OK, after a short detour, it looks like the gambling debate is back on the front burner on Beacon Hill.
The passing of Sen. Edward Kennedy put the casino issue temporarily on the back burner as lawmakers scrambled to pass legislation to give Gov. Patrick the power to appoint an interim senator.
That done, and Paul Kirk get ready to leave for Washington, lawmakers are now back at work hammering out the details of a gambling bill.
The Herald reports the House Speaker Robert DeLeo has put the issue on the fast track, with plans to start hammering out a gambling bill over the next few weeks.
So far, the big winners appear to be Richard Fields, who has lobbied hard for the chance to transform East Boston’s Suffolk Downs into a major casino complex, and Mohegan Sun, which has laid out ambitious plans of its own for the Western Massachusetts town of Palmer.
The big losers, so far at least, appear to be the Mashpee Wampanoag tribe and gambling boosters pushing for the chance to revive battered New Bedford with a major casino development.
The tribe, which had hoped to build a casino in Middleboro, has had a falling out with its investors. A U.S. Supreme Court ruling earlier this year also appears to call into question the tribe’s chances of winning federal approval to establish an autonomous reservation in the town – a basic first step in opening a tribal casino.
New Bedford elected officials are also fighting to keep their city included in the emerging casino plan, though that is increasingly looking like a daunting task.
When it comes to big resort casinos, three may be just too much for even gambling crazy Bay State residents to swallow.
It will certainly be interesting to see how it all shakes out.

I am sure it was all just a big coincidence.

But the timing of Fan Pier’s big lease deal, well that was certainly interesting.

For all the normal folks out there who don’t follow the rather incestuous intersection of business and politics in Boston, it may have just looked like business as usual.

Fan Pier’s developer on Monday announced a key lease deal, one that appears to go a long way toward resolving any remaining doubts about the viability of the long-struggling waterfront development.

Law firm Fish & Richardson inked a deal to lease 124,000 square feet, taking a big chunk of Fan Pier’s first major commercial building, an 18-story office tower.

Of course, it’s a great story for Menino, who has faced his share of criticism over the years over the slow pace of development at Fan Pier and along the South Boston waterfront.

If the Fan Pier plan sounds familiar, it should, since it has been kicking around for 30 years and is just now moving into construction.

Such is life in Boston when it comes to big development projects.

Of course, it sure was interesting that the announcement went out on Monday, the day before the hotly contested mayoral primary.

And that project’s developer is a long-time ally of the mayor.

But here I go, overanalyzing everything.

I am sure it was all just one big case of happenstance.

Developers who build office towers and suburban complexes take note.

As companies get lean and mean in a bid to survive the Great Recession, they are rethinking the way they use office space.

And the conclusion, unfortunately for those in the development business, is that they need less, not more space.

The San Francisco Chronicle takes a revealing look at this trend, which appears to be emerging in California as slimmed down tech companies brainstorm what to do with vast cubicle graveyards left behind after massive layoffs.

One thing these companies are increasingly doing is dynamiting the old cubicle system and moving toward a more open office, team approach to their office setups.

Obviously, this will save money – the story notes that health care company McKesson now has 60 workers per floor instead of 30 at its downtown San Francisco headquarters.

But it also matches up quite conveniently with the working styles of the “Millennials”  – the wave of tech obsessed younger workers born in the late 1980s or early 1990s.

The Millennials are said to eschew cubicles and offices and are comfortable setting up shop wherever they can plug in, whether it be the local café or kitchen table.

Of course, judging from some of the cynical comments posted by readers on the article, it could also be just another way to justify ever deeper corporate cost cutting.

Either way, its change, and its coming.

Just a matter of a week or two after leaving the Sox payroll, Janet Marie Smith, the charismatic architect who helped save Fenway Park from the wrecking ball, has landed a new gig.

Smith will oversee planning and development at the Baltimore Orioles, a franchise near and dear to her heart. Smith, who hails from Baltimore, worked with Sox chief Larry Lucchino back in the early 1990s, helping oversee the rollout of the well-regarded Camden Yards ballpark.

Lucchino spent several crucial years in Baltimore, forging close relationships with a talented crew of experts and executives like Smith who he later brought to Boston.

Still, the big question remains who will pitch development for the Red Sox, who now control a large swath of property around Fenway Park after years of aggressive acquisitions by John Henry’s ownership group.

In my Aug. 31 Banker & Tradesman column, I argued that Smith’s departure will take a major force pulling for preservationist approach around the ballpark. (It is a story I broke for the Boston Courant on Aug. 28.)

Smith, who helped inject new life into 1912 Fenway after nearly a decade of renovation work, was determined to prevent the ballpark from being overshadowed by a ring of towers on nearby lots.

She skirmished over the years with developers like Steve Samuels, who has built two high-rise residential complexes near the ballpark and is eager to do more.

And Smith also likely kept the Sox in check as well, throwing a damper on any dreams of massive new developments o the team’s parcels around the ballpark.

The Herald, in a nice story, takes things a step further, looking at the growing role played by John Henry’s new wife, Linda Pizzuti.

An experienced real estate executive from a local development family, Pizzuti is said to be lobbying for a more intensive approach to development by the team, the paper reports.

This should be an interesting one to watch.

Beacon Hill has been abuzz all summer with backroom talks on impending gambling legislation.

With Gov. Deval Patrick, Senate President Therese Murray and House Speaker Robert DeLeo all in favor of legalizing some form of expanded gambling, a casino bill this fall seemed like a slam dunk.

But the passing of Sen. Edward Kennedy appears likely to have thrown a monkey wrench into the legislative machinery at the State House.

The death of our beloved senior senator has left a representation void in Washington that the powers that be back in Massachusetts apparently can’t agree on how to fill.

Before his death, Kennedy had urged that Gov. Patrick be given the power to appoint an interim senator to give the state a voice in the epic health reform debate over the next few crucial months. A special election for his seat has been scheduled, but it’s not until January.

But state lawmakers have mixed feelings on this, having voted to strip the governor of this appointment power just a few years ago when Republican Mitt Romney was in the governor’s office.

Anyway, to cut to the chase, there’s no way legislative leaders on Beacon Hill are going to take up any other major issue, and especially not gambling, until this is resolved.

Lawmakers who’ve been around for a few years like DeLeo, the new House leader, know that once the gambling debate starts, it will steal all the oxygen out of the room.

That would likely make a resolution of the interim senator issue even more difficult than it is likely to be.

And, of course, choosing to debate gambling instead of finding an interim successor to the late Sen. Kennedy, well think about it, how does that look?

I think you get the picture.

Kevin Ahearn, the dean of the downtown condo market, offers an interesting counterpoint to my B&T column this week on the struggles of the downtown condo market.
In my column, I detail the findings of the PrimeTime Urban report, which looked at 13 new downtown luxury condo projects. Sales actually fell in the first half of 2009, to an anemic 1.03 sales per month for each project.
Ahearn doesn’t quibble with the sales slowdown, though he notes activity is picking up again. (The study only goes through the first half of the year.)
But he rolls out a barrage of statistics pointing to continued price gains in the luxury market downtown.
In particular, Ahearn took a look at four years worth of condo resales at several major downtown projects, including the Ritz Carlton towers, One Charles and the new InterContinental.
He came up with 134 resales from 2004 through Wednesday, Sept. 9
Of these, 84.3 percent saw their owners walk away with a gain, 3.7 percent sold for the same price, while just under 12 percent lost money.
Of these, just five owners lost 10 percent or more on their resale.
Anyway, thanks Kevin for the primer. There’s nothing better than a lively debate.

The downtown condo market looked all but invincible for so long.
No longer.
For my Commercial Interests column in this week’s B&T, I took a look at a survey of 13 new Boston condo projects by the PrimeTime Urban Report found just one sale per month.
The results, especially for someone who has been inclined to shrug off the problems facing the downtown condo market, were sobering.
The report out suggests that sales of luxury units remain stuck at last year’s anemic levels, and are even slipping back further.
Or to be exact, 1.03 sales per month through the first half of 2009, down from a not exactly banner 1.2 sales a month last year.
Either way, it’s not likely enough to clear out the hundreds of unsold luxury units out there.
At this pace, it would take 100 months to sell off the remaining 558 units in these projects, which include the Clarendon, 45 Province Street, Harrison Lofts and FP3.
I’ll do the math for you – that’s more than eight years.
More troubling yet, this lackluster performance has come amid growing signs the overall real estate market has bottomed out and may soon be on the upswing.
Not, then, what I was expecting to see.
You’ve got to hand it to this real estate downturn. Just when you think you’ve seen it all, it gets stranger still.

OK, now I feel a little better.
I just finished looking at a report by CresaPartners on the battered Rt. 128 office market.
Vacancy rates are edging towards the 20 percent market, rents are plunging and there’s 3.5 million square feet of empty space sitting on the market.
Sound bad? Yes, but take a look at what’s happening to our West Coast counterpart, Silicon Valley.
The unemployment rate there is nearing 12 percent and office vacancy has blown past the 20 percent mark.
But check this stat out, because it is truly mind blowing.
There’s more than 40 million square feet of empty – that’s right, empty – office and research space sitting on the market.
That includes more than 300 completely vacant research and office buildings.
Ouch!

Sam Zell hasn’t turned out to be much of a newspaper publisher.

After making billions in the commercial real estate market with his legendarily hard-edged, no nonsense style, Zell rode into Chicago with hopes of becoming the savior of the embattled Tribune Company, owner of the nationwide media empire that includes the Chicago Tribune.

The paper and the company are now in bankruptcy after a so far unsuccessful bid to turn things around.

I suspect his blunt style did not go over well with big city editors not used to being told very clearly where things are at, even if their business is in mortal peril right now.

Back during all the outrage over outsourcing to India a few years ago, Zell unabashedly praised the trend - and urged business leaders to jump on the bandwagon - during a speech to Boston business leaders.

Undaunted, Zell is now returning to his roots, putting together a $625 million fund to buy troubled asset backed securities, including some backed by commercial real estate.

He’s clearly looking at the prospect of reaping some big profits from the next big bust coming down the pike, predictions of a wave of foreclosures on everything from office buildings to downtown towers.

The sale of the Hancock tower at a foreclosure auction surely shows this is not just a lot of hype.

Anyway, good for Zell. After all, he made his tens of billions buying up troubled properties and turning them around.

That earned him the nickname, the “Grave Dancer.’’

It looks like Zell is going to be doing some dancing again.

Just when gambling boosters at the State House finally appear to have the upper hand, along comes Foxwoods to spoil the party.

Connecticut’s giant Indian casino would probably like nothing more than to derail the political momentum building on Beacon Hill for legalizing casino gambling,

And while it’s not likely the casino’s budding financial issues will do that, it could give gambling foes here in Massachusetts some ammunition to throw at the issue.

The Mashantucket Western Pequot Tribal Council, owner of Foxwoods, has just announced plans to explore a restructuring of its $1.5 billion debt load.

This certainly doesn’t signal a meltdown of the tribe’s finances, but with the casino industry struggling to emerge from a period of bankruptcies and declining revenue, it is just the kind of announcement that puts investors on edge.

Foxwoods, which spent hundreds of millions on an MGM-themed expansion that opened just months before the stock market tanked, has been hurting as well.

To compound matters, a memo leaked out to the local press from Michael Thomas, the tribe’s chairman, saying tribal members would get paid back before banks and bondholders.

Moody’s, reacting to the tribe’s announcement and concern on the possible impact on investors, knocked the tribe’s debt rating down four steps.

Ouch.

For his part, Thomas, who is in the middle of a tribal reelection campaign, has been placed on leave.

How does this play up here?

Certainly it should help lawmakers here craft sounder casino legislation.

Bigger may not now necessarily be better in this still fragile economy.

Gambling critics are also likely to make hay with this story, though with the state desperate for cash, this is likely to be more of a cautionary note than a deal killer.

That said, it will be interesting to see how this plays out.