Credit stunts growth of tallest building.

Soleil means sun in French. And the Soleil Center hotel-condo tower proposed for northwest Raleigh would reach closer to it than any of its immediate neighbors. When finished, it will be the city's tallest building-43 stories and 480 feet. But right now, Soleil Center is stuck in the soil near Crabtree Valley Mall. Foundations have been laid, according to a statement by the developer, Soleil Group Inc., but the company is restructuring financing before going vertical. Soleil Group co-owner Sanjay Mundra didn't return phone calls.

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His isn't the only big commercial project in the city on hold. So is an $80 million, 25-story downtown hotel-condo tower. Developer Ted Reynolds, CEO of The Reynolds Cos., says he had a handshake agreement last fall with a banker who had financed a previous project. In January, the banker told Reynolds he couldn't follow through. In mid-August, Reynolds still was trying to line up financing, which he hoped to have settled within a couple of months. "The financial markets are in a state of shock," he says. "They're all scared to death. You still have some banks that are strong performers, but even the strong performers are saying, 'Right now we don't have an appetite for commercial and residential construction.'"

With many banks struggling to contain loan losses in the wake of a national mortgage meltdown, the ones that are willing to lend want developers to put up more equity--at least 45%, compared with 25% in years past, Reynolds says. "You have to come to the deal with a lot more cash, and you have to put the bank in a zero-exposure position. Whatever you borrow from them, you've got to prove to them that at the end of construction, it's either going to be sold or you have the wherewithal to take them out and pay what's due."

Reynolds says the Triangle is in a better position than some other markets because its population is growing, its economy is strong and it's not overbuilt. He's confident things will get better soon, and he'll be happy to put the last eight months behind him. "This has been really ugly. I've gone through several of these things, and I've got banker friends who have been in the business 35 and 40 years scratching their heads and saying, 'I've never seen anything like this before.'"

PHOTO ILLUSTRATION BY MATT ROBINSON