C List
-
Posts
17 -
Joined
-
Last visited
Content Type
Profiles
Forums
Events
Posts posted by C List
-
-
33 minutes ago, dbigtex56 said:
I've lived in Midtown for ~ 5 years, and have noticed that there seem to be fewer dry cleaners than there used to be, even as the population and density increases.
Do the newer apartment complexes feature dry cleaning pickup for residents? Are people driving out of the neighborhood to get their clothing dry cleaned? Do they wear their clothes until they stink, then throw them out?Yes, new high-end apartments are increasingly featuring hotel-style amenities to include dry cleaning, housekeeping, and valet service. A local start-up, backed by local VC firm the mercury fund, has made great inroads with the big developers in Houston to offer these amenities.
-
1
-
-
On 7/24/2019 at 11:50 AM, Luminare said:
Absolutely! They definitely aren't the sharpest knives in the drawer. They always seem to have contractor issues, and at this point its not just a one time thing, but a pattern. Now this is merely an allegation, as I definitely don't know whats going on, but I know from knowledge and a little experience that when contractor problems arise it often times is the case when a project isn't properly bidded and instead is given to a contractor that is a "friend" of the client who wants a project to be built. This almost always hurts a project because often times the "friend" that is hired isnt one that can actually do the job. Once again this is just an allegation and speculative at best, but with multiple failed projects or delayed projects this is an allegation that I'm feel confident in making. This is organization that needs to clean house and restructure their team that approaches these kinds of projects.
Even better than giving the GC work to a friend is to keep it in house! The conflict of interest within this firm it out of this world
-
2
-
4
-
-
1 hour ago, kbates2 said:
I don't think that this would be anything constituting a crime. The 32% return seems to be based on a 5 year investment, so we are really talking about 6%+ returns a year. Still, my understanding is that the real estate market is based on full project returns, which this would seem to be, and cursory internet searches tell me that 18%+ returns on projects are opportunistic and thus a gamble if that is what you are banking on.
Telling somebody that you are shooting for super high returns usually isn't a crime. Ponzi schemes and the like are a result of people covering up for these promises by using others monies to pay that gain while continuing to make absurd promises. If they showed investors false financials claiming that they regularly receive those type of returns, that would be where the crime comes in.
My assumption is that 32% IRR does happen, it just is an exception - not the rule. If I was going to invest in this, I would want to see how they expected to achieve that based on prior performance.
Earning 6% a year does not equal a 32% rate of return, it equals 6%. That is why a bond with a coupon rate of 6% gives you a return of 6%, see below.
To achieve a 32% return as a developer you have to create a tremendous amount of value at exit.
Leveraging a property with two loans, a senior and mezz note, is one way to help you achieve this return. The downside is, when one thing does not go as planned then you can't cover your interest and the banks foreclose on your property (Banks do not like to foreclose on a property that is not complete, so they will work with developers but they will take 99% of the investor's money). Which it sounds like is happening below, they probably misrepresented to the two lenders who was a priority to foreclose on a property that was underwater, which is fraud.
The 32% is not fraud it is just deceitful (edit). Returns on real assets (properties) over the past 10-years have come way down. Real estate is very competitive and asset prices are high. With 10-year treasuries so low investors are looking for anything with yield and are willing to pay higher prices which lowers overall returns. If you are not familiar with real assets than it is easy for you to see a 32% and say holy S$%t I want it, but in the current environment, there is almost no way you can achieve that return.
1 hour ago, Vy65 said:I don't do criminal law, but my understanding is that bank fraud, like any form of fraud, requires intent. I skimmed through the indictment, but it sounds like misrepresentations were made regarding the lender's priority, secured status, repayment schedules, etc ... and not about overall return values. But like I said, I skimmed it.
I'm curious to find out if any of the crowdfunded investors have made any complaints regarding the Houston property. I spent the morning searching but couldn't find anything on the internet.
To clarify, the indictment is brought by the US Attorney concerning what a couple of Illinois banks were told regarding what they were told about the status of their loans. It's not about the return numbers. I'm sure the prospectus has all kinds of disclaimer language that would foreclose a civil, let alone criminal, complaint on that score.
-
4
-
4
-
-
2 hours ago, Nate99 said:
I just want to know who gives them cash to start these things. I can come up with way less wasteful uses for their money that involve Italian sports cars and nice vacations for me and only me.
There is definitely something fishy with how they conduct business and it starts with funding. They crowdfund their equity using unrealistically high returns with no mention of a hold period, not to mention they have a senior note and a mezzanine note to pay off. Their team is incredibly small and it doesn't look like they have any dedicated team members that work in Houston, so no developer on site. This group screams incompetence and I would love to get my hands on their prospectus, no doubt there are some upset people that saw their money vanish (Dolce Midtown).
https://www.luxecrowdfunding.com/regalia-at-the-park-2/
-
6
-
-
On 6/25/2019 at 12:04 PM, H-Town Man said:
A couple updates. Hines was already the property manager, diminishing my hope of a policy change regarding the sky lobby. This property sold for $300/SF, a little more than twice what Marathon Tower recently sold for on a per SF basis, illustrating the health of the downtown office market. Marathon does have a major tenant going dark, which accounts for some of that difference.
Skanska/Capital/BofA Tower and 609 Main are both looking to be sold in the next year, pricing in the neighborhood of $600-700 psf in both buildings. Buying 600 Travis at $300 psf (along with Cerebrus Capital who specializes in distressed assets) leads me to believe the building has major leasing issues and is in need of serious upgrades. I wouldn't be surprised to see a 8-9 figure capital injection to reposition the asset.
-
1
-
1
-
1
-
-
On 5/6/2019 at 12:38 PM, BeerNut said:
they've recently done patch work on the road and curb cut outs on Richmond between Montrose and Spur. Seem like a waste if they plan to put in BRT. There is sign in front of Post Oak apartments detailing the project but I was driving a missed the details
They've continued to tear more of Richmond up, Westbound between Yoakum and Dunlavy and eastbound between Shepard and Kirby
-
2
-
-
-
On 12/18/2018 at 10:35 AM, H-Town Man said:
Thanks for this.
More information in the news on EB-5 -> With the amount of scrutiny on EB-5 I wouldn't be surprised if this project gets further delayed.
And if you look here below you can find renderings for the Marlow, Hotel Allesandra, Kirby Collection, Arabella and more
-
1
-
1
-
1
-
-
12 hours ago, UtterlyUrban said:
Midway acquired the Pavillions in 2012, I think. In the last 7 years midway has created lots of pretty pictures and installed some grass on some roofs and some patch of AstroTurf called a “lawn” to hold events on. They have also built a hotel.
the pretty pictures that they published look nothing like what they built. Remember that grand hotel edifice and the “value engineered structure” that they actually built? Meet me in the Sky lobby, anyone? How about those expansive dry goods shopping spaces?
They own the property and they are free to do as they wish. And I am free to not believe that they will ever do anything at this property remotely like what they describe in their pretty pictures and flowery prose.
oh, and I hope, I desperately hope, that one day, they prove me wrong.
1To be completely honest, Midway does not own the property. They are the General Partner so they probably own 5% of the property and would not be putting up the majority of the capital for renovations, all they do is provide the vision and programming. It is up to the Limited Partner (Lionstone) to decide when and what actually gets funded.
I know everyone likes to think designing, programming, and construction are the epicenters of buildings but I promise it is finance. I'm willing to bet that when the team got their hands on the property in 2012 and then sat through the downturn 2014, that the property needed a whole lot more money infused and that the returns weren't worth it. Sometimes you have to sit on a property and find the right time, sometimes you have to admit you got it wrong and sell.
If it was easy to flip/build a property I'm sure you would be doing it yourself.
-
2
-
1
-
-
56 minutes ago, ttuchris said:
Does anyone know what happened to Alexan? I noticed the name was changed to 1414 Texas and it is now owned by ZRS Management. Seems like a really quick sale. The building has only been complete for 6 months.
TCR is a merchant builder, if the price is right they would sell as soon as the property is completed.....if not sooner
-
You also need to understand how a project gets financed. The initial renderings are nothing more than marketing especially for a project like this. I'm almost 100% positive this is an EB-5 equity financed project, meaning the initial renderings are shown to thousands of wealthy Asian/African investors to draw them in. Under this program, the foreign national must invest $500,000 or $1 million in exchange for an expedited green card process, depending on where the project is located. So you are showing these renderings to nonprofessional real estate investors whose primary focus is not on their money but being allowed into the US. Now, this first phase is probably a 100-200-million-dollar project if not more, which means you have to find a LOT of foreign investors to put up money before a construction loan even becomes a possibility.
Once the developer gets close to putting shovels in the ground he is 100% not going to build the marketing renderings; he has no incentive too. The great thing about EB-5 is the cost of equity is almost nothing, like a 2% return to the foreign investors with no definitive timeline on when that money will get returned. A developer like Hines or Hanover will have a cost of equity around 14-20%, a huge difference! So you over promise and under deliver, because if you can get anything built that looks halfway decent and leases up, you as the developer, will be swimming in money once you sell.
-
1
-
-
Probably the leasing center for the Condo's
-
I doubt this will be built anytime soon. As far as I know, DC partners almost exclusively use EB-5 financing for equity to build their projects. They still need financing for several other projects they have listed on their website.
Minute Maid Park Mixed-Use Development
in Going Up!
Posted · Edited by C List
Adding map
Yes, Jerry Jones has set the standard for this and his real estate plays are a big reason the Cowboys franchise's valuation has gone through the roof. While this is not the stadium, to do what he did at a practice facility is unreal.
https://www.thestarinfrisco.com/