Devon Energy Center

[ssandedoc]

You don't know what you are talking about. You don't know anything about Devon. They are a great company with plenty of money in their pockets to do whatever they want. NOTHING WILL GET SCALED DOWN! IT WON"T BE DELAYED! IT WILL HAPPEN! GET USED TO IT!

Simmer down. I want Devon Tower to be built, I'm just saying that with all this economic turmoil it's putting me on the side of doubt.

[bluedogok]

I think since it is not a developer-based project, being that it is for one specific client, they have talked about building it with cash and with the cash flow that they have and looks like would still have even in a soft energy market that it stands a better chance of getting built than many other projects of similar scale. Most of those other projects are developer-based spec projects that are reliant on financing and most of those are what has been stalled or halted.

[HOT ROD]

right blue, devon is not financing this building. They have TONS of cash on hand and their market capitalization is just crazy!!!

devon will build this building - Im just wondering why it is taking the city so long to approve everything? Just get it done!

[jbrown84]

It is approved.

[CuatrodeMayo]

devon will build this building - Im just wondering why it is taking the city so long to approve everything? Just get it done!

It takes time to design a building like this. Hold your horses.

[BDP]

This headquarters will be Larry Nichols legacy.

You can tell he also views this as a bit of a philanthropic project as well. He sees it as a way for a private business to significantly impact the community in a way that goes beyond a donation. He wants to take an up and coming district in an up and coming city and inject hundreds of millions of dollars into the area while solidifying his companies long term presence in his home community.

Now, I am sure he also knows that sinking his company in favor of building a building and improving downtown at large is not a good move for the long term health of Oklahoma City. He is not going to get OKC or downtown in trouble just to see this built. That is actually why they have waited so long to do this. They could have down it a few years ago, but he didn't feel that it would have a net positive affect on Oklahoma City's downtown. So, if it does get scaled back in any way, you can rest assured that it will be for the greater good.

That being said, I think it would take a lot for that happen and, really, this thing could be scaled back by 25% and it would still have huge impact on the city and would actually be closer to what most of us thought before the announcement and, if you remember, I think most of us were ecstatic even at that level.

[Urbanized]

This building is based on projected long-term growth of Devon, not on current market conditions. As previously mentioned, Devon has a remarkable amount of cash on hand, and will not require a penny of financing to build it. Based on everything I have heard, the economic downturn has made Larry Nichols even MORE determined to get this building completed, because of what it will do for Oklahoma City and long-term for the company.

The other thing that bodes well for the building is that labor and materials costs are currently in freefall, which could make the project far less expensive.

There is a factoid out there, I think in Steve's book, that points out that during the energy bust of the eighties/nineties, Devon was the only major energy company that didn't lay off a single employee. Is that right Steve? If so, that is remarkable, and yet another endorsement for the company and the man running it.

Larry Nichols built his substantial reputation on being financially conservative and prudent in all business manners. This building was NOT a rash decision based on wildly fluctuating oil prices, driven by speculation.

[OKC74]

urbanized - Great way to put it into perspective! I'm still so super excited about this project! Kudos to Larry Nichols for having the foresight to handle this entire project in a responsible manner, and for giving Oklahoma City something we can be proud of! It will definitely be the crown jewel of Downtown Oklahoma City, and I can't wait!!

[jbrown84]

This building was NOT a rash decision based on wildly fluctuating oil prices, driven by speculation.

Good point. This has been in the works in some for for 10 years probably.

[metro]

Good point. This has been in the works in some for for 10 years probably.

probably 2-3 years.

[jbrown84]

Meant to type "in some form".

In other words, it's been on his radar for 7-10 years probably. More specific details like the location, size, etc are obviously more recent like the last couple years.

[HOT ROD]

guys, I meant - why is the city taking so long to sell the property, and approve the TIF. I suppose it is procedure, but they heard about the TIF, why wasn't there an immediate vote? Why wait to Dec 16?

I say, someone (a hometown industry leader by the way) is offering to build a new billion dollar office skyscraper in your downtown on the condition that you sell him the land and make a special tax district that uses the increase in property value to improve the CBD; all which allows the city to retain a major fortune 500 company (the state's largest btw) and also attract many new companies to downtown and the city - what else is there to think about.??? Why couldn't this be fast-tracked?

I say, make it happen! I agree, I am impatient - but the way the economy is; I want OKC to flourish and begin to diversify (pop and industry) more.

[CuatrodeMayo]

guys, I meant - why is the city taking so long to sell the property, and approve the TIF. I suppose it is procedure, but they heard about the TIF, why wasn't there an immediate vote? Why wait to Dec 16?

I say, someone (a hometown industry leader by the way) is offering to build a new billion dollar office skyscraper in your downtown on the condition that you sell him the land and make a special tax district that uses the increase in property value to improve the CBD; all which allows the city to retain a major fortune 500 company (the state's largest btw) and also attract many new companies to downtown and the city - what else is there to think about.??? Why couldn't this be fast-tracked?

I say, make it happen! I agree, I am impatient - but the way the economy is; I want OKC to flourish and begin to diversify (pop and industry) more.

The building won't start construction for months anyways, so there is no need to fast-track that other stuff. It's just not necessary.

[metro]

guys, I meant - why is the city taking so long to sell the property, and approve the TIF. I suppose it is procedure, but they heard about the TIF, why wasn't there an immediate vote? Why wait to Dec 16?

I say, someone (a hometown industry leader by the way) is offering to build a new billion dollar office skyscraper in your downtown on the condition that you sell him the land and make a special tax district that uses the increase in property value to improve the CBD; all which allows the city to retain a major fortune 500 company (the state's largest btw) and also attract many new companies to downtown and the city - what else is there to think about.??? Why couldn't this be fast-tracked?

I say, make it happen! I agree, I am impatient - but the way the economy is; I want OKC to flourish and begin to diversify (pop and industry) more.

Does Seattle fast track procedures like this? Just curious.

[bluedogok]

There may be a minimum "legal review period" time line that is set by city statutes for anything involving city property/contracts. It is to allow possible opposition to review the contract and prepare comments for the next commission hearing. Doing anything other than that could open the project up to potential litigation whether valid or not.

[bombermwc]

Perhaps Tom Elmore got in there and found some old rail lines that went through that land at some point in the past.


Sorry, I couldnt resist.

[metro]

Perhaps Tom Elmore got in there and found some old rail lines that went through that land at some point in the past.


Sorry, I couldnt resist.

Him and David Glover...

[HOT ROD]

Does Seattle fast track procedures like this? Just curious.

It's not Seattle that Im worried about. It's OKC.

I don't know Seattle's procedures and Im not so sure they fast-track (cause they dont need to), but I bet you Houston would if the project was offered to them. ...

I only commented, because I don't want the city to get in the way of this. Remember OKC Chamber Hq, Cotton Exchange, The Factory, Office Depot, The Galleria, Century Center, downsized Will Rogers World Airport terminal, the crown heights/36th Street/I-235 project, itty-bitty 'suburb-style' hotels downtown, suburban and downsized Legacy at the Arts, ... on and on. NOT a good track record at all. ...

But if you guys are confident - then so am I.

[ssandedoc]

I was watching Morning Joe yesterday and they mentioned Devon right along with Johnson and Johnson as stable, good bet stocks.

I do want to clarify my comments, I'm not saying Devon is stupid with their money. I just don't think any company was ready for the economic downturn. If it was me, I would hold onto as much cash as possible and delay construction.

[Insider]

As far as Devon and their cash is concerned, IT IS NOT A CONCERN. They are the most stable independent oil and gas company in their peer group. They are valued by wall street at 29 Billion dollars, they have close to 10 Billion dollars in cash on hand, and only have about 1.5 Billion in debt (a very minor amount considering their value). I would really not worry about them. They are continuing to build this building because this economic downturn is a recession, and as such, will end. They are anticipating it to end in the next year to year and a half. When it does end, they will be one of the best poised companies out there!

[Rover]

Devon will benefit greatly by continuing. I am in the commercial construction business worldwide and can tell you that construction costs are dropping quickly, and will continue to. Materials like copper and steel are down as much as more than 50% from just 6 months ago. They will get a bargain if they proceed as quickly as possible. If they delay even as much as 18-24 months, it will cost twice as much to build when they do, compared to getting purchasing committed right now or in the next 6-12 months. Contractors are hungry, equipment suppliers are hungry, labor is now plentiful.

[proud2Bsooner]

Low fuel prices are very temporary. Just as oil was overvalued, it is now undervalued due to reactionary market trends. Luckily this happened around Christmas!

I have posted this before, but Iran will collapse with sustained low energy prices. Get ready, 'cause they're getting ready to get the pot stirring again. Russia's economy is now energy dependent. Venezuela's too. Low prices will not be sustained very long.

[Thunder]

1.5 billion?! Why are they not being responsible to zap away that debt? What kind of a company willing to have "in debt" status and not using the money to pay it off? Who is hurting? If these 1.5 billion was loans obtained from banks, then Devon could very well be responsible for the collapse of these banks...by not repaying! Eh? Now I see Devon in a whole different picture....

[Kerry]

Thunder you are out of your mind with the above statement. Who said anything about Devon not repaying any debt. Sure they could pay off a low interest loan but the cash on hand might be earning more interest that the debt is accruing.

[jbrown84]

1.5 billion?! Why are they not being responsible to zap away that debt? What kind of a company willing to have "in debt" status and not using the money to pay it off? Who is hurting? If these 1.5 billion was loans obtained from banks, then Devon could very well be responsible for the collapse of these banks...by not repaying! Eh? Now I see Devon in a whole different picture....

Hold on now! Take a look at what other companies have in debt before you make such statements.