Carefree Truth
Issue #536, December 16, 2016
Mayor Les Peterson stated that the Easy Street Condominium project began about 10 years ago and has been discussed extensively over that period. Although Mr. Lewis had positive reactions from potential buyers and had invested quite a lot of private money to get to this point, he recently terminated the project because he was unable to secure construction financing due to the addtional banking regulations now in place. Everything necessary had been done to obtain the required State, County, and Town permits, but he could not meet some of the Dodd-Frank requirements, such as the ability to point to a comparable condominium project within a 3 mile radius, and so was ineligible to receive the loan.
The Mayor read the following letter from Mr. Lewis, which was sent to the Town and to others. (Carefree Truth was a recipient and the letter was included in Letters from Readers at the time.)
November 29, 2016
Dear Friends of Easy Street,
You have all noticed our delays in getting construction started on the Easy Street Ultra Luxury Condos. Since spring, we have been talking to construction lending sources for this type of project. They required we have architectural and engineering plans completed, marketing and sales programs in place, costs tied down, utilities organized and committed, Town, County and State approvals, and market studies completed. We had completed all of these tasks last spring.
But, we have been unable to secure construction financing. I retained two substantial capital brokers to seek out well over 100 banks, venture capital sources, foreign and regional large developers, large homebuilders, private wealth sources, etc., all with no success.
When I built commercial and multifamily projects over the past 25 years, I always had several banks who wanted to provide construction financing for each project. But, the world has changed. Our federal government approved a 2200-page bill 6 or 7 years ago (Dodd-Frank) along with a subsequent 26,000 pages of rules and regulations that have caused most banks to increase their staffing to assure compliance with banking regulation by tenfold. It’s the collection of these banking regulations that has prevented our securing construction financing. Specifically, we did not meet 5 requirements for condo lending, so the Washington Bureaucrats see our project as not acceptable. If the current federal banking regulations were in place in the past, I could not have completed my two condo towers in Kierland.
After 10 years of work on this project, and millions of dollars spent, I have no choice but to abandon the development of Easy Street, an ultra-luxury condominium. I have spent 10 years trying to help energize the Town of Carefree; 10 years of the great recession, the financial crisis, the housing depression and now am unable to overcome excessive federal control of local banking.
I am sure most of you are disappointed, as I am, with this loss. The land is now being offered for sale.
Thanks to each of you for your support and encouragement. I still believe the Town of Carefree is a great place now, and that it has a very special future.
Sincerely,
Ed Lewis
President, Butte Companies
Having worked with Mr. Lewis and gotten to know him, Mayor Peterson expressed his professional and personal sense of loss.
https://vimeo.com/194915528
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list. Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.
Issue #536, December 16, 2016
Mayor Les Peterson stated that the Easy Street Condominium project began about 10 years ago and has been discussed extensively over that period. Although Mr. Lewis had positive reactions from potential buyers and had invested quite a lot of private money to get to this point, he recently terminated the project because he was unable to secure construction financing due to the addtional banking regulations now in place. Everything necessary had been done to obtain the required State, County, and Town permits, but he could not meet some of the Dodd-Frank requirements, such as the ability to point to a comparable condominium project within a 3 mile radius, and so was ineligible to receive the loan.
The Mayor read the following letter from Mr. Lewis, which was sent to the Town and to others. (Carefree Truth was a recipient and the letter was included in Letters from Readers at the time.)
November 29, 2016
Dear Friends of Easy Street,
You have all noticed our delays in getting construction started on the Easy Street Ultra Luxury Condos. Since spring, we have been talking to construction lending sources for this type of project. They required we have architectural and engineering plans completed, marketing and sales programs in place, costs tied down, utilities organized and committed, Town, County and State approvals, and market studies completed. We had completed all of these tasks last spring.
But, we have been unable to secure construction financing. I retained two substantial capital brokers to seek out well over 100 banks, venture capital sources, foreign and regional large developers, large homebuilders, private wealth sources, etc., all with no success.
When I built commercial and multifamily projects over the past 25 years, I always had several banks who wanted to provide construction financing for each project. But, the world has changed. Our federal government approved a 2200-page bill 6 or 7 years ago (Dodd-Frank) along with a subsequent 26,000 pages of rules and regulations that have caused most banks to increase their staffing to assure compliance with banking regulation by tenfold. It’s the collection of these banking regulations that has prevented our securing construction financing. Specifically, we did not meet 5 requirements for condo lending, so the Washington Bureaucrats see our project as not acceptable. If the current federal banking regulations were in place in the past, I could not have completed my two condo towers in Kierland.
After 10 years of work on this project, and millions of dollars spent, I have no choice but to abandon the development of Easy Street, an ultra-luxury condominium. I have spent 10 years trying to help energize the Town of Carefree; 10 years of the great recession, the financial crisis, the housing depression and now am unable to overcome excessive federal control of local banking.
I am sure most of you are disappointed, as I am, with this loss. The land is now being offered for sale.
Thanks to each of you for your support and encouragement. I still believe the Town of Carefree is a great place now, and that it has a very special future.
Sincerely,
Ed Lewis
President, Butte Companies
Having worked with Mr. Lewis and gotten to know him, Mayor Peterson expressed his professional and personal sense of loss.
https://vimeo.com/194915528
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list. Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.