South Bow building deffered

[Nehkara]

Originally Posted by You Need a Thneed

According to official reports that came out later today, "deferred" in this case just mean that the above grade portion will be started after the Main building is occupied, instead of them finishing the south block at the same time as the main building. Roughly a year to two years delay in the finish of the south block (the 7 story building).

The North Block is still full steam ahead until it's completed in 2012.

Precisely. They will now start above-grade work on the South block within a year of finishing the huge tower on the north block. Just a delay really, to save money.

[Table 5]

Originally Posted by Nehkara

Precisely. They will now start above-grade work on the South block within a year of finishing the huge tower on the north block. Just a delay really, to save money.

The thing is, we've heard this many times before. There are plenty of projects in Calgary that were supposed to have additional portions down the line, and never were built. First Canadian Centre (the white triangle topped building) and Bow Valley Square come to mind.

Usually, I can't say too m,uch, cause hey, that's business. But when there is a historical building involved that the city demanded be saved, it's not acceptable to delay years. The way things are going these days, developers can just leave empty pits and construction sites dormant willy nilly at their discretion.

[Suave]

Originally Posted by Clarkey

How so? I'm genuinely interested, all I see is concrete, steel and glass?

The podium level is a historic building.

[Table 5]

Yep, definitely one (if not THE) nicest heritage buildings in the city. We don't have many of these around, everything possible must be done to keep them standing. We've already lost a few gems in the last year....Penny Lane and the Curtis Block among them.

[Bunk]

Yeah, if you actually read the details of the article, it's not really a big deal. It'll just get finished a couple of years later than they had originally hoped. HR Reit had a difficult enough time financing this project, this is probably to reduce overall costs to get the tower complex done, then focus on the south block later. The do have an obligation, from a regulatory point of view, to finish it within a certain timeframe.

This project will be a real gem, and the south block, is underrated as far as I'm concerned with its contribution to the project and the overall downtown.

In a statement released Wednesday afternoon, Larry Froom, the REIT’s CFO, said: “To be clear, the operative word in this statement is ‘defer’. The south block is not being capped or cancelled. H&R is deferring the south block as a result of the current economic climate.”

He said the REIT is “making use of the phasing ability to focus on the north tower construction.”

“Construction continues on the below grade of the south block and has been designed to accommodate the above grade south block development. Later this month, H&R will provide further details on overall developments regarding financing of The Bow,” said Froom, adding that progress on the north tower is on schedule.

Calgary Mayor Dave Bronconnier said the REIT is meeting all of its obligations and commitments to the city regarding the project and its development permit conditions.

“And the commitment to the city was that they would start the south block within one year after occupancy of the north block,” said Bronconnier. “Now, what they had hoped to do a year and half ago when the world was different was effectively . . . (when) were about three-quarters of the way up (with the tower) then start the south block. But because of prices, the economy . . . they’re matching their private agreement that is between H&R REIT and EnCana to match the regulatory obligation which is to start the south block within one year of occupancy of the north block.”...

“Their (development permit) obligation within one year is to reconstruct that building on that site and provide a cultural and amenity space within the building,” said Bronconnier.

Alan Boras, spokesperson for EnCana Corp., said the company has reached an agreement with the REIT to essentially phase the south block development.

“They are working toward taking it up to grade and essentially that will be filled with a parking lot up to ground (level),” said Boras. “So they’re going to phase the second part and they’ve done that because of the economic environment.”

He said that as the REIT was working on its financing for the Bow project it approached EnCana and asked the company to consider a deferral of the south block development.

“So really this is just a change in timing. And this at the time was seen as a vital step . . . in keeping the Bow project on track so that it (tower) would be constructed,” said Boras.

He said that despite the deferral the intention is over time to build the south block.

[Barnes]

Does anyone know how this will effect the Regis hotel?

[Shazam]

Originally Posted by Table 5

Yep, definitely one (if not THE) nicest heritage buildings in the city. We don't have many of these around, everything possible must be done to keep them standing. We've already lost a few gems in the last year....Penny Lane and the Curtis Block among them.

Ever been inside? Like, really inside? There's a fantastic old fashioned elevator.

Also, Banker's Hall has the highest concentration of girlie calendars in offices I've ever seen.

[Shazam]

Originally Posted by Bunk

Yeah, if you actually read the details of the article, it's not really a big deal. It'll just get finished a couple of years later than they had originally hoped. HR Reit had a difficult enough time financing this project, this is probably to reduce overall costs to get the tower complex done, then focus on the south block later. The do have an obligation, from a regulatory point of view, to finish it within a certain timeframe.

This project will be a real gem, and the south block, is underrated as far as I'm concerned with its contribution to the project and the overall downtown.

I have zero confidence that the south portion will be built within the next 10 years.

[Table 5]

Originally Posted by octothorp

Bah, that seriously sucks. My wife's gallery is directly across the street from this, and we were really looking forward to having increased retail traffic in the area.

What's the name of the Gallery? Is it in Arts Central?

[Thunderball]

Originally Posted by Shazam

I have zero confidence that the south portion will be built within the next 10 years.

I wouldn't go that far. The South Tower was and is a total hubris project, while the main tower remains the essential project. Which means, as soon as times are good, H&R Reit/EnCana will want that sucker up and running to show how great they are.

I expect it under construction within the next 2-5 years.

[octothorp]

Originally Posted by Table 5

What's the name of the Gallery? Is it in Arts Central?

Yup, UPPERCASE Gallery, one the top level. <self promo>Be there for First Thursday tonight and the launch of our UPPERCASE Magazine!</self promo>

We've got a great view of the Bow construction site out the window and it's a lot of fun to watch the tower go up. I really do hope that the old york gets put back in as proposed in the initial Bow plans; not one of the greatest historic buildings in our city, but some of the art deco detailing on it was really nice.

[Shazam]

Originally Posted by Thunderball

I wouldn't go that far. The South Tower was and is a total hubris project, while the main tower remains the essential project. Which means, as soon as times are good, H&R Reit/EnCana will want that sucker up and running to show how great they are.

I expect it under construction within the next 2-5 years.

Really? Because I thought was the part that they could cut if oil prices fell.

[Bunk]

Well, part of the deal to sell the York was to construct it in a certain amount of time - as the article states to begin within 1 year of occupancy of the office tower. Maybe there's a stipulation that they would have to sell back the land to the City if they failed to comply? Not sure - but that type of stipulation, for example, with the development of The Bridges (formerly the general hospital site) is pretty commonplace in Corporate Properties' contracts.

[Wookie]

Transaction Commentary
H&R REIT announced that commitments have been secured from various Canadian financial institutions resulting from the successful syndication, co-led byRBC Capital Markets, of a $425MM construction facility for H&R's development project in Calgary - "The Bow". Legal documentation is currently being negotiated. The closing of the financing, which is expected within the next few weeks, is subject to certain customary conditions, including completion of documentation, which are typical for a construction facility.

nm

[Table 5]

Originally Posted by octothorp

Yup, UPPERCASE Gallery, one the top level. <self promo>Be there for First Thursday tonight and the launch of our UPPERCASE Magazine!</self promo>

Nice, I will have to check it out the next time I am in town.

My memory fails me, but you're the husband of the woman who runs Vangool, correct?

[Thunderball]

Originally Posted by Shazam

Really? Because I thought was the part that they could cut if oil prices fell.

Maybe they can, but like I said, when things are good, they'll want to demonstrate that, and complete the project.

I think they have to eventually build it, cause they needed it for density to build the main one.

[octothorp]

Originally Posted by Table 5

Nice, I will have to check it out the next time I am in town.

My memory fails me, but you're the husband of the woman who runs Vangool, correct?

That's right, though the gallery / magazine / publishing efforts through UPPERCASE are taking up all of her time and she's essentially stopped doing client work through Vangool Design.