W Hotel | 100 Stuart St | Theater District

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Re: W Hotel

Same ^, although i prob couldn't afford the HOA fee lol.
 
Re: W Hotel

I bet this has some pretty nice views of the garden and common

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^ Judging from the last photo there doesn't appear to be any occupancy at the residences although there must be a few who bought into it. Personally I think the residence concept should be scrapped and the entire building turned into hotel rooms. Better to be making money on hotel rooms then having all that space lay empty for what could be years. Maybe it's too late to do that now.
 
Re: W Hotel

Developer spanks city (Part II)

Intrigue at the W
Paul McMorrow
MassINC

Next week, a federal bankruptcy judge will decide whether the W Boston, a gleaming new 26-story hotel and condominium tower in Boston?s theater district, will fall to foreclosure. On one level, the foreclosure fight is about the tepid real estate market in Boston, particularly for condos. But the fight also has a hint of payback.

The real estate arm of Prudential Insurance, which holds the $190 million construction mortgage on the W, is pushing hard for foreclosure to take control of the property. Foreclosure also has the potential to wipe out $10.5 million in public funds the city of Boston invested in the project.

Prudential officials aren?t talking, but real estate industry insiders wonder whether the insurance giant is looking for a twofer at the W ? seize control of the property and at the same time dish a little payback to the city of Boston for blocking a development project that Prudential is spearheading with developer Don Chiofaro at the Harbor Garage.

The W mortgage was one of the last large development loans issued before credit markets froze in 2008. Because luxury hotels normally take time to become money-making ventures, the project?s developers were counting on condo sales to generate cash to repay the $190 million mortgage. But the building opened at a time when luxury condo sales were sluggish nationally, and its developer, an LLC controlled by Sawyer Enterprises, filed for Chapter 11 bankruptcy protection in April.

To date, sales have closed on 25 of the building?s 123 condo units, including 12 sales since the bankruptcy filing. The developer can also rent out 25 apartments, but most of that revenue is ticketed for paying condo fees and real estate taxes on unsold units.

Last December, Boston?s Department of Neighborhood Development closed on a $10.5 million second mortgage it gave to the W. The funds were earmarked for the completion of the W?s restaurant, spa, and bar, without which, the city argued, the project would have ground to a halt.

The $10.5 million mortgage was drawn from a $40 million bridge loan pool that Boston Mayor Thomas Menino launched near the end of 2008, with the aim of restarting stalled construction projects in the city. The funds are an advance on the city?s HUD Section 108 allocation; if the funds aren?t repaid, the lost amount will be deducted from future Community Development Block Grant distributions to the city.

Because the city loan was a second mortgage, Boston is second in line, behind Prudential, in payment priority. The city also holds second liens on a series of other small properties, cash, and securities that Sawyer posted as collateral to the Prudential mortgage. That?s why a bankruptcy court showdown next week, which centers on a foreclosure petition by Prudential, will essentially decide whether or not the city?s $10.5 million position behind Prudential gets wiped out.

Prudential is trying to foreclose on the W, arguing that condo sales have been slow, that reorganization prospects at the property are dim, and that the hotel and condo complex is worth far less than the lender is owed. Next week?s trial will center on the value of the development ? the less it?s worth, the more likely it is that Prudential will get permission to seize the property.

Prudential is currently owed $162 million from its original $190 million loan; it?s arguing that the W is only worth $141 million. The developer?s attorneys have countered with a value of $156.2 million, and have said that any valuation has to also take into account the value of the other land and cash Sawyer posted as collateral to the Prudential loan; taken together, they say, the whole package is worth nearly $172 million.

The city?s lawyers have thrown in an October 2009 appraisal that valued the W project at $194.5 million, and pegged Sawyer?s secondary collateral at another $14 million.

In court filings, the city has said it would be ?simply unconscionable for Prudential to wipe out, through foreclosure proceedings, all of the value that it has watched the City of Boston pour into the project.?

Evelyn Friedman, director of Boston?s Department of Neighborhood Development, said that because the city?s $10.5 million loan financed the completion of the development, ?it increased the value of the hotel. The hotel needed to have these amenities to increase its revenue. The restaurant and spa have both had an impact on that value.? She added that she believes the city?s cash is safe because ?there?s enough value there for everyone to get paid.?

In court filings, Sawyer?s lawyers have cast their bankruptcy case as a basic loan modification. In a statement, a project spokeswoman said the developer ?intends to pay all of its creditors in full, and that includes the City of Boston,? citing ?strong occupancy? at the hotel and ?strong sales activity with our condominiums.?

Privately, some Boston real estate officials believe Prudential is trying to use the project?s condo struggles to seize the hotel, with an eye towards flipping the hotel at a handsome profit later down the line.

There?s a good degree of irony in the hardball game Prudential is playing with the W developers, since it could put the city at the insurance giant?s mercy. Prudential has been taking several lumps from the city across town, at the site of another big-money development project.

Prudential owns most of the $153 million Harbor Garage. Prudential?s local partner, Chiofaro, wants to raze the garage and replace it with a pair of towers that would rival International Place, the massive office complex that Chiofaro and Prudential own across the street.

Chiofaro has received significant pushback from City Hall, which wants to cap any new construction at the Harbor Garage site at 200 feet; that?s far shorter than the height Chiofaro says he needs to make the development project financially viable. In September, the developer unveiled a new development scheme involving two towers of 615 and 471 in height.

One of the biggest losers in the Harbor Garage fight has been Prudential. The insurance company bought into the garage as a development site, not as a parking structure. The garage makes money, but it isn?t generating nearly the type of financial returns Prudential?s investors would normally expect from an ambitious urban redevelopment project.
Click to expand...

There is no copy of this story online; I received it as an email.
 
Re: W Hotel

That is beautiful. I wish Prudential the best of luck on the foreclosure.

Menino and his embarrassing, childish "Bloop. Bloop. Bloop. You in da tank for Chiofaro" schtick is running smack-dab into the adult world now. You don't string developers along, then pull the rug out from underneath them and their partners without some payback.

You can have a little fiefdom and treat Boston like your own version of Sim City. You can have your friends in the BRA come up with vague rules and restrictions, have them tell developers there are no real guidelines for what makes a building acceptable, but that ?We?ll know it when we see it,? and there is no desire on the part of the city to move the process forward.

But in the end you're playing with real money. Other people's money. Not just the guy you don't happen to like because of some minor slight you can't get over.

You can call people names. Pretend they don't exist, and that they can't be a part of the process. But eventually, if you step on the wrong feet, you realize that a company like Prudential doesn't give a damn about stepping right back. And they have very, very big shoes.

I'd really hate to see $10.5 million of taxpayer money go to waste, but I guess we all gotta pay the Menino tax.
 
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^

Well put.

I'd like to learn how buildings such as the W are valuated. My understanding is that value is the market rate PSF minus construction costs. The article makes it seem like valuation is much more complicated. Any insight would be of interest.
 
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Re: W Hotel

I usually don't route for lenders but in this case. It seems PRU has Chiofaro's back and if the Mayor wants to play games then lets play games.


Talk about being in the middle of a tornado for the W-Hotel Developers. Those poor suckers are going to get this development stolen from them because of the MAYOR.



"The city?s lawyers have thrown in an October 2009 appraisal that valued the W project at $194.5 million, and pegged Sawyer?s secondary collateral at another $14 million."

Would like to know what the the city has this property assessed at for tax purposes if the city lawyers are claiming now it should be valued at $194.5 Million
 
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Re: W Hotel

W woes could cost Hub $10M
Prudential argues for foreclosure
By Thomas Grillo
Tuesday, November 9, 2010 - Updated 5 hours ago

The city of Boston could be out $10.5 million if the Prudential Insurance Co. of America wins bankruptcy court approval to foreclose on the new W Hotel & Residences.

A three-day bench trial began yesterday in U.S. Bankruptcy Court before Judge Joan Feeney.

Prudential attorneys argue that SW Boston Hotel Venture LLC, a subsidiary of Sawyer Enterprises, defaulted on a $180.8 million mortgage in April. The Boston-based developer subsequently sought bankruptcy protection.

In opening remarks, Emanuel Grillo, a New York attorney for Prudential, said SW Boston Hotel has failed to meet sales goals for the 123-unit luxury condo project, has been unable to fill the hotel rooms, has yet to open the so-called theme bar, and as a result equity in the 26-story tower has plummeted to $141 million, less than the loan?s amount. ?The debtor has not met its sales velocity goals and the equity is diminishing,? he told the court.

But Boston attorney Harold B. Murphy, representing SW Boston Hotel Venture LLC, argues that the hotel has an occupancy rate of 75 percent - exceeding expectations - and a dozen units have sold since the filing for bankruptcy in April, with another nine sales in progress. He expects to sell out the project by mid-2013, bringing the loan due to about $50 million which, he said, would be paid for over a seven- to 10-year period.

A review of Suffolk Registry of Deeds records found that 36, or 29 percent, of the units have sold.

In court documents, Prudential said SW Boston?s ?lack of experience managing a significant real estate development project such as the W Hotel became apparent. The debtor missed important deadlines and completion dates and suffered substantial cost overruns.?

Attorneys for the city will argue against the foreclosure, because the Hub?s Department of Neighborhood Development invested $10.5 million to help complete the $234 million project.

Evelyn Friedman, the department?s director, has said city officials haggled for months over the terms of the deal before awarding the cash. Three Sawyer properties were put up for collateral to land the city loan, but Prudential holds the first mortgages on the properties, which have an appraised value of $6.88 million.

Joanna Mulford, a Prudential portfolio manager, testified that the hotel?s credit profile has deteriorated under SW Boston?s ownership.

But Murphy insisted the W is on course for meeting all of its obligations and cited an ?improving real estate market? as a sign of success.

Sawyer Enterprises is operated by Carol Sawyer Parks, the daughter of taxi operator Frank Sawyer, who previously owned Checker Taxi Co. in Boston.

Testimony is scheduled to resume today. A decision in the case is not expected for several weeks.

BANKRUPT BUILDING: The W Hotel and Residences could be foreclosed on pending a trial in U.S. Bankruptcy Court.

http://www.bostonherald.com/busines...rgues_for_foreclosure/srvc=home&position=also
 
Re: W Hotel

I think we can now, with the passage of time, succinctly summarize this project aesthetically, financially, politically, and olfactory in the following way:
(turn up volume)

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Re: W Hotel

An outstanding article about Sawyer vs. Prudential over the W is published in the January 2011 issue of Boston Magazine.
 
Re: W Hotel

Sicilian said:
An outstanding article about Sawyer vs. Prudential over the W is published in the January 2011 issue of Boston Magazine.
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Just read the article if Sawyer family is worth so much money why did they borrow 10.5 Million off the CITY?
 
Re: W Hotel

TheRifleman said:
Just read the article if Sawyer family is worth so much money why did they borrow 10.5 Million off the CITY?
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Because they know the system. Why use your own money when the city will offer you a low interest loan? Then you own money can be saved and used in a better investment vehicle earning a bettet return than the cost of the interest on the city loan.

Plus, the city now has a vested interest in this building, which is always good for a developer.
 
Re: W Hotel

palindrome said:
Because they know the system. Why use your own money when the city will offer you a low interest loan? Then you own money can be saved and used in a better investment vehicle earning a bettet return than the cost of the interest on the city loan.

Plus, the city now has a vested interest in this building, which is always good for a developer.
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How?s that even legal? That is the real question. The city is giving low interest loans that aren't even 100% secure. They might lose everything if PRU buys the property then dumps the condos.

Also the city has no right to give 10.5 Million to help a family gain wealth on the taxpayers back to build luxury condos.

I understand that there are circumstances to helping a private industries with taxdollars especially if there was sometype of foundation issue that was causing public safety problems that the developer never could have solved on his own. But to give a family low interest money to build luxury condos is absurd.
 
Re: W Hotel

The City's misuse of the definition of "blight" for the purpose of funneling loans, tax abatements and other goodies to private property owners is legendary. Someday maybe an attorney representing constituents of a truly blighted district will unravel exactly how and why this type of loan was made.

There is no oversight. NONE.
 
Re: W Hotel

Sicilian said:
The City's misuse of the definition of "blight" for the purpose of funneling loans, tax abatements and other goodies to private property owners is legendary. Someday maybe an attorney representing constituents of a truly blighted district will unravel exactly how and why this type of loan was made.

There is no oversight. NONE.
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So I should just give Deval or Menino $25,000 each and I can get a 30 Million dollar tax break over 5 or 10 years for a future project built in the city.

So you give these guys money and they rip off the taxpayers to take care of you. Blantant FRAUD in front our faces. This is really screwed up.
 
Re: W Hotel

Whether or not this loan was a good idea, that street corner was blighted.
 
Re: W Hotel

Buried in the Boston magazine article is a tidbit of info: the NikeTown used to be an empty parking lot as recently as 1999? I have no memory of that corner. Any photos out there by chance?
 
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