money that runs our city?s economy. You have new revenue due to an increase in property taxes on the hotel and condos (admittedly, some of the benefits would be lost, short-term, due to tax credits granted by the city and state). You have a physical link between the long-divided Back Bay and South End. You have additional parking for residents, visitors and neighbors. Do we need to be convinced of the value of that? And, the part that?s most overlooked, you have new parkland the length of a football field within walking distance from all our homes - and I promise, they?ll allow dogs.

Like I told my friend, I can only hope that the project will eventually be built, preferably in my lifetime.

Obviously, where and how development happens is as important as whether it happens at all. And, as we?ve seen across the country during the past couple of years, ?over-development? is a big, big problem. But I dare say we haven?t had enough growth in Boston. The number of housing units added in the city over the past half decade is well under 10,000 - you?d think it was a lot more, I know.

But in fact, what?s happened is that we?ve repeatedly fumbled the chance to make a change, a chance to lower housing costs through increased residential construction. Meanwhile, office and commercial rents have skyrocketed, due to lack of space - something that you don?t hear about too much, but is very important when corporations consider where to place employees (we currently have the lowest vacancy rate in a decade in the downtown Boston area). And, the biggest benefit to building, the one any elected official can love? Jobs. Jobs for construction workers, jobs in hotels and shops for those in the restaurant and hotel trades and in the service industry, jobs in offices for corporate types, jobs for virtually all sectors of employment. Hey, we all gotta eat.

Still, if you?re interested in a new Boston, a better Boston - and I hope you are - don?t be discouraged by this unfortunate turn of events. There are plenty of other buildings going up in our neighborhood and across the city, many projects that are either already under construction or about to break ground.

Within view from the rooftops of your homes you can see construction under way on The Bryant condo building and The Clarendon condo and apartment project and, off in the distance, two new dormitory high-rises on the site of Northeastern University. Soon, I expect to see a new residential tower and office tower on Prudential Plaza, and another one at Copley Place. Meanwhile, the Museum of Fine Arts is reaching the end of its record-breaking $500 million capital campaign which will allow it to display more of its vast collections of art. There?s even life in the financial district. Currently, there are three large office buildings under construction - Russia Wharf, Two Financial Center, and the first of many buildings on Fan Pier.

The most exciting project planned, far more ambitious than Columbus Center, is Seaport Square, down on the Waterfront. This is a 6.5 million square-foot, multi-use project, yet, surprisingly, there has been little opposition to the proposal. Mostly, people want to know just two things: how much parking will be included and when can you start?

So, I wouldn?t consider Columbus Center to be a ?litmus test? of whether or not anything can be built in the city of Boston or a sign of ?NIMBYism? rearing its ugly, sometimes masked head. Far from it. There?s too much else going on that?s good.

What I would say is that for too long in our city, the interests of a few have taken precedence and priority over the needs of the many. Now, it?s time for that to change.

 

[stellarfun]

Re: Columbus Center

CalPERS and MacFarlane lose money in another project.

Wall Street Journal

Calpers Takes Hit on Land Deal

[FONT=Times New Roman,Times,Serif]In a Rare Misstep, Pension Fund Trips On Real-Estate Bid[/FONT]
[FONT=times new roman,times,serif][FONT=times new roman,times,serif]By MICHAEL CORKERY and CRAIG KARMIN
May 1, 2008; Page C1[/FONT]
[/FONT]
The nation's largest pension fund is involved in one of the biggest land deals to fall victim to the housing bubble. It is an unusual position for the investor, which has a reputation for avoiding such blowups.


The deal involved a $970 million investment by an investment entity that included the California Public Employees' Retirement System in a venture that owns thousands of acres of undeveloped residential land north of downtown Los Angeles. Now, due to the downward spiral of the housing market, Calpers may find itself having to relinquish the well-located land to creditors and possibly lose much of its investment.

Pension funds have been players in the property market stretching back to at least the 1970s and have recently pursued more-complex real-estate investments. Land investment remains rare among these large institutional investors.

Calpers, a $244 billion fund, did its first undeveloped land deal in 1994 and today has seven partners for such deals and investments in more than 12 states.

"Land is the riskiest form of speculative real estate," said Paul Puryear, a housing analyst at Raymond James & Associates. "That's why you have such huge swings in value." Selling land to home builders can yield huge profits. But when demand from builders stall, land can lose value quickly because there are few other ways to generate income from it. "Maybe you can put cattle on it and wait until people can afford to buy houses again," Mr. Puryear said.

At the time of Calpers's investment, February 2007, the venture was appraised at $2.6 billion. The value of that venture, whose backers included the builder Lennar Corp. and LNR Property Corp., a unit of Cerberus Capital Management, is now much less.

The venture, LandSource Communities Development LLC, had assets valued at $1.8 billion as of the end of February, according to a filing with the Securities and Exchange Commission, but debt of about $1.24 billion. LandSource also is under siege by debtholders. The venture is running low on cash and may have to file for bankruptcy in coming weeks, according to a person involved in the venture. Still, while creditors could take ownership of LandSource's land and other assets, they have little other recourse against Calpers, LNR or Lennar.

The deal could prove a rare public misstep for Calpers, which had nearly $21 billion of real-estate investments at the end of September, or about 8% of its total assets, and is one of the largest land owners in the country.

Calpers's investment in the LandSource deal represents less than 1% of its total assets, and the rest of its real-estate portfolio has performed well, with a 12.4% nominal return after fees for the 12 months ending Sept. 30.
In that portfolio, some deals have suffered deep losses. M/W Housing Partners III LP, which includes the LandSource investment, had a return after fees of negative 53.6% for the year ending in September. Another deal, Hearthstone Housing Partners II LP, lost 40.2% in that period.

Rob Feckner, Calpers board president, said for a portfolio as big and diverse as the fund's, some losses were to be expected. "Real estate is a very cyclical business, especially right now," he said in an interview.

Details of the soured land deal are emerging amid upheaval in Calpers's executive suite. The chief executive, Fred Buenrostro, said this week he planned to step down. Last week, Russell Read, the chief investment officer, announced his resignation. People familiar with Calpers said the moves don't appear to be related to the LandSource deal.

The venture is structured similar to dozens of deals that were popular ways for builders like Lennar to buy highly leveraged land during the boom years and reduce the risk of owning the land outright. They would buy the land with partners in off-balance-sheet entities that would borrow money while limiting the builders' exposure to the debt. Many of these deals are unraveling.

The LandSource deal has the twist that the Calpers investment vehicle took a significant stake in the venture, amid the slowing housing market and months before real-estate values plummeted. MW Housing took a 68% stake in LandSource in February 2007, while Lennar and LNR reduced their exposure, each taking a 16% stake and each receiving $660 million after bringing MW Housing into the venture.

MW Housing was co-managed by MacFarlane Partners, a veteran manager of Calpers money, with $11.7 billion in real-estate assets under management. In recent years, MacFarlane has invested as much as $4 billion from Calpers in real-estate projects, such as the Time Warner Center and the Tribeca Green, a 24-story apartment building, both in New York City.

LandSource's California assets are prime real estate. They include some of the only undeveloped acreage in the greater Los Angeles area, about 15,000 acres known as Newhall Ranch lands.

MacFarlane recommended the deal because the land was located in an area with "long-term growth prospects" and investors would realize returns over 12 to 15 years, according to a person familiar with the matter. At the time, MacFarlane anticipated a slowdown in the real-estate market and obtained an independent appraisal of the land as part of its due diligence.

Shortly after Calpers made its investment, Barclays Capital arranged about $1.5 billion in loans for LandSource, which were snapped up by more than 100 investors. The March 2007 offering was oversubscribed.

LandSource's plan was to sell hundreds of ready-to-go house lots to builders to generate cash to service the debt, while the Newhall land was prepared for development, which could take years.

Once the credit crunch hit, demand for the lots evaporated, and the venture was left with less income than it expected.

Negotiations over debt restructuring between LandSource and its lenders are continuing. LandSource recently pulled back from a proposal to contribute several hundred million dollars of additional equity.

LNR didn't respond to a request to comment.

Lennar's chief investment officer, Emile Haddad, who is a managing member of LandSource, said the builder has an "excellent" relationship with Calpers. "These are tough times for all of us," he said. "It's during these times that relationships get tested."

http://online.wsj.com/public/article_print/SB120960362036258063.html

 

[skintreesnail]

Re: Columbus Center

In the BBJ Friday:

OFF CENTERThe Columbus Center project has stalled, leaving in its wake piles of dirt, idle
Boston Business Journal - by Mary K. Pratt Special to the Journal

It was a grand vision: a massive, ambitious development that would cap the Massachusetts Turnpike and transform seven acres in Boston's South End into a chic mix of homes, hotels, shops and parks.

Today, after a decade of planning and debates, the area is a dreary vista of cyclone fences, idle machinery, dirt piles and construction signs that were meant to be temporary but have become fixtures of the local scenery.

Columbus Center is in limbo, and no one knows when it'll emerge -- a victim of escalating project costs and stalemates over funding.

The project's developers and city officials urge patience, saying they're committed to seeing the project through. But no one is quite sure where to go from here. Neither does anyone have any idea of how this type of impasse could have been avoided -- or how such an impasse can be avoided on future projects.

"Could have, would have, should have -- it is what it is," said George Regan, founder of Regan Communications Group and spokesman for the developer, Boston-based WinnDevelopment.

John Palmieri, director of the Boston Redevelopment Authority, was to meet this week with WinnDevelopment managing partner Roger Cassin and hopes to gain a clearer idea of Columbus Center's future, as well as the main sticking points with the project.

"It's a very important and large project, and it took years for it to come together. The mayor supports this, and certainly (the developer) demonstrated good faith. But this has been a long and tedious process for them and us, and I think we owe them some time," he said.

Rep. Byron Rushing, D-Boston, whose district includes the South End, said he doubts "if we're going to learn enough to know how to prevent this in the future."

"I have no idea what's going to happen, and I think it's outrageous that we have a project that has essentially prevented any other proposal for air rights in the South End to come forward because they have complete development rights over this land," he said.

According to approved plans, the Columbus Center calls for a variety of buildings, ranging from four to 35 stories high; they'll hold condominiums, including some affordable housing units, a hotel, a parking garage, retail space and parks spread over seven acres on four parcels.

WinnDevelopment recently obtained an 18-month moratorium on construction. Spokesman Alan Eisner squarely put the need for the construction moratorium on funding, and he singled out the state's decision on its committed monies as part of the problem.

"(Site work) did begin in anticipation of receiving all of our funding from the state, but that did not materialize, and our key investor decided without those state funds it didn't make any sense to move forward," Eisner said.

Some question these assertions, noting that the public money committed to the project represented a small percentage of the overall price tag.

"They say they needed the state piece to come together first to get other equity and financing in place, and that may be true. But it shouldn't have been the breakdown point. It's an $800 million project," Palmieri said.

The city of Boston committed about $15 million to the project through tax increment financing, a form of bond-financed funding. Palmieri said the TIF funding is still there, but WinnDevelopment has to demonstrate that all the other financing is in place before it can receive the money.

State financial commitments are in a similar spot -- not pulled but not ready to be handed over. The state had awarded a $10 million Massachusetts Opportunity Relocation and Expansion Jobs grant last year on a preliminary basis, subject to a second round of consideration. But given the delay in construction, the state has decided it will not award the money at this time, said Kofi Jones, spokeswoman for the Executive Office of Housing and Economic Development.

"The administration decided that it would be the best use of the funds to redirect them to projects that were prepared to move forward and provide economic development and job growth in the immediate future," she said, stressing that the developer can reapply for grant money in the future.

Likewise, MassHousing, which had committed $20.6 million, decided it could not close on the loan at this time but said in an official statement that the commitment is still there.

Regan said these were just factors in a "perfect storm of financial disaster" that prompted the need to delay construction.

WinnDevelopment is partnering with the California Urban Investment Partners -- a joint venture of California Public Employees Retirement System and Johnson/MacFarlane Partners -- on the Columbus Center project.

Eisner, who also works at Regan Communications Group, said other factors were at play, too, citing the fact that the project's estimated cost rose from $350 million to $800 million over the 10-plus years it has taken to get this far.

The rising cost of construction has long been an industry concern and will probably not abate any time soon.

Last month, the Associated General Contractors of America said the producer price indexes for materials used in all types of construction -- as well as such items as diesel fuel -- rose 2.1 percent in March, propelled by a 24 percent increase in diesel fuel costs and as 5.5 percent rise in prices for steel mill products.

"Certainly over the past several years the cost of construction materials has been increasing dramatically because of the global economy," said Robert L. Petrucelli, president and CEO of the Association of General Contractors of Massachusetts, a Wellesley-based trade association. "So when you have a project that starts and stops again, the original price estimates aren't holding, and that's where a project could get into trouble," he said.

He also noted that other projects, mostly in the retail and hospitality sector, have been delayed due to overall economic climate today.

Rushing questioned whether there was adequate transparency on the project's financial details from the start. And he wondered whether the developer early on miscalculated how expensive the project would be.

"The only thing that has happened during this limbo is every time the developer has asked for something we find out something we should have known from the beginning," he said. "And I don't think anything is going to change in the process unless this thing collapses. I think the developer owns too much, he owns all the approvals, all the permitting."

http://www.bizjournals.com/boston/stories/2008/05/05/focus1.html?b=1209960000^1629232&page=1

 

[JimboJones]

Re: Columbus Center

A MATTER OF VISION

Author(s): Steve Bailey, Globe Staff
Date: June 2, 1999 Page: D1 Section: Business

Paul Roiff has been pounding the table the loudest so far. But you can bet he won't be the last.

Even Roiff knows he's in a bad place: He's a developer playing the "not in my backyard" card as the Massachusetts Turnpike Authority entertains "air rights" proposals for the three-mile stretch of highway that cuts through the city like an ugly scar. And who can blame him? For a guy who began as a real estate agent renting $90-a-month apartments to students in Allston-Brighton life is very good.

Downstairs in the 102-year-old Pope Building at 223 Columbus Ave., his Mistral is one of the trendiest restaurants in town. It's a place where starters like the confit of duck go for $18; the Dover sole meuniere goes for $40, the roast rack of Colorado lamb for $39. Upstairs his $1.5 million condominium commands some of the South End's best views.

At least up to now. What has Roiff worried is what he thinks fellow Boston developer Arthur Winn and turnpike boss Jim Kerasiotes, two men he has never met, have in mind for his neighborhood.

While the proposed $475 million, 59-story Millennium Project at Massachusetts Avenue has gotten all the headlines, more behemoths are on the way. Next up: Winn's $350 million, two-tower complex that would straddle the turnpike between Beacon and Clarendon.

A Winn spokesman declined to comment. But here's what I'm told to expect:

- One tower, on so-called Parcel 16, would be 38 stories high. It would contain a 200-room hotel, about 100 condos, and an urban spa along the lines of the elite Canyon Ranch Health Resorts in Las Vegas, Tucson, and Lenox, Mass., where prices range from $3,000 and up for a week's stay. Can you imagine getting a herbal wrap or a hydromassage over the pike at rush hour?

- The other tower, on Parcel 17, would be 33 stories of market-rate housing, with 330 units in all. The Boston architects, CBT, have been told to find a way to include an affordable housing component.

Winn, a respected developer whose projects include the Bostonian hotel, has been talking with both the Turnpike Authority and the Boston Redevelopment Authority. Look for an announcement in 60 days.

Roiff, the developer, isn't waiting. As a mayoral appointee to an advisory committee overseeing the air rights development of the pike in the city, Roiff has been by far the noisiest member of the panel. More than a few have wondered whether his opposition doesn't have something to do with the fact that the Winn development would blot out his penthouse views on two sides.

The relationship between the Strategic Development Study Committee and the Turnpike Authority has been, to be kind, contentious. Committee members complain of the turnpike's "bullying approach"; some are not nearly so kind about Kerasiotes, the chairman.

"We haven't felt like they have dealt with us honestly and upfront," says Roiff. Of his fellow committee members, Roiff is hardly kinder: "Nobody says anything at the meetings. We look at slide shows. We are like 3-year-olds."

Roiff complains that Kerasiotes' goal is to maximize revenue for the turnpike to pay for the Big Dig, and the neighborhoods be damned. Kerasiotes says development revenues have nothing to do with the Big Dig, but he is interested in getting full value for the air rights as a way to reduce pressure on tolls.

"I'm treating this no differently than Paul Roiff would treat any piece of property he owns," says Kerasiotes.

The Millennium debate has far to go. The debate over the Winn proposal hasn't even begun. And there are certainly others to come. What we are seeing is a not-so-silent war over development, a war that will test whether Boston can finally heal the scar left by the turnpike.

This is a war that needs to be fought in the open, based on what is right for the city -- not on whose penthouse view is being blocked or which proposal will raise the last dollar for the turnpike.

 

[TedG]

Re: Columbus Center

From The South End News:

Columbus Center developers meet with BRA

by Managing Editor Linda Rodriguez ? Thursday May 8, 2008

The developers of the now-stalled Columbus Center project met with officials from the Boston Redevelopment Authority (BRA) on May 1 to discuss the developers? attempts to get the project back on track.

Jessica Shumaker, a spokeswoman for the BRA, said that ?nothing really was settled from the meeting.? After filling the agency in on their current situation, the developers, represented by the local Winn Development Company, told the BRA that they?re still exploring their options.

?We?re still very much working hard to see if this project can move forward and how we can get it to move forward,? said Shumaker. As for the developers, she said, ?They were very committed, they weren?t trying to say to us that they were stepping away at all.?

Last week, the South End News reported that the construction on the Columbus Center site would continue at a slower pace over the next 18 months, according to Alan Eisner, a spokesman for the developers. Eisner said that the developers would be doing ?minimal work there? so as to ?keep the site in play.?

?If it keeps them going until they can get things finalized and fully move forward, I would say that further proves that they?re committed to finding a solution so that they can move forward,? said Shumaker. ??I would say that?s a positive that they?re doing everything they can to get this up and running.?

Eisner also said then that Winn Developers and their partners, California Public Employees? Retirement System (CalPERS) and MacFarlane Partners, were ?hopeful? about finding funding for the beleaguered project, which has seen a series of setbacks in the last few months.

The seven-acre project, which includes a 35-story hotel building, several multi-story luxury apartment complexes, retail space, and the deck built over the Turnpike, ballooned in cost from $300 million in its initial proposal more than a decade ago to its current estimated $800 million. Construction on the project began in November 2007, digging up a portion of the parcels in front of Cortes Street, however, it was put on hold at the end of March after the developers asked the Massachusetts Turnpike Authority for an 18-month moratorium. At the time, developers said they were waiting on funding from the state and could not move forward on the $800 million project without it. On April 7, the Patrick administration announced that because the developers had halted construction, the $10 million MORE grant, which developers had claimed was an essential part of their ?capital structure,? would be parsed out to other projects in the state (See ?Columbus Center Hits Another Snag,? April 10). A day later, MassHousing announced that it would no longer be closing on $20.6 million in loans it had previously approved for the project.

Mayor Thomas Menino, who took a tour of the residential street overlooking the cavernous site on April 10, said Wednesday that the city is still in talks with the developer regarding their financial situation. A supporter of the project, Menino said, ?It?s a project that will fill a gap there.?

However, he added, ?If they?re not going to move forward, then we?ve got to figure something else out for the residents of Cortes Street.?