New Oklahoma City Skyscraper

[Rothman]

Pfft.  Have you been to Manhattan lately?  Building boom, despite the obstacles.

[Scott5114]

The OKC administration already gave its approval.

Let's be honest, it would be kind of hard to come up with a project the City of Oklahoma City wouldn't give its approval to, especially if you're not asking for TIF money with it.

It would have to be something like a three hundred foot tall Satanic temple, topped by a one hundred foot tall statue of Baphomet, sporting an erection, wearing a Texas Longhorns hat and a T-shirt that says "I ♥ Proper Capitalization" and holding a sign that says "Gary England sucks", built in R1 zoning. And even that might get approved if you donate to the city council's re-election campaigns.

[Bobby5280]

Pfft.  Have you been to Manhattan lately?  Building boom, despite the obstacles.

It can take several years or more for a skyscraper project to go from the drafting table to completion. The market downturn in office real estate is very real. The downturn just hasn't caught up to the backlog of construction projects yet.

The situation is bad enough that some of these developers could get wiped out and leave some skyscraper projects stuck, unable to finish construction. They all planned these buildings with the intention of collecting high lease/rent amounts to help pay off all the money they borrowed to fund their projects. That borrowed money comes with variable interest rates that re-adjust every few years, unlike the 30 year fixed rate mortgages individuals get when buying a home. With office vacancy rates in Manhattan hitting the 20% mark it doesn't exactly put a stable floor under those high lease/rent prices. The insane living costs in the Greater New York Area is forcing a lot of workers out of the region. A growing number of employers are following them.

Let's be honest, it would be kind of hard to come up with a project the City of Oklahoma City wouldn't give its approval to, especially if you're not asking for TIF money with it.

I still think the OKC city council gave its approval as a means of calling the developer's bluff. They're giving the guy enough rope to hang himself with.

[Rothman]

Pfft.  Have you been to Manhattan lately?  Building boom, despite the obstacles.

It can take several years or more for a skyscraper project to go from the drafting table to completion. The market downturn in office real estate is very real. The downturn just hasn't caught up to the backlog of construction projects yet.

The situation is bad enough that some of these developers could get wiped out and leave some skyscraper projects stuck, unable to finish construction. They all planned these buildings with the intention of collecting high lease/rent amounts to help pay off all the money they borrowed to fund their projects. That borrowed money comes with variable interest rates that re-adjust every few years, unlike the 30 year fixed rate mortgages individuals get when buying a home. With office vacancy rates in Manhattan hitting the 20% mark it doesn't exactly put a stable floor under those high lease/rent prices. The insane living costs in the Greater New York Area is forcing a lot of workers out of the region. A growing number of employers are following them.

Although the office vacancy rate is a little intriguing, I don't find the exodus of residents and even employers to be very indicative of what is driving real estate on Manhattan.  Little pieces of real estate in the sky have become mere investments for the far upper classes.  As long as they trade them like poker chips, developers will build in Manhattan.

[Bobby5280]

Here's the thing: investors can buy and trade real estate properties back and forth, cranking up prices to squeeze out profit for only so long. At some point down the road a business has to actually lease that office space to use it. Or someone has to buy that house to actually live in it. The property flipping can flip only so far before the situation devolves into totally not-justifiable bullshit. And that's where we are now: a completely insane, illogical price bubble.

Cities like NYC are great and all. But it's no longer necessary for a business to pay extreme prices just to have some office space there. I live in bum-f*** Lawton, OK yet I have four choices of extreme speed Internet access, three of which are fiber -all wired right there at my house. On top of that my mobile phone has insane connection speeds. Many functions of modern business are about communication and moving data. You don't have to locate in a giant city to do that anymore.

Various forces have tried hard to extend the life of this current real estate bubble. Scores of private equity companies have been buying up hundreds of thousands of residential homes (along with all sorts of other things like nursing homes). But they're creating a new "too big to fail" scenario. However, private equity companies are just private equity companies. They're not banks who control the flow of capital. They're trying to monopolize all the basics of just surviving. But the long term math is not on their side, especially when an ever-increasing number of young adults are saying no to having children and breeding a new generation of suckers into existence. In the long run these ass-hat investors are going to be stuck with huge inventories of properties they cannot sell. They'll be looking to "Uncle Sugar" for a bailout, but won't deserve a bailout at all.

The collapse of Evergrande in China is a pretty good warning sign of what we're asking for here in 'Murica. It's an extreme example, aided by a police state dictatorship. But the potential for unfinished skyscrapers to sit derelict and subdivisions of empty McMansions facing the bulldozers is very real.

[brad2971]

The OKC administration already gave its approval.

Let's be honest, it would be kind of hard to come up with a project the City of Oklahoma City wouldn't give its approval to, especially if you're not asking for TIF money with it.

It would have to be something like a three hundred foot tall Satanic temple, topped by a one hundred foot tall statue of Baphomet, sporting an erection, wearing a Texas Longhorns hat and a T-shirt that says "I ♥ Proper Capitalization" and holding a sign that says "Gary England sucks", built in R1 zoning. And even that might get approved if you donate to the city council's re-election campaigns.

Mercifully, all financiers and bankers have to do nowadays is ask how much space is available right now in that college campus Chesapeake Energy built for itself, or that tower Devon Energy has downtown, and decline to finance this laughable tower. And all the TIF "money" that supposedly pro-development OKC could authorize will never change that.

[kernals12]

Oklahoma City Airport is now crying foul about the impact such a tall building will have on its operations. The guy who is proposing this is either incredibly naive about how real estate works or is pulling some kind of scam.

[Bobby5280]

I'm still very skeptical the Legends Tower thing will ever happen. And that would be fine by me; I'm not fond at all of how it looks. The Devon Tower looks interesting. The Legends Tower design is pretty bland. Overall the proposal seems very risky given the situation with office tower vacancy rates in urban centers.

There is a big want from some business and government types to get all workers back to in-person office settings. I think remote work is here to stay to some degree. Too many businesses are saving too much money they'd otherwise pay on office rent costs to not use the work model. And then people in certain living situations can only work remotely, such as women who have kids at home and can't afford crushing day care costs. They would quit their jobs if forced to "RTO."

It is surprising any civilian airport administrators would be complaining about the Legends Tower project. Do any flight paths from Will Rogers Airport or Wiley Post actually go over the downtown district in OKC? The main runways at both airports point North-South. And the diagonal runways appear to point away from downtown.

I could imagine officials at Tinker AFB raising concerns. One its runways does point diagonally toward the downtown area, but the main runway points North-South.

[Rothman]

I'm still very skeptical the Legends Tower thing will ever happen. And that would be fine by me; I'm not fond at all of how it looks. The Devon Tower looks interesting. The Legends Tower design is pretty bland. Overall the proposal seems very risky given the situation with office tower vacancy rates in urban centers.

There is a big want from some business and government types to get all workers back to in-person office settings. I think remote work is here to stay to some degree. Too many businesses are saving too much money they'd otherwise pay on office rent costs to not use the work model. And then people in certain living situations can only work remotely, such as women who have kids at home and can't afford crushing day care costs. They would quit their jobs if forced to "RTO."

It is surprising any civilian airport administrators would be complaining about the Legends Tower project. Do any flight paths from Will Rogers Airport or Wiley Post actually go over the downtown district in OKC? The main runways at both airports point North-South. And the diagonal runways appear to point away from downtown.

I could imagine officials at Tinker AFB raising concerns. One its runways does point diagonally toward the downtown area, but the main runway points North-South.

It's not only about interairport flight paths, but associated published procedures with every airport in the area.

[kernals12]

The real estate industry is filled with broken promises. Sometimes it's from excess optimism and other times it's wire fraud.

[JayhawkCO]

And then people in certain living situations can only work remotely, such as women who have kids at home and can't afford crushing day care costs. They would quit their jobs if forced to "RTO."

As someone who took care of an infant while working remotely, it doesn't quite work that way. You need day care to be able to actually do your job and you're still going to pay the ~$20k a year it costs because otherwise you can't get anything done. I made it as long as I could, very much benefitting having a job without a lot of time sensitivity. But just because you have a kid, doesn't make remote work "easy to do" where you get to save on day care.

[kernals12]

I love working remote. It doesn't just save you the time of commuting, but also putting on work clothes, packing a lunch, and then walking from the parking lot to your desk.

And in the near future, VR/AR should make it possible to create an office environment in cyberspace, complete with watercooler chats.