Banker: Penobscot Building in default

[bigtreble]

Tuesday, August 25, 2009
Banker: Penobscot Building in default

Christina MacDonald and Louis Aguilar / The Detroit News

The owners of the Penobscot Building, a 47-story landmark in downtown Detroit, have defaulted on bank loans and the bank is taking steps to foreclose.
According to an Aug. 7 letter sent to Penobscot tenants by mortgager Capmark Finance Inc., a unit of Capmark Bank, building owner PBDM LLC "committed events of default" in connection with its 2007 loan from Capmark.
A notice of default was filed with the Wayne County Register of Deeds on June 22. Capmark also filed a complaint of foreclosure in Wayne County Circuit Court on June 30; the case is pending.
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According to its Web site, the Penobscot was built in 1905. The building at 645 Griswold St. is 63.1 percent leased, according to CoStar Group Inc., a commercial real estate research and information service.
The global recession and the woes of the auto industry have hit Metro Detroit particularly hard. The office vacancy rate for Detroit's Central Business District is 27.8 percent according to CB Richard Ellis, a commercial real estate research and service firm. The decade began with a 17.1 percent rate. The U.S. average for downtown office vacancy is 13.7 percent, compared with 11.1 percent a year earlier, according to Colliers International, another commercial real estate brokerage firm.
laguilar@detnews.com [[313) 222-2760

[Detroitnerd]

Hurry up and knock that schitt down! Where are you, demolition man!

[Detroitnerd]

No way the Penobscot was built in 1905. The older one was, not the art deco masterpiece we know and love. What's up with this shoddy research?

[313WX]

No way the Penobscot was built in 1905. The older one was, not the art deco masterpiece we know and love. What's up with this shoddy research?

It's Detroit, who cares?

[Detroitnerd]

There are three different structures just in Emporis with the Penobscot name:

http://www.emporis.com/application/?...detroit-mi-usa

http://www.emporis.com/application/?...detroit-mi-usa

http://www.emporis.com/application/?...detroit-mi-usa

[Detroitnerd]

Oh, I see, they pulled it off the website. Those sillies. They should have known that "since 1905" doesn't mean that THAT building was built in 1905.

http://www.penobscotbuilding.com/

Jeez, you'd think two journalists would know that art deco buildings weren't built in 1905 and would dig a little deeper!

[kraig]

Oh, I see, they pulled it off the website. Those sillies. They should have known that "since 1905" doesn't mean that THAT building was built in 1905.

http://www.penobscotbuilding.com/

Jeez, you'd think two journalists would know that art deco buildings weren't built in 1905 and would dig a little deeper!

So when was it built? 1928?

[crawford]

I'd say the Penobscot is on the same path as the Book Tower, just 5-7 years behind.

It's changed hands 3-4 times in recent years, which is definitely a serious warning sign.

Imagine if the Penobscot becomes abandoned.

[Detroitnerd]

Aren't you licking your lips at the thought, Crawford? Another obsolete building for the wrecking ball! Let go, you sentimentalist.

[bailey]

Just think...after it ripens after 15-20 years of neglect and urban spelunking...it'll be a nice new piece of ruin porn for hipsters to take artsy pictures of.

[Detroitnerd]

And then we can call in Adamo! Yay!

[crawford]

Aren't you licking your lips at the thought, Crawford? Another obsolete building for the wrecking ball! Let go, you sentimentalist.

Absolutely! Would be a perfect spot for surface parking [[landscaped, of course), and could always be one of Detroit's patented "Premiere Development Opportunities".

[bailey]

Absolutely! Would be a perfect spot for surface parking [[landscaped, of course), and could always be one of Detroit's patented "Premiere Development Opportunities".

Well, that or an over sized canvas for a cheesy Wyland whale mural.

Oh, I see, they pulled it off the website. Those sillies. They should have known that "since 1905" doesn't mean that THAT building was built in 1905.

http://www.penobscotbuilding.com/

Jeez, you'd think two journalists would know that art deco buildings weren't built in 1905 and would dig a little deeper!

Certainly seems to be the intent they are trying to convey on the website....

Since 1905, the world of business has revolved around Detroit’s internationally recognized landmark, the Penobscot Building. Now, this timeless 47-story landmark stands as a proud symbol of the future.

[Detroitnerd]

Oh, I know that the website begs for people to misinterpret it. It's the job of a seasoned journalist to think critically. If I gave you a microwave oven I said was made in 1936, you'd know better, right?

[digitalvision]

Sorry to break your heart, Detroitnerd and others, but light rail is not the panacea - not for these problems. Not to mention, it's at least a couple years away AND only goes to Grand Blvd at this time.

It's going to be at least a decade until rider patterns shift enough to have impact. Not saying we shouldn't do it, but in business, you can't bet on the future like that - especially in a region so full of disappointments. Seen too many lost shirts betting on the maybe.

Losing the penobscot would be a body blow to downtown and devastating.

BTW, it would be the whole penobscot block, they're considered 1 structure.

Stott is not completely vacant, but almost completely vacant. There's some retail and a couple office buried in there.

[Detroitnerd]

Sorry to break your heart, Detroitnerd and others, but light rail is not the panacea - not for these problems. Not to mention, it's at least a couple years away AND only goes to Grand Blvd at this time.

Awwww, poow wittwe me. Stop being a condescending dick.

It's going to be at least a decade until rider patterns shift enough to have impact. Not saying we shouldn't do it, but in business, you can't bet on the future like that - especially in a region so full of disappointments. Seen too many lost shirts betting on the maybe.

Oh, yeah. It would be terrible if we had a plan that looked forward more than a year. But, since ridership patterns will take forever to shift, well, too bad. We may have to lose some more buildings. We all know it's disappointing, but, we have no vision. Sorry. Fuck it.

Losing the penobscot would be a body blow to downtown and devastating.

But that's what lack of a long-term plan, as well as a plan that if we make downtown Detroit as flat and vacant as Troy was in 1955, we're assured success. So why complain when this is the natural outcome of our foolish plans and demolish-it-first strategy?

Thanks for playing.

[EastSider]

What's your plan to fill the Penobscot with tenants? You're good with tossing out the words "we have to plan long-term," but the Penobscot issue is here-and-now.

What ideas do you have that the last three owners didn't?

And think quick, because the First National Building is probably following quickly on the Penobscot's heels.

[digitalvision]

DN,

I know you're pissed - we're all pissed at this possibility.

I said planning is a good idea - and it's a GREAT thing we've got forward looking plans for Detroit and the region. It's REALLY important and if the work was done 15 or 30 years ago, we wouldn't be in this fix. Better now than never. But we need to be realistic about what it's going to do.

Losing buildings will not be a function of what any one of us do - it's business conditions. It's the market. It's the fact we've been in a one-state depression. One of the things that can be a huge positive for the city is those buildings and whenever possible they should be preserved or torn down only when there's a replacement plan, and a real one.

If a building is not financially viable, it can't continue to stand save for a ward of the state.

[Detroitnerd]

And I say you're eulogy for what is yet to be destroyed is disingenuous nonsense. I'm sick and tired of people blaming the past, the market, the city, the suburbs. You know who is to blame? We are.

[bailey]

Quote:
Originally Posted by digitalvision
Sorry to break your heart, Detroitnerd and others, but light rail is not the panacea - not for these problems. Not to mention, it's at least a couple years away AND only goes to Grand Blvd at this time.

Awwww, poow wittwe me. Stop being a condescending dick.

wow...Pot? Kettle? It's a legit point. There have been "serious" talks about "mass transit" in detroit for what...at least a decade? There have been at least 5 years of "real planning" and focus groups and what not about "light rail" up Woodward...and not much else beyond that. At the current pace are we any less than 5 more years from a shovel going in the ground for what is currently on the drawing board? I mean it's not like they're going to put the street cars back online. It's going to be a Woodward loop that, at best case, goes from downtown to 8 mile. At best case, even after what little is planned is put online, parking for tenants is still going to be an issue for much of the CBD for the long term.

No one is saying tear down the Penobscot, but the proposal was about the consolidation of tenants and the removal of the annex or the old Penobscot as a parking solution for the Penobscot and several other buildings struggling ot retain tennants. .

[iheartthed]

Sorry to break your heart, Detroitnerd and others, but light rail is not the panacea - not for these problems.

Of course it isn't a panacea all by itself. But it's necessary if Detroit ever hopes to achieve a meaningful rebound.

On my way to work this morning I was thinking about how public mass transit in other well-functioning cities is regarded as a necessity, while private automobiles are viewed as a luxury. In Detroit, it is exactly the opposite; private automobiles are regarded as a necessity, while public mass transit is viewed as a luxury. That's some ass backwards type of thinking.

[GPCharles]

BTW, it would be the whole penobscot block

The Penobscot doesn't fill the entire block - there is the Ford Building and the old Silver's building.

[Oldertimer]

It is time to cut bait. It is time to "farm detroit". Tear it all down and start over. Run for mayor on not what you will do but what you won't do. You won't let "it" continue. You will tear down what is useless and not used. We all start over. It is 1701 all over again.

[Oldertimer]

We farm the fields. We rebuild in the future. Right now we get rid of what is waste and not needed or utilised.

[crawford]

A couple of thousand bucks for a huge 47-floor office tower

I know plenty of people who pay "a couple of thousand bucks" in monthly rent! For small aparrtments! Maybe they should buy giant office blocks instead.