Posted by: union03g | June 17, 2009

Waterview Tower: A Fossel Of The Recession

Waterview Tower on Wacker looks to be totally worthless. Who would have thought that a 90 story Chicago riverside project could be this big of a failure. What an embarrassment for the Chicago to have this skeleton just sitting there. My guess is it will take 10 years for this to get completed or maybe even started. Right down the street is also a swimming pool which was supposed to be The Spire.

CB Richard Ellis Inc. is taking on one of the toughest jobs in today’s languishing downtown real estate market: finding a buyer for the stalled Waterview Tower and Shangri-La Hotel project on Wacker Drive.

The Chicago office of the Los Angeles-based brokerage firm has been hired to sell the development, now just a 26-story concrete monument symbolizing the excesses of the real estate boom. The firm plans to scour the globe for potential investors, a necessary step amid a credit crisis that has made financing big, risky real estate projects virtually impossible.

These projects quite nicely illustrate how acute the downturn really was and they will be around awhile, to remind us that:

a) Real estate values don’t grow steadily into perpetuity and developers need to forecast cycles better.

b) Massive errors like this exist because we need stricter regulation on qualifying for home ownership -being a mortgage broker in 05 – 07 must have felt a lot like playing Monopoly.

c) Unfortunately, there needs to be real boom times for international buyers to choose Chicago over NY/SF/Miami and other coastal cities. Chicago has made some real progress as of late, but we are not quite a top 3 choice for the wealthy overseas buyer looking for a third condo.

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