Three downtown OKC projects are on hold for now

[mecarr]

BY STEVE LACKMEYER
Published: December 18, 2008

Three multimillion-dollar downtown projects are on hold because of uncertainty in financing and the hope that construction costs may drop next year.

JoeVan Bullard, Oklahoma City Urban Renewal Authority director, told commissioners the national economic crisis is linked to the stalling of the projects, which he identified as the Overholser Greens condominiums, the mixed-use Flatiron and a new Greater Oklahoma City Chamber headquarters.


Officials with the Greater Oklahoma City Chamber hoped to begin construction in January on an $18 million, four-story headquarters at NW 4 and Broadway. Chamber president Roy Williams confirmed those plans are now on hold following discussions within the chamber’s building committee.

"There are two factors they heavily weighed,” Williams said. "One is a report by Flintco that building costs are going down. And there is a very good chance the construction costs of our building will be less than currently estimated.”

Williams said that while Flintco was advising delaying construction to realize cost savings, the chamber was reluctant to begin fundraising until the business community "gets a better sense of what is going to happen.”

"The end result is they want to continue to keep their eye on it, wait 60 to 90 days, and then get back with a contractor and see what happens,” he said.

Grant Humpheys, who hoped to start construction this fall on a $20 million mixed-use development proposed for N 6 and Harrison, cited similar reasoning. "The thing that made us stop first was that we did not meet our pre-sales requirement,” he said. "And more than anything, it was not that the market wasn’t there; we just didn’t give enough time to penetrate the market. We simply ran out of time. So instead of trying to force six months into two in a very difficult economic cycle, we decided to wait six months and then regroup.”

The project, he said, is still viable and likely will resume next summer.

"We’ve got a project that is cued up, it’s gone through the approval process and we’ve got a project team,” Humphreys said. "We met on this yesterday, and we’re continuing to do value engineering with Lippert Brothers. We need time to let the market warm up.”

Chuck Wiggin, developer of the proposed $61.3 million Overholser Greens condominiums, told Urban Renewal earlier this year he hoped to start construction at NW 13 and Dewey this month.

"I just came from a bank board meeting,” Wiggin said. "There is a lot of stuff on hold right now. With Overholser Greens, we’re trying to be realistic about the economic climate we’re in. Right now, it doesn’t make a lot of sense to be pushing ahead on a firm timetable with this project. It doesn’t mean we won’t be doing it; we just won’t be doing it this quarter or next.”

[OKCMallen]

Sounds OK except for the O-Greens.

[metro]

Why am I not surprised at Overholser Green. For such successful businessmen on the board, you think they'd be more competent in their selection process. I wonder if this thing will be delayed years, if it gets off the ground. I imagine it gets watered down again and delays another timeline. Classic Urban Renewal. I understand the economy/lending thing, but heck how many times have they already delayed this project before the economy went south?




The latest designs for the proposed Overholser Greens at NW 13 and Walker.ILLUSTRATION PROVIDED BY Architectural Design Group.

[Midtowner]

I, quite frankly, hope Overholser Greens never goes anywhere. What we don't need in Midtown is a sequel to the Waterford.

[DelCamino]

.... I understand the economy/lending thing, but heck how many times have they already delayed this project before the economy went south?

Not even close to the number of times, and 6 to 7 years, the Seiber project was delayed.

[jbrown84]

I'm not a fan of Overholser Green, but I don't know why you are singling it out here over the other two.

[Steve]

"Not even close to the number of times, and 6 to 7 years, the Seiber project was delayed."
That's a shot from left field. Not sure who you are or why you mentioned the Sieber. But as a reporter who has covered most or all of these developments, I can probably shed some light on Urban Renewal projects in general.
First, to Metro - no downtown Urban Renewal project in the past eight years has been completed according to the original schedule.
Lower Bricktown was delayed by at least four years.
The Deep Deuce housing projects, collectively, all ran one to three years behind schedule.
John Q. Hammons actually hit up against his redevelopment agreement deadline on the Renassaince.
Even the Skirvin ran behind its initial schedule, though in the end it ran about as close to being on time as anything I've seen.
Final note: The Seiber was not an Urban Renewal project. It was privately done, and involved tax credits and other complicated financing requirements that almost always cause delays.

If you like projects that run on schedule and don't encounter any delays or complications, you might be more comfortable with something in the suburbs where the dirt doesn't have any decades-old contamination issues, where you don't have to go through design review, where you don't have to deal with historic buildings, where you don't need to tap into TIF or tax credits to overcome reluctance of banks uneasy with urban development.

[OKCTalker]

Mike Henderson's Legacy @ Arts Central (may have the name wrong, but I'm close) was repeatedly delayed and OCURA was under pressure to pull the rug out from under him. It was built and just sold for a record price/unit.

What's wrong with the Waterford? Are you talking about the hotel, office buildings, condos or the whole deal?

[jbrown84]

Who mentioned the Waterford?

[Will]

Who Mentioned the Waterford?

--

What we don't need in Midtown is a sequel to the Waterford.

[bluedogok]

If you like projects that run on schedule and don't encounter any delays or complications, you might be more comfortable with something in the suburbs where the dirt doesn't have any decades-old contamination issues, where you don't have to go through design review, where you don't have to deal with historic buildings, where you don't need to tap into TIF or tax credits to overcome reluctance of banks uneasy with urban development.

I can attest to the fact that every project faces issues where there are delays, even out in the suburbs. Sometimes those things are beyond your control and you try to deal with it the best that you can. The project that I have been working on for 9 months (in suburban Austin) and was supposed to start construction this month was shelved last week due to things beyond our control.

In renovation projects you never really know what you are going to be faced with. I know there were plenty of "unknowns" that we had to handle with JDM Place that we had no idea were there until demolition and those issues caused delays in the "optimal" schedule.

In design/construction a "schedule" and a "budget" are what you hope happens, that is until it meets the "real world" and then all budgets and schedules are subject to change.

[The Old Downtown Guy]

The only thing worse than Overholser Greens being put on hold would be if it were half built right not with limited near term sales prospects.

All the real estate gurus on this forum need to try jumping off the urban real estate development cliff, put their entire financial future on the line and see if that changes the content of their posts. I realize everyone is entitled to an opinion about any subject, but please stop acting like you have any clue about what you're talking about. No offense intended, but after a while, all the whining just becomes a little tedious.

Everyone is just going to hunker down until next March when the daffodils that foretell the coming of another spring will put some confidence back into the market. So, I'm going to focus on the joys of the season, the possibility that governing may become more important than politics in Washington DC and the coming long winter evenings I can spend with friends and family.

Pray For World Peace . . . pass it on.

Michael Smith

[Pete]

If you like projects that run on schedule and don't encounter any delays or complications, you might be more comfortable with something in the suburbs where the dirt doesn't have any decades-old contamination issues, where you don't have to go through design review, where you don't have to deal with historic buildings, where you don't need to tap into TIF or tax credits to overcome reluctance of banks uneasy with urban development.

Which of these apply to Overholser Green?

Maybe only the last one but you could make that claim about any project.


Delays are one thing. Not having financing after a year, not even having a time frame from when that might happen, not being sure if your project is even viable and missing several deadlines without any type of future assurance is another.

[jbrown84]

I think the point is that Overholser Green is taking a lot of heat, but Humphreys is in the same boat at this juncture.

[Steve]

Pete, my comment was intended in general for the "real estate experts" being cited by the Old Downtown Guy.