Our guest this week on “and then there’s that…” was Greg Hamm, the vice president and general manager of Columbia for General Growth Properties. Greg is a pretty personable fellow and he has a long history of new community development including a stint in Reston, Virginia.We asked Greg about the continuing opposition to the Columbia Town Center redevelopment plans after the council voted unanimously to approve it. Specifically we were curious as to what the opponents are referring to when the say this is a “giveaway”.
“What is the government actually giving you?” I asked
“I’m still waiting to find that out too, I’d like to pass that on to the people in Chicago as soon as I know. It will help me internally a lot” he quipped.
As Freemarket already noted in his blog this morning, GGP will spend approximately $100 million on creating new public spaces, renovating Merriweather Post Pavilion and creating a new housing trust fund for workforce housing.
True, the government did give the company approximately 3,500 additional housing units as part of the redevelopment program but the company already had the right to build more office and retail space. If anything, the additional housing units give the plan more balance.
“The worst of all worlds for the people of Howard County and Columbia would have been for us to have done more office buildings and retail here.”
And then there’s that…
We also had little fun with local new stories on porn, proms, sprinklers and my buddy Allen Dyer.
Our next podcast will be on March 19th and our guest will be Dick Story, the CEO of the Howard County Economic Development Authority.
15 comments:
gag me.
Well, let's add this add, shall we? 3,500 additional units given to GGP as part of the rezoning, @ $300,000 per unit = $1,050,000,000. That's right folks! That's over 1 TRILLION dollars!. If we assume the profit margin is just half of that, that would be 525,000,000. Over 500 BILLION dollars.
Compare that to the measly 100 million dollars that GGP will "invest" in green space and MPP, and the rate of return for them is a healthy 5000:1. As a poker player, that looks like pretty good pot odds to me. Looks like a giveaway to me. Mr. Hamm obviously thinks that everyone is naive enough to believe his cutesy little response to a fluff question. I'm not buying it, and I bet a lot of other people are not buying it either.
PZGURU, a 50% profit margin? Not likely. More like 5-12%. Go back to the rock from under which you came. Please.
I'm glad to see that the self-proclaimed GURU, a supporter of the referendum effort, has himself debunked their inaqccurate claim that the new plan allows for 7,500 new residential units. As for the 3,500 new units that are indeed created by CB59, the economics he cites aren't close to being correct. The property already has development value so whatever profit margin that comes from the residential units isn't all incremental. The residential units are marginally more profitable than office or other commercial development built on the same property. The real reason for the additional residential density is to make the commercial and office more valuable by creating a complete city that is more attractive to employers and commercial busiensses. GGP is responisble for more infrastructure and community enhancements than any other developer in Howard Co history. The claims that the passage of CB 58 & 59 is a "giveaway" or a "bailout" are merely claims by life long anti-business and anti-development people who have never seen a development project they liked.
I wrote the Anon 8:22 post. I'm starting to learn that these things time out when I take too long to write (which is frequent). I'm really trying to encourage people to stop hiding behind anonomous posts and even got myself a Google acocount a few weeks ago so I could attach my name. It took about 30 seconds do.
Anon 4:19 - where are you coming from? A 5-12% profit margin? You make me laugh. I have plenty of contacts in the building industry who have told me that the cost of a house is about 1/2 of the sell price.
Anon 8:22 - Not sure what you're talking about. I've never supported anyone's statement that GGP is getting 7,500 units. I don't know if 3,500 is the exact number either, but that's the number WB cited so I was running with that. And, although I do support the referendum initiative, I am not a member of TAG, and never will be. I support the referendum and agree with some of their reasons for pursuing it, but not all of their reasons. So, please, don't jump to conclusions or make false claims/accusations about me or my positions. If you want to know my positions, either read and understand what I post, or ask me directly. Thanks.
Furthermore, I am not and never have been anti-business or anti-development. I firmly believe in property rights and that developers have the right to develop their properties and (yes) make profits (even huge profits if it works out that way). What I am against is games played by politicians like Ulman, where they approve rezoning applications that are based on lies, false assumptions, and empty promises. If this rezoning is so "beneficial" for the County (ie: it will generate tax revenue) then why stop there? Why not rezone lots of other properties? Why have zoning laws at all?
You want to alk about GGP's rights? How about going back a few years when GGP submitted their planfor the Crescent Property? The piece of land next to MPP. Maybe you're not familiar with that plan. People like Ulman, Ian Kennedy, many of the Village board members (including Judd Malone) OPPOSED that plan over concerns about things like traffic and noise! But now somehow they support a plan that involves 10 times as much development!!! It's nothing but sheer hypocrisy!!!
And, please note that in my initial comment, I didn't even factor in the "profit" potential for any of the office or retail space allowed under the plan. So, my estimates are very, very conservative.
You know why it's viewed as a giveaway? Because, as you already pointed out, GGP had plenty of development potential/rights that they could have done in Town Center WITHOUT needing the rezoning. DUH!
As usual, PZ is right on target.
Anon 4:50 PM
Unfortunately it's usually the wrong target...
-wb
PZ, I wrote the 8:22 post. Sorry for lumping you in with TAG. I'm just so glad to see someone in oppositon not talking about this 7,500 unit figure that TAG is using to scare everyone.
As a Realtor, I work with builders all the time and typical builders profit in the suburbs is 8-10% all-in. I believe your figure is close on the construction cost alone excluding land and soft costs.
The proposed downtown units will be a bit lower due to the numerous fees and contributions contained in the CEPPAs and the green building codes.
As for the denial of the Crescent property development, I believe the official record will show that it was not about noise or traffic alone, but about how development of that property would fit into a plan for the whole downtown. In it's denial, the Council sent Rouse away with the charge to start this planning process, which is now in it's sixth year.
PZ, look at the annual report of any publically traded builder. Ryan Homes for example, claims a 6-8% margin. Who ever your contacts are, they are clerly in the wrong.
@ David - you may be correct about the Council's explanation in their vote; however, I was referencing the testimony given by the "opponents" of that plan, and also the position of several of the Planning Commission members. It was being claimed, at the time, that there weren't enough "details" in the application. However, as I have explained in my past "debates" with the now defunct Hayduke, GGP's application was a Sketch Plan stage that was only involved with setting general parameters for what could possibly be developed on the property. Their application met the letter of the law, but the Planning Commission, and I guess the Council, ignored that and blocked the application based in large part on the testimony of those aforementioned people who opposed that plan. The Planning Commission members and the Council certainly should know what the laws/regulations are and that the application met ALL of the requirements. The application was consistent with EVERY PRIOR COLUMBIA FDP and Sketch application. So, there was no legal basis for it to be denied.
It's those same people who opposed that prior plan that now support this current plan, and now call anyone who questions this plan "anti-development", "nimby's", or "anti-property rights". It's absurd. It's pure political hypocrisy.
GGP was going to sue the County and appeal the denial of the Crescent Plan, and they would have won. It was then that ratboy Ulman (and Guzzone was involved too) dangled this idea of granting even more development potential to GGP under the guise of a "we need to revitalize Town Center" slogan.
It may be true that SOME petition supporters may be against just about any development, but certainly not all.
@ ANON 6:58 - the financial records you're referring to sound like their annual reports of their "net" profits. But, ok, I'll use your much more modest figure of 5%. That would still be a 500% rate of return for their profit compared to the 100 million they "invest" in community improvements. Still a nice gift to receive. I wish that some local government would guarantee me and the rest of us poor, unconnected schlups that kind of return on an investment.
@ WB - huh? I've got the wrong target? Who is the right target then?
You always seem to duck questions and info that doesn't fit with your agenda. You like to attack lots of other people, but can't take a few hits yourself. You'll pick a fight and then when you're getting your butt whooped, you cry "foul" and moan about how mean someone is being to you, but you can't ever refute the info presented against you. Pathetic.
Aw, what's the matter WB, did you take your ball and go home? You can't even muster the decency to respond. Are you some kind of Saul Olinsky follower? How does the Olinsky playbook go? Isolate the opponent; villify the opponent; and the silence the opponent. Something along those lines right? Since I won't kow-tow to your orders, you won't ever respond directly to me? Grow the "F" up, man, seriously.
vintage PZGURU
You're at your best!
HH
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