Comments ( 11 )

• No Wilson Yard.

  Damn.

  I was going to announce that Trump had just purchased the land and was turning it into a 200 story Condo/hotel/Walmart.

  Foiled again.

• “lately it seems like readers are eager to spread wild tales about developers and their developments.” I hope that is in no way in reference to my comment earlier this week. In the case that it is, I implore you to do your job (you do pretend to be a journalist and not just a peddler for developers as it appears) and research my statement. You will see a long history of unhappy customers and lawsuits pending.

• Alan,

  This post was in no way addressed to your comment from several days ago about Kroupa.

  But, now that you mention it, I have some concerns about your comment.

  You began by saying “I have said this many times, but will say it again…” Perhaps you have said it many times, but this is the first time I can find a record of your having said anything about Kroupa here. Then again, I only looked back 12 months and only searched screen name “Alan” and the IP addresses from which you have posted.

  Nothing in your comment indicates that you have any direct personal knowledge of what you allege Kroupa’s behavior to have been. Do you have personal knowledge? From your own dealings or from discussion with others?

  Quite a few commenters have slammed Kroupa here. Are you relying on anonymous commenters for your opinion? That’s not a practice I recommend. Are you relying on media reports? If so, it would have been better to have said that rather than making blanket assertions.

  Without more disclosure on your part, it wouldn’t be unfair to characterize your comment as gossip or rumor. Perhaps worse, depending on who you are or what interests you may have in Kroupa competitors. If you want to lecture us on how to do our job, don’t hide behind anonymity and don’t take cheap, unsupportable shots to the effect that we’re simply peddlers for developers. Our biases are known, and you and I have had previous go-arounds about them. What are yours?

  I once had a developer client who screwed hundreds of buyers by promising things they never delivered and doing shoddy and sometimes dangerous work. Their last deal was a quality product in a fabulous location and they had great difficulty selling it because of their reputation. For what it’s worth, people who didn’t buy because of that reputation missed out on a great deal.

• I suspect the Spire won’t rise above ground. They were quoted in the WSJ earlier this week saying that the credit crisis was interfering with them obtaining financing which I find laughable.

  Its a convenient excuse, but the reality is it has been nothing but a hole in the ground all year. They are blaming a liquidity crisis in the banking system for their lack of demand. I hope the Spire gets built, but I have my doubts.

• I guess one comment would be the appearance of general ‘lying’ and number fudging going on on many projects, not being called out. So, I would ask, how does YO or NHM or other media actually check these numbers that developers throw out, and can you? There have been several projects in the news, where many games are played such as 2520 Lincoln Park (issue with American Invesco), Rokas (the news that many of the sales were reserves by ‘friends & family’ or possibly bogus) so that he could get a construction loan, and others who report 60-70% sales with new start of construction, with who knows how many are investors. So how do you deal with this state.

• Joe – Unfortunately, I am speaking from personal experience (personal purchase) as well as professional experience. I believe that I have said this before.

• Alan,

  Thanks for the clarification.

  Jeff,

  Good questions – no good answers.

  All we can reasonably do, given our resources, is report what we’re told by sales staff and developers. Sometimes those numbers are credible; often they’re not.

  A developer’s track record is the best proxy for whether sales numbers are accurate. In today’s climate, however, even the most honest developer doesn’t know how many of his sales are solid.

  We’ve reported sales claims for some projects over a long period of time, on occasion noting that the numbers are the same or lower months later. The claims may all be accurate or inaccurate when made.

• On that theme, for the education of us outside the business, where & how does people like Gail from the Appraisal Research Counselors, Ltd (who is the most quoted one I read) get their data, what methods do they use, what legal or ethic statutes are they bounded by when reporting data? So for example, do developers open up their contracts to them to review, do they audit the information, are they obligated to report irregularities? thanks in advance.

• Jeff,

  More good questions.

  Apppraisal Research Counselors and Tracy Cross are the two best-known sources of market data in the Chicago area for residential new construction.

  They’ve both been involved in their business for a long period of time and have developed their own proprietary and sophisticated techniques for cross-checking and validating the information that builders make available to them. That information varies by builder to some extent. I’m not current on the speccifics of their techniques, so I’ll avoid saying anything about them.

  Both of these firms perform development feasibility studies for builders and lenders, and it’s not uncommon for hundreds of millions of dollars to be risked in reliance on the integrity of the data underlying those studies.

  They make detailed info on individual projects available to their clients but only report summary data to the public. Those summaries are the best market snapshots available, since these firms are very professsional and guard their reputation carefully.

• Well-founded Spire gossip: developer Garrett Kelleher recently bought a home in the Gold Coast. Several high-end North Shore brokers doubt the project will ever be built.

• I guess the tallest towers from the boom will be Trump, Aqua & Legacy at Millenium Park in that order.