I heard about this yesterday when a buddy went to the site and he asked why the site looks cleared. They said they are stopping construction for a month. Skysraperpage.com has been talking about this since yesterday and the Bee has reported it today
No doubt construction cost increases are playing a big factor in this, along with a contractor switch from Turner to Bovis and the slowing housing market.
A project of this size would be a monster for almost all other cites in the US, let alone Sacramento. Considering the break neck pace since it was proposed just a little over two years ago to where it is at now, this is probably a good time to slow down a bit and get this squared away with financing instead of pushing forward without everything completely nailed down.
Next couple months will be very telling.
Construction on downtown towers halted
By Mary Lynne Vellinga and Jon Ortiz - Bee Staff Writers
Published 7:43 pm PST Thursday, January 11, 2007
Construction has stopped on downtown Sacramento's most ambitious development project ever - two 53-story condominium and hotel towers planned for the foot of Capitol Mall.
In a sign of developer John Saca's ongoing financial struggle to build his skyscrapers, several contractors filed liens against him in the past week for unpaid bills totaling $7.3 million for such items as architectural work and pile driving.
Hit with millions of dollars in cost overruns, Saca is seeking additional financing. Without it, he likely won't be able to close on his $375 million construction loan from Deutsche Bank.
Eric Rasmusson, a spokesman for Saca, called the work stoppage "a short temporary regroup" while the developer tries to reconstruct a workable budget and secure his construction financing.
Saca is seeking a greater infusion of cash from the California Public Employees' Retirement System, which had already agreed to invest $100 million in the project. The pension fund hasn't said yes yet.
As to whether the pension fund would put in more money, Ted Eliopoulos, who joined the giant state pension fund this week as its new head of real estate investment, said, "We'll evaluate it and complete our due diligence."