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Post by tm-you-know-who on Nov 18, 2009 16:06:46 GMT -5
So pretty much they have an empty facility that generates almost no income but costs 1.5 million a year to maintain. Because its public, they don't even make any income on land taxes. Sounds like they are offloading a white elephant.
My favorite statement is from the other guy who bid on it who said basically, "We tried to bid on it and are disappointed our even lower bid was beat."
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Post by baldheadeddork on Nov 18, 2009 18:12:54 GMT -5
So pretty much they have an empty facility that generates almost no income but costs 1.5 million a year to maintain. Because its public, they don't even make any income on land taxes. Sounds like they are offloading a white elephant. My favorite statement is from the other guy who bid on it who said basically, "We tried to bid on it and are disappointed our even lower bid was beat." Exactly. Five hundred grand is a joke for the cost of building it and the size of the land (and the location), but as it is right now you'd have to spend millions razing the Silverdome and getting rezoning to build anything else - or spend a couple million a year (at least) on maintenance and hope you can bring in enough events to make a profit. One possible future use for the site would be a new arena for the Red Wings, but good luck (1) getting the state to pony up money for a new arena and (2) winning a fight to move the Red Wings out of downtown. For all of his faults, I can't see Ilitch moving the Red Wings to the suburbs.
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Post by tm-you-know-who on Nov 18, 2009 18:20:49 GMT -5
Cities really should learn that this is the end result of what happens when they spend millions of tax dollars to support sports teams owned by billionaires. 25 years later the facility isn't state of the art and the team moves on. What a fucking joke.
Also, from what I understand GM has a bunch of empty factories in the same area they are trying to offload too. I'd imagine the demolition and clean up costs for any of those properties is going to outstrip the resources of all but the largest companies. It would probably be cheaper to buy land and build a factory somewhere else than to try and rehabilitate what's there.
I imagine that Detroit is starting to look a lot like the abandoned city in Blade Runner.
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Post by baldheadeddork on Nov 18, 2009 18:34:00 GMT -5
Indeed. It's another reason I think the employment numbers are going to get a whole lot worse before they get better. If commercial real estate is still foundering, that means that commercial enterprises are still foundering. Which means that the only people doing any hiring are the remaining companies. Normally you're right, but this time the bust was caused in large part by CRE becoming a trillion dollar ponzi scheme. For the last four years developers built with almost total disregard for things like occupancy because lenders were willing to finance practically any project you wanted. Even if the economy had not collapsed in the last year there would still be huge default rates in the CRE market because there was so much new and un-utilized commercial space available in almost every large markets. (I'm saying almost only because I don't know every metro CRE market, but all of those I do had a lot of available space even back in 2007.) The downturn has made that worse. But, contrary to what you're saying, that means new and expanding businesses will be able to soak up the excess space at fire sale prices for the next two or three years at the minimum, and existing businesses will use the glut of cheap space to renegotiate their leases at a much lower price. The rotting corpse of CRE is going to provide a lot of nutrition to companies that can feed off of it.
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Post by jeromeoneil on Nov 18, 2009 18:40:47 GMT -5
Indeed. It's another reason I think the employment numbers are going to get a whole lot worse before they get better. If commercial real estate is still foundering, that means that commercial enterprises are still foundering. Which means that the only people doing any hiring are the remaining companies. Normally you're right, but this time the bust was caused in large part by CRE becoming a trillion dollar ponzi scheme. For the last four years developers built with almost total disregard for things like occupancy because lenders were willing to finance practically any project you wanted. Even if the economy had not collapsed in the last year there would still be huge default rates in the CRE market because there was so much new and un-utilized commercial space available in almost every large markets. (I'm saying almost only because I don't know every metro CRE market, but all of those I do had a lot of available space even back in 2007.) The downturn has made that worse. But, contrary to what you're saying, that means new and expanding businesses will be able to soak up the excess space at fire sale prices for the next two or three years at the minimum, and existing businesses will use the glut of cheap space to renegotiate their leases at a much lower price. The rotting corpse of CRE is going to provide a lot of nutrition to companies that can feed off of it. I hadn't thought of it in those terms, but that sounds reasonably optimistic. I'd like to see it happen, that's for sure.
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Post by baldheadeddork on Nov 18, 2009 19:00:35 GMT -5
Cities really should learn that this is the end result of what happens when they spend millions of tax dollars to support sports teams owned by billionaires. 25 years later the facility isn't state of the art and the team moves on. What a fucking joke. Also, from what I understand GM has a bunch of empty factories in the same area they are trying to offload too. I'd imagine the demolition and clean up costs for any of those properties is going to outstrip the resources of all but the largest companies. It would probably be cheaper to buy land and build a factory somewhere else than to try and rehabilitate what's there. I imagine that Detroit is starting to look a lot like the abandoned city in Blade Runner. There is a lot of abandoned and unused industrial space in Detroit, but all of them that predate the 70's are also Super Fund sites. I'm in the middle on government providing financial support to build sports arenas. There have been a lot of cases where the team owners straight up raped the taxpayers. But if you've seen a city before and after a well-done stadium project - it can be a huge improvement in the quality of life for living in a city and a big source of economic development. I lived in Phoenix before and after the AWA (now US Airways Center) was built for the Suns. Before they played in an arena at the State Fairgrounds that had nothing around it. You drove to the game and drove home after. Downtown was dead after six pm. The AWA, and then the Bank One Ballpark Chase Field primed restaurant, nightclub, retail and hotel development downtown that eventually became self-sustaining. Same thing happened in Indianapolis, which now has an amazingly vibrant downtown. It started with the RCA Dome and the Colts. About Detroit - overall it's not as bad as you imagine. There are parts of the city (the one's that show up on TV all the time) that are as bad as any you'll find in the US. But there's also places like Greektown, Arden Park and Woodbridge.
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Post by john on Nov 18, 2009 19:17:25 GMT -5
Normally you're right, but this time the bust was caused in large part by CRE becoming a trillion dollar ponzi scheme. For the last four years developers built with almost total disregard for things like occupancy because lenders were willing to finance practically any project you wanted. Even if the economy had not collapsed in the last year there would still be huge default rates in the CRE market because there was so much new and un-utilized commercial space available in almost every large markets. (I'm saying almost only because I don't know every metro CRE market, but all of those I do had a lot of available space even back in 2007.) To add to this, there were a lot of foreign investors made tons of money on this. In Chicago, when I lived there, there were many companies that were founded using this idea, then folded when the bills came due.
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Post by will on Nov 19, 2009 0:52:06 GMT -5
And then there are those of us who have made a living building things for developers. Ahh, good thing I remember how to be a carpenter. Finish carpentry is actually fun. Rough carpentry and soffits on a building which is racked, out of square, out of plumb, and out of level... not really.
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Post by flylooper on Nov 19, 2009 9:00:10 GMT -5
And then there are those of us who have made a living building things for developers. Ahh, good thing I remember how to be a carpenter. Finish carpentry is actually fun. Rough carpentry and soffits on a building which is racked, out of square, out of plumb, and out of level... not really. I have nothing but envy for people that can do good finish work. The blight of my life is a total inability to work with wood, even though I love to do it.
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Post by jeromeoneil on Nov 19, 2009 12:23:59 GMT -5
I am the worlds worst carpenter.
Want to have a good laugh? Give me a hammer.
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Post by will on Nov 19, 2009 13:26:36 GMT -5
I am the worlds worst carpenter. Want to have a good laugh? Give me a hammer. I use pneumatic nail guns whenever possible. Problem solved. ;D
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Post by jeromeoneil on Nov 19, 2009 13:30:59 GMT -5
I am the worlds worst carpenter. Want to have a good laugh? Give me a hammer. I use pneumatic nail guns whenever possible. Problem solved. ;D I used one of those once, until the guy that owned it took it away from me because I kept putting three or four nails in right on top of one another.
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Post by arozanski on Nov 19, 2009 13:31:45 GMT -5
Boards have been known to spontaneously ignite rather than let me get to them with woodworking tools. Truth.
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Post by will on Nov 19, 2009 13:33:22 GMT -5
Well then, I see a business opportunity here! Call me anytime. Free estimates, low rates, high change order pricing...
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