Condo market seeking respect

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Condo market seeking respect

Betty Beard
The Arizona Republic
Dec. 29, 2005 12:00 AM

Some housing experts still look down on condominiums, but this might be the year that these little housing units finally get some respect.

The condo market in the Southeast Valley isn't just a group of Mesa patio homes popular with winter visitors anymore. It now includes penthouses priced at more than $1 million being built along the shores of Tempe Town Lake and luxury apartments being converted to condos in Ahwatukee Foothills and Chandler.

The market for condos, townhouses and patio homes in the Southeast Valley also changed radically over this past year because the lower-priced offerings became one of the most affordable options for new home buyers and young families who were priced out of soaring single-family homes. And Tempe's man-made lake became a place where people are willing to live a dense lifestyle.

While Realtors aren't all convinced this condo activity is a good thing, they agree it started because the prices of single-family homes climbed rapidly during the past year.

"This last year just wiped out first-time home buyers unless they can buy condos," said Elaine Sans Souci, a Realtor with Keller Williams East Valley in Gilbert.

A year ago, she could have showed someone willing to spend $150,000 a detached, single-family home. Today, if anyone wants to buy a nice home for less than $200,000 they likely have to look at a condo, she said.



Some housing experts remain leery about condos because they remember the last condo construction and conversion craze in the late 1970s and early 1980s. The condo market soured, and some of those converted condos eventually reverted to apartments.

Casey Strunk, chief executive officer of Diamond GMAC Real Estate in Scottsdale, is especially blunt, saying "When you see conversions coming into any market, it's time to get out . . . They are the hardest thing to get to work - condos, townhouses or patio houses. They are just so far overdone in my opinion it's not even funny."

He started his real estate career in 1979, during the height of the previous conversions, and saw many of those units depreciate and being sold for sinking prices.

Jay Butler, director of the Arizona Real Estate Center at Arizona State University, points out that homeowners don't like having homes 12 feet apart.

"What are you going to do if you are six inches apart?" he said. "The more intensive, dense lifestyle brings a greater requirement to get along with your neighbors.

"They are not a real preferred lifestyle. We like our open space and the whole bit."

Nevertheless, condos have become so popular not only as homes but investments in the past year that their prices appreciated at least 30 percent in the Southeast Valley, according to Sans Souci.

The average 1,100-square foot condo that sold for about $120,000 last December is selling for about $170,000, she said.

Josh Crockett, an account executive with a home-warranty service company, got tired of paying rent and bought a 1,600-square-foot condo a year ago in Gilbert for $179,000. "I didn't feel like I needed a full home. I didn't want to worry about landscaping," he said.

The condo had appreciated from March to December 2004, and he thought he was buying at the top of the market. But since he bought, its value has soared about 50 percent.

"I didn't buy it with the intention to buy an investment," he said.

Lois Tiedemann, with Keller Williams Southeast Valley, said condos can be excellent investments because their associations maintain the exteriors and make sure they are kept up.

"Condos or townhouses basically take care of themselves as long as you have good renters in there," she said.

She bought one herself in Tempe in February 2003 and said it has doubled in value.



At least 7,800 apartment units are being converted to condos and at least, 3,300 new units are being built this year throughout the Phoenix area, according to Butler.

The conversions aren't going to make much of a dent in the rental market because condos represent only about 8 percent of the housing units. And Butler believes most condos will end up being rentals anyway, especially since many of them appeal to winter visitors and retirees.

Brad Johnson, a researcher with CB Richard Ellis, said there are at least 330,000 apartment units in the Phoenix area.

"By no means will there be a shortage of rental units," he said.

But will the construction and conversions continue in 2006?

Johnson said he read that investors are starting to pull back in some areas to avoid risk of a market downturn.

"Lenders with three deals they are financing might hesitate to take on a fourth or fifth to see how the first ones sell," he said.

TV's Hot Properties: Real Estate Reality Shows

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TV's Hot Properties: Real Estate Reality Shows

By Teresa Wiltz
Washington Post Staff Writer
Wednesday, December 28, 2005; C01

This, people, is how you know the fearsome bubble is finally bursting (as if the moss growing on your neighbor's For Sale sign weren't enough of a clue): We're finally left with nothing to do but watch. Indeed, this collective lust for landholding, this national pang for property, has morphed into a strange new obsession. Instead of shopping for a house, we've taken to camping out in front of the telly, watching other people on the prowl for a place : "House Hunters" and "What You Get for the Money" on HGTV. "Location, Location, Location" on BBC America.

For a change of pace, we watch other people trying to get rid of their homes: HGTV's "Designed to Sell" and A&E's "Sell This House" and "Flip This House" (not to be confused with TLC's "Flip That House"). For the truly desperate, there's "Buy Me," HGTV's 30-minute cinema-verite excursion into the addled brain of the distraught homeowner trying to unload a money pit, and quick. And for anyone addicted to the blood lust of the sport, there's Discovery Home Channel's "Double Agents," which pits two Realtors against each other.

These shows "are not really for people that are going to buy and sell a home," says Jeffrey Sconce, associate professor at Northwestern University's screen cultures program. "They're for people who have a fantasy of buying and selling a home."

We've moved beyond the makeover mania of a couple years ago, when everyone was "Trading Spaces" and doing unto their neighbor what they would not do unto themselves, painting living rooms chartreuse and carving up Grandma's dining table and turning it into faux modern modular blocks. This isn't about designing on a dime or extremely redoing our homes or our lives.

In the past year, a batch of new shows-- about 20 of them -- have cropped up on HGTV, Fine Living, Discovery Home, A&E and TLC. ("House Hunters" is the most popular, averaging just under a million viewers per episode, with the nakedly greedy "Flip This House" coming in at a close second, an average of 802,000 viewers per episode -- big numbers for cable TV.)

These shows are all about the minutiae of real estate, condensed into easy-to-digest, made-for-cable bites: Stomping around scary-looking fixer-uppers. Scoping out the moldy tile in a "vintage" bathroom. Sitting out open houses while complete strangers turn up their noses at your rehabbed kitchen. Signing reams of paperwork. Waiting for the Realtor to call you with the news: You've been outbid. Or, since this is The World of TV, where everyone (usually) has a happy ending: "Congratulations!"

And, this being television, these shows are just a beat or two behind real time, a case of pop culture bringing up the rear in what economists like to call your classic lagging indicator: The bubble's bursting, and now we have a slew of television programs coming at us, after the fact.

Never mind the softer market -- which many real estate industry types deny -- we're still obsessed. "All of America right now is having a love affair with real estate," says New York real estate mogul Barbara Corcoran, founder of the Corcoran Group.

Most Americans -- almost 70 percent -- are homeowners. "Everybody's bought in," Corcoran says, "everybody's in the parade. . . . With so many people bragging at cocktail parties or at church how much their properties have gone up," it was just a matter of time before we'd see our personal obsession played out on the little screen, says Corcoran, who has her own real estate television show in the works. Especially now that we can't brag so much anymore and are praying to hold on to that equity.

Plus, watching others suffer can be so darn compelling. Maybe this isn't destination TV -- most shows air during prime time and are repeated during the week -- but if you're surfing and happen to settle on one of them, it's hard not to get sucked in.

Witness a recent episode of "Buy Me": We see the breezy Natalie and Henry, who figure that while the market's hot, they might as well make a mint on their McMansion. And then, after the first open house, when no one bites, we find out the truth: Said McMansion costs about 10K a month just to keep the lights on, the propane gas grill fired up and the pool and the Jacuzzi bubbling along, and the couple is desperate to ditch their property. Still, they list their three-bedroom place at $875,000, when houses in their neighborhood go for $750,000 at most. Soon they're screaming at their agent, they're screaming at the buyer's agent, and they're screaming at each other, too.

Drama.

Or, as the narrator intones at the show's end in a classic Rod Serling timbre:

"High expectations and economics often clash in the real estate market. . . . Buying and selling your home is more than just a business transaction. It's a roller coaster of emotion."

Which is exactly why it makes for good TV, says HGTV President Judy Girard. "Real estate lends itself very, very well to television. It touches people. It's storytelling at its best," she says. "It's a framework where people are bringing their lives, their hearts and souls into buying a house or selling a house."

Observes Kent Takano, vice president of programming for Fine Living: "We're all creatures of curiosity. It's very vicarious. It's window-shopping without" leaving the comfort of the couch.

While the audiences for these real estate shows are small compared with network TV, they attract a middle-class demographic that advertisers desire, Sconce says, hence lots of commercials for Home Depot and Benjamin Moore paint.

At HGTV, three of the five top-rated shows revolve around buying and selling homes. In 2004, the channel had two real-estate-related shows. This fall, it added two more, "Buy Me" and "What You Get for the Money." Next year, it will add four more, including "International House Hunters" (the titles of the others have not been announced), where yuppies from around the globe hunt for a home, for a total of eight shows. And that's just on one network.

Coming on Bravo: "Million Dollar Listing: Hollywood" is what the network describes as "a six-episode original series chronicling the high-stakes, cutthroat world of real estate in a thriving market."

Fine Living has two in the hopper, scheduled for early 2006 release. One will focus on architecture, the other on the "science" of real estate, the anatomy of the deal.

Yes, Takano says, the network is cutting "this pie thinner and thinner . . . ." But, he adds, "we're trying to skin it one more time. We think we're going to do great."

Even demi-celebrities are getting in on the act. The Learning Channel recently launched "The Adam Carolla Project," where the host of Comedy Central's "Too Late With Adam Carolla" (a former carpenter) guts his childhood home with the goal of flipping it for more than $1 million.

"Many of us are cynical," says Corcoran, who goes into production in January with her reality TV show, "The Bubble." "We don't trust the stock market. We don't trust corporate America. We don't trust the government. There's a tremendous need to put your money into something you can put your hands on."

Earlier this year, Vincent Hurteau, a D.C. real estate broker and president of Continental Properties, started shopping around a show he calls "Unreal Estate." His idea: Each episode would take viewers to a different city, contrasting the most expensive house in the city with what you can reasonably expect for your money -- say, a Dupont Circle mansion vs. a Brookland three-bedroom.

"A lot of people go to open houses," Hurteau says. "They love to see how other people live. And they love to know what things cost. Open houses are a way to that. Now they can do that on TV."

Hurteau started peddling his show around in the spring of 2004. And then the real estate market heated up. And then he got so busy working on real estate dreams, he says, he became too busy to pursue his small screen ones.

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Contractor getting ready to demolish Tokyo condo

The Yomiuri Shimbun

Demolition workers start preparatory work ahead of the demolition of Stage Daimon in Minato Ward, Tokyo on Tuesday morning.

Preparation for demolition work started Tuesday at a condominium in Minato Ward, Tokyo, that was built using fudged earthquake-resistance data. The residents have already moved out of the building.

Stage Daimon, a nine-story condo with eight units for rent, was one of four buildings the Construction and Transport Ministry cited when filing a complaint with the Metropolitan Police Department against the former architect Hidetsugu Aneha, 48, on suspicion of fudging the buildings' design specifications.

The condo's quake resistance is only 26 percent of that required under the Building Standards Law. It is feared the building would collapse if hit by an earthquake with an intensity of upper 5 on the Japanese seismic scale of 7.

A demolition contractor assigned by Shinoken, a Fukuoka-based builder and developer, started to erect scaffolding around the building at 9 a.m. The contractor will begin ripping out the units' interiors on Jan. 10 and plans to demolish the building between Jan. 23 and April 1.

1 BR @ Plaza, no park view: $2M

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1 BR @ Plaza, no park view: $2M
New York's Plaza hotel goes condo, with 181 posh units and a new mall area.
December 27, 2005: 2:04 PM EST

NEW YORK (CNNMoney.com) - The first condos have gone on sale in one of the most storied of New York hotels, the Plaza, and they're anything but cheap.

Prices start at $2 million for an 1,100-square-foot one-bedroom condominium -- and that's for one that doesn't have views of Central Park -- and max out at $32.5 million for the penthouse, the New York Daily News reported Tuesday.

A one-bedroom facing the park will set you back a cool $4.5 million, the newspaper said.

The hotel is being renovated and converted into a mixed-use apartment complex with 181 condominiums and high-end retail stores. An Israeli company, Elad, bought it for a record $675 million in the fourth quarter of last year.

The renovation has not been without controversy, as groups have argued that the mall will detract from the hotel's historic integrity.

"It isn't part store, part hotel, part condo," Elizabeth Ashby, president of New York's Historic Neighborhood Enhancement Alliance, told the Daily News. "It is The Plaza."

Donald Trump owned the hotel from 1988 to 1995, and married Marla Maples there in 1993. Michael Douglas and Catherine Zeta-Jones were married there in 2000.

The hotel will soon celebrate its 100th birthday -- it debuted to the public in October 1907.

Al Gore's Move to San Francisco Generates Real Estate Buzz

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Al Gore's Move to San Francisco Generates Real Estate Buzz

When Al and Tipper Gore move into a neighborhood, the place suddenly has a whole new buzz.

San Francisco, California (PRWEB) December 28, 2005 -- Following news that Al Gore and wife Tipper have purchased a multimillion dollar condo at the new St. Regis highrise in San Francisco, well-heeled home buyers throughout the city are clamoring to join the neighborhood.

"Ever since people learned that Al and Tipper Gore were moving into the St. Regis, I've had three times as many inquiries about the place," says Damion Matthews, a realtor specializing in San Francisco's luxury condo market.

"There's something about living near a person so powerful and important that really excites folks," he says.

"A client of mine just moved into the swanky Four Seasons a few blocks away, where the Mayor happens to be. It's a great place. But when she heard the Gores were moving into the St. Regis, she called me up and said she wants to sell her place so she can move to the St. Regis right away! I guess it's more exciting to live near a former VP than a current Mayor."

The Gores' new neighborhood, formerly a block of drab old office buildings and parking lots, has recently been revitalized by construction of the Museum of Modern Art, the beautiful Yerba Buena Gardens, and now the gleaming new 40 story St. Regis tower.

But before the Gores bought their condo, there was already considerable interest in the building. Of the 102 units put up for sale, less than 20 are still available.

"It's gorgeous! One of the finest condo buildings in the country," says Matthews, who points out that among it's best qualities are its spectacular views of the city and bay.

"Al might prefer to have a view from the Oval Office, but the stunning sights he gets from his new condo must be a good consolation. From his vantage point, he can even see his new television studios across town," says Matthews, speaking of the "Current TV" headquarters on Townsend Street.

To much of the country, the estimated $2 million the Gores spent for their condo might seem astronomically high, but in the pricey San Francisco market it's considered reasonable. Just a few floors above the Gores, one investor purchased three Penthouses for a total estimated at $30 million.

Amenities at the building include 24-hour room service, butler service, a fitness center, spa, lap pool, even a world class restaurant that's been receiving rave reviews.

"With such high demand for this kind of luxury living, if the Gores decide to move out in a couple of years, they could pocket at least $500,000 in profit," says Matthews, who tracks the condo market for the website www.liveinsf.com

"But if Al and Tipper Gore are as happy to be in San Francisco as we are to have them here, they won't be leaving anytime soon."

Public Meeting on Condo Plan Set

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Published Tuesday, December 27, 2005
WINTER HAVEN
Public Meeting on Condo Plan Set

City officials will have a public meeting to discuss the impact that planned condominiums will have on the neighborhood around lakes Howard and May.

The meeting will be at 6 p.m. on Jan. 5 at the Winter Haven Church of God at 675 Ave. E S.W.

The Maxcy Development Group plans to build 150 to 200 condominium units on property purchased from the city that was the site of the Public Works complex, and adjacent property that is now Osborn Marine.

Representatives of the developer and city staff will be at the meeting to provide information and answer questions.

For more information, call the Neighborhood Services Division at 863-293-4482 or 863-298-4483.

Note to tenant: Your home's for sale

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Dec. 24, 2005, 8:58PM

Note to tenant: Your home's for sale

Florida condo conversions create complex situation

By JOHN PAIN
Associated Press

MIAMI - Diana Perez got the letter a few months ago: the apartment complex where she and her family live was converting into condominiums. They had to leave if they couldn't pay a 20 percent down payment on their two-bedroom apartment, now selling for $185,000.

That's $37,000 up front on the apartment they now rent for $900 a month - too much for the 36-year-old who works in a nail salon and her car salesman husband, so they're looking for someplace else. But in the red hot Florida real estate market, they're having trouble finding anything comparable nearby.

"What I want to find is a place where I can stay and they're not going to kick me out" if the owners decide to convert into condos, she said.

As apartment building owners face rising property taxes and rents lower than home prices in certain areas, many are deciding to convert them into condos. That can generate large profits for owners, but the dwindling supply of apartments makes it harder for renters like Perez to find a place to live.

But developers say they help people who can't buy a single-family home by providing more affordable condos.

Affordable option

Problems finding apartments are more due to population growth and the difficulty for building owners to stay afloat with lower rents, said William Friedman, chief executive of Tarragon Corp., a New York-based urban homebuilder and condo converter.

Converted condos offer first-time buyers an affordable option to build up equity and live in more desirable locations with fewer responsibilities than owning a home, he said.

So far this year, the value of apartments sold to become condos is $22.6 billion, or about 152,655 units, according to Real Capital Analytics.

And the benefit for developers to convert is clear. So far this year, apartments converted into condos sold for an average of $154,000, compared to an average of $88,000 for units in buildings that were sold as rentals, according to the research firm.

Rents have been creeping back up as the market gets tighter after falling from 2001 to 2003, when more people were buying homes and avoiding renting.

In the third quarter of this year, the national average rent for a 1,000-square-foot apartment was $1,258 a month, up from $1,195 in the fourth quarter of 2003, according to Global Real Analytics, another research firm.

And rents have increased faster than wages, making it increasingly difficult for poorer families to afford even modest apartments, according to a report from the National Low Income Housing Coalition.

Rentals become rare

South Florida has been a pioneer in the condo conversion craze. Last year, 17,000 units were converted into condos, and that could surpass 30,000 this year, said Jack McCabe, chief executive of McCabe Research in Deerfield Beach.

There were 176,000 apartment units in large complexes with unrestricted rental rates in South Florida at the start of 2004, but that is down to about 128,000 now, he said.

Wait lists for affordable apartments in the Miami and Fort Lauderdale areas stretch for up to two years in places.

"We have a lot of renters who whether by choice or necessity can't find another rental that's comparable in price. We're seeing a lot of displaced people in Florida," he said. "We're not getting companies relocating because their work force is not willing to lower their standard of living to move to southeast Florida and other expensive areas."

And Florida is not alone anymore. The craze has spread across the country to other hot spots such as Washington and San Diego, and even to less in-demand areas such as Charleston, S.C., Dallas and St. Louis.

But the trend likely will be temporary because, once the real estate market slows down, the incentive to convert will decrease, said Scott MacIntosh, senior economist of commercial investment real estate at the National Association of Realtors.

Many real estate investment trusts still are looking to buy apartment complexes because they provide income over a sustained period instead of a one-time benefit from selling buildings for conversion, he said.

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'Bookend' groups drive condo-buying binge

Sunday, December 25, 2005

By Cami Reister

The Grand Rapids Press

Lois Medema and Yulia Barai are at different stages of life, but when it comes to home sweet home, they are looking for the same thing -- a condominium.

With the last of her three children soon to leave home, Medema is looking to downsize from her 5,200-square-foot house in Southeast Grand Rapids.

"When you're a growing, active family, you need lots of space," said Medema, who is in her 50s. "Now that it's just me, slowing down, I don't need so much."

Barai, a 24-year-old software engineer at Siemens, wants to stop paying rent and start building equity. But she travels a lot for her job.

"I don't have time to maintain a yard, do snow shoveling or landscaping and all that kind of stuff," she said. "Condos just seem to be low maintenance."

AJS Realty Vice President Pat Vredevoogd said people such as Medema and Barai are driving the condominium market in West Michigan.

She calls them "bookenders" -- young singles or couples with first jobs and the baby boomers with empty nests and plans to travel.

"Both are sets who don't want maintenance and don't want the burden of taking care of a yard," Vredevoogd said. "They want to be able to pick up and go when they want to."

The "bookenders" have been busy this year. While single-family home sales in the metropolitan area are down 1.2 percent for the year, condo sales are up nearly 18 percent, according to the Grand Rapids Association of Realtors.

Condo sales along the Lakeshore from Muskegon to Saugatuck show similar gains -- up 17 percent for the year, according to the West Michigan Lakeshore Association of Realtors. That compares to a 5.5 percent dip in single-family homes for the same period.

On Monday in East Grand Rapids, people got in line at 3:30 a.m. to buy one of the first 22 condomimiums that went on sale as part of Jade Pig's project in Gaslight Village. The units were gone two hours after the doors opened at 7 a.m.

One reason condos are popular is the price, Vredevoogd said. Some of the new condominium developments and conversions of apartments into condos have prices that rival rent payments.

"You can buy one for $67,000," she said. "That's cheaper than rent, and you're building some equity."

Greg Carlson, a co-partner of Five Star Real Estate, agrees the trend toward condominiums is changing.

"The mentality used to be, 15 to 20 years ago, that it was only for retired people," said Carlson, who moved into a condo at age 43.

"I wanted to simplify my life," he said. "It's about lifestyle, and I think you're going to have more people getting into condominiums."

Others are drawn to living on a single level or they are buying a vacation home or a future retirement home.

Still others look at condos as an investment. Debbie Yealin, vice president of sales and marketing for Redstone Group, which has been building condo developments since 1977, said they are getting a lot of interest from investors.

"Currently, 5 percent of our customers buy condominiums as an investment. I expect that percentage to increase over time," Yealin said. "If you get into the right project that has strong velocity, condominiums can be a great investment."

Building boom

Those looking for condominiums in West Michigan have a lot of choices.

In the City of Grand Rapids alone, more than 1,150 condo units have come on the market, are under construction or have been proposed in recent years.

The Jade Pig project in Gaslight Village will add 107 condos to the market, with prices ranging from $400,000 to $2 million.

Builder Track, a local publisher of building trends, reports condo starts through the third quarter are up 39 percent over 2004 (241 units to 334). In Ottawa County, they are up 11 percent over last year (219 units to 242).

Prospective owners can take their pick from high-rises to converted factories to site condos to traditional multi-unit buildings. Barai is looking at four developments, "but I just started my search a week and a half ago," she said.

Medema recently spent a day looking at eight developments. At their first stop -- Inglenook, a new, detached-unit development off Burton Street SE -- she found little that did not meet her criteria.

The Inglenook units sell for $247,000-$298,000 -- a figure Medema said is right in her price range.

She liked the 2,200-square-foot mission-style unit's large, open kitchen with enough room for a cabinet to display her crystal. It also had maple floors, a three-season porch and the option of finishing the lower level with two more bedrooms so her children can visit.

Medema said she lived in a multi-unit condo for a few months when she was first married. While she found that lacked privacy, "these (detached units) seem very private," she said.

"It's been a good year" for condo sales, said Amy De-

Kleine who has been selling condos and homes for DeKleine Builders in Byron Center for six years. But the slower single-family housing market is starting to affect her business.

"I've had a ton of reservations on our condos, but they can't sell their current homes to get into the condos," she said. "So, here we sit in the waiting game."

Statewide condo alliance taking agenda to Tallahassee

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Statewide condo alliance taking agenda to Tallahassee

Group looks to influence association law

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By Patty Pensa
Staff Writer

December 25, 2005

The newly formed statewide Coalition of Community Associations is readying for its first descent on Tallahassee.

With representatives from nine counties, including Palm Beach and Broward, the coalition is looking to spread its influence to legislators who write homeowner and condo association law. The group formed earlier this year as a way to counteract the influential consumer group Cyber Citizens for Justice, which advocates for homeowners battling their association.

Coalition leaders say they represent association leaders and homeowners alike, and they are intent on opposing "efforts to tear at the fabric of neighborhoods."

"People have no idea what it takes to be on a board and run a community," said Bob Schulbaum, a coalition member and president of the Alliance of Delray Residential Associations.

For a coalition that believes in less state intervention, this spring's legislative session will be the first test of its political prowess.

Some of the issues the group will pursue: ensuring a board's ability to place a lien on owners who fail to pay dues, eliminating mandatory mediation for homeowners and boards and adding standards of objectivity to the condo ombudsman's office.

"How it's going to play out remains to be seen," said Charlotte Greenbarg, a coalition member and president of the Broward Coalition. "This will be a learning experience."

The success of the group could hinge on bringing Democrats and Republicans to its side. Considering South Florida leans Democratic and northern Florida goes Republican, there might be something to this loose network of community leaders, coalition members said.

Three influential groups from southern Palm Beach County -- the Delray Alliance, West Boca Community Council and Coalition of Boynton West Residential Associations -- are members. Together, they represent more than 200,000 residents.

The coalition's strategy will be face-to-face contact with legislators, said Spears, who criticized Cyber Citizens for bombarding Gov. Bush and legislators with e-mails about home- and condo-owner issues across the state.

Cyber Citizens president Jan Bergemann had his own criticisms for the new coalition. He contended the group does not represent homeowners because its members are not elected by homeowners.

"In this country, people should speak for themselves," he said. "There should be nobody there that says, `I'm the big yahoo and I speak for you.'"

Morning File: It's a condo boom!

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Morning File: It's a condo boom!

Monday, December 26, 2005

By Gary Rotstein, Pittsburgh Post-Gazette

Condo shortage? What condo shortage?
OK, is there anyone not already constructing or planning to build condominiums Downtown? I think we see hands of a few Candy-Rama employees and some squatters from beneath the Fort Pitt Bridge, but other than that, there's the PNC developers, the new arena developers, the Lazarus developers, the First Avenue developers, the Union National Bank developers, and probably lofts more -- whoops, lots more -- we're forgetting. They've all gone condo-crazy! All those people from the suburbs who for years viewed Downtown as a bleak, scary place they wanted to be nowhere near? ("Careful down at Saks, Edna -- I heard they've got some foreign-looking people behind the perfume counter.") Apparently, they moved to Charlotte long ago, as developers are planning to build condos at a rate of about 2.3 units for every man, woman and child now living between Aleppo and Zelienople. People must really hate their longtime homes, which is kind of odd considering Pittsburghers are known to stay in the same dwelling longer than residents of any other metropolitan area.

We're ahead of Wichita . . . possibly
The condo-mania sounds kind of surprising until you realize that, yes, this is just one more party to which Pittsburgh is late in arriving. Scan headlines around the country, and there are plenty of other cities large and small already on the developers' dance card.

From the Providence, R.I., newspaper on Oct. 21: "Condos, condos everywhere."

From Boulder, Colo., on Sept. 13: "Condo boom continues."

From Starkville, Miss., on Aug. 29: "Mississippi State alums, fans fueling condo boom."

When the national urban trends are hitting Starkville before Pittsburgh, it's a sign that things may be progressing just a little tooooo slowwwwly here at the rivers' confluence. Around the country, more and more people are living in some kind of planned, collective community instead of independent, single-family homes. As they say in Ho Chi Minh City, "Socialism rocks, dude." The U.S. Community Associations Institute says 22.1 million housing units today are part of some condominium community, homeowners association or similar cooperative. That's about twice the number that existed in 1990, and they house 54.6 million Americans. In shared-ownership housing such as a condominium, people typically pay a monthly fee for services and for upkeep of common areas, and they agree to abide by legally binding restrictions on use and appearance of their own housing units. If you like to keep a large reptile collection and play Black Sabbath at full volume, your neighbors on the condo board may be only too happy to remind you such rights were sacrificed when you signed your covenant.

Bud Selig must live in one
For a comparison more apt than Starkville, one need only look to the Midwest to Milwaukee. The Business Journal in that city wrote that from 2002 to 2005, 2,352 condos valued at $739.4 million were built or planned in or around Downtown. The growth got real estate executives to discuss the saturation point they'd hit, with the housing volume exceeding job growth. "There are simply too many projects about to go forward," said one architect. "The area is not big enough to support all the projects because there aren't that many people interested in moving Downtown." One executive noted that Milwaukee was itself tardy to embrace the condo movement, trailing Midwestern trend-setters Cleveland, Minneapolis, Columbus and Indianapolis. Oh, how they must be snickering in Milwaukee now (and Starkville), to hear that Pittsburghers feel they've discovered some new-fangled style of living.

Anti-condo word of caution
Liz Pulliam Weston, a personal finance columnist for MSN Money, thinks the condo market is a bit out of control. She wrote of it being like "the tech-stock bubble," with too many speculators involved attempting to make quick profits. She's talking about "hot" markets like Las Vegas and Miami, rather than dowdy Downtown Pittsburgh, but notes that the rise in condo values nationally has begun slowing down after shooting past that of single-family homes in 2004. Yes, she agrees that some upscale baby boomers becoming empty nesters are willing to pay to avoid shoveling the sidewalk, to have a building fix-it man at their beck and call, and to be within walking distance of a city's cultural center. "But anyone who expects vast numbers of boomers to shift to condos is delusional," Ms. Weston wrote this fall. "Like their parents, 80 percent of whom age in place, most boomers will stay in the houses where they retire. Familiarity, and family ties, will, for most, trump Arizona golf courses and Florida early-bird specials."

Can't we all just get along?
Actually, a Pittsburgher is at the forefront of the condo movement in one respect. Virgil Rizzo, who grew up in the Steel City, graduated from the University of Pittsburgh in 1959, and taught in the city's public schools for several years, is the first condominium ombudsman in the United States. He has filled that new role in the state of Florida for the past year. The Fort Lauderdale condo-owner, who became both a lawyer and doctor in his later years, was appointed by Florida Gov. Jeb Bush to help reduce disputes between condo-dwellers and condo boards, which are made up of neighbors elected to run things. "He will strive to achieve harmony among those who reside in the many condominiums in the state of Florida," said the press release announcing Mr. Rizzo's appointment. He had practice in working out problems among his own condo's board and owners. He was in fact involved in some personal litigation of that sort, which is what he's trying to help other others avoid. "What happens in these communities is that they get polarized," the ombudsman told the (Fort Lauderdale) Sun-Sentinel. "You get a 50-50 split and you have discontent. They shouldn't be fighting amongst each other. They should be together and the board should keep them unified."

A role model for us
It took Florida long enough to find a Western Pennsylvanian to straighten things out. Way back in 1989, about the time that tepees and log cabins were being replaced in Downtown Pittsburgh, the Los Angeles Times was writing about the name-calling, back-biting and political shenanigans that marked condo life among the Sunshine State's older population. "Some of them sit around and read the Condo Act all day," said Alex Knight, then the chief of Florida's Bureau of Condominiums. "They have time to fight. Condo politics is like a hobby." Some condo developments were already like small cities, with 8,000 dwellers in 75 buildings at Century Village in Pembroke Pines. At the latter, the article noted such volatile board meetings that "people have dropped dead" and, during elections, "they fight for proxies like piranhas." The leaders of the condo board and the activists taking them on had nothing but vile things to say about one another, concerning such issues as mowing of lawns and consumption of electricity. "There are people around here who've never accomplished anything in life and this is their last guttural gasp to make something of themselves," said the beleaguered condo board president, Kitty Thibault. Now there's something that ex-City Council members and former row officers can look forward to, finally, in Downtown Pittsburgh.

The Age of Reinvention

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The Age of Reinvention

In 2005, There Were Soaring Condo Prices, A Row Over Skid Row and the Billion Dollar Babies' First Steps

by Kathryn Maese

If you had told people in 1995 Downtown what the community would look like in a decade, they would have laughed. But in 2005 the amazing reinvention of Downtown Los Angeles continued, with condos fetching upwards of $600 a square foot, cranes sprouting across the skyline and thousands of people moving into the fancy new residences. It was the story that dominated talk in the Central City, both for its potential and its pitfalls.

Of course, the housing boom didn't happen in a vacuum. Downtown was abuzz over the groundbreaking of L.A. Live and its roster of big-name tenants. Grand Avenue made strides as well, with plans for architect Frank Gehry to design a signature tower for the project.

From a battle over the new police headquarters to renewed attention on Skid Row to a new direction for the L.A. River, here's a look back at the stories that had Downtown talking.

Story of the Year: The Residential Rush: Despite endless talk of a real estate bubble and predictions of a market slowdown, Downtown's housing spree continued its frantic pace. According to the Downtown Center Business Improvement District, more than 19,500 units are under construction or in the planning stage, with 29,000 people expected to move in over the next four years. Projects became bigger and bolder, with high-rises such as the 50-story Zen Tower at Third and Hill streets capturing vertical imagination. A handful of openings - the Douglas Building Lofts, Metro 417 and the Pacific Electric Lofts - added hundreds of bodies to the mix. Waiting lists continued to grow, despite prices north of $600 per square foot. So how big is the appetite for Downtown living? Consider: In October, South Group's 191-condo Luma in South Park sold out in a dizzying seven hours.

L.A. Goes Live: On Sept. 15, Anschutz Entertainment Group's $1.5 billion sports and entertainment district broke ground to the Latin beat of Poncho Sanchez. The salsa impresario plays at the trendy Conga Room, which will become one of at least a dozen high-profile tenants when the retail, dining and activity promenade opens. Additional arrivals will include Gladstone's, P.F. Chang's, a 15-screen Regal cine-plex, an ESPN studio and a Grammy museum. The retail and restaurants, along with the 7,100-seat Nokia Theater and the 2,400-seat Club Nokia, are set to debut in 2007.

Down on Skid Row: A number of issues riveted attention on this stretch of missions, homeless encampments and crime east of Los Angeles Street. A Los Angeles Times series focused on the human tragedy of homelessness and the plight of families, while community walks on Skid Row brought attention to street conditions and safety. In September, the news focus shifted to illegal dumping of criminals by city and county law enforcement agencies and hospitals onto Downtown streets. Prodded by the outcry, state lawmakers began to craft legislation that could force the Sheriff's Department to stop letting released criminals wander into Skid Row.

Hospitality Ups and Downs: The usually lifeless hotel and tourism industry was alive and kicking in 2005. The Hyatt turned into a Sheraton, the Wilshire Grand announced a $40 million renovation, a handful of older hotels unveiled plans to convert rooms into condos or apartments, and a slew of investors clamored to create high-end boutique hotels. A potentially devastating hotel strike was averted in June, which segued into a double-digit surge in occupancy aided by big events such as the Siggraph conference and X Games. The biggest news came with the September approval of the 1,100-room Convention Center hotel. However, an unexpected blow occurred in November when the project's equity partner backed out over rising costs.

Old Landmarks, New Futures: It was a year of highs and lows in the preservation community. A beautifully refurbished (former) St. Vibiana's cathedral opened in November as a performance and event space. A glittering assemblage of city leaders, celebrities and preservationists turned out to fete the rehab by Gilmore Associates. It was a different story for the fabled 1921 Ambassador hotel on Wilshire Boulevard. The Los Angeles Conservancy, which led the charge to preserve the site where Sen. Robert F. Kennedy was assassinated in 1968 and where Hollywood frolicked at the Cocoanut Grove, lost its battle to an LAUSD plan to create a K-12 campus and demolish most of the property. In September the hotel's furnishings were auctioned off. Demolition began shortly after.

Return of the River: It was a big year for the L.A. River. Proposals aplenty were generated by the city, activity on the state level focused on the Cornfield Park, and federal funds were funneled in for feasibility studies. A $3 million, 18-month master plan got underway in September, including a series of community workshops. As part of the campaign to bring attention to reviving the waterway, a splashy press conference unfolded at the adjacent Cornfield, which is envisioned as part of the river's comeback.

Grandiose Plans: May brought the $1.8 billion Grand Avenue proposal into the spotlight, with plans unveiled for sleek towers and a lively nine-acre retail and cultural promenade. The County Board of Supervisors approved the project in August, allowing developer the Related Companies to move forward with a master plan. Further buzz came from the announcement that shape-shifting architect Frank Gehry would design a 50-story "iconic" tower to mark a project some have likened to the Champs-Elys�es. Plans currently call for 2,600 condos and apartments, a park, 400,000 square feet of retail and a 275-room hotel.

Planning Department Plight: In early 2005, Planning Director Con Howe announced he would retire after 13 years. Though he was praised in some circles, City Hall whispers said that Howe was pushed out by city and community leaders unhappy with his management. The department's woes were made public following a November audit by City Controller Laura Chick that called it "an agency caught in a time warp of past practices, old procedures and outdated technology." The report slammed the 270-employee department for being poorly managed and understaffed. Facing pressure to lead city planning in a new direction, Mayor Antonio Villaraigosa launched a search for a permanent department head and installed Mark Winogrond as interim chief.

Let's Make a Deal: It was a busy year for Downtown brokers, who closed dozens of deals from Chinatown to South Park. One of the busiest players was Jamison Properties Inc., which acquired the $135 million California Market Center in May and the $160 million Macy's Plaza in April. That same month, Union Bank Plaza sold for $144 million to Hines. In July, Meruelo Maddox Properties purchased the Union Bank & Trust Building at Eighth and Hill streets for $12 million; it will be converted into 90 loft-style apartments by 2007. The 7,200-seat Grand Olympic Auditorium sold to the Glory Church of Jesus Christ and Chinatown's Dynasty Center went to a private investor in June for $25 million. In January, Beacon Capital Partners paid $116 million for the Class A office tower at 1000 Wilshire.

Police HQ Gets OK: For the better part of a year residents and community groups battled to stop a new police headquarters from rising at Second and Main streets. The Cultural Affairs Commission became an unlikely forum of last resort, and voted against the location in May. Nonetheless, the city moved forward with the replacement facility for the aged, quake-damaged Parker Center. In late summer the department agreed to a compromise, increasing the amount of green space and adding trees fronting Second Street, as well as an expanded outdoor plaza and ground-level retail. Many park advocates, however, felt they got an unfair shake, since the site had long been envisioned as a civic park. The environmental impact report was completed in October and demolition of the old Caltrans building is nearly complete.

Which Way Downtown L.A.?: In April, after more than seven years of work, officials from Downtown's nine business improvement districts began installing 1,300 directional signs across the community. However, shortly after the signs in the $2 million program dubbed Downtown L.A. Walks began cropping up, complaints started trickling in. A number of the signs used puzzling abbreviations and shorthand, such as "Spring St Hist/Fin" and "Broadway Th District." The kinks continue to be worked out, but most people have nonetheless welcomed the project.

Mr. Smith Comes to Town: LAPD Central Division Capt. Andy Smith could very well have been the department's poster boy for community policing in 2005. Though he arrived just this spring, nearly every story dealing with crime and quality of life in Downtown had Smith's name attached to it. Whether it was drug pushers, illegal vending, stolen goods, homelessness or the issues facing Downtown's new crop of residents, the 42-year-old captain made a big impact on the Central City.

Making a Fashion Statement: Some believe that once you are profiled in the New York Times, you've arrived. Indeed, the 90-block Fashion District made the Times, and also made a big splash with 32 new projects in the past three years, including 13 in 2005 alone. In total, more than $510 million has been invested in the neighborhood since 2000. A new branding campaign gave some much-needed panache to the district's stodgy and industrial image. What was once known as the Garment District is now a Fashion District with trendy designer showrooms, restaurants, an expanding retail sector and international recognition.

MLS ballot initiative is 'ill-conceived,' says Realtor lawyer

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MLS ballot initiative is 'ill-conceived,' says Realtor lawyer Ballot measure seeks to open up real estate data to consumers Thursday, December 22, 2005 By Glenn Roberts Jr. Inman News

The proponent of an effort to establish a statewide database for property listings in California said today that the planned system could be modeled after the successful privatization of a Web site registration service. David Barry, a San Francisco lawyer who has aggravated real estate industry groups for filing a steady stream of antitrust lawsuits that span several decades, is behind this effort to establish a comprehensive property listings database that consumers can access free of charge. According to the text of the proposed ballot initiative, "Visitors to the open MLS Web site may access non-confidential MLS data and utilize search functions for free. All search reports are downloadable and printable for free." While MLS data in California is divided amongst dozens of local MLSs -- most of them owned by local Realtor trade groups -- the new proposal would require that all real estate professionals in the state place their listings in the statewide MLS, unless home sellers specifically request to withhold information about their properties from this database. Barry's plan calls for a private entity to manage the MLS for the first 10 years, and to keep monthly fees between $20 to $50 per month to enter property information into the MLS. The idea, he said, is similar to a technology company's handling of Web site registrations. In 1993, Network Solutions Inc. won a federal contract to handle the registration of Internet domain names, a duty that had formerly been conducted by the Internet Network Information Center, a U.S. government-created registry. The company lost that monopoly in 1999 but still handles millions of registered domain names. "They had a monopoly for a limited period of time ... to kick-start the thing, get it up and running," Barry said, adding that he is hoping some big technology companies -- such as Yahoo!, Google, eBay or Microsoft -- will consider bidding for the contract to operate the proposed statewide MLS service. June Barlow, vice president and general counsel for the California Association of Realtors trade group, which has about 180,000 Realtor members throughout the state, said today that she believes Barry's effort is "ill-conceived." "We're always looking for ways to make the (MLS) system more efficient and we do acknowledge that it could be more efficient," Barlow said, adding that the free market should develop the solution "as opposed to people trying to legislate their business model through the initiative process. "There's no need for an effort like this because free enterprise has worked well for a number of years," she also said. What the initiative proposal is seeking could be accomplished outside of the initiative process, Barlow said, adding that it "shows a lack of confidence" in attempting to place the issue before voters. "You can certainly do any kind of business without the initiative process."   Barry has targeted the state association of Realtors and other local Realtor associations several times in lawsuits he has filed. In September, the state Realtor group fired back against Barry with a "malicious prosecution" lawsuit, charging that Barry re-filed the same complaint twice.   Barry said he plans to be a bidder for the entity that he is proposing to create, and the bidding process is slated to close Jan. 11, the law firm announced Wednesday.   To qualify for the ballot, Barry said that initiative supporters will need 373,700 signatures. If obtained through signature firms at a rate of $1.50 to $2 per signature, it would cost about $1 million to qualify the initiative for the ballot, he said, adding that he expects the contract winner to pay this cost.   "I'm hoping to encourage innovation here," Barry said, adding that he has received mostly positive feedback from industry professionals about his proposal.   The text of the proposed initiative states that the purpose of the initiative is to "induce the creation of an open MLS in California and the United States of homes for sale and rent that provides free access by Web browser to buyers and renters," "to lower the cost of MLS services for real estate professionals," and to "lower commission rates," among other aims.   "Any person will be permitted to establish a paid subscriber account with the open MLS operator," and subscribers -- who do not need a real estate license -- can enter an unlimited number of property listings, the initiative text also states. "Subscribers will be required to agree that all persons have the fair use right to unlimited copying and republication of all MLS data, including visual and auditory data, when used as part of an effort to market, promote, or value real estate, and all such use will be free of all copyright claims and restrictions."   Such language may worry real estate brokers, who typically are protective of property information associated with their companies' listings. Data ownership and control issues are a hot topic in the real estate industry, particularly as the U.S. Justice Department has filed an lawsuit against the National Association of Realtors over the trade group's policies for the online sharing and dissemination of property listings among its members.   Industry players in California have discussed the possibility of a more widespread sharing of property listings information in California, and there are already some regional efforts in the San Francisco Bay Area and in Southern California through which local MLSs share data with other local MLSs. The discussion of more widespread data-sharing in the state "is making some progress -- more so than in any other year," Barlow said.

Local condo flippers may be in too deep

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Local condo flippers may be in too deep
By Scott Van Voorhis
Thursday, December 22, 2005

The Hub's jittery condominium market faces another storm cloud: hundreds of unsold units in new condo towers that brokers and mom-and-pop investors had bought early on in hopes of flipping for quick profits.

    Some have exited, as planned, with thousands in windfall profits. But others may not be so lucky amid falling sales and dropping prices in an overloaded condo market, real estate executives say.

    Thousands of new condo units, in glitzy downtown towers and modest suburban projects alike, are opening up across the Boston area. And more than 10 percent of these units have been snapped up by investors of various stripes, according to Brian Rugg, who puts out an influential market report at ERA Boston Real Estate Group.

    With the market sliding, a flood of condo flips could grease the market's downward slide, executives warn.

    "Putting more supply in a soft market, that obviously would create more volatility in prices on the down side," said Thomas Meagher, head of Northeast Apartment Advisors.

    One project where condo flippers can clearly be seen at work is East Boston's newly minted Porter 156, a one-time lightbulb factory where loft-style units sell for prices ranging from the high $200,000s to well past $400,000.

     Amid this rush to cash out, Rhonda Kelley, a local music publicist, counts herself among the lucky ones, flipping her condo for $439,000 shortly after Porter 156 opened this fall and pocketing more than $100,000. But she winces when she looks at the myriad of online postings from other would-be Porter 156 flippers.

    "There are a huge number of flippers," Kelley said. "If I didn't close quickly, I would be up against 30 or 40 units in a matter of a week."

    Still, Porter 156 is far from unique, with condo speculators flocking to an array of new Boston towers and projects.

     Looking to cash in, Will Montero, a top Boston real estate broker, has created his own condo flip investment pool that includes cash from Ohio doctors, San Francisco investors and overseas financiers.

    Over the past three or four years, Montero and his fellow investors have snapped up as many as 40 condos in some of the city's top new high-rises: Fort Point's Channel Center, South Boston's Court Square Press and various Leather District buildings. Some were buy and holds, others quick flips.

    Not to mention East Boston's Porter 156, where Montero finds himself with two units to unload.

    But he has no plans to quit flipping, even with signs that the condo market's best days may be gone.

    "It's a pretty interesting game," Montero said. "Real estate blows away anything in the stock market for the average investor."

Housing gets more affordable

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Housing gets more affordable

By TAVIA GRANT

Thursday, December 22, 2005 Posted at 8:07 AM EST

Globe and Mail Update
 
 Housing became sligGhtly more affordable for most Canadians in the third quarter of the year as incomes grew and the pace of house-price increases slowed, a Royal Bank of Canada report showed Thursday.

The RBC affordability index, which measures the proportion of pre-tax household income needed to service the costs of owning a home, shows a standard condo remains the most affordable type of housing. A standard townhouse is next, followed by a detached bungalow. A standard two-storey home remains the least affordable.

Housing markets, which have been on fire this year, are cooling gradually across most of Canada as the pace of price increases slowed, RBC said. There are exceptions, however, notably in Alberta, Saskatchewan, Manitoba, and parts of Atlantic Canada.

Overall, "as demand softens, there has been a gradual decline in new home construction activity across most markets as well, helping to alleviate any sudden price movements," said Derek Holt, RBC's assistant chief economist, in the report.

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"Even with interest rates going up, housing markets will remain healthy going into 2006," he said.

Condominiums remain "by far" the most affordable housing option across all markets, the report said.

"Rising apartment rental vacancy rates and significant numbers of investor-owned condos will likely serve to keep condo affordability well in line as price pressures ease."

In a comparison of affordability among the largest cities, Vancouver remains the most expensive place to own a detached bungalow, followed by Toronto. Housing is more affordable, however, in Calgary and Ottawa.

Condo Crazy: Renters hurt by conversion trend

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Condo Crazy: Renters hurt by conversion trend

 

Thursday, December 22, 2005

MIAMI

Diana Perez got the letter a few months ago: The apartment complex where she and her family live was converting into condominiums.

They had to leave if they couldn't pay a 20 percent down payment on their two-bedroom apartment, now selling for $185,000.

That's $37,000 up front on the apartment they now rent for $900 a month - too much for Perez, who works in a nail salon, and her car-salesman husband, so they're looking for someplace else. But in the red-hot Florida real-estate market, they're having trouble finding anything comparable nearby.

"What I want to find is a place where I can stay and they're not going to kick me out" if the owners decide to convert into condos, she said.

As apartment-building owners face rising property taxes and rents lower than home prices in certain areas, many are deciding to convert them into condos. That can generate large profits for owners, but the dwindling supply of apartments makes it harder for renters like Perez to find a place to live.

But developers said they help people who can't buy a single-family home by providing more affordable condos.

Problems finding apartments are more because of population growth and the difficulty for building owners to stay afloat with lower rents, said William Friedman, the chief executive of Tarragon Corp., an urban homebuilder and condo converter based in New York.

Converted condos offer first-time buyers an affordable option to build up equity and live in more desirable locations with fewer responsibilities than owning a home, he said.

So far this year, the value of apartments sold to become condos is $22.6 billion, or about 152,655 units, according to Real Capital Analytics.

And the benefit for developers to convert is clear. So far this year, apartments converted into condos sold for an average of $154,000, compared to an average of $88,000 for units in buildings that were sold as rentals, according to the research company.

Rents have been creeping back up as the market gets tighter after falling from 2001 to 2003, when more people were buying homes and avoiding renting. In the third quarter of this year, the national average rent for a 1,000-square-foot apartment was $1,258 a month, up from $1,195 in the fourth quarter of 2003, according to Global Real Analytics, another research company.

Rents have increased faster than wages, making it increasingly difficult for poorer families to afford even modest apartments, according to a recent report from the National Low Income Housing Coalition.

South Florida has been a pioneer in the condo-conversion craze. Last year, 17,000 units were converted into condos, and that could surpass 30,000 this year, said Jack McCabe, the chief executive of McCabe Research in Deerfield Beach.

There were 176,000 apartment units in large complexes with unrestricted rental rates in South Florida at start of 2004, but that is down to about 128,000 now, he said. Wait lists for affordable apartments in the Miami and Fort Lauderdale areas stretch for up to two years in places.

"We have a lot of renters who, whether by choice or necessity, can't find another rental that's comparable in price. We're seeing a lot of displaced people in Florida," he said. "We're not getting companies relocating because their work force is not willing to lower their standard of living to move to southeast Florida and other expensive areas."

Florida is not alone anymore. The craze has spread across the country to such other hot spots as Washington and San Diego, and even to less in-demand areas such as Charleston, S.C., Dallas and St. Louis.

But the trend will likely be temporary because, once the real-estate market slows down, the incentive to convert will decrease, said Scott MacIntosh, a senior economist of commercial investment real estate at the National Association of Realtors.

Also, many real-estate investment trusts are still in the market to buy apartment complexes because they provide income over a sustained period instead of a one-time benefit from selling buildings for conversion, he said.

Alphonso Jackson, the secretary of the U.S. Department of Housing and Urban Development, acknowledged that HUD can't stop apartment-building owners from selling to converters. But HUD has tried to persuade landlords it works with to sell their properties to nonprofit groups to keep rents affordable.

"And we have been very successful right now in keeping about 10,000 units in affordable housing areas around the country that would have been converted into condos," he said.

$130-million condo sale blasts record Bear Mountain Resort: One day, two buildings

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	Monday � November 14 � 2005
$130-million condo sale blasts record Bear Mountain Resort: One day, two buildings   Rob Shaw Times Colonist Sunday, November 13, 2005 CREDIT: Debra Brash, Times Colonist Condo buyer Semion Strovski, left, thinks Bear Mountain Village Resort is the next Whistler. Strovski looks over the village golf course with his wife Galina and another condo-investing couple: Lize and Johan Blignaut. Langford's Bear Mountain Resort is the new Whistler -- at least, that's what Semion Strovski is betting. The Quesnel doctor, who moved to Canada from Russia in 1998, was one of scores of people Saturday who snatched up 271 condominiums in a record-setting real estate grab. "Whistler has reached its top as far as investment, I think," he said, describing property he owns there yet intends to sell. "But Victoria is the retirement capital of Canada as far as we can see ... we hope [the condo] will appreciate [in value], and we hope we'll use it as well." Bear Mountain Resort estimated $130 million in sales Saturday when two condo buildings -- Finlayson Reach and St. Andrews Walk -- officially hit the market. It is the highest one-day total for condominium real estate in Greater Victoria's history. Bear Mountain mauled even monthly records kept by the Victoria Real Estate Board, beating $66 million in condo sales recorded for this March and $39 million in October. Strovski paid $341,500 for a 562-square foot, one-bedroom, condominium in St. Andrews Walk. From the fourth floor perch atop the west building, he and wife Galina will have a view of the golf course. Strovski admits Bear Mountain's 18-hole course, designed by golf legend Jack Nicklaus, was a major reason for his purchase. He, like fellow Quesnel doctor Johan Blignaut, views the property as an investment in Greater Victoria, the golf course, and a village planned for Bear Mountain. Blignaut and his wife Lize had never been to Bear Mountain before they arrived Saturday, cheque-in-hand, to buy their 630-square-foot, $349,900, one-bedroom suite on the third floor of Finlayson Reach. "I was amazed by the view and the buildings," said Lize. The investment "risk is minimal" said Blignaut. The couple, in their early 30s and originally from South Africa, intend to make at least yearly visits to their new Langford condo. Inside the busy clubhouse Saturday, buyers were ushered upstairs to select one of 127 units in St. Andrews ranging from $205,000 to $949,000, or 154 units in Finlayson Reach, from $400,000 to $1.8 million. After they signed on the dotted line, they went outside to a heated tent where champagne was served in the company of a live band. A large display showing individual units inside was covered with sold signs. All but 10 units in Finlayson Reach were gone, and penthouse apartments were not yet on the market. Much of Bear Mountain is still under construction. The Fairways hotel -- Phase 1 of development -- is open with 65 suites. The resort's new clubhouse building -- a massive structure with suites, a restaurant, ballroom, spa and pro shop -- is considered Phase 2 and should be done by May 2006, said Bear Mountain Resort CEO Len Barrie. Barrie said many of the current buyers are from Alberta "and are looking at it as a vacation or secondary home." Some came from as far away as Germany and the Middle East, he said. Victoria Real Estate Board president Garry McInnis said Bear Mountain's "site-specific" golf course attraction highlights a larger demand for real estate in the region. "I'm very confident that 2005 will go down as a banner year for real estate overall," he said. "There's just nothing to stop it from being one of the most remarkable years of all time." Saturday's buyers will have plenty of time to sit and anticipate their new Bear Mountain condos. The St. Andrews building isn't scheduled to open until mid-2007, and Finlayson Reach until 2008. � Times Colonist (Victoria) 2005

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Builders aim high on Merritt Island

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December 14, 2005

Builders aim high on Merritt Island

BY ERIKA PESANTES
FLORIDA TODAY

As the Hubert Humphrey Bridge dips away from Cocoa, Island Pointe's nine-story tower and three of its eight-story luxury condo buildings gradually emerge from the Indian River's edge.

For some, these are stately pillars of progress. For others, these multistoried buildings are menacing misfits that make Merritt Island's skyline strangely unfamiliar.

As developable land disappears on the island, as elsewhere in Brevard County, some developers are looking to maximize desirable properties by building taller.

Three separate Merritt Island projects -- all nine to 11 stories -- await approval from the county. All are centrally located on the island, not far from the State Road 520 commercial corridor.

But some longtime residents fear that as developers build up, they'll whittle away at Merritt Island's character.

"It's pitiful going over the bridge. I think 'Boy, I'm glad to be home,' but with all the high-rises, it don't look like home," said Norma Bennett, a resident of the island's Bel-Aire subdivision for the past 25 years. "I'm for progress, but it seems we
have a little more than we need."

Although north Merritt Island is home to the tallest building in Brevard, the 525-foot, 52-story Vehicle Assembly Building at Kennedy Space Center, structures beyond a few stories aren't the norm. Much of the riverfront property still is the domain of single-family homes -- some palatial estates and some much less.

David Hobbs, president of the East Merritt Island Homeowners Association and a resident since 1977, said he's paying close attention to the proposed developments.

"I think it's getting exponentially worse as Merritt Island builds out and gets build up," he said. "There just isn't that much property where people can keep expanding. They're being forced to go up."

A small group -- branching out from his association -- is being created to watch the path of growth.

"We're trying to preserve our single-family neighborhood," Hobbs said.

New projects

The three proposed "tall" projects are in various stages of approval, but all will need the final OK from the Brevard County Commission. They are:

An 11-story commercial and residential building as part of Island Pointe.

A nine-story condominium project at the site of the Banana River Marine.

The nine-story, 112-unit River Fly-In Condos next to Merritt Island Airport.

Commissioner Ron Pritchard, who lives on and represents Merritt Island, said he didn't consider the recent proposals part of a trend. He added that the multistoried building have some plusses.

"One advantage to condo lifestyle is it tends to inhibit the creation of additional subdivisions," Pritchard said. "It focuses construction in specific areas. As for density, I'm not particularly fond of the density created."

He said his constituents want to preserve the pristine areas of the island, but they also want to improve blighted neighborhoods.

"Most folks don't have a problem with growth or change, they're concerned with nine-story buildings," Pritchard said. "When it comes to your neighborhood people are always concerned as to what will happen; there's a certain lifestyle they've adapted to."

Favorable outlook

Some residents and business owners think the developers will help build back areas of Merritt Island that need revitalization.

"I absolutely am in favor of Merritt Island building up. It adds value to our property, it removes blight in many situations," said Fran Quattrochi, who lives on Merritt Island and works in real estate. "I believe just coming over the causeway and seeing those condos on both sides of the road makes an impressive entrance into Merritt Island."

"I know people feel that we're losing the smaller town feel, but I really feel it's advantageous to the economy."

Antonio Rovira, an East Merritt Island Homeowners Association member who moved from Orlando, said he thought he'd left the big-city madness behind and found paradise.

"Development's not needed in the area, especially nine-, 10-story buildings, which don't add to the beauty of the island," he said. "We don't oppose progress, but at the same time we know that we're going to have big problems."

Contact Pesantes at 242-3618 or epesantes@flatoday.net

 

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Theater company to move into condo

A West Palm Beach theater company has signed a letter of intent to relocate into the ground floor of a proposed downtown condominium.

Palm Beach Dramaworks is negotiating with Miami-based BAP Development for the buildout and lease of a 240-seat, 20,000-square-foot venue at Opera Place, at 322 Banyan Blvd. Construction is set to start in early 2006, with delivery and move-in expected in two years.

"We are thrilled to have created an alliance with Opera Place so we can continue our dedication to helping downtown West Palm Beach revitalize through the contribution of arts and culture," Dramaworks Executive Director Sue Ellen Beryl said.

Dramaworks was founded in 2000 as a nonprofit organization.

Florida Stage was originally expected to move to the proposed development.

The 26-story Opera Place has 536 units priced from the $400,000s to $4.5 million. BAP's current portfolio represents 3,200 condominium units valued at $1.5 billion, including Onyx and Onyx 2 in Miami, and 610 Clematis in West Palm Beach.