Wednesday, June 11, 2008

McGowan Delays Start of Heer's Tower Renovation as City Officials Consider Park Central Square Issue

His interest in downtown is not waning

Developer puts brakes on Heer's Tower lofts, Springfield News-Leader

"On Tuesday, he (Kevin McGowan) met with the owner of the McDaniel and Woodruff buildings -- downtown -- and indicated an interest in other buildings in Springfield.

"We are looking at more than the McDaniel and Woodruff buildings," he said. "I've said before that if we came to Springfield we weren't interested in doing just one building. I don't find the recent issues involving the square to detract from that.""*

Shop owner: Heer's delay 'frustrating' , Springfield News-Leader

I can't help but wonder if the News-Leader's Mr. Bridges told the shop owners that McGowan is interested in purchasing other properties on the square and that he doesn't find the controversy over Park Central Square's Eligibility for the National Register of Historic Places to be a detraction from those plans. I'd think other invested downtown property owners would find that anything but 'frustrating.'

Further, Springfield's Economic Development Director fully anticipates beginning "Phase II" of square renovations by the deadline of August 1, which will meet the contractual obligation with Kevin McGowan under their agreement, isn't that what she said?:

"I don't have a date for bidding yet, but we feel like we have just enough time to get everything underway so that we could start construction by August 1st.

"If we need to, we can break the canopy out as a separate contract. We already know what we need to do in order to take that down and that would absolutely be the start of construction on repair of the sidewalks, and we've been working with Kevin McGowan, he thinks that this is a really good solution. He obviously wants the sidewalks in front of his building repaired." - Economic Development Director Mary Lilly Smith, June 3, 2008

Why does it seem that some people are trying to make this out to be more of a problem than it really is, unnecessarily worrying the public that the city will end up buying back the Heer's Tower? Is that productive?

Yes, McGowan has a "put option" under the agreement with the city of Springfield that he can force them to buy back the Heer's Tower if they don't begin construction on the redevelopment of the square by August 1.

Yes, the city has double insurance on meeting that deadline. According to Smith, the city will be able to mark the beginning of construction on "Phase II" by starting the process of removing the canopy:

"...that would absolutely be the start of construction on repair of the sidewalks...." - Smith

So, there you go.

We can have our cake and eat it too. We can begin construction of Phase II, by the August 1 deadline, by removing the Halprin canopy, thus taking away the threat of McGowan exercising his "put option" and forcing the city to buy back the Heer's building, and the city will be in a postion to more carefully and fully weigh the decision concerning how best to renovate the Halprin designed portion of the square.

McGowan seems like a smart business man. He takes his time and is methodical about how he proceeds. Usually, less mistakes are made by a person who takes their time and doesn't rush into the decision making process than when one gets in a hurry to make something happen.

Kevin McGowan impresses me more and more all the time. :)

*emphasis mine

Update: Background: McGowan gung-ho about Heer's, April 23, 2008:

"McGowan doesn't seem the least bit concerned.

"That issue (Park Central Square design) is going to be resolved," he said. "The Heer's project is going to get done -- I promise you that.""


take two said...

Maybe the really smart ones are those folks in the City Public Relations Dept that skillfully write these news releases and gets the News-Leader to publish them as though thy are reporting news. Several of them used to work for the News Leader and have excellent luck getting their releases published this way.

This release meant to scare tax payers into being upset with Dan Chiles for speaking his mind. Maybe this will decrease his image in the minds of those of us who are pleased that he had the courage to think outside of the city staff's dictates. They won't like him until he becomes another bobblehead nodding their suggestions.

take two said...

The housing market is terribly slow, and the developer may be looking more cautiously at his $25 Million. How do you sell a high dollar condo when fabulous homes are dirt cheap right now and getting cheaper? The stock market took another dive recently. How does that affect his market for expensive condos? Maybe the developer is playing it smart to try to use that trump card. But then the tax credits must be pretty good on downtown property with him looking to buy more.

take two said...

Notice how McGowan was quoted the very next day that he WAS ready to proceed. What happened from one day to the next? He wanted to delay the development 60 days one day. The next day the NL says McGowan wants to proceed with investing $25 million and has sales meeting set up.

Do you suppose McGowan noticed that the variable news releases the City staffers got published made him look like a jerk, and not many people want to buy condos in a cooperative arrangement with a jerk.

That "delay" story got turned around real fast. I suspect it is because McGowan knew nobody would want to do business with somebody full of notions on whether or not it was a good investment. Not a good sales tactic to look like your plan is shaky.