According to the Baltimore Sun, WCI has come upon some tough financial times. What does this mean for the Tower? No one knows for sure. My guess is that it gets built. If not by WCI, then by some other investor who buys the site and plans and rolls forward. There are many people who have made a lot of money (Donald Trump, for example) by being the second owner of real estate projects. Granted, those are typically projects that are already built, but WCI might be able to work out an arrangement where they transfer the majority of the risk and reward to a third party and score themselves a construction management deal to recoup some losses they may have to take on that sale. I heard that the profits on the Tower could be between $60 and $100 million. If that is the case, the Tower will be built. Like Deep Throat said, follow the money.
However, given that the market in Columbia is still strong compared to other places, and that a billionaire is backing WCI, I’d say the odds of the Tower being built by WCI are fairly strong.
WCI’s stock closed yesterday at $4.54 a share. I’d say it’s time to buy*. We’ll see if I have a future in mutual fund management.
*When if comes to putting my money where my mouth is, I only buy index funds. Burton Malkiel is my investment hero.
1 comments:
I read a number of Blog's, which leads to reading all sorts of stuff, but your Blog keeps bringing
me home to my college courses in finance and economics. Now I am off to read "A Random Walk Down Wall Street". Keep up the good work F.M.
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