News 12-10-08 Montage News
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Posted by: Tom - 12/10/2008 7:31:53 PM
First question Mike - you need to clear this up right away - do you have any business/financial relationships with The Montage Project or any of Fernando Leal's businesses or other properties?
Posted by: Nick - 12/10/2008 9:24:33 PM
What does Fernando see as the longer term future of Downtown Reno, with the end of the condo boom and an increasing number of vacant former casinos and hotel casinos?
Posted by: Jared - 12/11/2008 3:45:53 AM
I would like to know when he plans on starting the renovation process of Fitzgeralds and what the plans are for the old Golden Phoenix entrance along Virginia Street across for Harrahs.
Posted by: Curious - 12/11/2008 6:33:17 AM
What is with all the delays, project was originally expected to be completed spring 2008. When will people actually be moving in? How many buyers in contract have walked away? What about the remaining unsold units, what is the plan moving forward to sell these units? What is the status of the retail portion of the building as well, Ruth Chris, etc.
Posted by: Mark W. - 12/11/2008 8:05:33 AM
I would second the request for a retail tenant status report for the Montage, especially after the lackluster turnout at the Palladio. What does Mr. Leal have as far as a long-term list of projects or goals for future development? I'm looking forward to the interview!
Posted by: Bugsy - 12/11/2008 9:03:08 AM
hey makeover dude, months ago you mentioned that you saw the plans to the renovations of the fitzgerolds but promise leal that you wouldn't talk about it yet....When do we get to see those plans, when will leal show us also.
Posted by: DowntownMakeoverDude - 12/11/2008 9:31:30 AM
Good question Bugsy I totally forgot about that! I will ask him about the Fitz. The reason I was under wraps before, was the deals and partnerships he was lining up for the Fitz weren't finalized yet. Last time I asked him, which was right before the Fitz closed, Leal wanted to focus on the closure of the Fitz out of respect for the employees. I'll pin him down regarding the Fitz, since all of that is over now I can't see any reason he couldn't release SOME details at least.
Posted by: DowntownMakeoverDude - 12/11/2008 9:59:17 AM
Hi Tom, not that it affects anything, the studio I work for did some design work for Fernando a while back, and Fernando Leal chose that studio because of my intense coverage of the Montage. Other than that? No. I dont work for L3, I dont get paid for any coverage of the Montage including my downtownmakeover.com construction updates, I dont get paid for any information I put on this site about the Montage. I have a very close relationship with Fernando Leal, which is based on trust, and the fact I have covered the construction of the Montage from day one without earning a dime from L3, just like I cover the construction of a slew of other projects in town. He simply appreciates it more than other developers, so he lets me in on secrets from time to time, on the premise that when the time is right (i.e. when it wouldnt jeapordize a project to make something public) I get to publish them first and get the scoop. Thats kind of my ongoing reward per say from Fernando. Like this interview on Friday. He isnt doing that because its part of some staged PR manuever or something I am being paid to do, hes doing it because I asked him to, because I felt if he didnt speak out soon on what was going on, he would be facing a tidal wave of negative publicity, which certainly wouldnt help the Montage or downtown. I get 20,000 unique visitors to my site per month, and I bet most of them are wondering whats going on with the Montage.
Your question seems phrased in more of a legal format than a curious format, so can I assume you are a buyer at the Montage?
Posted by: Matt Orchowski - 12/11/2008 6:11:09 PM
Whats going on with the Fitz, when does construction on the boutuque hotel get underway?
Posted by: Montage Buyer - 12/11/2008 7:17:08 PM
Obviously, there will be at least some significant price reductions for existing contract holders - ask him what options there will be for those that no longer qualify at even the new price? How much, if any, of the deposit can be returned. As much as my wife and I still believe in the downtown - and Fernando's - vision, we no longer are in the position to qualify for a loan. Worth a shot... thanks!
Posted by: Lofty in Reno - 12/11/2008 9:21:05 PM
The biggest problem facing the Montage right now is twofold: 1)appraisals need to come in at or near the asking price for people to be able to finance (even at a reduced price - will they in this market?) and 2) no financing has been available since the project hasn't met Fannie or Freddie requirements for sales percentage at this point -meaning no banking institutions want to finance the condo's because they can't sell the paper, i.e. they would have to hold the loan indefinitely, tying up their money. Can you ask Fernando if any measures are being considered to bridge this problem?
As to Tom who is worried whether you work for Fernando, hopefully that was meant tongue in cheek. If not maybe he should consider how much you contribute FOR FREE to all of us who read your site and apprecriate what you do.
Posted by: Bugsy - 12/12/2008 9:45:20 AM
One more question makeover dude, ask Mr Leal what the plans are for the fitz gaming licence and if he plans on using it for a new casino downtown.
Posted by: Montage Buyer - 12/13/2008 11:51:03 AM
Were you able to sit down with Fernando yesterday? I expect he is pretty swamped right now... Thanks again for your great site and efforts to inform!
Posted by: Another Buyer - 12/13/2008 12:14:00 PM
As a buyer I find the lack of communication coming from the Montage leaves me extremely frustrated. We have been told completion dates that have never been met - without explanation. Currently we really don't know how to plan when we might be buying or moving in. The web site hasn't been upgraded as to what is happening in months. We weren't contacted yesterday to find the 'latest' plan, and although I'm sure it takes time to get your interview with Mr Leal posted, as no doubt you have other things going on, did the interview even happen? Or is this still under wraps as proprietary information? The holidays are coming, we thought we'd be moving in over that time period. Now, well who knows.
Thanks for the info you put out. So far your the best source of where to get this.
Posted by: DowntownMakeoverDude - 12/13/2008 12:24:48 PM
I was kind of put on standby and am awaiting Fernando's call. Not sure what the delay was, but as far as lack communication with his buyers, Fernando wants to inform the buyers (I assume is you from your comment name) first out of respect. I am on hold until that happens, which I hope is today.
Posted by: Another Buyer - 12/13/2008 12:34:28 PM
Fair enough. If I had my way he'd hire you to do his press release/ communications. :)
Posted by: stjoe56 - 12/13/2008 2:16:25 PM
It is with a heavy heart that I inform you that L3 Development will no longer be the owners of The MONTAGE. The loan with our lender, Corus Bank, is up for renewal in December and my partner and I have made the very difficult decision to return the project to the bank once completed. This was a business decision strictly driven by the uncertain economic conditions that currently exist on a global scale.
In the coming weeks, we will complete a "deed in lieu of foreclosure" transaction, which is essentially an amicable transfer of ownership back to Corus Bank, thereby avoiding any foreclosure procedures. A Deed in Lieu is very rare in that it requires two willing participants and a project that is free of mechanics liens or other encumbrances. We have had an incredible relationship with Corus Bank and hold them in the highest regard, which has helped make this difficult situation very amicable.
Corus Bank is full of incredibly bright, experienced and ethical business people who are experts in the development of for-sale condominiums. It is my sincere belief that Corus Bank understands and values the goodwill that has been established by L3 Development over the last three years and will do everything possible to preserve and expand on it.
Now on to the good news: I am very excited to say that we have enthusiastically accepted an offer from Corus to assist them in the management of the project going forward. This will help make the transition seamless to our buyers and will ensure that every aspect of the project moves forward expeditiously. Managing other people's projects is not our business. But, in this case, given our commitment to the redevelopment of downtown, our neighboring projects, and most importantly to you, our buyers, we felt it was the right business decision.
We will have certificates of occupancy for the entire building no later than next Wednesday, December 17th. We originally had planned on phasing occupancy, with floors 6-22 being the first delivered in November. However, we felt it was in all stakeholders' best interest to take this time to complete the negotiations with the bank and to deliver the building in its entirety. We invested significant amounts of money to further upgrade numerous aspects of the exterior of the building, interior finishes and common areas throughout the construction process. I am very proud to say that many aspects of The MONTAGE have been completed to specifications that exceed the original architectural plans.
And now some fantastic news: several weeks ago I provided to Corus Bank for their consideration an analysis of recommended pricing adjustments of all existing contracts, as well as the balance of the unsold inventory. They have agreed to my recommendations and will be providing a final sign off in the next few days. This will allow us to contact you in the very near to disclose the dollar amount of discount that will be extended to you. I also want to be clear that Corus Bank is not obligated to reduce the price of existing contracts. In my opinion, the fact that they have agreed to do so is clear evidence that they are aware of the current economic climate and will do their part to achieve the highest degree of customer satisfaction possible.
I am also currently working with Corus Bank and other lenders to explore the possibility of creating a program to provide interim and end loans to buyers who are struggling to obtain financing. I want to be very clear that Corus Bank has made no commitment to provide any credit programs at this time, but is giving serious consideration to this request and should decide within the next 30 days.
Now that the building is 100% complete, and we are very close to having final direction from the bank as it relates to pricing adjustments, we will be moving aggressively to initiate closings and occupancy of the building in January. It will be an exciting time in downtown Reno.
I sincerely believe that The MONTAGE is in a very unique situation compared to countless new projects throughout the country. The MONTAGE is the premier vertical residential property in Reno, a market not over-saturated with similar or like product. It will be many years before a building with the variety of living options, amenities and quality of The MONTAGE will be developed in downtown Reno. I believe that this is a unique opportunity for every buyer.
I realize that numerous questions will arise from this letter, many of which I may or may not be able to answer at this time. However, I will do my best to keep you up to date as soon as information and direction from the bank becomes available. In the interim, I am available to you, as always, via phone or a face-to-face meeting.
In closing, I would like to assure you that our commitment to this community, specifically the revitalization of downtown Reno, is not diminished by this very tough situation. It is our intention to remain very active in the community and be staunch supporters of all the new projects that are expected in the coming years. We are very proud of the product that we have delivered and hope that it will serve as both a catalyst for continued development, and as the bellwether that all future projects will be judged by.
Posted by: Downtown D - 12/13/2008 2:33:08 PM
The email has arrived and seems unsatisfying. After years of waiting, we get more promises of "Almost ready, we just need to do this and that." Is anybody going to be able to get financing; I've heard that lenders will not make loans for new developments that are under 50% sold.
Posted by: Chet Dunlap - 12/13/2008 2:37:57 PM
I am not the smartest guy on the block and I am certainly not known for my insightfulness….but even I know this lack of communication coming from the montage looks very bad.
Until we SEE otherwise, I suspect all the dire predictions are going to come true.