W

Amid the bad news in the economy and real estate, there was a distinctly bright spot in the city on Tuesday, as the already shiny new W Hotel and Residences were "topped off" at Stuart and Tremont streets in the Theatre District.

Replacing a dreary parking lot, the W with its purple logo -- each W has a distinctive color -- will bring a modern flavor to old Boston.

The heros of the day were the ironworkers of Local 7, who were there to take that beam up at put it on the roof of the 28th (and top) floor.

They've put up a floor a week since last spring, sometimes two -- and in one week three floors. (Ironworkers like to call them stories rather than floors, because there are job stories and personal stories that go with each higher level.)

It's been a safe job by Bovis, with Jones Lang LaSalle as the owner's representative. The architect was William Rawn Associates and TRO Jung|Brannen. Interiors are being designed by Bentel & Bentel of New York.

The ceremony was at Citi Center Performing Arts Plaza, across the street. As Local 7 business manager Edwin Wright told it, there was one minor injury on the job, on a lower floor. And the replacement for that worker was one Shannon Cook, 27, of Abington, whose father, a retired ironworker, and mother watched on Tuesday as she connected the celebrated beam high up.

Wright watched too. "There's a female up there," he said. "There's history made up there." With minorities and women only relatively recently making it into the tight ironworkers union, Wright said he thought this was the first time ever a woman had put a topping-off piece of steel in place.

It was a gorgeous fall day, the kind that makes us really glad we live in New England, and hundreds of people gathered, including another former ironworker, Congressman Stephen Lynch of South Boston, who brought a US Flag that had flown over the Capitol.

The hotel will have 235 rooms, and the W will also have 123 condominiums, with views you can imagine. There are no other towers around there.

This local union has a tradition of charitable contributions, and every worker contributed $2 a week to a fund.

Before the beam was raised, union steward Jeff McKinley presented a check for $21,000 -- "and it's going up as we speak" -- to the Floating Hospital for Children at Tufts Medical Center.

John Schreiber, chief administrative officer and pediatrician-in-chief, accepted the donation gratefully, after retired ironworker Steve Lauziere said a few words and introduced his granddaughter, Kaleigh Nowak, 12, of Tewksbury. Kaleigh had been treated at Tufts for leukemia, which has been in remission for six years. "That's my inspiration right there," Lauziere said.

(The gala gathering was put together with the efforts of Kortenhaus Communications Inc., to which -- full disclosure here -- we contributed a small part.)

Carol Sawyer Parks, daughter of Frank Sawyer, who started the company that today is developing the W (and has stuck with it since it was supposed to be a Loews, a decade ago), recalled that her father started as a cab driver, had his dreams, and worked his way into real estate development.

Impressed by the example of the ironworkers, Sawyer Enterprises matched the donation to the Floating Hospital.

Her check was for $19,500, the figure she'd been given earlier in the day, but the ironworkers kept giving. It will be re-written to match the final figure, she said. "This is humbling," said Schreiber. "This is going to help a lot of children."






Long Slow Recovery

The state of the economy now is a little like that of Red Sox. "It's going to take a lot to win it in seven."

Eric Rosengren, president and chief executive officer of the Federal Reserve Bank in Boston, opened with the analogy at NAIOP's breakfast yesterday, the morning after a tough 9-1 loss by the home team -- some who had attended even admitted heading for the exits early.

But nobody can choose to bail out on the economy, much as we might like.

It rarely happens that housing prices go down all across the country at the same time. "The last time we had housing prices nationally go down was the Great Depression," Rosengren said.

That's one reason a lot of those folks who bundled mortgages together and sold them as good investments thought they were better than they were -- nobody expected one region's health not to save another.

In July, home values in all 10 Federal Reserve Bank regions declined. And since the beginning of the year the country has lost more than 50,000 jobs a month. NAIOP's program, sponsored also by the Boston Business Journal, at the Westin Copley hotel was "Global Trends, Local Impact: Changing the Way Massachusetts Does Business."

Unlike Europe's central bank, which only worries about keeping inflation at bay, our fed has a dual role, Rosengren said: It worries about both inflation and unemployment.

In fact, in recent years, even when the Fed was wary of inflation and not so worried about unemployment, it cut rates or kept them low, to keep the economy rolling.

"By historical standards, we were actually moving very, very dramatically," he said.

Housing is one of the most interest-sensitive sectors of the economy, but low rates haven't yet brought values back up.

The decline in prices in the Boston area has been modest, down only 5.4 percent.

Compare that to Miami (-28.2 percent) or Las Vegas (-29.9 percent), and you can almost feel good.

Nationwide, foreclosures are concentrated in the West Coast, northern Midwest, and Florida. In this region, subprime loan delinquencies are mostly in Springfield, Lowell, Lawrence, Providence, and Hartford.

Three things are needed to get the economy back up and running, Rosengren said: liquidity, so companies can roll their short-term debt; capitalized banks, so they can lend; and a housing market back on track. The housing problem may take a few quarters, longer than the other two, to get resolved, he said.

The government has put a lot of money into the system to patch up holes and restore confidence. Too much?

"We're not going to exhaust our resources with the amount we're talking about now," he said, and it's not all intended as subsidy. Much is considered investment.

"The hope is some of these things will end up making money for the taxpayers," like the Chrysler bailout did.

Panel moderator Jim McCaffrey of the Boston office of Eastdil Secured (filling in for Eastdil chief executive officer Roy March, who had been called to Washington), said the long bull market that is now over was "fueled by wagonloads of cheap debt."

There is $3.1 trillion in outstanding commercial mortgages, and commercial banks have 54 percent of that. Commercial mortgage-backed securities got us into trouble by doubling over three years -- $600 billion was issued in '05, '06, and '07. CMBS accounts for a quarter of outstanding debt; life insurance companies had about 10 percent.

McCaffrey said when property sales pick up again, "You're going to see more and more sellers providing financing along with the sales."

And the good properties in the top markets will move first.

McCaffrey said everybody's nervous. Even though there may be 5-10 offers on a deal today, few of those bidders are prepared to close within a few weeks. "There's a lot of head-fake action," he said.

European and Asian banks, which were strong, are now weak.

Some foreign money is still investing in the United States. One surprise is that three of the largest six investors in the last six month have come from -- Australia.

"We have seen some core capital migration to B and C markets," McCaffrey said.

And some sellers don't want to be too visible and will try to sell off- market.

"We don't want a shiny book," McCaffrey said they're telling him. "We don't want to read about it."

Boston is still a healthy place to invest he said, but, "We will see some distress in order to get buyers off the sidelines."



In a part two of yesterday's program, moderated by state energy and environmental secretary Ian Bowles, the focus was green: "The Tidal Wave: Environmental and Energy Policies 2012."

As one attendee said, "I felt a lot better after I heard the second panel." Hemant Taneja, managing director of General Catalyst Partners, which invests in new and existing businesses, said he is funding real estate deals involved in helping to commercialize new energy technologies.

"What's become overnight a really good asset is real estate."

He said he was in India recently looking "a few thousand acres" to purchase for use for solar power generation.

Tom King, executive director of National Grid, said technologies will continue to improve. "What you may have installed 10 years ago -- it's even better today. And it will do nothing but enhance the value of your property."

Investment opportunities in new energy saving technologies will increase dramatically in the next few years, he said.

But Taneja said no one form will dominate. "It's a bag of tricks." King broke down the opportunities users have into energy efficiency, demandside reductions, and choosing energy sources that have the least carbon impact. All forms of conserving are needed.

"We need to create a symphony around this," he said.

With Massachusetts now setting goals for carbon reductions over coming decades, King said such goals will "hopefully get set up on a national level." He said he though in 1-2 years there would be legislation requiring companies to buy credits for the pollution they create.

"The cost of carbon will be in every departmental budget."

Chris Gordon, chief operating officer for the Harvard University's Allston Development Group (the new campus across the river in Boston), cautioned that he can't just grab some of that $38 billion endowment for green technologies in new buildings.

Donors and university overseers watch closely how money is spent,he said. "We do have a long-term view," though, he said. "The environmental sustainability issue is the issue of our generation."

Wherever you stand on global warming, he said, sustainability makes sense, because it saves money, reduces local pollution, and fits in with a view of a shared global political dependency.

"I think the public is going to demand this," he said. "If you told me that 10 years ago, I wouldn't have believed it."

Gordon said for competitive purposes the university has to be green. Students visiting campus say, "I want to see how many LEED buildings you have." "They say, 'I want to see your carbon footprint data'."

"You think these kids are spaceshots, but they're not," Gordon said. "They can say, 'I'm going to go work in a lab at Stanford because it's a greener building'."

Gordon said the first Allston building required 26 permits, and it's a fundamentally new design that sometimes confounds the old ways of securing government approvals.

"Our building 'breathes'. You can imagine the building codes. They have no idea how to even discuss that," he said.

Gordon said Harvard would like to put wind turbines around athletic fields and tap geothermal energy. But it took a year to put up an 75-foot anonemeter, which measures wind speed.

There's no electricity. It runs on solar power and sends its data wirelessly to an analyst. But it hadn't been done before.

NAIOP made contributions in the names of each of the participants on the panels to the Grameen Foundation, which funds microloans to small businesspeople globally.