Pinnacle at Central Wharf (Harbor Garage) | 70 East India Row | Waterfront | Downtown

Vivanna

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Most of my lawyering is writing Federal laws, including laws with criminal and civil penalties. One of which was in play with respect to Cronin's project, but not in play for Pinnacle because of the magenta zone.
Can you share what was in play for Cronin's project and how it played out?
 

stellarfun

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Can you share what was in play for Cronin's project and how it played out?
The law is P. L. 92-500, which has a section (404) regulating dredge and fill of the navigable waters of the United States. As best as I can tell, whiskey Priest did not require a Corps of Engineers permit under Section 404.

When Chiofaro first proposed his re-development of the Harbor Garage, he appeared to extend the property by filling in part of the harbor. I thought the Corps will never allow that. But I subsequently learned that Congress, back when Tip O'Neill was Speaker, declared that certain waters of Boston Harbor were not navigable waters of the United States, removing them from regulation under Section 404. These waters are the so-called Magenta Zone, and are waters immediately adjacent to the piers and wharves of downtown Boston, (The Magenta Zone does not extend to South Boston.)

I thought that Chiofaro had bought and owned the garage, with Prudential lending him the money. When I read the PNF and read that the owner was a Rams Head Development Co., and after looking up Rams Head, I concluded that they had recently assumed ownership from Chiofaro, as he was listed as "agent".

Early-on, Chiofaro secured a balloon note from a financing company in Hartford. IIRC, the note covered most of the cost of the garage purchase. (and I thought that Prudential was limiting their financial exposure.) This was a five year note, subsequently replaced by a second five year note from the same CT company. The second year note was due several years ago, and I found no announcement of a third note. I thought Chiofaro had found another lender who was not advertising the transaction in a p.r. release. When Rams Head appeared on the PNF, I figured that explains why there was no third note.

So I was truly dumbfounded to read in the Superior Court's decision that Rams Gate was the purchasing owner of the Harbor Garage in December 2007. The Rams Gate LLC was incorporated in December 2007, specifically for this purchase. And Chiofaro clearly has never owned the garage. If he did, the Superior Court judge should have noted that, as the judge traced development and ownership of the Harbor Towers site over more than five decades.
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As an aside on waters of the United States. I am very indirectly involved with a development project in Washington DC. The project is on property previously owned by the Federal government and sold. The property was conveyed to private ownership with a covenant, declaring that the ground water under this property remained the property of the United States. That covenant was introduced to prevent the new and any subsequent owners of the property from developing much of the property. The covenant effectively precludes excavation and de-watering of the property, as the government will not allow you to remove even a tablespoon of groundwater. (There is good reason for this covenant, as it limits potential liability of the government for any contamination of the site.)
 

Johnnyrocket891

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It seems you have sometype of personal vendetta against the developer spewing legal mumbo jumbo on a architectural message board that is supposed to be about building designs, aesthetics, urban fabric incorporated into the city environment. To continue to state some accurate information then along with misstating misinformation concerning this development.

Like I said before- Nobody knows how business structures are setup in most corporations, LLC, Trusts, Partnerships. To assume who owns the garage (WHO CARES at the end of the day) This is a message board about architecture why are you using this board as a legal platform.

What is gripe with the development or the developer? It's giant hulking Garage in a prime development spot.

Rifleman I am not. :mad:
 

George_Apley

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It seems you have sometype of personal vendetta against the developer spewing legal mumbo jumbo on a architectural message board that is supposed to be about building designs, aesthetics, urban fabric incorporated into the city environment. To continue to state some accurate information then along with misstating misinformation concerning this development.

Like I said before- Nobody knows how business structures are setup in most corporations, LLC, Trusts, Partnerships. To assume who owns the garage (WHO CARES at the end of the day) This is a message board about architecture why are you using this board as a legal platform.

What is gripe with the development or the developer? It's giant hulking Garage in a prime development spot.

Rifleman I am not. :mad:
This is out of line.

*Clarification* this post is an attack on another poster's apparent expertise and seems to (willfully or not) misinterpret the intent of the poster. The *whole post* isn't that. But it includes plenty of it.

Also... DM mods if you have issues with moderation. This is clearly stated in the CoC.
 
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Johnnyrocket891

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I really don't see anything wrong with the written content I wrote up above. If anything the writer is creating a legal narrative which is not based on data or facts. I was just curious if the writer has an agenda creating a legal narrative based on a development that stays in limbo for a decade which would be ultimately good for the overall area?

I was not attacking somebody's expertise? This is an architectural message board for all I know the writer might work at McDonalds.
 

shawn

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Rilfeman, please stop. You were banned once for this before.

stellerfun has been contributing to this site 14+ years and running, and I for one read and appreciate his posts interpreting legal minutiae, relavent to a specific project or to development in general. I learn new stuff, just like I learn new stuff about construction, design, and all the rest. How are you contributing, other than by derailing threads?
 

stellarfun

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This is a link to the full text of the Superior Court decision addressing the separate claims of the Harbor Towers residents and the Conservation Law Foundation.


Beginning on p. 7, the section titled Alleged facts of the Armstrong case, there is a history, starting in 1964, of the development of the Harbor Towers residences and garage, in plain English. (Armstrong is the name of the lead plaintiff for the Harbor Towers residents.)

The judge describes at length how the residents of Harbor Towers came to obtain the parking spaces that they currently have in the Harbor Garage. On the old board, there were posters who wanted the city to use eminent domain and take the 'right' to those parking spaces from the HT residents and allow the garage to be re-developed. I suspect that if the Superior Court judge had decided that these residents have a right to these spaces in perpetuity, cedrtain posters would have absolute conniptions.
 

Rover

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A few points: johnny is by and large correct about stellarfan in that he does appear to have a personal problem with Chiofaro. I myself have caught him a few times repeatedly making false statements such as the garage is losing money which he wrote for years. It puts all of his other postings on the subject in doubt IMHO.

Next, it does matter somewhat who the owner is. Let's revisit my unanswered question. If the former mayor with an iron grip on development hated Don, why in God's name would he still be involved with the project if he had no ownership? Most likely Don and Pru formed a LLC and he's either the majority owner or has a real significant percentage. So one way or the other he's not going away if true, and this is a lot more plausible than the weird speculation we've been given for his continued involvement. Also some quick research shows Chiofaro as being regularly identified as the site owner in the local media. He sure snowed a lot of people if that wasn't true.
 

stoweker

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A few points: johnny is by and large correct about stellarfan in that he does appear to have a personal problem with Chiofaro. I myself have caught him a few times repeatedly making false statements such as the garage is losing money which he wrote for years. It puts all of his other postings on the subject in doubt IMHO.

Next, it does matter somewhat who the owner is. Let's revisit my unanswered question. If the former mayor with an iron grip on development hated Don, why in God's name would he still be involved with the project if he had no ownership? Most likely Don and Pru formed a LLC and he's either the majority owner or has a real significant percentage. So one way or the other he's not going away if true, and this is a lot more plausible than the weird speculation we've been given for his continued involvement. Also some quick research shows Chiofaro as being regularly identified as the site owner in the local media. He sure snowed a lot of people if that wasn't true.
i mean, it's likely set up as a GP/LP LLC with Chiofaro acting as general partner for the investment (which is why he's identified as the developer in everything) and Pru is the "silent" LP with majority control decisions. For tax reasons this likely isn't set up as a REIT as that would block a sale (there's a 2 year safeharbor rule so you can't sell the property or recapitalize for 2 years after final C of O, or for that matter sell condos as REITs dont allow for dealer sales unless through a TRS). Realistically though it doesn't matter what the structure is for the deal for any of us; it's purely a tax thing.

As an aside there's also no way the parking garage loses money, if i recall they bought it at a decent basis (i think it was like $100MM 15 years ago or something, so figure somewhere around $100,000 / spot in a city where parking spots sell for like $250K+ now) and parking garages are pretty high-margin enterprises. Your cost structure is mostly tax and insurance with some low wage workers in it doing porter service / basic R&M. I don't even think the garage has like a person manning a booth anymore.
 
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stellarfun

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The HT garage was purchased for $153 million in December 2007, supposedly as an all-cash transaction.

The following year (in 2008), a five-year balloon note for $85 million was taken out on the property.
.

In 2013, a second, five year balloon note for $90 million was taken out on the property.

I have found no record of a third note. (One can readily price the annual interest costs of a balloon note; these costs are a non-operating expense.)

In 2010, Ted Oatis, Chiofaro's main business partner, estimated the cost of burying the garage at $140 million.
"...and the cost of burying the existing 1,400 spaces underground. They say it would cost about $100,000 per space, or about $140 million, to put the garage underground."

(Oatis died in 2014. Chiofaro compared Oatis and himself to Felix and Oscar in The Odd Couple. “I was Oscar,” Chiofaro said, while “Teddy was detailed and orderly and complete and concise,”)

Back in 2010, the combined cost of the project, acquisition plus construction cost of a new garage, was about $300M; to that add the cost of whatever was to be built above the garage.

Ram's Head Development Co. LLC, annual report for 2019 filed with the Commonwealth.

http://corp.sec.state.ma.us/CorpWeb/CorpSearch/CorpSearchFormList.aspx?sysvalue=9gr67UrCwZ.oMoa.bZWvVA--
Check the 2019 report box
The MA corporate filing page is a mess. You need to search by ID number, which will pull up the corporate filings.
Identification Number: 000965905 Annual Report Filing Year: 2019 1.a. Exact name of the limited liability company: RAM'S HEAD DEVELOPMENT COMPANY LLC
From that report, one obtains a listing of the three officers.
7. The name and business address of the person(s) authorized to execute, acknowledge, deliver and record any recordable instrument purporting to affect an interest in real property: Title Individual Name First, Middle, Last, Suffix Address (no PO Box) Address, City or Town, State, Zip Code REAL PROPERTY xxxxx xxxxxx 7 GIRALDA FARMS MADISON, NJ 07940 USA REAL PROPERTY yyyyyy yyyyyyy 7 GIRALDA FARMS MADISON, NJ 07940 USA REAL PROPERTY zzzzz zzzzzzz 7 GIRALDA FARMS MADISON, NJ 07940 USA


The three officers of Ram's Head listed in the report hold these positions in Prudential Real Estate.
Executive Director, PGIM Real Estate
Managing Director, PGIM Real Estate
Chief Financial Officer for PGIM Real Estate's flagship core fund, one of the largest open-end real estate funds in the United States, with $26B of gross assets under management.

I do not know Massachusetts's rules of civil procedure, but I would think if a party, such as Chiofaro, is a limited partner in an enterprise, and the general partner is Ram's Gate, both partners would join in a motion to dismiss the parking-spaces-are-ours-in-perpetuity claim of the Harbor Tower's residents, particularly, as in this case, the limited partner is a 'resident' of Massachusetts (and this is a case in a MA court). But maybe that's just my perception of how things ought to be done.
 
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stoweker

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The HT garage was purchased for $153 million in December 2007, supposedly as an all-cash transaction.

The following year (in 2008), a five-year balloon note for $85 million was taken out on the property.
.

In 2013, a second, five year balloon note for $90 million was taken out on the property.

I have found no record of a third note. (One can readily price the annual interest costs of a balloon note; these costs are a non-operating expense.)

In 2010, Ted Oatis, Chiofaro's main business partner, estimated the cost of burying the garage at $140 million.
"...and the cost of burying the existing 1,400 spaces underground. They say it would cost about $100,000 per space, or about $140 million, to put the garage underground."

(Oatis died in 2014. Chiofaro compared Oatis and himself to Felix and Oscar in The Odd Couple. “I was Oscar,” Chiofaro said, while “Teddy was detailed and orderly and complete and concise,”)

Back in 2010, the combined cost of the project, acquisition plus construction cost of a new garage, was about $300M; to that add the cost of whatever was to be built above the garage.

Ram's Head Development Co. LLC, annual report for 2019 filed with the Commonwealth.

http://corp.sec.state.ma.us/CorpWeb/CorpSearch/CorpSearchFormList.aspx?sysvalue=9gr67UrCwZ.oMoa.bZWvVA--
Check the 2019 report box
The MA corporate filing page is a mess. You need to search by ID number, which will pull up the corporate filings.
Identification Number: 000965905 Annual Report Filing Year: 2019 1.a. Exact name of the limited liability company: RAM'S HEAD DEVELOPMENT COMPANY LLC
From that report, one obtains a listing of the three officers.
7. The name and business address of the person(s) authorized to execute, acknowledge, deliver and record any recordable instrument purporting to affect an interest in real property: Title Individual Name First, Middle, Last, Suffix Address (no PO Box) Address, City or Town, State, Zip Code REAL PROPERTY xxxxx xxxxxx 7 GIRALDA FARMS MADISON, NJ 07940 USA REAL PROPERTY yyyyyy yyyyyyy 7 GIRALDA FARMS MADISON, NJ 07940 USA REAL PROPERTY zzzzz zzzzzzz 7 GIRALDA FARMS MADISON, NJ 07940 USA


The three officers of Ram's Head listed in the report hold these positions in Prudential Real Estate.
Executive Director, PGIM Real Estate
Managing Director, PGIM Real Estate
Chief Financial Officer for PGIM Real Estate's flagship core fund, one of the largest open-end real estate funds in the United States, with $26B of gross assets under management.

I do not know Massachusetts's rules of civil procedure, but I would think if a party, such as Chiofaro, is a limited partner in an enterprise, and the general partner is Ram's Gate, both partners would join in a motion to dismiss the parking-spaces-are-ours-in-perpetuity claim of the Harbor Tower's residents, particularly, as in this case, the limited partner is a 'resident' of Massachusetts (and this is a case in a MA court). But maybe that's just my perception of how things ought to be done.
still cheap basis, it's 1,380 spaces so $110K/space. the second mortgage likely paid off the original mortgage rather than a supplemental so say they have $90mm on it now. If it's an I/O note payments are probably like ~4mm +/- 1mm year, if fixed amortizing maybe $7mm but in any event that's not a crazy debt burden. SWAG math puts me at ~9mm / year in NOI on the garage (assuming 70% occupancy at $36 and a 70% EBITDA margin). That also puts basis yield around a 6% which candidly sounds like a pretty good investment to me given general durability of cash flows on parking lots (well pre-covid anyways). either way i'd be surprised if they were losing money on this thing.

also re:rams head, the GP is the operator, the LP is the investor member. person with money = lp, person doing work = gp. not surprising that the officers of the JV would be the LP members as they have a disproportionate share of the money and would be the signatories for anything.
 
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shmessy

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A few points: johnny is by and large correct about stellarfan in that he does appear to have a personal problem with Chiofaro. I myself have caught him a few times repeatedly making false statements such as the garage is losing money which he wrote for years. It puts all of his other postings on the subject in doubt IMHO.

Next, it does matter somewhat who the owner is. Let's revisit my unanswered question. If the former mayor with an iron grip on development hated Don, why in God's name would he still be involved with the project if he had no ownership? Most likely Don and Pru formed a LLC and he's either the majority owner or has a real significant percentage. So one way or the other he's not going away if true, and this is a lot more plausible than the weird speculation we've been given for his continued involvement. Also some quick research shows Chiofaro as being regularly identified as the site owner in the local media. He sure snowed a lot of people if that wasn't true.

Stellar is only stating facts and providing info. Anyone can have an opinion. I disagreed with his take on Parcel 12 and the Eliot Hotel's claim on the obstruction of their alleyway. However, I learned alot from his information on it and can respect his opposing view.

If you want to see a truly axe grinding subjective personal agenda/opinion, see post #421.
 
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Rover

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Stellar is only stating facts and providing info. Anyone can have an opinion. I disagreed with his take on Parcel 12 and the Eliot Hotel's claim on the obstruction of their alleyway. However, I learned alot from his information on it and can respect his opposing view.

I
Actually he isn't. He's speculating and always to the detriment of Chiofaro which calls into question everything else he posts on this particular project. I can't speak to his activity in other threads with other developers.
 

shmessy

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Actually he isn't. He's speculating and always to the detriment of Chiofaro which calls into question everything else he posts on this particular project. I can't speak to his activity in other threads with other developers.

I'm always here to learn. Please tell me what was misleading about Stellar's posts? I'm no legal expert, so I fully admit I can be misled on the subject.

Simply stating that Stellar is wrong or has an agenda, doesn't mean anything. Tell us WHY Stellar is wrong. With facts. Not too hard to ask.

The critical arguments against are baseline Post #421 (talk about agendas!) - - which is empty and juvenile personal attack piffle. So, yes, I'm still waiting for something more credible. I have no dog in this fight, other than trying to learn what is the situation. Personally, I hope Stellar is wrong, because I very much just want to see this development get built. But I'm not seeing anything substantive from the folks dismissing his informative posts. So, please...somebody....anybody....bring it.
 
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Johnnyrocket891

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. Tell us WHY Stellar is wrong. With facts. Not too hard to ask.

....bring it.
Comments like this---

Chiofaro doesn't own the garage.
How do you know? Why does it even matter?
If anybody is calling into the question of character on this board. The writer is calling out the developer's character. So why can't other writers on this board question the writer's motives?

I don't care if the writer likes or hates the development or the developer.
It's okay that a writer can call out a developer but when another writer questions and comments on the other writers comments only to get threatened to be banned by other members is called censorship.
 
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Rover

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Stellar has no actual information that Chiofaro has no ownership of the garage. He's basing this on the assumption that since he wasn't personally named in some lawsuit he must have no interest. Myself and others have given a far more plausible explanation, which is that he's part of a LLC which owns the garage. Stellar has flatly stated that Don is not the owner, or to use his words has a fractional stake.

Beyond that you yourself will have to look back through the threads on this subject to find all the times he stated that Chiofaro paid too much for the garage (really strange since apparently he doesn't own it!!!). I've already dug up those quotes once a couple of years ago. I don't care enough to do it again.
 

stellarfun

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It has been many a year since I took a course in agency, so my memory has surely faded, but I do distinctly recall that a principal cannot simultaneously be an agent with respect to the same transaction. In the very first pages of the PNF filing, Ram's Head is listed as the owner (the Principal) of the Harbor Garage property. just beneath that entry, Chiofaro & Co. is listed as the agent.

This discussion of Principal in Wiki is a fair outline of the difference between Principal and Agent.

Partners are principals.
___________________________
I did a little test to see if anybody reads the links I posted. The linked article in Commonwealth magazine contains this gem from Ted Oatis (in 2010), "Oatis says the garage generates an operating profit of $8.5 million a year."

Before there is a chorus of 'I told you so', operating profit is not the same as net profit, as operating expenses do not include interest payments on loans. In this instance, the operating profit would be further reduced by the interest paid to the lender in CT on the two balloon notes made to the 'joint venture' of Prudential and Chiofaro.
____________________________
Chiofaro, in the Globe obituary of his partner Ted Oatis, compared their partnership to that of The Odd Couple (a play and comedy series which antedates most posters on this board) starring Felix and Oscar. Oatis was Felix, and Chiofaro was Oscar. Neil Simon, the playwright, intended they be stereotypical opposites.

"Felix exemplifies the precision and perfection that Banker's are known for. He has very specific views about how things are to be done. Going with the flow when things change without warning makes his brain twitch with nervous discomfort. He seeks order and predictability.

"Oscar, on the other hand, is a stereotypical Merchant. He is easygoing and takes things as they come. In fact, Oscar would rather things not be orderly and consistent. What's the fun in that?

"Despite the fact that Oscar is constantly frustrated by Felix's ordered lifestyle, he is very loyal and places value, albeit unconsciously, on their friendship. Their relationship matters, and that is a hallmark trait of Merchants."
 

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