Friday, September 29, 2006

Joie de Vivre Update

I was able to attend a community meeting last week for the Joie de Vivre hotel planned (interior demo is occurring as I write) at the Cal Western Life Building at 926 J Street.

His vision of a boutique hotel is one it that needs to be a reflection of the community and how it's citizens feel about it for it to be successful. That was what the meeting was about. To pick everyones brains on the subject.

The room was full of people from young and old, straight and gay, married and single, hipsters and hippies, different ethnicities, and different economic backgrounds, all with opinions of what the hotel should be like.

We were all asked to think of 5 words to describe Sacramento and the hotel.
My words were:
1) Unexpected/surprising -People are surprised to see what Sacramento is about after being here for a little while compared to what their perception was.
2) Lush -Trees, Greenery, Rivers, Parkways
3) Diverse - We are one most diverse cities in the US
4) Influential -Being the state capitol, politics and influence play a role in our city
5) Aspiring -For what Sacramento aspires to be

I personally wanted to stay away from the really old feeling words like historic, timeless, traditional and the such.

In the end, my group choose words that reflected the past and the hopeful future of Sacramento. Unexpected/Surprising, Lush, Aspiring, Influential, and Timeless.

While most people were on the same page other common words I heard most were welcoming, friendly and eclectic.

One part of the meeting that I found very interesting was when Chip asked everyone to tell him what percent of the hotel between the historic and timeless, and chic and modern they would like to see. The first lady who responded said 90% historic and timeless, 10% chic and modern, which I thought would be the common consensuses from most people in the my surprise the responce from the crowd was a big "No!!"

Almost everyone wanted to see this become something different from what Sacramento currently has, or is accustom to seeing. People wanted to see more like 10% "old" and 90% chic and modern, which I am very much in favor of. He mentioned that in the other meetings, people also felt this way. Which I was a little surprised at, but very glad to hear.

Maybe it's that I go to so many of these community meetings and a majority of people that go are the older generation Sacramentians that usually want to keep the historic, traditional and timeless parts of Sacramento alive and aren't so much into seeing the cosmopolitan side of Sacramento (regardless of how small it is, but is growing fast)

I am all for keeping the history of Sacramento, but I think a lot of times people are too consumed by it and try to portray it too often in everything we do. There are only so many things that can pay homage to the Gold Rush, Railroads, and Capitol. It gets boring and old after a while. Time to mix it up a bit.

Chip had what I thought was a good idea for the hotel (I'm sure he has been thinking about this for a while already). He wants to do a combination of both, which would include when you first arrive at the hotel you get a sense of history and timelessness from the building itself, but when you step inside, something more chic, modern and surprising with the lobby, entryway and restaurant, then as you move to the rooms from the elevator and hallway, slowly go back to traditional.

His reasoning seemed to be Sacramento has that older, timeless feel to it on the outside, but inside people are much more sophisticated, cultured, and modern than what they may be perceived as, but deep on the inside, there is still that sense of tradition. Pretty accurate in my mind.

One feature that I think will be absolutely amazing is the outdoor patio will be open on the 6th floor facing the Capitol Dome. If you drive down J Street you can see it when you look up at the building. As the area cleans up a bit more, I can imagine the most amazing wedding ceremonies at Caesar Chavez Park followed by a reception on the 6,000 square foot patio over looking the Capitol. This will be the spot for receptions in the future.

We were also asked about what we would like to see with the restaurant. Everyone was very adamant about a non-chain. They assured us it would not be a chain.

Since this hotel is supposed to be a reflection of the community, my recommendation was to look at a local restaurateurs such as Biba or Rick Mahan at Waterboy who have been part of the community for a while now. They seemed to want to do a play on all the fresh local produce we have access to here in California. While that sounds fine and dandy, it unfortunately also screamed more California or American cuisine to me.

One lady had an excellent recommendation to have the restaurants wine list include Delta wineries in addition to the usual Napa and Sonoma wines.

All I can say is I can't wait to walk through that lobby for the first time. I think this is going to be a real landmark project in Sacramento. Expected opening is Spring 2008

Wednesday, September 27, 2006

Rising Construction Costs Hitting Home

We all know construction costs have risen over the last couple of years due to the supply being eaten up by China and high fuel prices. These rising costs are affecting projects all over the country, including Sacramento.

The important infill project The East End Gateway project at 16th and O (others two sites are 16th and P and 16th and N), which was under construction and undergoing demo and site prep has been delayed due to construction bids that have put Loftworks 10% over budget.

The two sites are going to consist of 21 loft condo units for sale, 32 apartment, 8 for sale townhomes and about 23K in retail space. This is an excellent, excellent infill project that I have been excited about for years now.

The good news is material prices are expected to come down over with oil prices moving sharply down recently.

Loftworks is taking some time to do some value engineering to see where they can cut some costs. I try and attend the next CADA meeting on Oct 27th when an updated is expected and will report back.

My feeling is this will still happen, but it will just be delayed a bit. If they can get started back up again before the rainy season starts, we could see these two buildings done by very late 2007, early 2008. Originally, the timeline was Oct 2007.

Sunday, September 17, 2006

The first casualty....

The Sacramento Business Journal reported this week that DR Horton has canceled plans for Library Lofts and Jibboom Street Towers.

While I am not surprised the Jibbom Street Tower was canceled, I am a little surprised about Library Lofts. I thought this one was as good as gold considering the financial power of DR Horton and the counties desire to get rid of the building.

My thinking is that with the slow down of the market and Horton being a corporation, they have shareholder to answer to and taking a risk on a project that may not produce the great returns was not in the cards right now. Remember, these weren’t going to be luxury units, so the prices would be lower, and risk probably be higher with the raise in materials.

We all knew this was coming at some point. There was no way that all the condo towers proposed would get built. This one hurts since these units, while not "affordable" were going to be built targeting a much more moderate household income, which we all know is needed amongest all the higher end product on the market right now.

The key is to still get as much mixed use housing built during this boom as possbile. In the last couple of years there have been about 550 units completed, and about 1500 under consruction, in addition to over 600 hotel room, including one of my favorite projects, Joie de Vivre at 926 J Street. That could be a huge jump in people in and around downtown in the next couple of years.

To me, the most important projects to see get built aren't the biggest ones, but the ones that will create the most synergy with what is already built and under construction, like Cathedral Square Tower, The Metropolitan, 700 K Street, 800 K Street, 10th and K, Crystal Ice, and the other two East End Gateway sites.

Speaking of synergy, will some developer PLEASE buy the surface parking lot at 16th and J and build housing or a small hotel on it!! The folks at Loftworks would have been smart to pick up that property when they first rehaded the Elliot Building. After what has happen on that corner, I'm sure the owner is holding out for a kings randsom.

There was also a note in the article that Aura has financing and is simply waiting for permits to get going. Groundbreaking should be middle to late next month.

Friday, September 15, 2006

More Arena News

I'm sure most of you have seen the news that the Maloofs have walked away from the arena talks again. I do think the Maloofs want to be here, but they also want a very good deal as well

The latest worries me. It sounds as if the Maloofs want to turn the Railyards around the arena into another Natomas. I won't vote for a deal that sacrifices the plans for the Railyards, even if it is a small portion. From what it sounds like, the Maloofs want no competitive retail or restuarants within 1000 feet. I don't like that one bit.

The point of an arena in the railyards is to create a walkable entertainment district, not another suburban arena

Put it in Natomas if that is the case. I think that is where the Maloofs want it anyways. I'd take the vision of the railyards over another suburban arena that is just 5 miles closer to downtown.

Now the question?
Do they work out a last minute deal (again) for something in Natomas to keep the Kings?
Screw the Kings and build an arena in the Railyards according to the plan we want?

The problem with #2 is there is no one major tennat and the city would be stuck with the operating costs where in #1 the Maloofs would paying for them, a major tennat that is paying on average 4M a year over 30 years and 20M cash. Also, I don't think Millennia would agree to drop all the housing, hotel and retail in the area. I think the Railyards is close to dead.

I would still vote yes for the tax increase because I think the money could be spent on many good things in Sacramento up and above the facility, but I would vote no on the other measure if the above plan is what they draw up.

Leaders will push ballot measure with or without the Kings
By Mary Lynne Vellinga - Bee Staff Writer
Last Updated 3:33 pm PDT Wednesday, September 13, 2006

Discussions between the city and county of Sacramento and the Kings owners over the terms of building an new arena in the downtown Sacramento railyard have stalled.

The pro-arena forces were left Wednesday with the very real possibility that they may be campaigning for a new sales tax to build an arena in the railyard without the Maloofs, owners of the local NBA franchise, on board.

"We still consider them part of our team, but it is our arena, and we will decide where it goes, and the public has said loud and clear that the best place for the arena is in the railyard," said Assistant City Manager John Dangberg, who has represented the city in talks with the team.

County and city staff members had committed to producing a memorandum of understanding with detailed deal terms by Oct. 6. But even if that document never materializes, the ballot measure to raise the sales tax by a quarter cent remains on the November ballot, Dangberg said. So does a companion advisory measure asking voters if they want to spend about half the $1.2 billion in new taxes on an arena and the other half on community projects.

Disputes with the Maloofs have centered on parking, the amount of land that will be set aside for the arena, and uses immediately surrounding it, said those involved in the negotiations.

Joe Maloof said Wednesday he supports the idea of putting a new arena in the railyard, but won't go along with it if it means it will put "the franchise in jeopardy."