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May 29, 2009
Forest City in the News
Dallas Observer, This Evening, Talk of Designating Two Downtown Buildings as Historic Landmarks
Forest City tried to double-dip in Dallas’s subsidy pool through a landmark designation, and now they may be sorry they did so.
Noticed something interesting on the Landmark Commission Designation Committee's agenda for today's 5:45 p.m. confab: the re-initiation of historic designation proceedings for two downtown buildings, the Mercantile Continental Building on Commerce Street and the Dallas National Bank Building on Main Street (otherwise known as The Joule). That's re-initiation -- as in, both buildings were, at one time, being vetted to see if they deserved designation and should be afforded the attendant protections and stipulations that come with such a title. But the initiation proceedings were terminated -- by the very folks who initially approached the Landmark Commission about starting 'em up in the first place.
Katherine Seale, executive director of Preservation Dallas and a member of the Designation Committee, says that three years ago, the owners of both properties approached the Landmark Committee about designation. Forest City Enterprises, of course, owns the Continental, which sits just across the street from their Merc re-do, while Tim Headington is the oil man who sunk a small fortune into the circa-1925 Gothic revival skyscraper known as the Dallas National and rebranded it The Joule.
The Designation Committee found both more than worthy of historic designation -- each met at least eight of the 10 criteria -- and recommended moving forward. But representatives for both owners yanked their request for designation, Seale says, because officials with the city's Office of Economic Development told the owners they wouldn't be eligible for historic property tax credits, since both were receiving tax increment financing district money for their respective redos. (Forest City, which has promised 140 residential units in the Continental Building, is set to receive $10 million from the Dallas Connection TIF; The Joule, $8.5 million from the City Center TIF.) Messages have been left with Karl Zavitkovsky, head of Economic Development.
"So the property owners asked the nominations to be withdrawn," Seale says.
The Designation Committee will vote on re-initiating designation proceedings without the owners' consent.
Bloomberg News, Martin Whitman Is Buying Distressed Debt, Forest City
Martin Whitman’s Third Avenue Management LLC increased its stake in Forest City Enterprises Inc., the property developer whose shares have tumbled 83 percent in the past year, and is investing in distressed debt while avoiding most stocks.
Third Avenue already owned 22.7 million Class A shares at the end of the first quarter, more than anyone else. The firm bought shares that were sold for $6.60 apiece in an offering this month. Forest City is the Cleveland-based developer that’s planning a new arena for the New Jersey Nets in Brooklyn.
Whitman confirmed the purchase in an interview in Chicago yesterday. He said Third Avenue plans to invest in more companies that are seeking to pay down debt and is avoiding stocks because of short sellers’ ability to drive down prices.
NoLandGrab: Whitman has been a respected fund manager for decades, but riding a $70 stock down to $6, and then buying more, may not be a recipe for success.
Posted by eric at May 29, 2009 7:47 PM