The building is marked for an amazing transformation by Mark Freidman into housing and retail, "The Ice Blocks", along with a pedestrain walkway with festivals, walking, outdoor eating, street venders and markets. Go check out the great photos he has up.
Here are some other old photos I found online.
Man, I love the way the new Crystal Ice block will look. What are the chances of this actually being built? I only say that cause it seems like nearly every large project proposed these days gets held up, stalled, and then dies on the vine.
ReplyDeleteI hear ya. Its been pretty frustrating seeing all these projects get held up.
ReplyDeleteRetail West Inc is looking for retailers, and the plaza has design funding from the city and CADA, but other than that I haven't heard much else other than Freidman saying in an article recently things are progressing "slowly".
Freidman has done other rehad projects (Elloit Building) so he seems to have ability to pull it off. Dealing with old buildings and rehad seems to always be tricky though, so time will tell.
Maybe Wburg heard something new at the meeting he attended that he can share with us. :)
Typically, developers come to the neighborhood a year or so before actually submitting their plan to the city. This is done to gauge neighborhood reaction as well as to get a certain amount of neighborhood input.
ReplyDeleteFrom what I heard at the meeting, the land-sale portion of the deal is done: Friedman bought the land from Tsakopoulis, he owns it already, so there won't be an issue with land assembly. There wasn't a lot of outrage or anything from the neighborhood, although the issue of an exemption for height (90 feet when zoned for 75) was raised.
I'm a bit cynical about when a developer asks for public input, due to past experiences with developers. But according to one of the development team, the public input from this meeting was better advice than they got from a fairly expensive focus group they paid some marketing company to do, and it was a lot cheaper.
I'm hoping that they will hold more meetings in the space--next time I'll bring my good digital camera!
One things for sure, developers will say anything to give the impression that things are fine on a project to boost sales and the publics impression of a project. I have been close with several developers, and I was really sad that at the end of the whole dog & pony show on how much they mislead myself as well as the media, and the city as to what was really happening with the project. Well, just about everyone who got info from them as to the progress of the project.
ReplyDeleteI know not all developers are this way, but I'm really hesitant to believe anything they say till the project is rising out of the ground.
Thanks wburg. I think it was about a year to year and half that he closed on the land property, so a year out from submitting plans sounds about right.
ReplyDeleteOur timeline usually starts about two years before we hope to break ground. Our due-diligence process typically lasts about three months (although I have done some in one!)and during that time we determine best/worst-case scenarios. Even just a few years ago, due-diligence could take up to six months but as a ever increasing number of players pursue a finite number of developable properties, brokers/sellers/cities demand - and get - shorter time periods to wait for cash-flow.
ReplyDeleteWhat you can actually do with a specific property is surprisingly limited. Site constraints/political constrains/market constraints/cost constraints are pretty much the same for everyone. Development is - after all - the art of the possible. Although this is a paraphrase of a famous line about politics, it is completely accurate regarding development too.
After you've completed your due-diligence package. You take it to the appropriate in-house committee for action. It's called many things, a Bank Committee if you need financing, a Land Ac. or Forward Planning Committee. You typically have several bullet points regarding the various constrains and potential profits and rank the various risks for approval. Most of the ones I've done are on a 1-5 scale or something similar.
Assuming approval, only now do you go to the city/neighborhood to start the official process.
Many cities now employ a project manager system and it sounds like Sacramento may have moved to this. You are now ready to meet the local planning/neighborhood group for the first time regarding the project and the city PM will direct you (if you don't already know)to the appropriate person while placing your project in the process. At this point you have no real plans to submit, but you do want a placeholder so that you may nimbly act when ready.
Here's where the real fun begins. I won't go into detail now because you never know who's reading your posts. But a lot of success depends on your previous relationship with the local group or, if you've done nothing in this area before, how quickly you can establish trust.
You can usually tell pretty quickly who you can work with on any committee. You need to ascertain their particular concern. Traffic/noise and parking are always huge issues and will always be the last insurmountable resort for those who want no change in their neighborhoods whatsoever. Parking can run anywhere from $10-50k a space so if you're already providing 1.5/unit (I'm not sure what the requirement is in Sacramento)and the neighborhood wants 2.2/unit it can easily cost you half a mil. and, oh, by the way, we want 30% of the units to be 60 percentile affordable and... hmmmm, I seem to be digressing here.
For those who are cynical regarding their experience with developers, believe me, the cynicism is a two-way street. The "E" in CEQA could easily stand for "extortion" and sometimes it's as easy as... well, again, I don't want to give too much away. If you have a lot of owner-occupied homes near-by, illustrating the rise in property values your project should afford them in the long-term is often successful in ultimately getting their approval. Apartments are almost always a harder sell than condos for urban projects. With apartments you point to the retail/commercial/services and other amenities that the project will bring to their neighborhood. You stress that these services need a local population to thrive - a population your project helps provide. With Crystal Ice, it appears that it needs to go to 90' to support the services the entire community will benefit from. You need to make the reason for that zoning change clear and show how it benefits all.
Contrary to a lot of public belief, most development firms take a great deal of pride in their work and every PM I know (including me) got into this field because we wanted to leave a legacy of thriving, livable communities. We can usually find kindred spirits on any planning/neighborhood group and those are the people with whom you work closely to create - with their input - a terrific project that benefits your community's residents and the neighbors.
It's only as this excruciatingly long process nears the end do you begin the fun with the city.
It's part of why PMs are so well compensated and it's why the work is so satisfying and fulfilling.
This projects looks outstanding from every angle. It is undoubtedly the result of long hours from people of good faith from both the neighborhood and the developer.
Other than advance sneak peeks, the neighborhood has only gotten their first look this Wednesday. There was a city planning manager with the developer, so they are indeed getting their ducks in a row. The audience included a lot of pretty smart people who are involved in the local preservation community, so this was definitely a tough audience for Friedman, but he went over pretty well. I think everyone there, developer, neighborhood resident or city staff, wants to see those blocks utilized rather than simply demolished--the question is the details, and as william mentions there are a LOT of details. The newer generation of developers seem to really prioritize values like green building, transit-oriented development, and creating cityscapes over the older Buzz Oates school of "build ugly stuff and make a lot of money" development.
ReplyDeleteTypically it helps keep good relationships with the neighborhood activists, too. While we all love free food (the pizza from Bernardo was great) most of us neighborhood activist types are also very interested in public transit, sustainable building, walkable neighborhoods, and avoiding sprawl. As a result of that interest, many have gotten pretty good at telling when a developer is actually interested in those things and when they're throwing around buzzwords.
thanks for the insight, william. that was a great read. it's not often that you get to hear an unsolicited persective of a developer.
ReplyDeleteand a side note... i was just accepted to the City's Planning Academy. i've been waiting for this for almost two years now. should be cool :)
Very cool, TD. I really wanted to do it as well, but life got really busy over the last 6 months, so I had to postpone doing it
ReplyDeleteYeah, you'll usually have a planner or your city PM join you at these meetings. This way, the city gets a feel for what a neighborhood wants but also discourages items that might sound great but, for whatever reason (legal, financial, infrastructure), are impossible. The staffer can also answer specific questions regarding city policy or process that you simply don't know the answer to. A smart PM considers considers city staff every bit a part of his team as he does his civil engineer. He also needs to hold the neighborhood planning group with the same regard.
ReplyDelete15 years ago, development firms wanted all of their PMs to have engineering backgrounds. Ten years ago, they leaned toward MBAs. Now, you often find PMs with planning backgrounds in great demand.
The reason is simple. Your PM needs to be able to guide the project through the neighborhood and city staff process. You need both a skill set and a philosophy that matches these groups.
Most PMs with planning backgrounds share a similar vision of what makes a good community with city planners and local residents (someone in the local group always has some planning experience - often more than one). You can speak their language and you share their goals. A strictly financial guy that tries to fake it gets outed in a minute these days. The financial guys always think they're the smartest guys in the room and don't realize - often until it's too late - that there is enormous talent in the local planning groups. That attitude will kill you.
Utilizing that talent helps in a thousand different ways. Some more tangible than others, but they all contribute to better establishing the necessary trust that allows a project to move forward.
You still need to make a profit. Your investors have many choices as to where they put their money and, given the high risk enterprise that development is, that return has to be pretty darn good.
Also, be it a great neighborhood group or one that doesn't want to listen to anything, the process never goes perfectly and some people you will never satisfy. But no matter what type of local group you are working with, some people will come to trust you. That trust saves your firm hundreds of thousands of dollars (or more) and results in a much better project - the very definition of "win-win."