Time to acknowledge this significant project properly by giving it it's own thread. Here's some background about the project going back to May....

 

On 5/13/2020 at 11:54 AM, KJP said:

 

WEDNESDAY, MAY 13, 2020

Developers, investors making big plays on Flats' West Bank

 

Despite the economic slowdown, several prominent local and national developers and investors are making big real estate plays on the Flats' West Bank, across the Cuyahoga River from downtown Cleveland. The end result could be a mix of buildings with mostly residential offerings and at least two of the developments possibly rising to 20 stories or higher.

As one real estate insider said, "That area might be the next hotspot after Hingetown." He's referring to the northeast corner of Ohio City, adjoining Flats' West Bank, where just about every block since 2000 has had a development project built, underway or planned. It's about time, as the Flats' West Bank sat out Cleveland's redevelopment boom of the 2010s.

 

MORE:

https://neo-trans.blogspot.com/2020/05/developers-investors-making-big-plays.html

 

 

AND

 

On 5/17/2020 at 2:21 PM, LlamaLawyer said:

Awesome work, @Geowizical! What a dramatic difference.

 

By the way, here are some of the Stonebridge views that would be impacted by the 2208 tower.

 

 

 

AND

 

On 5/26/2020 at 10:19 PM, KJP said:

 

 

TUESDAY, MAY 26, 2020

Flats West Bank high-rise plans revealed

 

At a meeting today of the Riverfront District Block Club, developers presented their plans for a high-rise apartment tower near the top of the hill above Flats' West Bank. It is the first of what is likely to be more residential towers publicly announced in the near future for the West Bank.

The development team, led locally by Walton Hills resident Wayne Jatsek of Jatsek Construction Co., presented preliminary plans for a 24-story tower at 2208 Superior Viaduct with about 186 market-rate apartments above six levels of parking totaling roughly 128 spaces, according to documents presented by Paul Glowacki of Lakewood-based Dimit Architects.

 

MORE:

https://neo-trans.blogspot.com/2020/05/flats-west-bank-high-rise-plans-revealed.html

 

 

AND

 

On 7/13/2020 at 3:40 PM, urbanetics_ said:

New renderings for the “The Viaduct” - and I gotta say, I’m really blown away by this latest iteration!!

 

I absolutely love the greenery and trees integrated throughout the tower.

 

 

AND

 

On 8/7/2020 at 4:00 PM, Mendo said:

The frontage along the viaduct looks fantastic.

 

 

 

 

 

AND

 

7 hours ago, urbanetics_ said:

A few comments:

1. I found this rooftop rendering I hadn’t seen posted before and thought it was epic.

 

2. Hopefully a reimagined Superior Viaduct as a Highline-esque public park can happen concurrently or resulting from this development. This space has so much opportunity and potential to be something far more community-serving and publicly enjoyable rather than asphalt car parking.

 

3. A before (today) and after (rendering) view along the Viaduct.
 

 

 

 

New Twitter account and project brief at Dimit Architects' web site (unfortunately "Viaduct" is misspelled)....

 

 

Is it the Viaduct, or the Viadauct?

Oh my, that's a really ugly spelling with the extra "a". I really hope its just "Viaduct".

When I lived in the Stonebridge condo building, we were looking at renaming the building to get away from the stigma of the shoddy construction and differentiate the building from the K&D apartments after the (still not started) recladding. I proposed the name "The Viaduct", but it was voted down. They missed a great opportunity there. It's the perfect name for a highrise in this area. 

43 minutes ago, PoshSteve said:

When I lived in the Stonebridge condo building, we were looking at renaming the building to get away from the stigma of the shoddy construction and differentiate the building from the K&D apartments after the (still not started) recladding. I proposed the name "The Viaduct", but it was voted down. They missed a great opportunity there. It's the perfect name for a highrise in this area. 

Maybe if you had proposed “The Viadauct” you would have won that vote. 

Does anyone know anything about this developer? It just seems like a massive project from a relative unknown. No website (that I could find) or anything beyond what Dimit has. I just wonder if they have any financing lined up. Many banks are tightening their CRE lending to mainly first tier clients. (And if all of this has been answered, apologies)

1 hour ago, Paul Jandro said:

Does anyone know anything about this developer? It just seems like a massive project from a relative unknown. No website (that I could find) or anything beyond what Dimit has. I just wonder if they have any financing lined up. Many banks are tightening their CRE lending to mainly first tier clients. (And if all of this has been answered, apologies)

 

Excellent questions @Paul Jandro !! I ask those same questions in an article I posted today (below). I didn't realize that United Community Developers is also developing the West 73rd Apartments project too! It has no history with any completed new-construction developments projects. Now, two big projects on the same Planning Commission docket totaling $120 million or so. That said, I've found Wayne Jatsek to be a straightforward, unassuming guy when he speaks. He's very much in control of himself. He's already won over some pretty important people in Cleveland's development community...

 

 

Thanks, Ken. Just saw your article and not surprised you were a step ahead of it. Fingers crossed he can pull it off. It’s a good sign they’ve actually sunk some costs into it. Will be interesting to see if they can keep up this pace. 

Is the W. 73 Apartment bldg a separate project from this four-story apt. bldg on W. 73?:  https://www.crainscleveland.com/real-estate/four-story-apartments-proposed-battery-park.  With the empty site immediately behind it on W. 70, it looks like the project that planned two bldgs back to back one on W 73 and one on W 70.

23 minutes ago, Pugu said:

Is the W. 73 Apartment bldg a separate project from this four-story apt. bldg on W. 73?:  https://www.crainscleveland.com/real-estate/four-story-apartments-proposed-battery-park.  With the empty site immediately behind it on W. 70, it looks like the project that planned two bldgs back to back one on W 73 and one on W 70.

different projects

Yeah not to get off-thread but other is Avenue Partners our of Columbus, I believe. 

Thanks to @KJPfor creating this new thread - very helpful to keep track of latest posts on this specific project!  I’m really rooting for the Viaduct to mirror the rapid pace of The Lumen from its announcement to its groundbreaking and construction. 

5 minutes ago, CleveFan said:

Thanks to @KJPfor creating this new thread - very helpful to keep track of latest posts on this specific project!  I’m really rooting for the Viaduct to mirror the rapid pace of The Lumen from its announcement to its groundbreaking and construction. 

The thing is that the Lumen was an "unannounced" thing for years as PHS tried to pin down a few public subsidies and had a hard time trying to find a developer who could make the numbers work before finally deciding to go it alone, so it really did not move at the speed this project is moving.  Viaduct seems to have popped out of nowhere (at least that is the impression) and has progressed very quickly preliminarily (design, retaining contractors like Osborn, neighborhood engagement, finding partners and speeding through the city approval process despite the Covid crisis).  It almost seems too good to be true.  Hope it continues as I love this project and what it could help spawn in the immediate and adjacent neighborhoods.

Two things appear to be expediting The Viaduct, City Club and another new-construction tower that's lurking out there. Stan Bullard of Crains mentioned one of them on Twitter -- the time-limited availability of capital through the Opportunity Zone program. The value of this program decreases over time as the capital invested in an O-Zone fund gets fewer tax benefits the later it is invested. So developers are trying deliver projects now while the program is near the beginning and the full benefits can be enjoyed. But it may not be so time-limited. When this program runs its course, I fully expect that there will be a push to renew the program in some form with lessons learned from the first version.

 

The other aspect is that the Cleveland urban core's multi-family market is pretty strong and getting more mature. And now it is evolving somewhat with the introduction of micro-units so more people can afford living in the urban core while still producing the same or similar rent incomes for developers. These new high-rise projects plus many smaller ones will continue that maturation process by bringing more wallets to the urban core. The retailers/restuarants/other amenities will follow those wallets, and possibly some office tenants will follow those amenities. All of this also changes the electorate of the urban core.

And the classic @KJPtease - “another new construction tower that’s lurking out there..”.  Inquiring minds want to know.

Planning Commission today approved demolishing 2208-2210 Superior Viaduct to clear the site for the new tower.

Edited September 4, 20204 yr by KJP

10 minutes ago, KJP said:

Planning Commission today approved demolishing 2208-2210 Superior Viaduct to clear the site for the new tower.

So, is the tower a full go? i don't remember seeing that announcement.

1 minute ago, Ineffable_Matt said:

So, is the tower a full go? i don't remember seeing that announcement.

Still needs final design approval

I marked it as sad. Not because of what is coming, but because of the loss of the historical nature of the building as well as fun artistic roof decor leftover from Spaces. There is a lot of opportunity for the reuse of portions of the interior.

46 minutes ago, musky said:

I marked it as sad. Not because of what is coming, but because of the loss of the historical nature of the building as well as fun artistic roof decor leftover from Spaces. There is a lot of opportunity for the reuse of portions of the interior.

I know about the lanterns on the top of the building they use to occupy, but what sort of art from Spaces was on the roof of these buildings? 

Wait,what? Based on the pics of the building coming down for the new Viaduct tower I was under the impression it was a nondescript industrial building and not the old Spaces building which is a very nice old structure. So are there two buildings or one and if two is the old Spaces building one of them? 

 

Like everyone else on this site I too love the design of the new tower. It would be a shame if the Spaces building has to come down in order to build the new tower but in this case the new tower would trump (no pun intended) the existing building(s). 

17 minutes ago, cadmen said:

Wait,what? Based on the pics of the building coming down for the new Viaduct tower I was under the impression it was a nondescript industrial building and not the old Spaces building which is a very nice old structure. So are there two buildings or one and if two is the old Spaces building one of them? 

 

Like everyone else on this site I too love the design of the new tower. It would be a shame if the Spaces building has to come down in order to build the new tower but in this case the new tower would trump (no pun intended) the existing building(s). 

 

What's being demolished is the short building in the middle. The Spaces building isn't going anywhere.

That's what l thought. Must have misunderstood what the mention of the Spaces building was all about. 

3 hours ago, Htsguy said:

Ugh.  I was afraid of that with the lack of any noise since last fall.  And like stated above, it was one of my favorite projects.  I guess inexperience, lack of deep pockets and financing were always an issue.  With all the work they have done so far maybe they can sell their "work product" to a developer who could get it done, although I know something like that rarely happens.

 

@KJP do you know if the same developers apartment building near Battery Park is also in trouble?  I believe that was a nice project as well.

 

@Htsguy A source who has seen United Community Developers' pro forma for The Viaduct said they have virtually no equity in what is likely a $100 million +/- project. A similar situation likely exists for the Edgewater Hill project on West 73rd which is probably a $20 million+ project. I realize that the port authority is being asked to finance The Viaduct (and perhaps West 73 too). But these guys have no track record except in heavy highway construction and some housing rehabs/additions. This is going to a whole 'nother level for them. If they somehow get a TMUD tax credit, that *could* things for them and might attract more capital. But I'm afraid they're way in over their heads, although they've got some great design ideas and plans from Dimit.

 

EDIT: here was the last piece I wrote about these projects.... https://neo-trans.blogspot.com/2020/08/edgewater-hill-project-signs-of-sudden.html

As attractive as the viaduct is, I'd much rather not have a 100 million+ project in the hands of someone with such unqualified experience 

40 minutes ago, FutureboyWonder said:

As attractive as the viaduct is, I'd much rather not have a 100 million+ project in the hands of someone with such unqualified experience 

 

On the other hand, they have Geis Companies as their construction manager and Osborne Concrete as their foundation contractor. Between those two, they should be able to figure out how to build this. The big question is money.

1 hour ago, KJP said:

 

On the other hand, they have Geis Companies as their construction manager and Osborne Concrete as their foundation contractor. Between those two, they should be able to figure out how to build this. The big question is money.

Good point. If they were able to get those two to buy in, maybe this thing has a chance.

6 hours ago, KJP said:

 

@Htsguy A source who has seen United Community Developers' pro forma for The Viaduct said they have virtually no equity in what is likely a $100 million +/- project. A similar situation likely exists for the Edgewater Hill project on West 73rd which is probably a $20 million+ project. I realize that the port authority is being asked to finance The Viaduct (and perhaps West 73 too). But these guys have no track record except in heavy highway construction and some housing rehabs/additions. This is going to a whole 'nother level for them. If they somehow get a TMUD tax credit, that *could* things for them and might attract more capital. But I'm afraid they're way in over their heads, although they've got some great design ideas and plans from Dimit.

 

EDIT: here was the last piece I wrote about these projects.... https://neo-trans.blogspot.com/2020/08/edgewater-hill-project-signs-of-sudden.html

What is the pro forma for? Is it possible they didn’t feel the need to fully lay out their capital on it? Is it possible they have other funding commitments they’re optimistic about but haven’t closed in on yet?

I forgot that Geis also wanted to bring some equity to the project because they don't have a new-build skyscraper on their resume. They we're willing to pay a little bit to get that experience so that they could get more skyscraper projects.

23 hours ago, KJP said:

I forgot that Geis also wanted to bring some equity to the project because they don't have a new-build skyscraper on their resume. They we're willing to pay a little bit to get that experience so that they could get more skyscraper projects.

How much equity is typical for projects like these? 10-20%?

On 2/14/2021 at 7:57 PM, LlamaLawyer said:

What is the pro forma for? Is it possible they didn’t feel the need to fully lay out their capital on it? Is it possible they have other funding commitments they’re optimistic about but haven’t closed in on yet?

 

A pro forma is the real estate project's financial statement. It shows what is expected of financial contributors in a real estate project and how their funds will be spent.

 

10 hours ago, ASP1984 said:

How much equity is typical for projects like these? 10-20%?

 

I'm no development expert but my understanding is that real estate developers usually bring about 3-5% of the financial equity and contribute sweat equity instead. But 20% is usually the minimum that an equity partner brings to a project. 

2 hours ago, KJP said:

 

A pro forma is the real estate project's financial statement. It shows what is expected of financial contributors in a real estate project and how their funds will be spent.

 

I understand what a pro forma is. I'm just wondering if we know who the particular audience for the pro forma is and what the context of the specific request for the pro forma is. As with any financial statement, a pro forma can vary materially based on why it's being prepared.

 

EDIT: Here's roughly the kind of hypothetical I'm wondering about.

 

Geis: "We're interested in investing our own capital in this project, send us a pro forma."

 

UCD: "Okay, but we're still moving money around so we don't have our capital outlay figured out precisely yet."

 

Geis: "That's fine, just send us a pro forma with the expenses laid out and whatever capital you have in hand so we can at least look at the cost."

 

The result is a pro forma that makes the financial situation look worse than it really is. Not saying I have any clue the above is what happened, I'm just curious how much we know about the context of the request.

Edited February 16, 20214 yr by LlamaLawyer
Further explanation