More bad economic news for Emerald City. Boss Godfrey's much ballyhooed downtown Wal-Mart Super Center project has hit a snag. According to this morning's Standard-Examiner story, groundbreaking has been delayed for at least a year. We incorporate the lead paragraphs from this morning's Ace Reporter Schwebke's story:
OGDEN — The construction of a downtown Wal-Mart Supercenter will be delayed a year because soil at the site will have to undergo environmental cleanup, a city official said Tuesday.Although Emerald City and Wal-Mart spokemen attribute the delay to an unspecified "soils problem," we wonder whether more fundamental market forces may be at work. On March 5, the Wall Street Journal reported on a slump in commercial real estate development, specifically noting that Wal-Mart, among other US retailers, have "pared expansion plans" -- and worse. From the WSJ article:
Greg Montgomery, the city’s planning manager, said he was told by a Wal-Mart engineer the cleanup will be necessary, but he hasn’t seen a report detailing what was found in the soil.
Work on the Wal-Mart at the northwest corner of 20th Street and Wall Avenue was initially slated to begin later this summer and be completed in late 2009 or early 2010.
However, the start of construction has been pushed back to October 2009 to accommodate the soil cleanup, Montgomery said.
Retail is one of the more vulnerable sectors of commercial real estate, tied to the housing market and consumer spending. As the economy lists toward recession, retail property stands to suffer higher vacancy rates, constrained rent growth and declining values. Results for publicly traded retail landlords look healthy. After several years of rapid expansion by retail tenants and strong spending by shoppers, real-estate investment trusts that own and develop retail properties boast occupancy rates in the low- to mid-90% range. Many claim little trouble so far in replacing bankrupt or otherwise failing retailers that have vacated their stores.It's been a couple of months of bad economic news in Emerald City, with recent disappointments such as Adam Aircraft, Midtown Village at the Junction and now Wal-Mart.
The outlook is souring. Retailers have reported a slowdown in sales. Wal-Mart Stores Inc. and J.C. Penney Co., among others, have pared expansion plans. Electronics seller Best Buy Co. has reined in its quarterly earnings forecast. Talbots Inc., Movie Gallery Inc.'s Hollywood Video and numerous home-furnishings retailers have announced store closings. Others, including Bombay Co., have liquidated under bankruptcy protection.
We swear it's got to be driving our can-do Mayor nuts.
And what say our gentle readers? Will it actually take a full year for Wal-Mart's contractor to haul off and replace 16 acres of contaminated dirt? Or are Wal-Mart officials playing it cagey, drawing in their horns and preparing to ride out the percipient world recession?
14 comments:
Not merely delayed, which a soils problem should do until it's resolved, and for which a workaround can be engineered [though at some cost]. But also downsized. The new plans shave about 45K square feet of floorspace from the project, the SE reports, "for budgetary reasons." That would not seem to be a result of soil problems, but rather a result of the market conditions your WSJ article summarized. Fortunately, even the down-sized version will contain a super-market which God knows downtown Ogden needs. But it will be delayed. All told, not good news for the city.
If it's going to go up, better it goes up quickly and starts pouring tax money into the city's coffers [the major justification for seeking the project, as I recall].
Damn! Now I am going to have to drive an extra 20 blocks in order to feed my insatiable Wall Mart habit!
I bet if you Nay Sayers had not killed off the Gondola this would not have happened.
See how much grief you bastards cause us common folks!
So far nobody is talking about just what "contaminates" they found on the property. Perhaps it is the long lost integrity of the little pecker head and his million dollar dream team? Now there would be some pollution that would take a year to clean up!
And speaking of pollution - Gadi Lesham the indicted for felony guy from California is the developer?
An all around slimy deal if there ever was one.
>>>We swear it's got to be driving our can-do Mayor nuts.
How can Godfrey become any more nuts than he already is?
All you naysayers.... Look, maybe something good will come of this yet. Perhaps while they're poking around down in the dirt out there, trying to figure out exactly what previous owners poured onto and into the ground, they'll come across the 275 city-owned parking spaces Mr. Harmer misplaced and is still looking for.
Hey WalMart. I’m rootin’ for ya. I like WalMart.
There is some other gummint-business news today that’s good news for Ogden.
Click Here
It sounds like Midtown is steering their formerly “upscale” projects in other cities into what we, back in the Windy City, used to call “The Projects,” aka “insta-slums.”
Ogden isn’t in bed with these guys because some citizens headed off the city handouts by asking questions and looking over the paperwork.
Not getting done “prison shower style” by a taxpayer subsidized, marginally-capitalized business counts as a good thing nowadays.
BTW, notice how much the stock market went UP after I expressed concern it would TANK? If I’d suggested some tickers like SKF, and you’d listened to me, you’d be down quite a bit by now. Like I said, I never give investment advice, and that’s why!
But I do still think we are in for hard times, stock market tanking, and all.
Danny:
Back where I come from, the word for tall, narrow 100 apartment buildings, one after the other, is "tenement." It is not a complementary term.
I haven't seen a comment yet on the Apr 1 S-E report on Val Southwick's plea agreement.
I was amused, in a darkly cynical way, by this interchange between Southwick's attorney and the assistant AG:
"The assets are there, but there's an if," [Defense Attorney Max] Wheeler said. "If the properties are developed as intended, Val feels there is enough money for everyone...but not if everything is liquidated in a fire sale."
My translation: "if you just let my client operate his Ponzi scheme through a couple more turns of the wheel, I'm sure he can make enough money to pay everyone back."
The assistant AG, to her credit, fired back with the 21st century legal equivalent of the famous quote from WW II General Anthony McAuliffe: "NUTS!".
"I would expect Max to say that, and I'm sure that's what Southwick has been telling his victims for years," Assistant Attorney General Charlene Barlow, [my new heroine and] prosecutor in the case, responded after the hearing.
It seems to me that Mayor Godfrey is a metaphorical acolyte, if not an actual acolyte, of Mr. Southwick. His true ambition seems to be to use his station to realize a thwarted ambition as a big-time real estate developer. He has robbed Peter to pay Paul with his grandiose "projects", and now that the economy has gone South, it's all coming apart. Heck, he can't even get a Mall-Wart built.
All this dissembling about parking spaces and "Adam is rising from the ashes like a phoenix" and "The Junction is a roaring success" and "the golf course is dragging Ogden down" has been, and continues to be, tiresome.
But then, I'm just a naysayer who happens to be paying off my fixed-rate mortgage each and every month on time and paying taxes to the Ogden City coffers without all kinds of smoke and mirrors. I just bring in a paycheck and pay my bills. That's apparently what naysayers do.
Mono
Your reference to General McAullife's famous "Nuts" brought back some old memories of my own. I was in the 101st in the Sixties and served under quite a few senior NCOs and Officers who were in WWII and Bastogne.
While the "NUTS" comment has become a part of the 101st legend, that is not what the General actually said - at least according to the old timers I served with. Some said the General's reply was "Shit", and some said he also told them what they could go do to themselves using even stronger language.
As to the Little Lord and this Southwick scammer, well they do seem to be cut from the same cloth, and the LL was quoted as saying when this first hit the press what a great guy and long term family friend Southwick was to him.
Birds of a feather I would say.
OK, guys, Mr. Southwick was a crook and con man, of the particularly odious kind that trades on religiosity to hook the marks. No question about that. And I've got my disagreements with Hizzonah, Mayor Godfrey. But I think we ought to remember that Hizzonah is one of the victims here, one of those Mr. Southwick bilked, trading on his family friendships [making him an even more odious crook]. Trying to associate Hizzonah, even by implication, with Southwick's criminal conduct seems over the line to me.
The mayor is one of the victims of Southwick's crimes. And blaming the victim is usually not a good idea, and almost never is a fair thing to do. Yes, even when the victim is Mayor Godfrey.
I don't know what the problem is. All they have to do is dump all the bad soil in the river and call it bio-degratible and every thing will be fine.
Curm:
There's an old saying from the long con business that Mr. Southwick is in: "You can't cheat an honest man."
Mono:
Well, Mono, I'm not sure that's so, since we've seen of late a lot of honest folks... including the proverbial Little Old Ladies... taken to the cleaners by the con artists who ran World Com and Enron and so on. Con man is short for "confidence man" and they're very good at gaining the confidence of honest, trusting people. Playing on family connections of long standing, as Southwick apparently did with Hizzonah, makes it even easier.
I'll agree with "you can't cheat an honest man" if they way you're going to cheat him is to lure him into something illegal -- like buying into a drug deal. That doesn't seem to be the case here. The victims were lured into investing in what seemed on the surface to be a reputable and successful real estate and land development company, engaged in quite legal land speculations. We can question the victims' judgment, certainly, and perhaps ask a pointed question or two about their greed [Southwick was baiting his hook with promises of returns well above market averages]. But I don't think we can assume everyone he conned was dishonest. Sadly, con men are just damn good at what they do.
Maybe the old bromide that fits this case better is "If it seems too good to be true, it probably is."
Getting back to the Mayor's development problems (and ours by extension) - I guess the "hold" put on WalMart and the Gondola-Stop Hotel means that we will once again have huge fields of dirt and unfinished construction as architectural features of our "revitalized" downtown. The Godfrey legacy of "Leap before you look" lives on.
Post a Comment