10-04-2006, 05:01 PM | #21 | |
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I do know a little about Church finances, and although the Church has positive cash flow, it's not wealthy beyond imagination. Most of its assets do NOT produce income but rather require cash to sustain them. Some of you are characterizing the Church as possessing untold wealth, richer than kings and kingdoms. Not true, the Church must continue ot operate under sound fiscal principles and a series of bad financial decisions could severely hurt the Church.
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10-04-2006, 05:04 PM | #22 | |
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When things go wrong, however, the developer has to go through the agony of bankruptry, foreclosure, loss of credit rating, etc. Yes, he may have a corporation to hide behind, but more times than not the bank wants a personal guarantee, and even when protected by the corporate veil he emerges with his reputation in tatters and cannot be spared the agony of protracted litigation. It's a tough, risky business, and when developers get extremely rich, as they sometimes do, it's probably well earned. My points are: First, no, the Church doesn't have $2 billion cash lying around; it's borrowing the money, and tithing won't be tapped into only if the commercial project is successful. Second, you can't make these types of projects successful just by throwing money at them. I've seen plenty of gleaming, empty, drafty malls in places like Oklahoma, Texas and Alaska where the developers guessed wrong and got killed or came too late and got crushed at the door when the economy softened (is that other mall at Second South going to take this lying down? Seems there's a lot of competition). The Church seems to be acting like local government here. Yes, there are examples such as the Riverwalk in San Antonio, downtown Baltimore and many others where the city injected resources and helped to make a dismal area bloom. But invariably it's a delicate marrying of private enterprise and risk taking and public incentivizing that makes it work. Hoya and others here know the actual facts; I don't. Who will be the tennants? Most important, who are the anchor tennants? Is the Church selling municipal backed bonds? (ACLU, are you listening?) Is there a commercial lender? Is the temple being pledged as collateral? (This is giving me an idea for a great comic novel spoofing LDS utah culture.) Has anybody seen their pro formas, cash flow projections? Are their assumptions realistic? If law firms were publically traded I think James Cramer would be issuing a buy recomendation for the ones in SLC. Consturction contractors are notorious litigation predators. It will be interesting to see this unfold.
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Interrupt all you like. We're involved in a complicated story here, and not everything is quite what it seems to be. —Paul Auster Last edited by SeattleUte; 10-04-2006 at 05:08 PM. |
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10-04-2006, 05:07 PM | #23 |
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The website I provided earlier shows the anchor tenants.
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10-04-2006, 05:16 PM | #24 | |
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Interrupt all you like. We're involved in a complicated story here, and not everything is quite what it seems to be. —Paul Auster |
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10-04-2006, 05:21 PM | #25 | |
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You're correct that the Church must continue to use fiscal wisdom in its investments, but that applies to any company no matter their cash flow. Positive cash flow means little when companies like Google and Yahoo can catapult up the Fortune 500. And on the other side of things look at the companies who have fallen out of the Fortune 500. AT&T for example went from in the top tier to out of the list in a single year I believe.
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10-04-2006, 05:24 PM | #26 |
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It's too bad that Real Salt Lake wouldn't build their soccer stadium downtown.
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10-04-2006, 05:27 PM | #27 | |
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10-04-2006, 05:31 PM | #28 |
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No, I do agree that the church doesn't not have liquid money coming out of their ears. A lot of church property is taken up with its buildings, etc. that do eat money (though that is also tithing payed for)...but the church does have a lot of money in land development (thru ag, dairy, etc.) that do generate some cash.
The church also has some significant money in investments that they can access though they rarely do. This project is not a humanitarian project...they are doing it to preserve downtown SLC (temple square, etc.) as well as to recoup and make money. And as SLC continues to grow, the church is 'risking' a 1.5 billion dollar investment...but it is a project that the church fully intends to recoup the majority of its costs. |
10-04-2006, 05:32 PM | #29 |
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I was under the assumption the church is not borrowing any money for this project, is that wrong?
If they aren't, that is a lot of liquid money the church has, a lot more than I ever imagined the church had. The businesses involved, are they going to be held to higher standards? For example: Will 'Buckle' be able to sell slut clothing? Will 'Chili's' be able to sell alcohol? Will 'Nordstroms' be able to open on Sunday? Is the church leasing the property or selling the units? If they sell, how do they ensure that the businesses maintain certain standards? |
10-04-2006, 05:32 PM | #30 |
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Man I'm being excoriated just for asking a question on CB.
http://www.cougarboard.com/noframes/...tml?id=2151464
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