Almost three years ago, Shelbourne Developments struck a deal to build one of the tallest buildings in the world, the Chicago Spire. Construction of the $1.2bn (€950m) tower — expected to reach 610 metres — began in summer 2007.
When the ambitious plans were announced in 2006, the company said the tower would be “the tallest free-standing structure in North America and Europe, surpassing the Sears Tower in Chicago and the CN Tower in Toronto, Canada”. However, the credit crunch has stopped the tower in its tracks. Construction of the tower, which was initially due to be finished by late 2010, has been on hold since late last year “until the market improves”, according to a spokeswoman for Shelbourne. The spokeswoman said the tower is still going ahead and that 40 per cent of the apartments have been sold.
However, the latest pictures — which show that the tower is currently little more than a hole in the ground — are unlikely to be much comfort to Anglo Irish Bank, the key backers of the project. Shelbourne paid about $64m (€51m) for the Spire site about three years ago — and this paper understands that most of this money came from Anglo. Neither Anglo nor Shelbourne would say whether Shelbourne has paid Anglo back its loans for the Chicago Spire. As this project is only a couple of years old, chances are Anglo hasn’t got its money back — and that the Spire could make it into the mix of properties that loans heading Nama’s way are secured on.
– From an article in Sunday’s Irish Independent highlighting international projects whose loans may fall into the hands of Ireland’s National Asset Management Agency (Nama), a national “bad bank” created to take billions of euros in loans off the books of six Irish banks including Chicago Spire lender Anglo Irish Bank, which was nationalized in January.
Nama will take over any eligible loans over €5 million, which “would mean that a substantial number of properties that have loans secured on them will be transferred over” to the agency, the article states. Some of those loans will be bad; others, the paper reports, “will be good, and will include those secured on development land and property under development” or “which have already been completed and are likely to generate income for the bad bank.”
The article doesn’t hazard a guess as to how this will affect the long-term plans for Shelbourne Development or the Spire, but an unnamed source says that the agency most likely would take over the assets of developers who fail to pay off their loans.
(Hat tip to “odlum833” at SkyscraperCity for the article link.)