A Decade Since Developer Pyramid Construction Collapsed; Guidelines Needed for Development Incentives
A decade ago I was about four hours from St. Louis, still in a rehab hospital after my February 1st stroke. I got a call from a friend, a former Pyramid Construction employee, telling me he heard the heavily-leveraged company was shutting down that day. I immediately called someone still employed at Pyramid, but my call wasn’t returned. I ran the story Rumor: Pyramid Ceasing Operations based on my source.
Many people lost their jobs that day, some found out about their employer closing here. While unfortunate, I was just the messenger. Current & formers employees close to the matter felt is was important to get the word out as it was happening — hence the call to me.
From 2010:
For much of this decade, Steffen’s Pyramid Construction Inc. led the way in loft construction and other residential and commercial projects in downtown St. Louis. But overwhelming debts crushed the company, which went out of business in 2008. (Steffen indicted on bank fraud charge)
On a related note, Sunday’s non-scientific poll was about development incentives.
Q: Agree or disagree: The City of St. Louis should end all development incentives (tax increment financing, tax abatement, etc)
- Strongly agree 1 [2.63%]
- Agree 1 [2.63%]
- Somewhat agree 4 [10.53%]
- Neither agree or disagree 1 [2.63%]
- Somewhat disagree 4 [10.53%]
- Disagree 6 [15.79%]
- Strongly disagree 21 [55.26%]
- Unsure/No Answer 0 [0%]
Wisely a large majority disagreed. Incentives are necessary to produce desired results where the market hasn’t or can’t made the numbers work. What needs to stop is incentives being used in hot areas for high-end projects — the type market conditions would support. That said, incentives where the project is very urban with ground-level retail, underground parking, etc can make sense.
It appears last year’s efforts to create guidelines failed.
— Steve Patterson