Everything Condo

First Quarter Newspaper Print Ads Down, Online Up

2007-06-06T07:39:00.000-04:00

Wednesday, June 6, 2007

As reported by: Media Post

According to preliminary estimates from the Newspaper Association of America, advertising expenditures for newspaper Web sites increased by 22.3 percent to $750 million in the first quarter versus the same period a year ago. Advertising on newspaper Web sites made up 7.1 percent of total newspaper ad spending in the first quarter compared with 5.5 percent for the same period a year ago.

NAA President and CEO, John F. Sturm, said "The percentage of ad spending generated by newspaper Web sites continues to grow as advertisers realize the value of (this) Web audience... consumers who have higher household incomes and shop online more frequently than other Internet users."

Advertising expenditures at newspapers and their Web sites totaled $10.6 billion for the first quarter of 2007, a 4.8 percent decrease from the same period a year earlier. Spending for print ads in newspapers totaled $9.8 billion, down 6.4 percent versus the same period a year earlier.

Among the major print components in the first quarter:

Classified advertising fell 13.2 percent to $3.4 billion
Retail declined 2.2 percent to $4.8 billion
National was down 2.8 percent to $1.7 billion

Within the classified print category in the first quarter:

Real estate advertising fell 14.2 percent to $953 million
Recruitment dropped 14.3 percent to $975.3 million
Automotive was down 20.1 percent to $751.3 million
All other classifieds were down 0.5 percent to $699.3 million

"... newspapers continue to make aggressive moves to redefine classified advertising through new online partnerships and other approaches that will position them for the future," Sturm concluded.

THE WORLD’S LARGEST ONLINE CONDO MARKETPLACE REMAINS THE MASTER OF ITS DOMAIN NAME

2007-06-05T10:57:00.001-04:00

USCondex.com Now Operates Under New Domain Name Condo.com

MIAMI, FL., June 5, 2007 – USCondex.com, the world’s first and largest online condo marketplace – dubbed the NASDAQ for Condos – today announced it has acquired the domain name Condo.com, and effective immediately will operate under its new domain www.condo.com. The new name easily resonates with buyers, renters, sellers and developers of condominiums around the world, identifying Condo.com as THE leading website to visit for all things condo.

The announcement comes less than two years after the successful launch of USCondex.com to the online real estate community. The name change is a significant milestone for the company, indicative of the growth it has experienced and further strengthening its leadership position in the online condominium marketplace.

“Acquiring this new domain has a huge impact on our business at hand,” said Richard Swerdlow, Chief Executive Officer for Condo.com. “As we continue to bring the world’s condo community together online, owning the premier domain name in the space will help us achieve our goal to better communicate our business model to global users and partners. Condo.com is a name that transcends language barriers, giving us a tremendous advantage over our competition as we seek to grow our business globally.”

Condo.com provides cutting edge information, functionality and tools for buyers and sellers around the world, including a social networking tool that allows users to network and connect to one another, video blog and upload virtual tours. With unmatched listing capabilities and resources offered on the site, and proprietary technology that provides users with detailed neighborhood, school and demographic information, Condo.com provides a service found no where else in the world.

For more information, visit Condo.com.

About Condo.com

Condo.com is the first and fastest growing global advertising portal and listing service for condominiums. Condo.com carries the largest inventory of condominiums listed in the United States and 70+ countries around the world, valued at over $100 billion. Condo.com cost-effectively delivers unparalleled international exposure to developers, brokers and for-sale-by-owners through the seamless distribution of its listings to a global network of real estate websites visited by over 15 million viewers per month.

Condo.com -- US Condo Exchange (USCondex.com) Changes name to Condo.com

2007-06-04T04:36:00.001-04:00

US Condo Exchange has changed its name to Condo.com. "This name better reflects our mission, growing global brand and positioning as the World’s Largest Condo Marketplace," says founder and CEO, Richard Swerdlow.

For Buyers it means more condos to search and more tools to help
with purchase and rental decisions!

For Sellers it means more traffic, more leads
and faster sales!

Our site now features:

- Over 300,000 listings from around the world
- A growing social network and user community
- Condo TV with dozens of property videos
- Detailed neighborhood information on all listings
- Free listings and video uploads
- Power Seller program for Brokers and Agents
- And more...

"Our site has been the largest site on the internet dedicated exclusively to condo sales and advertising for over two years," states co-founder, James Haft,"Come visit Condo.com and see 'the best place to buy, sell or rent your condo(tm)'."

Miami office market picks up

2007-05-07T22:08:00.000-04:00

A RECORD NUMBER OF NEW OFFICE TOWERS ARE BEING PLANNED FOR MIAMI'S DOWNTOWN AND BRICKELL AREAS DESPITE WORRIES THAT THERE WON'T BE ENOUGH DEMAND

BY MATTHEW HAGGMAN
mhaggman@MiamiHerald.com

Just as a record condo building binge is playing out across Miami's skyline, a record office building binge is just about to start.

Developers want to add three giant office towers in Miami's downtown and Brickell areas, with workers preparing and marketing campaigns under way. Yet some wonder if it's not another case of developers responding to a market need with too much, too fast, just as many think they did with condos.

''There is definitely pent-up demand for new office space, but how much?'' said Peter Harrison, senior vice president at Transwestern Commercial Services. The veteran office broker said the current office proposals are more aggressive than anything he's seen in Miami in his three decades in the market.

For more than a year builders for each of the proposed towers -- called 1450 Brickell, Met 2 and Brickell Financial Centre -- touted their respective projects as the answer to a shrinking supply of office space. But many observers assumed one or two would ultimately back off.

Instead, work crews are now on each site. Each builder has renewed pledges that they have the financial backing and gumption to go forward, whether or not any companies sign leases to rent space before construction starts. All three are marching ahead without announcing a single signed lease.

Some equate the jockeying to a game of chicken.

''If so, it's a very serious game of chicken. There is a lot of money at stake,'' said Jack Lowell, an office broker who represents MDM Development Group, which is building Met 2.

Owning office space has become increasingly desirable, because a lack of recent office construction has driven up occupancy levels and rents. Last month Tishman Speyer of New York, one of the best-known commercial property owners in the world, bought an office complex on Miami's Brickell Key.

If built, the three new buildings would add about 1.9 million square feet of new space by 2010 to a downtown and Brickell area that has some 12 million square feet of office and a vacancy rate of about 10 percent.

So, is there enough demand?

South Florida has long been a home for regional headquarters, but not a magnet for big corporate tenants that gobble up lots of space in one swoop. The average annual absorption for office space in the area from 2003 to 2007 was 287,000 square feet annually, reports Jones Lang LaSalle.

''The talk has been that the office market will be fine if one building goes ahead and it will probably be OK if another is built a year later,'' said Steve Owens, president at Swire Properties, which has built offices, condos and a hotel on Brickell Key. ``But if all three go, we would be potentially challenged.''

Foram Group last month broke ground for Brickell Financial Centre, a planned 40 floors with 602,000 square feet at 600 Brickell Ave. Delivery is set for 2010. The firm, backed by a wealthy Malaysian family, has enough cash to build without a bank loan, said Foram CEO Loretta Cockrum.

''We just can't think about how many others are coming out of the ground,'' she said. ``We have decided the market is there and will compete for the best tenants.''

Similarly, work is already under way on the foundation of Met 2's office and hotel complex, slated to rise 47 stories with 750,000 square feet on Southeast Second Avenue. Insurance giant MetLife is a joint venture partner. Completion is slated for 2010.

1450 Brickell was the first to announce office building plans, with 35 floors and 585,056 square feet planned on Brickell Avenue. Alan Ojeda, CEO of the tower's builder, Rilea Group, said he wouldn't build three office buildings now if he had the land to do it.

Yet he said the coming surge in new office property may not create the glut some fear. For one, vacancy rates should continue shrinking through 2010, he said. And, all of the condo development downtown will bring more people, along with more need for office space.

Also, two of the projects -- Brickell Financial Centre and 1450 Brickell -- are looking to build structures certified green, which may draw tenants. ''If you look at the whole thing, it is adding about 10 percent more space to the market,'' Ojeda said. ``Ten percent doesn't break a market.''

Still, despite construction crews doing foundation work, there is still time to pull the plug.

''From what we see at the moment, it looks like all three are moving forward,'' Owens said. ``But the real truth comes when you come out of the ground. You can put foundations in and stop; cover them up and wait. Yet if you don't stop there, you must finish the building.''

Condo Sales in Massachusetts Decline More Than 10 Percent

2007-04-26T09:25:00.000-04:00

From Banker and Tradesman Online
January 22, 2007
By Aglaia Pikounis

After two years of substantial growth, the condo market took a breather last year, with unit sales dropping more than 10 percent statewide and prices slipping slightly.

A total of 30,203 condominiums were sold in Massachusetts in 2006, a 12.89 percent decline from 2005, according to statistics released today by The Warren Group, parent company of Banker & Tradesman. The statewide median selling price for condos last year fell 1.2 percent to $275,000

The drop in activity is a sharp contrast to the last two years, when the condo market saw double-digit percentage gains in sales and robust price gains. Condo sales jumped about 12 percent in 2005 from the prior year and sales were nearly 19 percent higher in 2004 compared to the year before.

“We had a normalization of the market. The market had been heated up over the last couple of years,” said Larry Rideout, owner and general manager of Gibson Sotheby’s International Realty in Boston. “Prices didn’t go down as much as everyone – the media – anticipated.”

Condo sales in recent years have been fueled by demand from aging baby boomers seeking a more carefree lifestyle and first-time buyers who couldn’t afford surging single-family home prices, according to longtime Realtors.

A significant portion of boomers searching for condos have a home they need to sell and as the single-family home market softened and homes took longer to sell, some of them put off their purchases, industry watchers say. Meanwhile, first-time buyers, who may have thought that buying a single-family home was impossible, paused as they saw a growing number of for-sale homes to choose from and prices begin to ease.

With the availability of undeveloped land shrinking, parts of the Bay State have seen a jump in new condo development as builders try to maximize the number of units they can build, explained David S. Drinkwater, president of Grand Gables Realty Group in Scituate.

In Boston – which saw a flurry of new luxury condo sales later in the year with the opening of the Residences at the Intercontinental along the Fort Point Channel – some neighborhoods
experienced gains while others saw sales plummet by 20 percent or more. Overall, sales in Boston fell 9.6 percent with a total of 6,588 units trading this year compared to 7,286 in 2005, The Warren Group reported.
In central Boston – which includes the South End, Back Bay, Beacon Hill, the waterfront, Fenway and other downtown neighborhoods – sales were off by only 1.4 percent and the median selling price fell 4 percent to $489,000.
‘Percolating’ Market Jason Weissman, a principal of Boston Realty Advisors, said sales activity remained strong in tony Boston neighborhoods like Back Bay and Beacon Hill because there wasn’t a significant spike in the number of condos available for sale.

“Volume and prices may have been off statewide, but in areas like Back Bay and Beacon Hill, prices really held and there were slight gains in volume,” he said. Some 544 condos in the Back Bay and Beacon Hill were sold last year with an average price of $822,276, compared to 541 condos that were sold in 2005 with an average selling price of $809,275, according to Weissman, who cited information from MLS Property Information Network.

Still, sales volume declined by 22 percent to 33 percent in neighborhoods like Allston, Brighton, East Boston, Jamaica Plain and Roxbury. In Brighton, 476 condos were sold, a 22 percent drop from the prior year, while the median selling price dropped a modest 1 percent to $271,750.

In Roxbury, the median selling price dropped 6 percent to $354,500, and sales were off by 24 percent.
Matt Bless, broker-owner of Vanguard Realty in Brighton, said properties took twice as long to sell. The average market time increased from 30-45 days to 60-90 days, he said.

In Brookline, a community that Bless’ office serves, properties that normally went under agreement within two weeks were taking about two months to sell. Constant news reports about the real estate market affected buyers and sellers, according to Bless.

“Because there was so much publicity about the state of the market and the death of the seller’s market, there were buyers who started to have unrealistic expectations about how much of a discount they could get,” he said.
“I find the market is percolating and coming back to life. We’ve gotten a lot of inquiries. A lot of people who were renting last year and decided not to buy, it seems like we’re getting calls from them again saying ‘now I think I want to buy,’” he said.

While condo sales cooled in Brighton and other sections of Boston, sales jumped 34 percent in Dorchester last year. A total of 862 condos were sold in Dorchester and the median selling price climbed 5 percent to $288,900.
Rideout, of Gibson Sotheby’s International Realty, said Dorchester may be benefiting from home seekers priced out of the South End and Back Bay.

In other parts of the city, some in the industry were stunned when an auction took place in the fall for Folio Boston, a new development in the city’s Financial District. “The Folio was kind of [in] a fringe market. That was a unique property location that was definitely an untested product. The numbers that they were reaching for, I think, were difficult to achieve for a new residential neighborhood,” said Weissman.

Outside of Boston, steep drops in sales occurred in Essex County, where the 3,564 unit sales were 21.86 percent lower than a year earlier, and in Norfolk County, where 3,055 condos were sold – a 19 percent drop from 2005, according to The Warren Group.

Commercial and Retail Condos Growing in Popularity

2007-04-11T09:03:00.000-04:00

Minding the Store in a Condo

New York Times
April 11, 2007
By J. ALEX TARQUINIO

Patrick Cooney stops in frequently at the Museum of Modern Art store on the corner of Spring and Crosby Streets in Manhattan. Before Christmas, he loaded up on T-shirts and toys for the family. “MoMA is a part of New York,” he said.

But unlike other loyal customers at the museum’s outpost in SoHo, Mr. Cooney is also the store’s landlord. Five years ago, he bought the 15,000-square-foot retail condominium at 81 Spring Street, covering the ground floor, lower level and a storage area in the basement, and the Modern rents all the space.

Retail condominiums work much like residential condos. Developers carve out retail space on the ground floor of a building and sell it to investors. The developers often lease the space out first, and the more compelling the tenant, the steeper the price they can ask of the buyer.

Over the last few years, the market for these properties has skyrocketed in Manhattan. More than 560,000 square feet of retail condo space sold last year for almost $650 million. That was a sharp increase from the 28,000 square feet that sold in 2003 for around $26 million, according to Real Capital Analytics, a New York real estate company that tracks deals worth at least $5 million.

Over the last two years, Manhattan represented 38 percent of the total square footage of retail condo space sold nationwide, and 65 percent of the dollar value, according to the company’s statistics.

While New York has the largest market for retail condos, they are also popular with investors in other densely built-up American cities like Chicago, San Francisco, Boston and Washington, said Dan Fasulo, the director of market analysis at Real Capital Analytics. “They’re the glamour cities, with global appeal,” he said.

Brokers say that in New York’s intense real estate market, developers are eager to assemble construction sites, even in neighborhoods not previously regarded as prime commercial areas. In the process, they are offering such high prices for smaller buildings that the owners cannot resist selling. And once they do sell, there are powerful tax incentives to plow the money back into real estate.

Mr. Cooney, for example, purchased the SoHo store with money he made selling four adjacent residential brownstones on the Upper East Side of Manhattan that had been divided into rental units.

Mr. Cooney, a restaurateur who immigrated from Ireland in 1968 and owns O’Casey’s at 22 East 41st Street, had purchased all four buildings for a total of $350,000 in the late 1970s. So when he sold them for $12 million in 2001, almost all of the proceeds would have been subject to capital gains taxes.

But he opted to do a 1031 exchange, which is named for a section of the federal tax code that allows real estate investors to avoid paying capital gains taxes if they quickly reinvest in real estate. The law gives them 45 days to identify the properties they would like to buy and 180 days in all from when they sold their original properties to close on the new ones.

Mr. Cooney used most of his windfall to buy two retail condos.

First, as part of his original agreement to sell the brownstones to the developer Sherwood Properties, he gained the right to pay $3.5 million to acquire a retail condo in the Metropolitan, the 30-story residential tower at 181 East 90th Street that was built on the brownstone site. A Chase bank branch has a 20-year lease in his condo.

He also paid $6.3 million to the Horizon Realty and Development Corporation for the store in SoHo, where the Museum of Modern Art already had a 10-year lease.

The museum created this store to maintain a foothold in Manhattan while the museum on 53rd Street was closed for renovation, said Kathy Thornton-Bias, the museum’s general manager of retailing.

But the SoHo store first opened its doors just a few days after the terrorist attacks in September 2001. It was difficult then even to enter the neighborhood in Lower Manhattan, much less do any shopping there.

At the time, Mr. Cooney had only a verbal agreement to buy the retail condo, so he might have backed out. But his interest in the distinctiveness of the location and the tenant — combined with his need to close the deal quickly because of the 1031 rules — persuaded him to proceed.

Eric Anton, an executive director at Eastern Consolidated who sold the Spring Street store to Mr. Cooney, estimates that half of the retail condo sales in his office are to buyers with money that they are eager to apply to 1031 exchanges. He said many of these buyers are gearing up for retirement — like Mr. Cooney, who is 62 now — and without the tax incentives, they might instead roll some of their gains into bonds.

David LaPierre, a senior vice president at CB Richard Ellis, said that retail condos might also have a psychological appeal for some local investors.

“Walking around a neighborhood, you can see new stores opening, and you can go in and out of stores,” he said. “That makes retail feel more tangible than an office market, where you can’t tell the quality of the buildings from the outside.”

Of course, soaring sales prices have taken a slice out of capitalization rates, a ratio of the net income produced by a property relative to its cost. When Mr. Cooney bought the Spring Street store in early 2002, it had a capitalization rate of 7 percent.

Now, however, some retail condos in prime locations like Fifth Avenue are selling with yields as low as 4.5 percent, brokers say. “That is very close to a bond,” Mr. LaPierre said. Buyers who accept yields that low are betting that the values of condominiums will continue to climb, he said.

Mr. Cooney estimates that the SoHo store might sell with a capitalization rate of 5 percent now.

“And I would buy it today for 5 percent,” he said. “You can’t beat the location, or the tenant.”

Why Icahn Is Betting On WCI's Florida Condos

2007-04-05T12:08:00.000-04:00

From: Wall Street Journal
By MICHAEL CORKERY in Miami Beach
April 5, 2007; Page C1

Amid softening home prices, rising foreclosures and turmoil in the mortgage industry, billionaire financier Carl Icahn is making a contrarian bet on a troubled pocket of the U.S. housing market: high-end Florida condominiums.

How Mr. Icahn fares with his wager could help answer whether this state's housing downturn is a cloud that will soon blow over or a storm that will linger for years. The board of WCI Communities Inc., a home builder that has erected hundreds of high-rise condos along the Florida coast, could decide today whether to accept Mr. Icahn's tender offer of $22 a share for the builder that many consider a good barometer for the state's priciest real estate. That offer, which totals about $920 million, is slightly higher than WCI's $21.45 price yesterday in 4 p.m. New York Stock Exchange composite trading.

Mr. Icahn's pursuit of WCI has puzzled many on Wall Street who believe the Bonita Springs, Fla., company is highly exposed to the swelling glut of condos dotting Florida beaches and golf courses. In the fourth quarter, WCI, which has a market value of about $909 million, had more defaults on condos and cancellations of typical single-family homes, which it also builds, than it received orders for new homes.

Mr. Icahn appears to be counting on Florida real estate to make a comeback. "My investment philosophy, generally, with exceptions, is to buy something when no one wants it," he said yesterday. "We made a fairly large investment and took control of several energy companies seven or eight years ago when they were way down. Housing is somewhat analogous."

Mr. Icahn, who has put up a slate of nominees for the WCI board, declines to comment on what, if any, plans he has for the company. In a Jan. 16 Securities and Exchange Commission filing, Mr. Icahn said he beneficially held 14.5%, or 6.1 million shares, in WCI and that he intended to contact the company to discuss how to "unlock the inherent value" of its shares. His tender offer is conditioned on the WCI board pulling its recently enacted poison-pill provision intended to ward off hostile takeovers. WCI declined to comment, citing a "quiet period" after the tender offer.

In an interview before he made his March 23 tender offer, he said, "On a medium- to long-term basis, there are a lot of factors that will help Florida." Among them: Baby boomers reaching retirement age are moving south.

With prices as high as $11 million for some prime units, WCI condos seem suited to wealthy buyers. WCI also boasts a large amount of undeveloped land across Florida, with many parcels located near its current developments. Some investors believe that land will prove valuable when the Florida market recovers.
Mr. Icahn's offer comes at a crucial time for WCI and for the Florida condo market, generally. The company is expected to open about 10 condo developments across Florida this year. Many of the units within these developments were sold to investors several years ago, as the speculative market roared along. Now those buyers are choosing whether to close on their units and move in, or walk away from hefty deposits, or try to resell their condos in a softening market. WCI buyers put down average deposits of 18% on units with an average sales price of $1.2 million.

While the speculative overhang of newly constructed single-family homes may have peaked in some markets across the country, the full force of Florida's condo glut is still unfolding because, in many cases, it has taken two to three years to complete the high-rise buildings.

In Miami-Dade County alone, 8,000 condo units are expected to open this year, while an additional 12,000 units will open in 2008, followed by 5,500 units in 2009, says Jack McCabe, a housing consultant based in Deerfield Beach, Fla. Fewer than 11,000 condos were built in Miami-Dade between 1995 and 2004.
"It's not a pretty picture," Mr. McCabe says. "This stuff was built five years too soon. The first real wave of baby boomers will retire in 2010 and Florida is going to be one of the most vibrant markets. But before that, we are going to see a lot of people lose money."

Many investors agree. As of March 15, WCI was among the most heavily shorted stocks, with short interest comprising 55% of its float.

Short sellers bet that a stock price will fall. Many short investors are betting WCI will be hit by a wave of defaults, as buyers walk away from their deposits or buyers try to rescind their contracts through lawsuits.

"You have a dire situation," says Credit Suisse analyst Ivy Zelman, who has a "sell" rating on WCI. "There is too much inventory, not enough sales and price deflation. It's the perfect storm."

Charles May put down a $315,000 deposit on a WCI condo in Bal Harbour, near Miami, in December 2003. Before he decided to buy the approximately $1.55 million condo he says WCI sent a limousine to his house, delivering champagne and fancy bathrobes.

Three years later, the condo tower isn't finished and Mr. May expects he will have to resell for a loss. Mr. May is suing the company to get his deposit back, claiming the project is behind schedule.

WCI says its default rate, or rate of condo buyers who don't close on their unit and walk away from a deposit, this year may rise above its historical average of about 2%, but it doesn't expect that rate to exceed 10%. While on the rise, that measurement is much lower than what many other builders are experiencing.
Other builders have higher cancellations, in part because they require smaller deposits for single-family homes. Buyers of WCI units have been more reluctant to walk away from their bigger deposits.

A surge in defaults could be especially painful for WCI because the company needs cash to pay down its debt. WCI's debt-to-capital is roughly 66%, compared with an average of 44% among other builders, says Credit Suisse's Ms. Zelman.

To be sure, some analysts say WCI could limp along collecting as much cash as it can.

One source is the deposits that the company gets to keep when buyers walk. Some analysts also believe Mr. Icahn could refinance the company's debt and possibly sell off some of its land

US Condo Exchange Hires New Chief Marketing Officer to Manage Global Expansion

2007-03-26T12:09:00.000-04:00

USCondex the world's first and largest online condo marketplace, today announced the appointment of Xavior Miller as Chief Marketing Officer (CMO). Mr. Miller will be responsible for company marketing, eCommerce, and branding initiatives.

Miami, Florida (PRWEB) March 26, 2007 -- USCondex the world's first and largest online condo marketplace, today announced the appointment of Xavior Miller as Chief Marketing Officer (CMO). Mr. Miller will be responsible for company marketing, eCommerce, and branding initiatives.

"Mr. Miller brings over 12 years of branding, product development, and interactive marketing experience to our company," says Richard Swerdlow, CEO at USCondex. "His previous work with major global brands including; Travelocity, American Express, and Crystal Cruises will allow him to create innovative marketing solutions for USCondex."

Over the last 12 years, Mr. Miller has had notable success in several industries, including online travel, entertainment and retail. He was most recently at RazorGator, a Kleiner Perkins company, where he led the eCommerce operations and was key in preparing the company's online business for which they received Series A funding.

Prior to Razorgator, Mr. Miller assisted in the growth of Travelocity, American Express Travel, Crystal Cruises, Navigant International and a company he founded in 1994 XStreamSolutions.net.

"I am excited to join a talented and passionate team of experts at USCondex," Says Mr. Miller. "Like many of my previous ventures, this company is poised to revolutionize their industry and I am here to contribute my expertise to help make that happen."

For more information please contact Adam Kujacznski at 305.476.2075

US Condo Exchange, LLC (www.uscondex.com) is a global leader in the online condominium marketplace, with over 300,000 listings spanning 40 countries valued at over $100B. USCondex is based in Miami, FL, and was founded by CEO Richard Swerdlow and James Haft, managing director of Pacific Alliance Limited, LLC, a New York-based investment bank, in 2006

J.P. King partners with USCondEx.com to demonstrate auction solutions to developers

2007-02-09T17:54:00.000-05:00

J.P. King has announced an agreement with the US Condo Exchange under which the auction marketing firm will be featured in animated advertisements on the Condo Exchange’s web site at www.USCondEx.com.

J.P. King and the Condo Exchange will work together to help demonstrate to developers how a J.P. King Auction can reduce inventories, which are currently at all-time highs.

“Hundreds of condominium owners are currently saddled with large of inventories that they thought would have been sold long ago,” said Craig King, president of J.P. King. The US Condo Exchange currently has more than 190,000 condos located in the United States and in 37 countries around the world. This provides us an opportunity to reach many of these developers,” said King.

Numerous options exist for condominium developers who need to reduce their inventory. Two common types of auctions include “Grand Opening Auctions” and “Closeout Auctions,” said King.

“Most developers know that the hardest units to sell are the very first ones and the very last ones. When a development is brand new, you often have a situation where people wait around for someone else to jump in first. A Grand Opening can establish the momentum that ensures a successful project. Toward the end of the sales period, developers often find that expense of continuing their marketing efforts for just a few units can cause their profits to erode. For those, a Closeout Auction can be a good choice,” said King.

In between, an Inventory Reduction auction may help a developer solidify the investment by selling a large number of units and reducing the inventory and debt to manageable levels.

To see current auctions, click here.

It's Trump vs. market in condo project

2007-01-28T23:14:00.000-05:00

By Alexandra Clough

Palm Beach Post Staff Columnist

Sunday, January 28, 2007

The condo market is tanking, and many projects are being canceled or put on hold nationwide.

Donald Trump's response? Don't worry. Be happy.

The real estate mogul says his brand is so strong that it now has the power to defeat poor market conditions, wherever they may be.

As proof, he pointed to his latest Trump Tower in Hawaii. Despite a slumping real estate market there, that project sold out for a whopping $700 million in just eight hours, setting a world record. Buyers were from around the globe.

Average unit price: $1.5 million.

Those kind of results are music to the ears of Jorge Perez, head of The Related Group of Miami.

Perez has been trying to drum up pre-sales for his latest planned West Palm Beach condo, Icon Palm Beach, on North Flagler Drive. Even though Perez has a loyal following on U.S. and South American projects, the Palm Beach County market is so tough these days that Perez knew he needed something more: Access to the worldwide market.

Enter The Donald to goose Icon's chances of success. Perez said he's counting on Trump's worldwide name to bring international buyers to his high-priced project, now renamed Trump Tower Palm Beach.

Would Perez have gone forward if he didn't have Trump?

"We think the land and the project are fabulous," he said. "But would we have waited one year for the launch until the market got better? We might have."

Perez said he's not concerned that Trump's bold way of speaking will hurt sales. "He's always been a controversial guy who speaks his mind," he said.

Indeed, Trump has made waves nationally for his verbal attacks on comedian and The View host Rosie O'Donnell, whom he's called a "loser" and "fat pig." Closer to home, Trump's also feuding with Palm Beach town officials over an oversized U.S. flag and flagpole at Mar-a-Lago.

In Trump style, he called these events positive. "Fox did a poll that said 91 percent of Americans are in favor of what I said about Rosie," he said. "And everyone is in favor of the American flag."

So will Trump fly the big flag at Trump Tower Palm Beach when it's done?

"I think we should have one," Trump said. "It's a prominent site, and any prominent site should proudly fly the American flag."

Perez may go along with Trump's over-the-top comments and his flag-loving ways. But one thing's for sure: He won't be joining Trump on the small screen.

Perez said he's frequently asked if he and Trump have discussed filming The Apprentice: South Florida, starring the telegenic Perez. The answer is a big fat no.

"I have no desire whatsoever to be on TV," Perez said.

Condo inventories rose sharply in last six months

2007-01-26T00:50:00.000-05:00

Condo inventories rose sharply in last six months

Vancouver Sun
Published: Thursday, January 25, 2007

Greater Vancouver real estate markets saw a 55 per cent increase in inventory of unsold presale condominium units over the last six months, which may trigger a slowdown in future development, PricewaterhouseCoopers reported today.
The rising inventory is likely a result of fewer buyers being able to afford Vancouver's high-flying prices, Craig Hennigar, vice-president of PricewaterhouseCoopers Real Estate (PsC), said.

However, Hennigar said developers will likely build the projects they have in the works now, then scale back their future expectations rather than drop prices that are being driven largely by skyrocketing land and construction costs.
Hennigar, in PwC's latest Greater Vancouver condominium market review, counted 4,350 unsold condominium units in pre-sale marketing at the end of December, compared with 2,780 in January, 2006.

However, Hennigar added that the 4,350 unsold units only represented about 28 per cent of all units in pre-sale marketing. In January, the 2,780 units represented 23 per cent, so the ratio of unsold units in the market hasn't increased dramatically.

"We're not suggesting, at this point, that the market is awash in unsold presales," Hennigar said. "We're not even at 50 per cent [which would signal a buyer's market]. But we're closer to it than we were six months ago, or 12 months ago when the market was hotter."

How about a college education with your new condo?

2007-01-17T14:31:00.000-05:00

A slow market has developers offering everything from shopping sprees to new cars to vacations.
BY RICHARD WESTLUND

''I had been looking for about six months, and didn't have an immediate need to buy,'' said Nisius, an agricultural exports manager for Cargill who was seeking a shorter commute to her Coral Gables office. ``The developer offered to waive his fees and pay my closing costs.''

Before Nisius moves into her $400,000 condominium this month, she will take advantage of a $4,000 credit from Rooms to Go, whose Dadeland showroom is on the ground floor of Toscano, and another $1,000 credit from Best Buy. ''I'm moving from a three-bedroom house further south and downsizing, so some of my current furniture won't work at my new condo,'' she said. ``Getting all new furniture for free was a real incentive for me.''

Faced with a sharp drop-off in demand at a time when thousands of new units are coming on the market, South Florida developers are offering a host of financial incentives to attract buyers like Nisius. To take just one example, Abel Homes was recently offering zero down payments, no closing costs and no association fees for a year on the remaining townhomes at its Naranja Villas development in Southwest Miami-Dade.

''I think it's essential for builders to offer incentives,'' said Al Piazza, CEO of Coscan Homes in Fort Lauderdale. ``Customers today are expecting them, and with the market still so slow, I think you'll see even more out there.''

To promote its new family-oriented Orchid Grove townhouse community in Pompano Beach, Coscan is offering buyers a free four-year college education for one child or grandchild. Under the incentive program, which is scheduled to run until May 1, Coscan will cover the child's cost to enroll in the Florida Pre-Paid College Plan, about $10,000.

LOT OF INTEREST

Piazza said he got the idea from developer friends in New York who offered a similar incentive in the 1980s. ''We've had a lot of interest from both buyers and brokers,'' he said. ``It's generated a lot of talk and I'm sure it will be an important consideration for many buyers as we begin closing these sales.''

In the past year, some individual sellers have offered new cars, airline tickets or exotic vacations to market their homes. But buyers usually prefer a cash incentive, such as a discount in the sales price or the payment of closing costs. In a recent national survey by online real estate company HouseHunt, 77 percent of responding buyers said payment of closing costs was their top incentive choice.

''Not surprising, this would represent a bottom-line savings of several thousand dollars in normal closing cost fees and services,'' said Michael Bearden, president and CEO, in announcing the results.

Many developers in South Florida today are typically offering a package of incentives, according to Ron Shuffield, president, Esslinger-Wooten-Maxwell in Coral Gables.

''We've worked with developers who gave away car leases to buyers,'' Shuffield said. ``We're not doing that anymore. Most people prefer incentives like having their homeowner fees paid for a year or two, or other costs associated with the transaction.''

One common incentive today in the new home market is waiving a provision in the sales contract that requires the buyer to pay a 1.5 to 1.75 percent fee to the developer. Those fees, which covered some of the developer's closing costs and enhanced a project's profitability, were widely imposed several years ago at the height of the recent boom market. ''Many developers are now paying closing costs for the buyers, which are usually 2 to 3 percent of the sale price,'' said Shuffield. ``If you include the waiving of the developer's fees and other incentives, a buyer's savings today can be 5 to 6 percent altogether.''

Some real estate brokerages and developers offer discounts to buyers who use their affiliated mortgage and title services. However, buyers should also compare fees with independent companies to be sure they are getting the best deal.

SELLERS IN ACT

Individual sellers are also offering incentives, such as paying a buyer's closing costs or homeowner association fees. Again, it's important for buyers to be sure the seller has not inflated the sales price in order to offer these ``discounts.''

Regardless of incentives, the best way for a seller to market a home is to price it correctly, said Mike Pappas, president of The Keyes Co. in Miami. ''Sellers don't have to resort to gimmicks and making sacrifices,'' he said. ``In reality, if a seller works with an agent at pricing his or her property correctly, and that property receives proper attention and exposure, this is the magic formula for a successful sale.''

__________
richard.westlund@earthlink.net
Posted on Sun, Jan. 14, 2007
Source: MiamiHerald.com

US Condo Exchange Partners with Italian Powerhouse to Showcase American Condos

2007-01-16T13:07:00.000-05:00

US Condo Exchange Partners with Italian Powerhouse to Showcase American Condos

Miami, FL, January 15, 2007 --(PR.COM)-- US Condo Exchange, LLC, www.uscondex.com, the online marketplace where more than 200,000 condos can be searched, compared and reserved online in real time, announced today that it has entered into a strategic partnership with Italian real estate powerhouse Pirelli & C. Real Estate (“Pirelli RE”), a firm with over €15 billion in real estate assets under management and a leadership role in a wide variety of real estate businesses throughout Italy and Central-Eastern Europe.

Through the partnership, Pirelli RE’s online real estate venture, www.casaclick.it, will showcase condos listed on US Condo Exchange, bringing the vast market of European buyers and extensive inventory of U.S. Condos. In addition, Casaclick will employ new, patented technology to feature streaming video content of US Condo Exchange properties at its hundreds of newspaper kiosks throughout Rome, Milan and other key cities, including planned interactive capabilities where passersby can simply click on kiosk screens to view potential vacation homes in South Beach, Las Vegas and more. For Americans interested in that dreamed-of apartment in Florence or Rome, they will now be able to access the best of Italy’s “condo” market on www.uscondex.com, thanks to the new relationship between US Condo Exchange and Pirelli RE.

This pairing is one more step in US Condo Exchange’s efforts to globalize the condo market and comes on the heels of a similar agreement with Primelocation, www.primelocation.com, the United Kingdom’s leading online real estate portal. “US Condo Exchange aims to eliminate all borders when it comes to condo marketing and transactions,” said Richard Swerdlow, Co-Founder and CEO of the U.S. Condo Exchange. “Through our partnership with Italy’s leading real estate conglomerate, we have opened up our condo inventory to Italians. We expect the ease with which Italians can now view and purchase American condos to result in exponentially increased sales to that market. Additionally, we are adding worldwide condo inventory which we believe will be interesting to our site users.”

According to the National Association of Realtors, Europeans already account for 58% of international home sales in markets such as Florida, illustrating the market for of vacation and second homes across the Atlantic. Furthermore, Pirelli RE is currently expanding its own reach to Germany and Poland.

“Italians are increasingly interested in condos, but up until now, there has never been an easy way to access condo information let alone conduct transatlantic transactions,” said Paolo Bottelli, CEO of Casaclick. “Condo Exchange facilitates the exchange of information like never before. At the same time, the best of Casaclick’s listings are now available to a much broader audience by having them showcased on US Condo Exchange.”

Now, Italian-speaking visitors may visit www.casaclick.it to “Esplora il mercato immobiliare,” translation: Explore the American Housing Market. What’s more, Casaclick will “push the net to go on the road” via newsstands, according to Mr. P. Bottelli, with the new interactive-shop-window patented technology making the condo market available “street by street regardless of whether you have a personal computer.”

“The condo market has never seen such exposure, and it couldn’t come at a better time,” added Richard Swerdlow, Chief Executive Officer of US Condo Exchange, “We continue to pursue key international alliances while adding new condo inventory to our exchange daily… this is just the tip of the iceberg.”

British residents may visit www.primelocation.com to access US Condo Exchange listings, and US Condo Exchange expects to unveil other key international alliances shortly.

Pirelli & C. Real Estate (“Pirelli RE”) is one of the leading players in the real estate industry in Italy and one of the most important in Europe, thanks to an innovative business model for the sector and a flexible and dynamic organization with the highest professional standards. Pirelli RE has become a leader in the management of real estate assets in Continental Europe. The company, listed on the Milan Stock Exchange since June 2002 (PRS.MI) and with about €15bn of AUM, is a subsidiary of the Pirelli Group, a large multinational industrial conglomerate listed on the Milan Stock Exchange The Pirelli Group businesses include Pirelli Tyres, Pirelli Labs, Pirelli Broadband Solutions, Pirelli Ambiente and indirectly stakes in telecom companies. (www.pirellire.com)

US Condo Exchange is the first and fastest growing global advertising portal and listing service for condominiums. Condo Exchange currently has over 200,000 condos listed on its site located in the United States and in 40 countries around the world, valued at over $60 billion. The website cost-effectively delivers unparalleled international exposure to developers, brokers and for-sale-by-owners through the seamless distribution of its listings to a global network of real estate websites visited by over 15 million viewers per month. Condo Exchange also features a simple and automated self-listing process, and partners with major media companies to automate the listing of for-sale and for-rent condo classifieds.

###
Contact Information
US Condo Exchange
Adam Kujacznski
305-476-2075
a.kujacznski@uscondex.com
www.uscondex.com

2007: A time of widgets and Web redesigns

2007-01-12T09:29:00.000-05:00

Inman Real Estate News

2007: A time of widgets and Web redesigns
Brokers reveal real estate technology plans
Friday, January 12, 2007

By Glenn Roberts Jr.
Inman News

Matthew Borland Matthew Borland, Zephyr Real Estate

The new year is here, and brokers are already buzzing about new Web sites, widgets and other technological doodads that they expect to use in 2007.

Carolynn Ozar-Diakon, broker-owner of Resources Real Estate in Rumson, N.J., said she plans to explore the use of a 'virtual kiosk' module for her real estate office this year.

Simon L. Conway, broker for Picket Fence Realty in Kissimmee, Fla., said he will be investing in online mapping technology and a Web site redesign.

And Matthew Borland, a broker and managing partner with Zephyr Real Estate in San Francisco, said he expects tablet PCs, wireless broadband and transaction management platforms will be in"

Read more...

U.S. mortgage rates rise for fourth week in five

2007-01-11T17:44:00.000-05:00

Excite

Marketwatch - The story behind the numbers

30-year fixed-rate should remain below 6.5% in 2007: economist

By Amy Hoak, MarketWatch
Last Update: 11:54 AM ET Jan 11, 2007

CHICAGO (MarketWatch) -- Mortgage rates edged up in Freddie Mac's weekly survey released on Thursday, the fourth increase in five weeks, lifted by a strong December employment report, the company's chief economist said.

'The gain in employment in December exceeded the consensus forecast, and helped ease fears about the state of the economy,' said Frank Nothaft, Freddie Mac (FRE: news) chief economist, in a statement. 'But stronger employment and higher wages put upward pressure on inflation, which, in turn, translates into higher interest rates.'

The 30-year fixed-rate mortgage averaged 6.21% in the week ending Thursday, up from 6.18% last week. The mortgage averaged 6.15% a year ago.

'We expect rates on 30-year fixed-rate mortgages to remain below 6.5% in the coming"

Real estate rebound likely in second-half '07, economists say

2007-01-11T16:04:00.000-05:00

Inman Real Estate News

Thursday, January 11, 2007

By Glenn Roberts Jr.
Inman News
Frank Nothaft

NEW YORK -- The national housing market may not have reached bottom yet, but the second half of the year will likely begin the recovery from a slight downturn that followed a prolonged boom in sales and home prices, economists generally agreed during a panel this week at the Real Estate Connect NYC conference.

'We're going to hit the trough in the first half of 2007,' said Frank Nothaft, chief economist for Freddie Mac and a panelist for the 'Housing Outlook: 2007' session. Other panelists included representatives from the California Association of Realtors, Rutgers University and the University of Pennsylvania.

Single-family construction, which peaked in third-quarter 2005, was 18 percent lower in third-quarter 2006, he noted. From that level Nothaft said he expects an additional decline of about 8 percent to 10 percent before the market turns around. 'We're most of the way through the correction but we're not at the trough part yet.'"

Read more...

NYC condos grab larger share of the pie

2007-01-04T10:16:00.000-05:00

Brokers predict Manhattan co-op boards may have to relax some restrictions to compete

The Real Deal
By Lauren Elkies
December 2006

It's unlikely that prestigious Upper East Side co-op buildings like 740 Park Avenue and 834 Fifth Avenue are going to let the riff-raff in any time soon.

However, Manhattan co-op buildings as a whole -- despite trumping condos by three-to-one in sheer number -- have been losing a bit of steam as the primary apartment choice in recent years.

Source: Miller Samuel

Despite generally costing more per square foot, condos are taking up an increasing share of the real estate market in Manhattan -- accounting for more than 50 percent of sales in recent quarters.

Some brokers are saying co-ops will eventually have to reposition themselves to adapt: Changes could involve slightly more lax financial requirements and even tweaks to the typical co-op board approval process in some buildings.

Jonathan Miller, president and CEO of appraisal firm Miller Samuel, said he would suspect that in some buildings, "you may see co-ops limiting and, especially in a weaker market, loosening financial requirements." Still, that may take awhile, as many brokers say co-ops are getting tougher on candidates recently, and there are more board rejections now than in a long time.

Read more...

Manhattan real estate prices still rising in Q4

2007-01-04T09:14:00.000-05:00

2006 was better than last year, says Douglas Elliman CEO

Thursday, January 04, 2007

By Glenn Roberts Jr.
Inman News

Manhattan, N.Y.

Manhattan residential real estate prices climbed overall in the fourth quarter compared to the same quarter last year, several major brokerage companies reported this week. Halstead Property, Brown Harris Stevens, The Corcoran Group and Prudential Douglas Elliman released reports detailing condo and co-op sales and pricing activity for the fourth quarter.

The sales data used by some companies was in some cases skewed higher in the fourth quarter when compared to fourth-quarter 2005 because of a new source of public data on co-op sales that became available earlier this year.

Miller Samuel Inc., a residential appraisal company that prepared the quarterly report for Prudential Douglas Elliman, reported that the average sales price for Manhattan co-op and condos in the fourth quarter grew 3.2 percent compared to fourth-quarter 2005 and the median sale price was up 5.1 percent.

Meanwhile, the average price per square foot declined 0.4 percent, days on market from the last list date increased 9.1 percent and the listing inventory shrank 0.5 percent when compared to the same quarter last year. The report is based on data from 2,441 sales in the fourth quarter.

The average sale price of co-ops grew 2.7 percent in the fourth quarter compared to fourth-quarter 2005 and the median sale price was flat. The average price per square foot fell 4 percent and days on market increased 6 percent compared to fourth-quarter 2005, Miller Samuel also reported.

The average sale price of Manhattan condos rose 7.5 percent; the median sale price was up 14.4 percent; the average price per square foot was up 6.5 percent; sales grew 36.1 percent; and days on market increased 14.9 percent compared to fourth-quarter 2005, according to the report.

The average sale price of Manhattan condos increased 52.3 percent among three-bedroom condos but dropped 26.6 percent among condos with four or more bedrooms in the fourth quarter compared to the same quarter last year -- there were price increases between 4.2 percent and 7.2 percent for condos with fewer bedrooms.

The average sale price of lofts rose 11.9 percent while the median sale price dropped 5.4 percent in the fourth quarter compared to fourth-quarter 2005, according to the report. The average price per square foot grew 15.8 percent and the days on market from last list date rose 19.8 percent for lofts compared to the same quarter last year.

The price per square foot paid for co-ops and condos flew up 19.7 percent in the fourth quarter compared to fourth-quarter 2005 in Manhattan's Uptown area, while climbing 4.2 percent in the downtown area, and falling 3.1 percent in the east area and 1.1 percent in the west area of Manhattan.

Read more...

Webcam provides view of project's progress

2007-01-03T11:28:00.000-05:00

Orlando Sentinel : Orange County News

With investor-owners located worldwide, from Ireland to South America, The Point Orlando Resort near the Orange County Convention Center faced a challenge in keeping buyers updated on progress of the two condo-hotel towers now rising near Wet 'n Wild.

Technology has done the trick. A live Web-camera shot offers viewers anywhere 24-hour visual access to the scene on Carrier Drive near Universal Boulevard.

"I always used to have to run out and snap pictures and send them out to people individually, but now this is very helpful. Anyone, anywhere in the world can watch the towers go up, with this dedicated webcam," said sales coordinator Debora Pludwinski. The Web address is www.thepointorlando.com

Read More...

Realtors give readings on local markets

2006-12-22T09:08:00.000-05:00

Inman Real Estate News - Realtors give readings on local markets

Part 1: Word-On-The-Street market snapshots

Friday, December 22, 2006

By Matt Carter
Inman News

Editor's note: No one knows the local real estate market better than Realtors. In this two-part series, Inman News sought out local insights on what's happening on the ground and what agents think is in store for 2007.

Read more....

More people using Web for real estate search

2006-12-16T00:00:00.000-05:00

Inman Real Estate News:

More people using Web for real estate searchPew study: 39% of Internet users look for housing info onlineFriday, December 15, 2006Inman News
The number of Internet users who look for housing information online has grown steadily over the last six years, a new study finds, thanks to more online resources for listings and other real estate information.

Nearly two in five adult Internet users in the United States, or 39 percent, have looked online for information about a place to live -- double the overall number of Americans who had done so in 2000, according to the Pew Internet & American Life Project. That was up from 34 percent in 2004 and 27 percent in 2000.

Overall, more than a quarter of all adults in the United States, or 27 percent, have looked online for information about housing, more than double the overall number of Americans who had done so in 2000 (13 percent).
Younger Internet users were more likely to seek housing information online than older Web users. Fifty-one percent of Internet users 18-29 years old have searched online for housing information, compared with 43 percent of Internet users 30-49 years old, 27 percent of Internet users 50-64 years old, and 15 percent of Internet users age 65 and older.

Moreover, 9 percent of Internet users 18-29 years old reported in August that they looked for housing information on a typical day, more than double the percentage (4 percent) in this age group who said the same thing two years earlier."

More...:

Source: Inman News

Condo auction attracts many bidders

2006-12-12T09:19:00.000-05:00

Tampa Bay Business Journal - Monday December 11, 2006.

Forty condominium units at The Hamptons at Tampa Palms were sold at a public auction over the past weekend, at an average price of $148,000 a unit.

J.P. King Auction Co. of Gadsden, Ala., managed the sale of the units, which were among the most expensive converted apartments in the Tampa Bay area. The auction attracted 171 bidders from 15 states as far away as Minnesota, Nevada and California.

The sale disposed of 20 two-bedroom units, 15 three-bedroom units and five one-bedroom units, at a total price of just above $5.9 million, a J.P. King spokesman said.

More....

NAR: Pending Home Sales Indicate Market Stabilization

2006-12-11T14:20:00.000-05:00

NAR: Pending Home Sales Indicate Market Stabilization

WASHINGTON, December 04, 2006 -
Pending home sales are hovering in a narrow range, another indication that a stabilization is occurring in the housing sector, according to the National Association of Realtors®.

The Pending Home Sales Index,* based on contracts signed in October, slipped 1.7 percent to a reading of 107.2 and is 13.2 percent lower than October 2005. The index had trended up from a cyclical low of 105.6 in July, and a decline from year-ago levels is narrowing. In September, the index was 13.6 percent below a year earlier, while in August the decline was 14.0 percent.

David Lereah, NAR’s chief economist, said a fairly steady pace of home sales can be expected for the next two months. “It’s important to focus on where the housing market is now – it appears to be stabilizing, and comparisons with an unsustainable boom mask the fact that home sales remain historically high – they’ll stay that way through 2007,” he said. “In addition, a temporary correction in prices distracts from the fact that it is primarily the number of home sales that affects the economy, and the number for this year will be the third highest on record.”

The index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed and the transaction has not closed, but the sale usually is finalized within one or two months of signing.

More...

Sold out condo hotel: a sign of hot times in Napa

2006-12-10T20:19:00.000-05:00

Napa Valley Register Online | LocalNews
: By KEVIN COURTNEY, Register Staff Writer
Sunday, December 10, 2006 1:13 AM PST
Want proof that downtown Napa is becoming a hot address? One hundred investors together and paid an eye-popping $63 million last week to own rooms in the luxury Westin Verasa hotel on McKinstry Street.

The condo hotel hasn't yet risen from the ground, but two of the 100 buyers paid $1.25 million each for suites that will overlook the Napa River and the planned Oxbow nature preserve, said Benjamin Tice, director of sales for Westin Verasa.

Buyers, who paid an average of $630,000, will own rooms at the Westin Verasa. They will be entitled to stay at the hotel up to 29 days a year. The rest of the time, the rooms will be rented to the public.

'We sold out,' Tice said of the first phase. The hotel's remaining 60 units will be put on sale early next year. Now starting construction, the hotel is scheduled to open in late 2008.
Playground Destination Properties, a division of Intrawest, a major hotel-resort developer, sold the 100 rooms within a few months of opening a sales office on First Street."

More....

REBNY Report Shows NY Condos and Co-op prices still rising

2006-12-07T15:39:00.000-05:00

December 7, 2006

The Manhattan Residential Sales Report is compiled by REBNY through confidential surveys provided by the city’s major residential brokerage firms. Individual brokers submit data and REBNY publishes its findings in an effort to help buyers and sellers determine current fair market values.

The report indicated that northern Manhattan condo prices were up 60 percent to $558,000 and those condos on the east side jump 45 percent to about $1.4 million. The report also showed cooperatives’ median sales prices on the east side rose 13 percent to $865,000 and downtown co-op units rose 20 percent to $662,000.

The median price-per-square-foot for Manhattan condominiums rose one percent to $1,022. Median prices of condos between 851 and 1,000 square feet rose by 10.6 percent, and units between 1,001 and 1,500 square feet increased by 5.5 percent. However, median sales prices of units between 1,801 and 2,000 square feet fell 6.7 percent and units 2,001 square feet and larger dropped by 8.7 percent.

Source: Multi Housing News

Rise in existing-home sales is first since February - MarketWatch

2006-12-04T01:24:00.000-05:00

Rise in existing-home sales is first since February - MarketWatch: "By Rex Nutting, MarketWatch
Last Update: 3:18 PM ET Nov 28, 2006

WASHINGTON (MarketWatch) -- Sales of existing U.S. homes rose 0.5% to a seasonally adjusted annual rate of 6.24 million in October, the first increase since February, the National Association of Realtors reported Tuesday.
Inventories of unsold homes on the market continued to grow, while sales prices fell at the fastest pace ever recorded.

The report was better than expected. Economists were forecasting sales to fall to 6.15 million annualized, according to a survey conducted by MarketWatch. See Economic Calendar.

September's sales were revised higher to 6.21 million from 6.18 million initially reported. Sales are down 11.5% from October 2005's 7.05 million pace.

'As expected, existing-home sales appear to be stabilizing, fingers and toes crossed,' said David Lereah, chief economist for the Realtors. Market fundamentals are improving, he said.

Read more

Source: MarketWatch.

Condo group prepares to fight insurance hikes

2006-12-01T15:56:00.000-05:00

Condo group prepares to fight insurance hikes

By MARGIE KACOHA
Daily News Staff Writer

Friday, December 01, 2006

SOUTH PALM BEACH — As with their neighbors to the north, condominium owners are considering banding together in the fight against rising insurance rates.

Leaders of the South Palm Beach Condominiums & Cooperatives Association Wednesday discussed gathering information from the town's 24 associations.

Chairman Murray Fox, who founded the association last year, cited insurance rate increases ranging from 20 percent to 50 percent because of the storms that ripped through Palm Beach County in 2004 and 2005.

"It's gone crazy," Fox said. "It's a mammoth problem."

The Citizens' Association of Palm Beach has formed an insurance committee to analyze the problem and formulate possible solutions.

Fox said the South Palm Beach group will do the same, with the help of Floyd Nichols, an agent with Insurance Office of America in Jupiter.

Nichols was the guest speaker at Wednesday's session at Town Hall, which drew about 70 residents to the 90-minute morning meeting.

Options addressed included self-insurance and the joint purchase of insurance by the associations.

Nichols will assist the group in formulating a list of questions to send out to the individual condominium

associations.

The Citizens' Association of Palm Beach is starting its insurance research in much the same way, sending a survey to each of its member buildings.

Fox said his group will form an insurance committee.

"We're going to start the questionnaires and get the ball rolling," he said.

State legislators will gather in January for a special session to address Florida's insurance woes.

They will use the recent recommendations of the Property and Casualty Insurance Reform Committee as a framework.

Two other issues Fox brought to the meeting were beach restoration and the town's current comprehensive plan review.

"I think the beach is the heart of the town," he said. "Without the beach, we have no town.

"It's time for creative solutions. I don't know what to do, but I'm a businessman," Fox said. "I know how to get things done. We have to be imaginative."

South Palm Beach officials and residents will receive a county report at the Dec. 19 Town Council meeting, outlining recommendations for the shrinking shoreline.

According to preliminary details provided by the Palm Beach County Department of Environmental Resource Management, a full-scale sand-dredging program is not a likely solution because of environmental concerns.

More likely, the town would best be served by constructing a breakwater and possibly rock groins to keep sand on the 5/8-mile-long beach.

Fox also explained the town's current comprehensive plan review after a show of hands indicated that most in attendance did not know of or understand the state-mandated process.

One element of the review is land use within the town, including redevelopment of existing properties.

Residents continue to focus on a preliminary proposal by the Palm Beach Oceanfront Inn to build a high-rise luxury hotel/condominium. The owners have not filed an application for any redevelopment.

Many residents at Wednesday's meeting indicated they would not favor any new building that exceeds the current six-story maximum height. Councilmen Marty Millar, Robert Gottlieb and Chuck McCrosson have indicated they oppose large-scale redevelopment within the town.

Attorney Ron Kolins, who represents the inn, asked residents Wednesday to keep an open mind and assured them any redevelopment application would be subject to town scrutiny and openly discussed in public meetings.

The South Palm Beach Condominiums & Cooperatives Association will hold its next meeting on Dec. 20.

Another Surprise on Rising Home Prices

2006-12-01T01:49:00.000-05:00

Another Surprise on Rising Home Prices: "Another Surprise on Rising Home Prices

Attention, everyone who thinks Zillow knows zippo about home valuations (read some recent blog comments here and here): It ain't just Zillow that's saying home values are up.

Check out this announcement today from the Office of Federal Housing Enterprise Oversight, the organization that oversees mortgage-buying giants Fannie Mae and Freddie Mac. OFHEO (pronounced 'oh-FAY-oh') says that single-family house prices were 7.7% higher in the third quarter of 2006 than one year earlier.* It said they grew at an annual rate of about 3.5% from the second to the third quarter of 2006. A slowdown, but not a decline.

There were declines from the second to the third quarter in only five states: New York, Rhode Island, New Hampshire, Michigan, and Massachusetts. And only Michigan was lower than a year earlier.

Idaho, Utah, Oregon, and Arizona were all up 16% to 17% from a year earlier.

Kind of amazing, when the Census Bureau and National Assn. of Realtor numbers show prices flat to falling. There are a couple of explanations. One is that the OFHEO index covers only single-family, detached homes with conforming mortgages, which currently are around $400,000 or less.

A more interesting difference is that the NAR figures, in particular, have been skewed downward by a change in the mix of homes being sold. When more cheap homes are sold, it pulls down the median sales price. OFHEO uses a statistical method to compare prices as particular homes are sold and resold over the years, avoiding the mix problem.

The OFHEO numbers are consistent with the S&P/Case-Shiller Home Price Indices released Nov. 28, which showed that prices in 10 major markets rose 3.7% in September from a year earlier.

*Asterisk for those who care: The OFHEO index uses valuations reported in refinancings as well as in sales. That number is influenced by overstatement of valuations. OFHEO's purchase-only index shows a 6% increase from a year earlier rather than 7.7%.

Peter Coy
BusinessWeek
November 30, 2006

Philippines set for housing boom - INQ7.net

2006-12-01T00:16:00.000-05:00

Business - Philippines set for housing boom - INQ7.net

Published on Page B3 of the December 1, 2006 issue of the Philippine Daily Inquirer

BANKS have started to aggressively advertise their housing loans with a previously unheard-of 25-year repayment period, in case you have not noticed yet.

"Buying your own home is just as simply affordable as buying appliances," trumpeted Metrobank's Philippine Savings Bank ad campaign, guaranteeing a fixed 11.5 percent interest rate on a 25-year loan.

Drawings of a washing machine (18 monthly installments of P3,480), a plasma TV (24 "gives" of P13,500), and a P1-million house (300 fixed monthly installments of P10,165) adorned the ad.

Even more, PSBank is willing to shave one percentage point off the first year's interest "if you don't get results [in the loan application] in five days or less."

On Thursday, Megaworld Corp. and Security Bank Corp. sought to undercut the competition by offering a lower 11.0 percent fixed interest rate on the same 25-year loan term.

Calling it Homelite, Megaworld, the largest residential condominium developer in the country, sweetened the offer by promising to further cut the interest rate without any prepayment penalty, should the low -inflation, low-interest-rate trajectory continue.

"Homelite is made possible since we are currently enjoying the lowest interest rate environment in our history," an exuberant Megaworld chairman and CEO Andrew Tan said.

"This is the result of our government's success in reigning in the fiscal deficit through a series of fiscal reforms, including raising of taxes and increasing efficiency in tax collection."

Former undersecretary of finance and now a director of Bank of the Philippine Islands, Romeo Bernardo, could not recall any commercial bank that offered a 25-year loan term in the past.

Just to be sure, Bernardo consulted with a colleague, who confirmed that only the government's pension fund unit, the Government Service Insurance System (GSIS), and its private sector counterpart, Social Security System, have had a 25-year repayment scheme, apart from the government's housing-specific Pag-IBIG Fund.

With the real estate industry turning the corner in 2005, Pag-IBIG Fund further stoked the market by slashing to 6.0 percent the interest on low-end housing loans of up to P300,000.

Even better, Pag-IBIG stretched the repayment period to 30 years.

For loans OF from P500,000 up to the P2 million ceiling, Pag-IBIG shaved the interest rate by half a percentage point to a more market-pegged 11.5 percent, still higher than the Megaworld-Security Bank rate.

Megaworld's Tan also predicted that with the lower rate and longer repayment scheme, condo buyers would be enticed to consider bigger units, instead of starting out with broom closets masquerading as studios.

Outlook on Foreclosures and Auctions

2006-11-30T10:46:00.000-05:00

RealEstateJournal | Distressed Real-Estate: Priced to Sell in 2007

We have seen growth in the Foreclosure and Auction markets for Condos in Florida, California and other markets across the country. Most market participants see growth in both these markets.

Wall Street Journal has an interesting article on the current state of these markets which includes high end develpments and condominiums.

Read more...

Interesting Primer on Condo Hotels from New York Times

2006-11-29T17:00:00.000-05:00

Condo Hotels - New York Times

By AMY GUNDERSON
Published: November 29, 2006
Imagine a vacation home complete with 500-thread-count linens on plush mattresses, daily maid service, and a 30-treatment spa. Hotels have rolled out condos at an increasing clip over the last several years, tempting buyers with amenities, hassle-free ownership and the potential for regular rental income, all rolled into one sleek package with a concierge desk.

Like the rest of the housing market, however, condo hotels are not immune to the slowdown, and several projects, after splashy sales releases, have quietly curtailed building plans because of sluggish sales and rising construction costs.

More...

Condo the way to go in Caribbean

2006-11-26T20:29:00.000-05:00

Condo the way to go - CBC.bb

anaging Director of the Caribbean Tourism Investment Management Company predicts that condominiums will replace hotels in Barbados in the not too distant future.

Timothy Boyce says the trend is already taking place in other destinations across the globe.

He argues that research has found the return on investment from hotels is not as great as from condominiums.

Boyce dismissed the argument that hotels generate more employment than the condominium market.

Barbados developer, Island Properties, says it is anxious to develop a number of luxury housing projects on the south and west coasts, but is frustrated by government bureaucracy.

Director, Colin Brewer, says the company has bought for development, two beach front properties in St. James and land on the south coast to build more that 60 condos.

But he tells the Business Report that he fears these two developments may not be realised.

Brewer made the comments following the official opening of his company's St. Lawrence Beach Condominiums which was converted from a hotel.

He says condominiums are the way to go.

Visit this link to see video.

Online Real Estate Portal Begins Reverse Publishing into The Miami Herald

2006-11-21T17:19:00.000-05:00

Advertisers on US Condo Exchange can now buy classified ads in the Miami Herald and El Nuevo Herald to compliment online exposure.

Miami, FL – November 21, 2006 - US Condo Exchange, LLC., a global advertising portal and international listing service for condos and townhomes announced today that they have added print classified ads to the available advertising opportunities on the site. Classified liner ads to be run in the Miami Herald and El Nuevo Herald are now available for purchase on www.uscondex.com for people seeking additional print exposure for their online listing.

Using reverse publishing technology, US Condo Exchange customers can purchase 14-day and 28-day liner ads through the site which are then posted to the Miami Herald in real time and run in Herald publications based on the customer’s desired run dates. This functionality allows the Miami Herald and US Condo Exchange to offer advertisers a mix of both print and online exposure within their marketing partnership. “The deployment of this functionality on our site creates additional value for our advertisers and our partner the Miami Herald” said CEO Richard Swerdlow. “With the new functionality we can serve as an online reseller of print classified ads and drive incremental revenues to a variety of media partners.”

US Condo Exchange is a global advertising portal and international listing service for condos. The Company currently has over 155,000 condos located in the US and in 40 countries around the world listed on the site, valued at over $60 billion. US Condo Exchange cost-effectively delivers unparalleled international exposure to developers, brokers, and for-sale-by-owner sellers. The Company also partners with major media companies to automate the listing of for-sale and for-rent condo ads.

The Miami Herald is the leading daily newspaper in South Florida reaching nearly 1.4 million readers weekly. It has a 100 year history of quality journalism and has won 18 Pulitzer prizes. The Herald is owned by the McClatchy Company, a leading newspaper and internet publisher dedicated to the values of quality journalism, free expression and community service.

Lower rates coming?

2006-11-20T14:55:00.000-05:00

An Awful October for Housing Starts

With new-home construction dropping to its lowest level in over six years, markets are betting the Fed could start cutting rates by June

by Michael Englund and Rick MacDonald for Businessweek.com

The U.S. housing slump appears to be deepening based on a government report released Nov. 17. Housing starts plunged 14.6% in October to a 1.486-million-unit annual pace—well below economists' median forecast of a 1.70-million-unit pace. Starts have now fallen in seven of the last nine months, and are currently at the lowest level since July, 2000.

The massive drop in October bucked the trend of improvement in other housing sector indicators since the big June-August downside correction and has left the market still focused on downside housing market risk.

U.S. REIT shares cool amid condo glut

2006-11-13T13:17:00.000-05:00

U.S. REIT shares cool amid condo glut - Barron's

NEW YORK, Nov 12 (Reuters) - Shares of Real Estate Investment Trusts are cooling due to a soft market for condominiums in the United States, according to financial publication Barron's.

Equity Residential (EQR.N: Quote, Profile, Research), the largest U.S. publicly traded apartment owner, said that the market for condos in Florida has limited one-time gains from converting rental apartments, with similar conditions possible in California, Phoenix and Washington, D.C., according to the financial newspaper.

Tearing Down A Brick Wall: The Problem With Sellers

2006-11-12T12:52:00.000-05:00

Tearing Down A Brick Wall: The Problem With Sellers

You know the saying…Can’t live with ‘em, can’t live without them.

…when the masses believe something is a good idea, it takes a sturdy soul to resist the trends. We just saw this in the recent housing boom. Buyers are more closely associated with this group behavior and sellers are happy to oblige. The flock or herd mentality reigns.

The same is true in the opposite scenario. Buyers have been quick to react to weaker market conditions, but as evidenced by their pile-on behavior a few years ago, then tend to overreact and expect a large discount on their purchase. Sellers are the “other” half of the buyer-seller equation and they are creating havoc by their unwillingness to realign with current market conditions.

My old rule of thumb: sellers take about 3 quarters to readjust to weaker market conditions. Thats been thrown out the window since its been 5 quarters since the end of the housing boom (mid-2005) and seller resolve remains relatively strong.

This has been one of the reasons that certain vulnerable real estate markets haven’t seen a significant price correction. Although buyers don’t have a sense of urgency, sellers are in denial about weaker market conditions. The result? Sales activity drops sharply until someone or both budge for their position. Brokers are frustrated because they have limited flexibility with today’s sellers [Realty Times]. They gear up for the sale with advertising, open houses and other marketing strategies but if a seller isn’t ready to enter the market realistically with the right price, the effort is largely a waste of time and money.

Generation X is Looking For A Different Home Than The Baby Boomers � The Real Estate Bloggers

2006-11-08T08:35:00.000-05:00

Generation X is Looking For A Different Home Than The Baby Boomers

As the Baby Boomers start to gray, Generation X is coming to the forefront in the minds of homesellers and builders. And what is interesting, the homes that the baby boomers craved is not the same home that the Gen-Xers are looking for. The Real Estate Journal has an informative article on the changing demographics of home building and home buying.

Homeownership Goes Through The Roof

2006-11-08T08:33:00.000-05:00

Matrix Homeownership Goes Through The Roof

The Federal Reserve Bank of San Francisco recently published a study on the The Rise In Homeownership (hat tip to Economist’s View).

The study explored the causes of the rapid rise in homeownership over the past decade. Entities like Fannie Mae and Freddie Mac have focused on helping as many as possible attain the American Dream: home ownership.

New look -- Housing futures

2006-11-08T08:31:00.001-05:00

Bear market in housing futures - Nov. 2, 2006

Investors and homeowners can now trade financial securities to hedge their exposure to real estate. I believe this will lead to the ability to sell houses with "downside protection."

Right now the contracts are limited to price changes over 12 months. I believe the timeframe for these securities will stretch out to 5 and then 30 years and these instruments will serve as price insurance for homebuyers....removing some of the hesitancy to purchase due to buyers desire to time the markets.

New look -- Housing futures

2006-11-08T08:31:00.000-05:00

ClickPress | Dr. Naphtali Rishe, Renowned Database and Geographical Internet Pioneer, Joins US Condo Exchange Advisory Board

2006-11-06T18:07:00.000-05:00

ClickPress | Dr. Naphtali Rishe, Renowned Database and Geographical Internet Pioneer, Joins US Condo Exchange Adv

S Condo Exchange, LLC, www.uscondex.com, the first global advertising portal and international listing service for condos, announced today that Dr. Naphtali Rishe, the Founder and Director of the High Performance Database Research Center at Florida International University, has joined the US Condo Exchange Advisory Board.

[ClickPress, Mon Nov 06 2006] US Condo Exchange, LLC, www.uscondex.com, the first global advertising portal and international listing service for condos, announced today that Dr. Naphtali Rishe, the Founder and Director of the High Performance Database Research Center at Florida International University, has joined the US Condo Exchange Advisory Board. Mr. Rishe is an international pioneer in the use of Internet programming for satellite imagery of geographical information, with his work supported by NASA, the National Science Foundation and IBM. The primary outlet for that work is Terrafly, www.terrafly.com, which Rishe founded, a website with technology that allows users to “fly over” vast land areas to view everything from satellite 3-D views of buildings and their surroundings, to maps showing the contour, shapes and elevation of land. The service also shows billions of pieces of data, including neighborhood and demographic information, schools, economic data, property comps and more. Terrafly was developed in partnership with the US Geological Survey, www.usgs.gov. Dr. Rishe now brings his unique expertise and insight to US Condo Exchange, which continues to develop cutting edge web-based solutions for condo developers, brokers, buyers and sellers.

Old tricks combine with new technology in today's competitive real estate climate

2006-11-06T18:05:00.000-05:00

Read More

Old tricks combine with new technology in today's competitive real estate climate

ORLANDO, Fla. – Nov. 6, 2006 – Rhonda Morgan has pulled out all the stops for her recent open houses: big signs, balloons and people in costumes out by the street waving to passers-by. The Orlando Realtor bakes cookies in the listed homes and sometimes serves wine and cheese.

But Morgan, who was a computer-systems administrator before switching careers a year ago, spends most of her time selling real estate on the Internet: doing research, updating electronic listings and interviewing prospective customers.

"I probably spend 70 percent of my time on my computer," Morgan, 41, said.

As the nation's housing market comes off a five-year boom, real-estate agents here and elsewhere are resorting to all the usual tricks of the trade to encourage home sales.

This time around, however, technology – specifically, the Internet – is changing, in fundamental ways, the nature of the process.

Although there may always be sign-waving clowns and cookies baking in the oven, the Internet is playing a bigger role in how the industry interacts with clients and prospective home buyers.

Coldwell Banker Real Estate Corp., for example, parent company of Florida's largest residential real estate agency, recently launched an online service that allows potential customers to receive personalized listings and daily mortgage updates.

The company also allows would-be home buyers to type questions on its Florida-specific Web site, floridamoves.com, which automatically generates voice mails for a quick response from a nearby agent.

Online searches take off

The Realtors' Multiple Listing Service, once a closely guarded list of homes for sale by professionals, is now more widely available at many Web sites. And new online services launch almost weekly.

The National Association of Realtors estimates that three of every four home buyers now use the Internet to search for a house; every month, about 16 million people browse the group's property listings online.

Almost eight of every 10 real-estate firms have a Web site, half of which have been up and running for more than five years.

"We're moving down the Internet highway, and now we're moving a lot faster," said Houston Briggs, an independent agent near Kissimmee who buys and sells rental properties and teaches real estate at Valencia Community College.

"It's just so much easier to do research now, particularly in public records," Briggs said.

Many real estate Web sites also map the location of listed homes, calculate monthly mortgage payments, post local school ratings, provide "virtual tours" and serve up photos from ground level to bird's-eye.

Realtors say the shift to the Internet is both intimidating and empowering.

The transition favors agents who are nimble and tech-savvy; it also extends the marketing reach of individuals and small agencies, putting them on a more even footing with larger competitors.

"My background in technology has given me an upper hand," said Morgan, who switched to real estate last year just as Orlando's existing-home market began retreating from record heights.

Morgan promotes her listings on three Web sites: her own; one for the small Orlando real-estate firm she works for, Exit Real Estate Results; and the nationally known Realtor.com.

Morgan pays a premium of about $800 a year for extra bells and whistles on Realtor.com, allowing her to display multiple photos, a scrolling marquee and yellow highlights.

Gannett Newsroom Restructures for Digital

2006-11-05T12:47:00.000-05:00

Lost Remote TV Blog

US Condo Exchange in the news - Auctions coming to the condo market

2006-11-01T13:28:00.000-05:00

Auctions coming to the Condo MArket

A new way to hedge against falling housing values

2006-08-31T09:01:00.000-04:00

A new way to hedge against falling housing values

"the Chicago Mercantile Exchange quietly began trading futures contracts on home resale values last May. The contracts are based on the Standard & Poor's Case-Shiller Metro Area House Price indexes, which track price changes of existing homes in 10 major metro markets."

Southern Florida Condo Market Set to Take a Dive � The Real Estate Bloggers

2006-08-24T17:14:00.000-04:00

Southern Florida Condo Market Set to Take a Dive

The condo marketplace in Southern Florida is coming to a screeching halt as the speculators have left and the developers are looking at an over supplied market. Speculators, or flippers, have been very active in the south Florida condo market driving up prices and demand at a record rate.

Many pundits attributed the velocity of the market to foreign demand and relocation. Now that interest rates have declined and the market slowed, many of the condos that have been recently built are just partially filled and those that bought to flip are try to sell desperately.

Inman Real Estate News - Demand for housing not dependent on interest rates

2006-08-24T16:28:00.000-04:00

Demand for housing not dependent on interest rates

Soaring condo plans come down to earth

2006-08-24T12:30:00.000-04:00

Brought to you by

Jack Snyder

The unprecedented boom in condominium towers is remaking downtown Orlando's skyline. But with fewer than half of the 30 announced projects completed or under construction, the timing -- even the survival -- of the rest is now in question because of rising costs and prices.

Developers who a couple of years ago could have sat back and taken deposits from eager buyers before starting work on a building are now battling fiercely for attention, hoping to snare enough sales to justify a construction loan.

Those 18 unbuilt projects are competing not only with one another but with the eight towers that are being built and with sales in the four that are already open. They also have to contend with the thousands of city-center units in apartment-to-condo conversions.

Two of the towers now under construction contain apartments, not condos, reflecting a renewed demand for rental housing now that several years of conversion activity has consumed most of the apartment complexes in the downtown core.

The two big questions for most of the remaining towers are: How high will their asking prices be pushed by still-rising construction costs? And can they find enough buyers in an increasingly expensive market to obtain the financing needed for actual work to start?

"At best, there could be delays," said Charlie Lentz, managing director in Orlando for Integra Realty Resources, Inc., a national real-estate-consulting firm. "At worst, some projects may not be financially feasible at this time."

Construction costs are "the number one thing killing some projects or putting them on hold," said Tim Baker, a principal at Baker Barrios Architects, an Orlando architectural firm that has done the design and planning work for more than a dozen of the downtown projects.

"Dealing with costs was huge," said Scott Stahley, senior vice president of Lincoln Property Co., which just started building the 32-story Dynetech Centre at Magnolia Avenue and Washington Street after months of delay. The tower will have 164 rental apartments.

Rising costs so concerned developers of The Paramount, a condo tower now under construction on east Central Boulevard, that "we were borderline on whether to go forward," said Steve Patterson, chief executive officer of Zom Inc., the venture's majority partner.

Asked how profitable the 312-unit tower would turn out to be, Patterson replied: "I'll let you know when construction is done."

Both Lincoln Property and Zom are nationally known developers, with solid track records and strong relationships with lenders. But lesser lights could face an uphill fight to secure financing for their projects, said Jamie Buckland, senior vice president and commercial-banking director for EverBank Financial Corp., a Jacksonville-based bank that just opened an Orlando office.

"It's an entirely different market today," Buckland said. "Lenders are only going to consider the most solid deals."

The push for sales

What makes a solid deal? Solid sales, for one thing.

JLJ Properties LLC of Lake Mary, which wants to build a 510-unit condo complex called Eola Place, recently spent thousands of dollars to wine and dine local real-estate agents in the hope they will steer prospective buyers its way. More than 300 Realtors turned out for the free martinis and food.

Even so, the developer is pushing ahead with sales for just one tower with 196 units.

"It would be crazy to try and bite off the whole thing right now," said John Bahng, a partner in the venture. Bahng would not disclose what percentage of the tower's units the company has to sell before a bank will open its vault, saying only that he is talking with several interested lenders.

Condominiums and downtown Orlando didn't mix well for years. Only two high-rise condos were built downtown before the turn of the century -- Park Lake Towers in the 1970s and 530 East Central in the 1980s -- and both sold poorly. But as the region's and the nation's housing markets set off on a five-year boom early in this decade, so did people's interest in living in Orlando's city center.

More than a score of projects were announced. The Waverly, downtown's first luxury apartment high-rise when it opened in 2001, went condo two years later. Downtown's first condo high-rise project in two decades, The Sanctuary, opened last year. Two mid-rise condos, Thornton Park Central and The Jackson, opened during that same time frame.

The 26 other condo or apartment projects under construction or in planning stages would, if all completed, add more than 7,000 residential units to the downtown core.

But the housing market has softened this year, and some of the downtown projects are clearly stalled. North Orange Condominiums, for example, was first proposed in late 2002 as apartments for a site just north of Colonial Drive. Yet the site remains vacant, a sales office has come and gone, and the developer couldn't be reached for comment last week.

A few other developers are forging ahead with sales campaigns in hopes of landing enough buyers to attract lenders' interest.

Sales are to kick off in a few weeks at The Monarch, a tower off South Street near State Road 408. Prices for The Monarch's condominiums are expected to start in the high $300,000s.

The goal for Tradition Towers, to rise on the site of the University Club on Central Boulevard, is to pre-sell half the building's 276 units to trigger construction financing. Although building costs have soared 50 percent since the project was first planned more than two years ago, buyers for the project's luxury apartments are still out there, according to Steve Walsh, president of Broad Street Partners, the developer.

"We just sold a 4,200-square-foot penthouse for $2.3 million," said Walsh, who expects to have enough buyers in hand to break ground in four to six months.

In the Orlando area, condo sales generally have remained stronger than single-family home sales, which peaked last summer. That's because the typical condo unit still sells for less than $200,000, while the median price for a single-family dwelling is somewhere north of $250,000.

As a result, the number of condos sold in the Orlando area during the first half of the year, while slowing in recent months, was still 51 percent ahead of last year's first-half total, even as single-family sales fell nearly 10 percent behind last year's record-setting pace.

Downtown demand

But in downtown Orlando, prices for condos have been soaring because towers, already an expensive form of residential construction, have been particularly affected by the rising cost of materials and labor the past couple of years. And rising interest rates are making it harder for prospective buyers to qualify for a mortgage.

City-center condos are still in demand, said Craig Ustler Jr., a downtown developer and president of CondoHQ Orlando LLC, the brokerage handling sales at 55 West on Church Street.

"Thousands of people want to live downtown," he said. "It has become a question for many whether they can afford to."

The 55 West project, announced more than three years ago, was delayed for months as the developers rewrote their price list and added more units to the tower before starting construction late last year. The 405-unit building is now 75 percent sold, Ustler said.

A partner in what would be downtown's biggest project -- Orlando City Place, at Colonial Drive and Hughey Street -- sees the current market squeeze as a normal correction that won't affect his plans.

"We're going forward," said George Kalivretenos. The developers have completed their transformation of the former Holiday Inn into The Lexington condo-hotel and will start work next year on more than 1,200 condos and apartments, he said, with office and retail space.

GDC Properties Inc., a New York-based developer with extensive Florida operations, says it expects to have no problems financing its mixed-use apartment project in downtown Orlando.

The project, once called The Ivanhoe, has since been renamed Verde. In planning stages since 2004, it would feature twin 35-story towers with a total of 476 apartments at North Orange Avenue and Marks Street.

GDC President William Ingraham said construction is now expected to start late this year or early next. "Market conditions are ideal right now for a rental community of this scope," he said.

Heathrow-based Wescar Cos. recently bought property at North Magnolia Avenue and Marks Street, including the old Lunch Basket building, with the intention of putting 80 to 100 condos on the site.

But at this point, the company is starting design work only.

"We'll be in no rush," said Wesley Geys, the company's vice president. "We'll let the market tell us when the time's right."

Florida leads nation in housing growth

2006-08-24T11:38:00.000-04:00

Brought to you by

For the second year in a row, Flagler County, Fla., had the highest rate of growth in the number of housing units of any county in the nation, according to U.S. Census Bureau estimates released today.

The estimates cover July 1, 2004, to July 1, 2005, and show that Flagler's housing stock increased by 14.8 percent, or more than 5,000 units. Flagler had added more than 4,000 housing units a year earlier.

Three other Florida counties made the top 10 with the highest rate of growth in housing stock: Sumter (ranking second); Osceola (fourth); and St. Lucie (ninth).

The remainder of the top 10 consisted of Pinal, Ariz. (third); Franklin, Wash. (fifth); Culpeper, Va. (sixth); Washington, Utah (seventh); Kendall, Ill. (eighth); and Rockwall, Texas (10th).

The United States had an estimated 124.5 million housing units as of July 1, 2005, representing an increase of 1.8 million, or 1.5 percent, since July 1, 2004.

Florida also topped the list of the states adding the highest number of housing units, gaining 247,000 homes over the period. Following Florida were California (182,000), Texas (179,000), Georgia (98,000) and Arizona (87,000).

Maricopa (Phoenix), Ariz., was the biggest numerical gainer among counties, adding 52,000 homes over the period, followed by Clark County (Las Vegas), Nev., and Harris County (Houston), Texas, which gained 35,000 and 34,000 units, respectively.

At the state level, four of the five states that had the most rapid housing growth are located in the West: Nevada (first with a growth rate of 4.4 percent); Arizona (second at 3.5 percent); Florida (third at 3.1 percent); Idaho (fourth at 2.9 percent); and Utah (fifth at 2.9 percent).

Nevada's growth rate was almost three times faster than housing unit growth for the nation as a whole, according to the Census Bureau.

The estimates are based on Census 2000 counts supplemented by administrative records such as building permits.

New Signs of Cooling in Housing - New York Times

2006-08-24T01:22:00.000-04:00

New Signs of Cooling in Housing - New York Times

In the latest and strongest indication that the home buying and selling frenzy is over, the National Association of Realtors reported yesterday that sales of previously owned homes fell to the lowest level in July in more than two years, prices flattened and sellers waited longer and longer to find buyers for their homes. The supply of unsold houses on the market hit a record high.

Movin' Out

2006-08-21T08:00:00.001-04:00

Movin' Out

Sales data released yesterday by the National Association of Realtors showed a clear pattern--the states with the biggest drops in home sales were the ones who've seen the steepest price appreciation over the past few years.

World Property Investment Hot Spot Map

2006-08-20T14:24:00.000-04:00

World Property Investment Hot Spot Map

Top 10 Most Expensive Rental Markets 2006 � The Real Estate Bloggers

2006-08-19T10:34:00.000-04:00

Top 10 Most Expensive Rental Markets 2006 � The Real Estate Bloggers

Condo Conversion Planned for Former Detroit Office Buildings

2006-08-15T13:30:00.000-04:00

Brought to you by

The Pagan Organization has purchased the Book Tower and Book Building in downtown Detroit and plan to convert a portion of both properties into luxury condominiums. The New York investment and development group led by Ricardo Pagan, acquired the buildings for an undisclosed price. Book Tower is a 38-story office building built in 1928 and the Book Building has 13 stories and was also built 1928.

Hotel-condo idea a win-win?

2006-08-10T10:56:00.000-04:00

Brought to you by

Donna Hogan

Adding and selling living quarters offers a perfect solution for developers trying to finance a new or redeveloped hotel. And it gives well-heeled consumers the opportunity to live in a resort atmosphere - full time or just for vacations. It sounds like a win for everybody, said Jim Butler, a L os Angeles based lawyer who specializes in the legal aspect of condo hotels. But the hardly-new-butsuddenly-the-rage concept generates a plethora of legal and financial consequences, he said.

For consumers. For developers. Even for towns and cities dependent on hotel revenue to pay for roads, parks and other municipal services.

Paradise Valley, a town of panoramic mountain vistas, multi-million dollar homes and no shopping malls, is totally dependent on the resorts and the high-end restaurants and boutique retail shops that go along with them to fill coffers with bed tax and sales tax collected from hotel guests.

Every luxury hotel room developed or redeveloped instead as a luxury condo means a big chunk of lost bed tax - charges added to hotel tabs.

Three so-called mixed-use resorts - Montelucia, Mountain Shadows and Ritz-Carlton - are currently in various stages of development in Paradise Valley. But the typically laid-back town government has gotten aggressive about preserving its income.

"We addressed it with Montelucia through a development agreement," said Tom Martinsen, town manager. "The resort will pay the town 'in lieu bed and sales taxes' each year, guaranteeing the town a stable flow of revenue. We expect to do the same with Mountain Shadows and Ritz Carlton."

The geographically small town is such a desirable spot for resort developers, Paradise Valley can gain such accords by withholding approvals, Martinsen said.

But even for cities with more diverse revenue streams, the loss of bed tax is still a concern.

"As an industry there is a lot of confusion about whether condos add or take away from (tourism revenue)," said Rachel Sacco, president of the Scottsdale Convention & Visitors Bureau. "But what we do know is most developments and redevelopments now include condos. We're looking at how it will play out."

So are the industry trackers, trying to make new rules for the hybrid hotel developments.

"It can be disastrous if not done right," Butler said. "The front-end structure determines whether a project will be successful or not. You have all the issues with a hotel and all the issues with condos. And when the two intersect, it creates problems that don't exist in either world."

Besides the liability, security and "common area" maintenance rules that real estate experts for condos or hotels are used to dealing with, a condo hotel developer has to determine, before selling the first residential unit, how the units will be controlled and marketed.

For example, the Securities and Exchange Commission says if a person buys a hotel suite as an investment it's a security - just like a stock share - and has to be registered and sold by a securities broker, Butler said. If it's sold as a home, it's considered real estate and is bought and sold like any other housing purchase.

If it's marketed as both - a place to live for a few weeks a year and add to the hotel pool to be rented to overnight guests the rest of the time, it is still considered a security and can cause huge problems for the purchaser, Butler said.

"It just doesn't work as a security, and that makes marketing difficult," he said. "They can't even tell you about the rental program, although once a unit is purchased they can offer one."

And what about those purchased with plans to rent the rooms most or all of the year? For such a business model to be effective, a hotel needs to know exactly how many rooms it has to sell at any time, especially for meeting planners, who book months, sometimes even a year or more in advance.

That means the hotel needs control over when an owner can use his own property, Butler said.

And just about everything else, such as decor and furnishings.

"If you wanted to put pink carpeting or weird decor in your condo, it wouldn't work in a hotel environment," Butler said. "If you are a guest staying at a W or a Westin, you expect a certain image."

Camelback Inn in Paradise Valley, which has been a condo hotel since 1972, has a structure that works well, said Clark Albright, director of sales and marketing.

Owners let hotel management know nine months in advance during peak months and three months ahead in the off-season if they plan to use their casita, he said. Marriott controls all the furnishings and a board made up of owners approves all capital expenditures, he said.

3 Greenwich, Conn., Multifamily Properties Sell for $50Mln, to Go Condo

2006-08-10T10:27:00.000-04:00

Brought to you by

Jill Ambroz,

Prescott Capital Management LLC has acquired three newly-constructed townhouse projects in Greenwich, Conn., for about $50 million, with plans to convert the properties to condominiums.

The properties include two buildings near Greenwich Avenue, 17-unit Milbank Commons, and Field Crest, with seven units, and Holly Hill, which has 10 luxury units off of West Putnam Avenue.

Prudential Connecticut has been tapped to market the units for sale.

Prescott Capital Management is a unit of New York real estate merchant banking firm, The Prescott Group LLC, which two years ago lined up equity for investments from the family of Gordon P. Getty

Anaheim, Calif., Mixed-Use Condo Project Secures $17.2Mln in Financing

2006-08-10T10:11:00.000-04:00

Brought to you by

Jill Ambroz,

A venture between Urban West Strategies and St. Clair Meyers Partners has secured $17.2 million in financing for a mixed-use development project near the Platinum Triangle in Anaheim, Calif.

Five Mile Capital Partners is providing the two-year, fixed-rate loan. Holliday Fenoglio Fowler LP arranged the financing.

The proceeds from the loan will be used for the acquisition and entitlement process of the property.

The venture plans to redevelop an 11.8-acre site at 593 West Ball Road into a 449-unit residential condominium project with retail space and underground garages. The project, to be called Parc Anaheim, will replace a 296-space recreational vehicle park. All existing structures will be razed.

Developer Urban West Strategies has projects underway throughout Orange and San Diego Counties in California. St. Clair Meyers Partners is an Orange County developer with projects in California and Arizona.

Morgans/Hudson Venture Pays $110Mln for Miami Apartments, Plans Hotel Conversion

2006-08-10T10:05:00.000-04:00

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A joint venture between Morgans Hotel Group Co. and an affiliate of Hudson Capital has paid $110 million for a Miami apartment property that will be converted into a 342-room hotel.

Upon completion of the $60 million transformation, the hotel will be the fourth property to operate under Morgans' Mondrian brand. The other hotels are in Los Angeles, Scottsdale, Ariz., and Las Vegas. Morgans will oversee the hotel's management.

The Morgans/Hudson Capital venture will fund the purchase and renovations with $124 million in financing provided by Eurohypo AG. The financing carries a rate of 300 basis points over Libor.

The 16-story Mondrian will have a mix of studios, one- and two-bedroom rooms, and four penthouse suites. The venture could sell the units as hotel condominiums. Amenities include restaurants, meeting and event space, a spa, and boat slips for guests to park yachts and sailboats.

Corus Provides $142.5Mln for Philadelphia Condo Project

2006-08-10T10:00:00.000-04:00

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A joint venture between P&A Associates and Thomas Properties Group has lined up $142.5 million in construction financing for The Murano, a 302-unit condominium tower in Philadelphia.

The venture received the financing from Corus Bank, a Chicago lender. The fixed-rate loan carries a three-year term, but can be extended for up to one year.

The 43-story Murano will sit at the corner of 21^st and Market streets in downtown Philadelphia. It will have a 304-space parking garage and ground-floor retail.

San Francisco, Boston, and Other 'Superstar Cities'

2006-08-10T09:58:00.000-04:00

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Peter Coy

Economists have twisted themselves in knots trying to explain why housing prices in cities like San Francisco and Boston are so high. One theory says that the cities have better amenities. Another says that moving to these cities makes workers more productive (presumably because of the higher quality of their colleagues) so people will pay more to live there.

Lately, though, three economists from Philadelphia and New York have been pushing a completely different argument, which is a version of the old riddle about what happens when an irresistible force meets an immovable object.

The irresistible force, in their telling, is rapidly rising incomes in the top tier of the U.S. population. Their immovable object is the supply of buildable land in "superstar cities," which are mainly along the coasts where there isn't much room to grow.

Simply put, a certain percentage of rich Americans would like to live for whatever reason in, say, San Francisco. But at some point, there's no more room to build there. So the arrivistes have to pay a premium to move in. Prices go up. The number of rich Americans keeps going up and the number of houses in San Francisco doesn't. So the rich newcomers are pushed out by even richer newer-comers. And before you know it, people are paying millions of dollars for houses that would go for $150,000 in Rochester. (Pictured is a house you won't find in Rochester. It's a Spanish-style home in San Francisco on the cliffs above China Beach, going for $23.5 million, offered by Alain Pinel, Realtors.)

What goes for San Francisco goes for other superstar cities such as Los Angeles, Boston, New York, and Seattle, say the authors: Joseph Gyourko and Todd Sinai of the University of Pennsylvania's Wharton School and Christopher Mayer of Columbia University's Graduate School of Business.

The authors sum it up this way: "Living in a superstar city is like owning a scarce luxury good."

Their theory implies that the price gap between superstar cities and the rest could get even bigger in coming years if incomes of rich Americans continue to rise and the supply of houses in the cities remains fixed. The U.S. population will simply re-sort itself again, with the richest supplanting the slightly less rich from their homes along

Developers nix or delay condo projects as sales slow, costs rise

2006-08-08T10:24:00.000-04:00

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Deborah Yao

PHILADELPHIA - More and more developers are canceling or delaying condominium projects as home sales slow, construction costs soar and lenders balk at financing units that might not sell.

What's making the situation worse is a glut of high-priced condos and too few people who can afford them.

SOME COULD BECOME RENTALS: It's called "reconversion"

In Philadelphia, a city cluttered with condominium construction, Old City 205 aspired to shine as an ultramodern residence for the well-heeled with its zinc and glass facade, loft-style homes and windows that span floor to ceiling.

But the $40 million project in Philadelphia's Old City neighborhood won't break ground after the housing market softened and increasingly picky buyers balked at its price tags from $400,000 for a studio to over $2 million for a three-bedroom penthouse.

Brown Hill Development, the company behind the project, saw the slowdown in home buying and decided it didn't want to be left with unsold units, said partner Greg Hill.

"We've gone through the biggest real estate boom in the last eight or nine years and some of these projects haven't started yet. Do you think they're going to start building now?" said real estate executive Allan Domb, dubbed Philadelphia's "condo king."

In Las Vegas, projects nixed include high-profile developments such as Aqua Blue, a $600 million, 825-unit luxury condominium-hotel resort that counted former basketball superstar Michael Jordan as an investor; the $3 billion, 4,400-unit Las Ramblas resort, backed by actor George Clooney; and Ivana Las Vegas, a $700 million, 945-unit tower named after Donald Trump's ex-wife.

Related Las Vegas, one of the two developers for Las Ramblas, cited rising construction costs and slowing sales for the cancellation.

In South Florida, canceled condo developments include 1390 Brickell Bay and ICE in Miami, Fort Lauderdale's The Waves Las Olas, and Promenade in Palm Beach County. WCI Communities, a luxury home builder based in Bonita Springs, Fla., said in June that new orders for its high-rise condominiums fell 84% in the second quarter. The company will now go forward with only three to five condo projects in 2006, down from as many as 15 to 17, mostly in Florida.

With housing sales looking increasingly anemic, it's not surprising that developers are bailing out.

Domb in Philadelphia said he's gotten half a dozen phone calls the past four weeks from developers asking if he would like to buy their properties.

In May, the volume of apartment-to-condo conversions plunged to $334 million from $1.65 billion a year ago, said Gleb Nechayev, senior economist at Torto Wheaton Research, a real estate research firm in Boston owned by CB Richard Ellis. The all-time high was $4 billion last September.

Builder confidence, measured by the National Association of Home Builders/Wells Fargo Housing Market Index, fell in June to its lowest level since April 1995. Confidence took a hit due to rising mortgage rates, high home prices and investors and speculators fleeing the market.

The index surveyed builders of single-family homes, where the sales decline hasn't been as severe as for condos.

Jack McCabe, chief executive of McCabe Research and Consulting in Deerfield Beach, Fla., said desperate developers with finished condos are offering incentives in South Florida.

Freebies range from one year's free mortgage to the use of a yacht or upgraded kitchen packages. McCabe thinks some developers might even sell condo units at cost if sales continue to weaken.

McCabe believes the condo market, especially the luxury end, is at risk of a crash. Over the next few years, he sees prices falling by double-digit percentages.

The luxury condo surplus is to blame. McCabe said about 25,000 condos are under construction in Miami-Dade County, with two-thirds costing $700,000 or higher; another 25,000 units have gotten building permits and 50,000 have been announced for future construction.

McCabe said the median household income in the county qualifies local buyers for a $225,000 home, so the luxury units are targeted mainly toward affluent, out-of-state buyers.

Meanwhile, speculators have driven up prices by flipping units, he said. But they're now leaving the market - driving down demand - and putting up for sale properties they own, adding to the glut.

Aside from Miami, he said areas at risk include Boston, San Diego, Las Vegas, Seattle, Chicago, Orlando, Washington, D.C., and Manhattan.

A big part of the problem is that many condo projects are priced high, in part because developers have to recoup the high prices they paid for land. But most buyers can't afford it.

"The sweet spot of the market is probably $250,000 to $700,000," Domb said. "That's what the majority of the population can afford. Many condos are priced higher. That's part of the problem."

Tell that to The Donald. Real estate mogul Donald Trump told the Associated Press that he's going ahead with his 45-story waterfront luxury high rise called Trump Tower Philadelphia.

"It's doing fine," Trump said. "It's been intense. So many people want to move there."

He said that doesn't surprise him, because his name sells.

Austin Post Office May Go Condo

2006-08-07T17:04:00.000-04:00

Brought to you by

Kirk Ladendorf, Kate Alexander

The U.S. Postal Service is seeking development proposals for its downtown site, opening up new possibilities for more residential development.

The Postal Service has set an Aug. 20 deadline for proposals for the site at 510 Guadalupe St. between West Fifth and West Sixth streets.

Already, one developer says it's very interested, and city officials say they expect more will make a bid for the block, especially given the shrinking supply of downtown land that doesn't have height restrictions.

"We absolutely plan to respond to it," said Billy Holley, a developer for Austin projects at Novare Group.

The Atlanta company, with local partner Andrews Urban LLC, is building the 430-unit condominium tower called 360 at Third and Nueces streets. The developers also are partners in a planned major renovation of the Austin Music Hall.

"Our goal is to support Austin's vision for a diverse and vibrant core, so it's definitely something we'll pursue," Holley said.

Mayor Will Wynn said he has been lobbying postal officials in Washington to put the land up for redevelopment, to help achieve the city's goal of having 25,000 people living downtown within 10 years.

"No block in downtown Austin has been more underutilized than the one occupied by our current post office," Wynn said in a statement Thursday. "I have desperately wanted to see it play its rightful role in the revitali- zation of downtown."

The post office, completed in 1996 at a cost of $6.2 million, is two stories high and occupies about a fourth of the block, with the rest used for parking. It's north of Republic Square Park.

"This is a prime piece of property that, if put in private hands could generate a building of high value to downtown and to the city and could build a great deal of tax base to the benefit of everyone," said Charles Betts, executive director of the Downtown Austin Alliance.

The Postal Service says that any proposals must include a plan for building a new post office on part of the property or within a block.

There will be plenty of interest, Council Member Brewster McCracken said, because the site isn't affected by the Capitol view corridor law, which limits development on some downtown sites to protect views of the Capitol from certain vantage points.

Some downtown leaders say they'd be happy to see something replace the post office, which has been criticized as an unattractive design.

"It's about time that something happens with that site," said Kevin Burns, owner of Urbanspace Realtors LLP and vice president of the Downtown Austin Neighborhood Association. "It's a hideous block."

The block is pivotal to creating a vibrant downtown, Burns said, because it serves as a link between the high-rise residences on the west end and along the Congress Avenue corridor.

"We should have something spectacular there," he said.

Lowe Venture Plans $300Mln Mixed-Use Development in D.C.

2006-08-07T16:22:00.000-04:00

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Condo Project Planned for Downtown Indianapolis

2006-08-07T11:43:00.000-04:00

Brought to you by

Eric Martin

Mass Ave. has long been a powerful draw for boutique shoppers, fans of the performing arts and people seeking trendy dining, but lately the allure and size of the street's residential developments have been getting a lot bigger.

Large luxury condos are making their way to the avenue and will take up the majority of a new 10-story building planned at the street's south end -- a development that will continue a condo boom that is expected to create more than 1,100 Downtown units by 2010.

The building, known as Three Mass Ave, will stand adjacent to and south of McNiven's Restaurant and Bar on what is now a parking lot bordered by New York Street. The first floor will hold 19,000 feet of retail space, perhaps including a wine shop, organic grocery store or sidewalk cafe. The upper nine floors will house 46 residences, some with two stories. Units will be priced from $400,000 for two-bedroom, two-bath condos to $2 million for custom-built penthouses. The project also will have one or two levels of underground parking.

The building will be designed by Schmidt Associates and developed by Halakar Properties and Pillar Investments LLC. Contractor Keystone Construction should break ground by March at the latest, and tenants could start moving in by early 2008.

The developers declined to reveal the price they are paying to acquire the land from Horizon Partners or the estimated cost of construction. They did say they are not seeking tax abatements, and Terry Sweeney of Indianapolis Downtown Inc. said the property taxes on the project will help Center Township, where about half of all structures are tax-exempt.

The building will rise four floors above most of Mass Ave.'s century-old rustic brick structures. In order not to obscure views of the sky for Mass Ave. pedestrians, Schmidt designed the building so that floors seven through 10 are each a few feet smaller on the outside. But Robert Shula, a member of the Metropolitan Development Commission, worries that the building's top could become an eyesore.

"I can understand how the first six floors blend into the neighborhood, but it looks like Flash Gordon did the top of the building," he said at a Wednesday hearing about the building. "I don't understand why it has to be so futuristic."

Style didn't stop Shula from joining the majority of commission members in a 5-1 vote Wednesday to allow the development to proceed. Scott Keller, a former developer and City-County Council member who represents the district that includes Mass Ave., said the design is a good compromise because the land is too valuable to make a shorter residential building economically viable.

Although the least expensive residences will cost twice the price of the least expensive lofts at One Market Square, a 208-unit project nearby that has sold slowly, demand on Mass Ave. seems to be high. Sheri Barnes, an agent with Re/Max Preferred, said she has sold 11 of the 23 units at 757 Mass Ave., another new project, for $290,000 to $1.2 million -- without even showing buyers a model. She also manages sales for a building at 707 North St., three blocks east of Mass Ave., where two penthouses have presold for $800,000 to $1.2 million. Beilouny Luxury Properties, which owns both buildings, plans to break ground on the 23-unit project on North Street this fall.

"With our new stadium and all the positive things happening Downtown, I think we're catching up with the bigger cities," she said.

Halakar President Todd Maurer says he, too, has interested buyers who think the price is worthwhile.

"These are going to be in a high-class neighborhood with stainless steel appliances and granite countertops," he said. "It's the life you want to live."

The units will range from 2,000 to 5,000 square feet, with balconies ranging from 100 to 2,000 feet. Amenities, including a rooftop garden, will be incorporated into the design.

Michael Harrison, housing and economic development coordinator for the Riley Area development corporation, said these projects are helping meet the area's goal of increasing Downtown's population from 20,000 people in 2003 to 40,000 by 2020.

DSF Cancels Condo Conversion in Baltimore

2006-08-07T11:26:00.000-04:00

Brought to you by

Lorraine Mirabella

When they learned that their apartment building at 3900 N. Charles St. would turn condominium, many residents reluctantly packed up and moved, scrambling to find new homes in the sought-after neighborhood. Some elderly tenants gathered paperwork to show that they legally qualified for six more years as renters. A handful made offers to buy.

Now, five months after registering to convert the building to condos and adding a private screening room, a health spa and a library, the owner is abandoning the conversion because of slow sales. DSF Group of Boston plans to market the units it had offered for $185,000 to $300,000 as luxury rentals.

"It's really what the market wants, and it's as straightforward as that," said Art Solomon, chairman and chief executive of DSF, which bought the 232-unit building in North Baltimore's Tuscany-Canterbury neighborhood in January from the Harry and Jeanette Weinberg Foundation.

DSF has taken 35 to 40 reservations since starting the marketing campaign for the Halstead at Guilford Condominium in April, Solomon said.

The abrupt switch - the first halting of a condo conversion in the state in at least three years - was made at a time when the once red-hot housing market is losing steam, as buying power is eroded by rising interest rates, soaring energy costs and record home prices.

Home sales in Baltimore and the five surrounding counties have fallen each month since October from year-earlier levels, and the number of unsold properties has been piling up: The number for sale in June was more than twice the number a year earlier.

In addition, developers, in the belief that a city that once shunned condos is ready to embrace them, have been adding hundreds of units in the region as the overall market has weakened, and more are in the pipeline.

And nationwide investors, intent on cashing in on rising real estate values, had been snatching up units in hot markets, fanning demand and fueling fears of overbuilding.

In the Baltimore area, about 5,000 condos - 1,300 of them in the city - were for sale at the end of June, nearly double the 2,800 that were for sale six months earlier, according to Delta Associates, an Alexandria, Va.-based real estate information firm. Developers plan to market 5,024 new condos in the area over the next three years, 2,053 of them in the city, Delta reports.

Nationally the market for condos has slowed significantly over the past six months, with more for sale now than at any time since the early 1990s, said Celia Chen, director of housing economics for Moody's Economy.com. Overall sales were down 10 percent as of June 30 from June 2005, while prices have remained flat.

Because prices had risen so fast, and mortgage rates have climbed, "the affordability of housing is eroding in many areas," Chen said. "It's becoming more difficult for people to buy houses."

With so many new condos coming on line in a slowing market, conversions of older buildings face stiff competition, experts said.

"If it's in an area with a lot of competition, where there are new condo projects as well as conversions, a plain vanilla building ... would be a project that wouldn't work," said William Rich, a vice president of Delta Associates.

The 3900 N. Charles building was one of 28 condo conversions registered with the state this year, according to the office of the Maryland Secretary of State. Staff members said DSF's about-face was the first in at least three years.

Though the Halstead is the first Maryland conversion to be called off, there have been several in Northern Virginia, where there has been a condo building boom.

The 574-unit Park Center in Alexandria began a conversion in October but pulled back during the second quarter of this year. The developer, Monument Realty of Washington, also halted a conversion this month at the 256-unit The Prime in Arlington County after receiving 52 contracts.

At the end of June, about 13,300 condos - 3,800 of them conversions - were for sale in Northern Virginia, up from 9,600 a year earlier, Delta Associates said.

"The supply is exceeding demand," said Robert Stein, president of RMS & Associates, a condo converter and developer based in McLean, Va. "If the supply exceeds the demand and the price points are too high, people are going to be resistant to buying a condo right now because they're worried about the economy and international events and interest rates and gas prices."

Real estate agents, too, say they are seeing the impact of more condos in a softer market.

"There's so many more condos because so many of these apartments are converting to condo, and these are places we didn't have two years ago," said Amy Ruth, a real estate agent with ReMax American Dream in Lutherville who has been selling homes in the area for 26 years.

"Add that to the market slowing, and of course it's going to slow the sales. It's not horrible, and condo sales haven't stopped, but it's slowing."

Ruth said she nevertheless was surprised by the sudden change at 3900 N. Charles, where one of her clients was ready to put down a deposit on a unit.

"I was just shocked, because there was no indication," she said. "The condos were nicely done, in a nice location with beautiful views. I thought they would do so well."

The abrupt change in plans has thrown the lives of many of the 14-story building's tenants into turmoil. Since they were notified of the condo plans in February, people have been moving out almost daily for the past few months, current residents say. Others have committed themselves to new leases elsewhere and are preparing to move.

Barbara Ruland and her husband hated the thought of leaving their bright, 11th-floor apartment at 3900 with its views of downtown, but they had no interest in buying. They moved across 39th Street to the Ambassador on July 12.

"They were expensive, and they weren't fixing any major systems," said Ruland, a part-time worker at Wegmans supermarket in Hunt Valley. "They put a lot of money in stuff on the first floor we'd never use - a bar/lounge, billiard rooms and a little projection room. We made a decision to move and spent a fortune in moving."

Ross Waldsachs, a 79-year-old retired state worker, had lived at 3900 for 26 years. After the conversion was announced, he moved in February to an apartment in Towson.

"It's been a trauma for me; I did not want to move," said Waldsachs, adding that he had become accustomed to the spaciousness of his two-bedroom apartment.

"Now we find out it's going back to apartment living. All of these people have been displaced. I can't get out of this lease and go back."

Corus Lends $127Mln for Los Angeles Mixed-Use Project

2006-08-07T11:14:00.000-04:00

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An affiliate of Koar Institutional Advisors has lined up $127 million in construction financing from Corus Bank for Solair Wilshire, a mixed-use project in Los Angeles.

The Beverly Hills, Calif., firm is constructing Solair Wilshire through a joint venture with the Los Angeles Metropolitan Transit Authority. The project will be at the intersection of Wilshire Boulevard and Western Avenue next to the Red Line subway station.

Solair Wilshire will include 186 residential condominium units, 40,000 square feet of retail space and a 578-space parking garage. It will also include a library, business center and 20,000-sf garden.

MGM Mirage Seeks to Add 2,500 Condo Units to Las Vegas Market

2006-08-07T11:09:00.000-04:00

Brought to you by

Mike Kalil

Southern Nevada's overall housing market may no longer be sizzling, but the Strip's biggest gaming player believes demand will continue for luxury condominiums with a Las Vegas Boulevard address.

MGM Mirage is seeking initial county approval this week for two high-rise tower projects that would add some 2,500 condos to the south end of the Strip.

The company has not formally announced either proposal, and a spokesman said their likely development dates remain undetermined. But documents filed with Clark County provide architectural renderings and details of both projects.

The Clark County Planning Commission is scheduled tonight to consider approval of MGM Mirage's plans for The Place at Mandalay, a proposed 520-foot tower with 1,344 units that would rise on the northwest corner of the Strip and Mandalay Bay Road, only feet from Luxor's pyramid.

On Wednesday, the company will ask the Clark County Commission to approve plans for two additional high-rise towers behind MGM Grand that would add 1,152 more condos to the 1,700 hotel-condos that are there or are now under construction.

MGM Mirage was already betting big on Strip condo development before proposing The Place at Mandalay and what amounts to a nearly 70 percent expansion of the high-rise hotel-condo projects at MGM Grand.

Some 1,650 condos are planned within the company's $7 billion Project CityCenter, the massive mixed-used development slated for 66 acres on the west side of the Strip between Monte Carlo and Bellagio.

"While our first order of business is Project CityCenter, it is not the end of our plans in Las Vegas," Gordon Absher, an MGM Mirage vice president, said Monday. "Having projects in a development pipeline assures us an ability to meet the variety of commercial property needs of the future.

"There will be other MGM Mirage projects beyond these," Absher also said.

This week's agenda items, Absher said, are "initial steps on a lengthy road" and "part of an orderly process in a companywide master plan for future development."

MGM Mirage owns 831 acres on the Strip, many of which are undeveloped or underdeveloped.

County officials appear poised to support the projects.

"I think it's a good thing. The trend is to have more vertical development," said County Commission Chairman Rory Reid, who represents the district where both projects would be built. "Sprawl is not necessarily a good thing."

The shift from people renting rooms on the Strip for a few nights to owning them permanently will not necessitate a big boost in municipal services for these new property owners, Reid said.

Planners and developers project that condominiums in the resort corridor will be used much like hotel rooms: mostly rented out to tourists for brief visits.

"The owners will use them on a periodic basis, and when they're not they'll put them into a (timeshare) pool," Reid said. "(Owners) are not going to live full time there. A lot of people are buying them as vacation homes or investment properties."

Although it would be located on Luxor's property, architectural renderings submitted to the county for The Place show its exterior design retains the metallic gold-on-white motif of nearby Mandalay Bay and The Hotel at Mandalay.

"Architecturally, it's going to look like Mandalay even though it will be pretty much adjacent to Luxor," said Anthony Molloy, the county principal planner working on the project.

The two additional towers on the MGM Grand site will retain the sleek white look of the Signature towers already under development there, according to renderings.

The Las Vegas market for single-family homes has slowed as the inventory of homes for sale pile up, but county planners say they see no signs that demand for luxury condos on Las Vegas Boulevard is waning.

"The market is fairly healthy and people continue to come in with applications," Molloy said.

The Planning Commission on Thursday is scheduled to consider plans for yet another mixed-use condo project on Las Vegas Boulevard. But the hearing for the proposed R Resort several miles to the south at the boulevard and St. Rose Parkway is likely to be moved to September, said project consultant Greg Borgel.

R Resort principal Ray Shapiro, a local businessman who operates restaurants and convenience stores, has submitted plans to the county showing a 1,500-room hotel, 720-unit condo tower and an 85,000-square-foot casino there.

He could not be reached Monday.

Mixed-Use Development Coming to Houston

2006-08-07T11:03:00.000-04:00

Brought to you by

Jennifer Dawson

A hip and trendy new mixed-used development is getting a mixed reception in a unique shopping and entertainment district dating back to the 1930s.

Rice Village is slated for its first new urban development project in more than 10 years.

Lamesa Properties Ltd., one of the largest property owners in the area, plans to develop midrise condominiums with offices over street-level retail space.

Lamesa estimates the project cost at more than $100 million.

Plans call for demolition of roughly four acres occupied by old buildings with tenants such as Walgreens and Nit Noi restaurant.

Lamesa also wants to seal off a segment of Bolsover Street to create a public market setting where residents, office employees and shoppers can congregate.

The proposed project and street shutdown is a subject of debate among members of civic clubs active in the Rice Village area.

The City of Houston will have the final say on whether the development stretches across part of the thoroughfare.

Lamesa has owned most of the four-acre tract for three decades, and put the complete package together by acquiring other bits and pieces over the past five years.

Real estate broker Jeff Peden with Cushman & Wakefield of Texas Inc. says the land price would probably be "off the charts" if bought today.

Peden estimates Village land might go for $70 to $80 per square foot, putting the value of four acres at $12.2 million to $14 million.

"That land is so highly sought after," Peden says. "Plenty of developers would love to put in office, retail, residential. The demographics are so good."

The median household income within one mile of the project was $104,006 in 2005, according to Lamesa.

Those deep-pocketed shoppers are loyal to the Village, which originally was established to cater to Rice University students, and now has more than 300 shops and dozens of restaurants in a 16-block area.

It takes a village

Lamesa's development site is just north of Rice Village proper in an area bounded by Morningside, Dunstan, Kelvin and Rice.

Residents in some civic clubs are making an effort to keep Bolsover open to traffic. A petition with at least 75 names will be presented to the Public Works Department opposing a city sale of the street's right-of-way to Lamesa.

Other civic clubs have voted in favor of the deal. On July 10, the Southampton Civic Club board voted to send a letter of conditional approval of the project to the city, as long as Lamesa sticks to the current development plan.

Some residents contend the project's height clashes with the Village character and hope the development fails to get off the ground.

Preliminary plans include buildings taller than existing structures in the pedestrian-friendly shopping mecca.

Prolific condo developer Randall Davis is consulting with Lamesa on the residential section, which will be six or seven stories high with 250 units and underground parking.

Sources say participation of Davis, a high-quality product and proximity to Rice University and the Texas Medical Center mean that Lamesa probably won't have a problem moving the residential units.

Blake Tartt III, a retail broker not involved with the project, says Lamesa also won't have trouble filling the 100,000 square feet of retail in the works.

"There's a tremendous pent-up demand from national retailers and restaurateurs to get into the Village," says Tartt, president of New Regional Planning Inc.

Julie Tysor, an area resident and Lamesa's point person on the new project, wants to attract a boutique grocery store, a few restaurants and high-end soft goods retail tenants that would complement current retailers in the Village.

"The Village is ripe for some redevelopment," says Tysor. "You can look at that site and see that it needs to be something other than what it is."

A moving study

The project will be built in two phases, with first-phase construction slated to begin as soon as early 2007.

Each phase will take 18 months to build and include residential, office and retail components.

Robert Williams, a resident of Southampton Place, is concerned the higher density will make already bad traffic congestion even worse.

Williams says a traffic study used by the city to evaluate the project was arranged and funded by Lamesa.

He says the study was conducted after Lamesa stopped renewing leases on company properties in the area. Lamesa's Tysor says the move-out began two years ago in anticipation of this deal.

Williams is also concerned that the project will have inadequate parking.

"They have an urbanization vision, which is fine," Williams says. "But I don't think appropriate for the Village. It's way out of character."

A successful project will generate more traffic, says retail broker Tartt, but it just comes with the territory.

"Any time you add that amount of density, you're going to add traffic," says Tartt. "It's just part of what's happening in Houston."

Les Appelt's Lamesa

. A brokerage firm launched by Les Appelt in 1949 changed names over the years and operates today as Colliers International.
. In the early 1970s, Appelt formed Lamesa Properties Ltd., an entity of roughly 40 limited partners with a portfolio of assets inside the 610 Loop. Lamesa Corp., the general partner, is owned by the Appelt family.
. Appelt also founded the Appelt Co., the management company for Lamesa Properties. Appelt Co. is now owned by Julie Tysor and Gary Clayton, the firm's chief financial officer.
. Tysor carries the titles of vice president of Appelt Co.; vice president of Lamesa Corp.; vice president of Colliers International, where she does a limited amount of brokerage work; and president of the University Place Association, a "super neighborhood" created by the City of Houston that encompasses several civic associations in the Rice University area.
. Appelt lives in Bastrop and is no longer involved in the day-to-day operations.

Lamesa's Building Blueprint

. 250 residential condominiums for sale, designed by Randall Davis Co.
. 100,000 square feet of retail space
. 50,000 square feet of office space
. Village square-type plaza in center
. Underground parking for residents
. Commercial properties designed by Ziegler Cooper Architects

Chicago Developer Plans St. Louis Condominiums

2006-08-07T10:40:00.000-04:00

Brought to you by

Petra Breyerova

Seeing an opportunity in moderately-priced condominiums, Chicago-based
developer Silverstone Communities is entering the St. Louis downtown area
housing market.

This month, its new division, Silverstone Communities-Midwest LLC, acquired the
former Bethesda Town House senior apartments located at 60 Plaza Square from
private investment group Dharbaj Holdings LLC for an undisclosed price.

Silverstone plans to transform the vacant 13-story building into 127 units of
moderately-priced condominiums.

Prices will range from about $80,000 for a studio to around $200,000 for a
two-bedroom, two-bath property.

Rising demand and the improved downtown property market has created a shortage
of affordable condominiums, said Kevin Farrell, senior director of economic and
housing development at Downtown St. Louis Partnership, a nonprofit group that
supports downtown area development.

"Anything that would be priced under $100,000 or even $150,000 at this point is
very tough to find (in the downtown area)," he said.

In 2001, condos averaged about $75 a square foot. Today, prices typically range
from $175 to $210, and can exceed $300 per square foot in some projects,
Farrell said.

The 60 Plaza Square project pegs its condominiums at roughly $180 to $190 per
square foot.

When the 60 Plaza Square project is completed, it will include a fitness
center, library and 4,800 square feet of commercial space.

Silverstone is selecting a local architect and a contractor next week to carry
out the $4 million renovation, which will start in August, said Stephen Anrod,
the division's president. The building, built in 1961, was designed by St.
Louis-based Hellmuth, Obata & Kassabaum Inc.

The division plans to start selling the condos this fall, with the first units
available in late 2006 or early 2007.

Total project sales should reach $18.5 million, Anrod said.

Targeting young professionals and first-time house buyers as potential
customers, Silverstone sees a niche for moderately-priced condominiums in the
downtown area, which encompasses the Downtown and Downtown West neighborhoods.

Overall, the downtown area residential market continues to pick up steam with
$807 million invested in from 1999 to 2005 in condominiums and apartments.

This year alone, investment is expected to reach $655 million, with most of
that coming from projects set to start later this year, according to the
Downtown St. Louis Partnership. Currently, there are about 800 condominiums
under construction in the downtown area.

Because of the trend, the partnership projects the downtown area population to
increase to 17,000 in 2010 from its present level of about 10,000. The area
population was 8,300 in 2000.

FSBOBOLINKS: Survey-Sort Of

2006-08-06T21:52:00.000-04:00

FSBOBOLINKS: Survey of FSBO Markets - Informal

Chicago Developer Plans St. Louis Condominiums

2006-08-01T15:04:00.000-04:00

Brought to you by

Petra Breyerova

Fla. Hotel Sells for $71.7Mln to Condo Converter

2006-08-01T14:51:00.000-04:00

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Signature Communities, a Naples, Fla., homebuilder, has paid $71.67 million for the Vanderbilt Inn on the Gulf, a 147-room hotel in Naples, Fla.

Signature is expected to redevelop the unflagged property, which is slated to be 72 residential condominium units.

The property was acquired from a partnership, Vanderbilt Beach Associates, which was advised by Cohen Financial of Chicago.

Vanderbilt had hired Cohen in 1999 to explore strategic and financial alternatives for the property. At the time, however, Vanderbilt Beach was not ready to pull the trigger on a sale. So, working with Cohen, the partnership improved the property's entitlements, which included allowing for taller structures, among other things.

Two years ago, Cohen was formally tapped to offer the property for sale. Cohen specifically sought condominium converters because of the property's value to such developers. The property was placed under contract with Signature last year, nearly a year before final development plans were approved by municipal authorities. Since then, Signature has been pre-selling units to prospective buyers.

"We strategically targeted condominium developers who were focused on adding beach front properties to their portfolios," Rick Tannenbaum, managing director of Cohen, who spearheaded the transaction, said. "As a result, the sale achieved a record price for gulf-front land in Collier County."

Jacksonville, Fla.'s Eagle Harbor to go Condo

2006-08-01T14:45:00.000-04:00

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A New York company is converting an Eagle Harbor apartment complex into condominiums. Tarragon Corp. will convert the 328-unit Vineyard at Eagle Harbor and sell the units at prices starting in the $120,000s.

The property, which is off County Road 220 in northern Clay County, will be renamed Cobblestone at Eagle Harbor.

The units will be available in one-, two- and three-bedroom configurations. Sales and marketing will be handled by Coldwell Banker The Condo Store.

Fremont, Lehman Lend $247Mln for Calif. Condo Project

2006-08-01T06:09:00.000-04:00

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Fremont Investment and Loan has provided a $215 million construction loan for Skyline at MacArthur Place, a proposed 349-unit residential condominium complex in Santa Ana, Calif., just outside Los Angeles.

Fremont's loan, as well as a $32 million mezzanine loan from Lehman Brothers, was arranged by Buchanan Street Partners.

The $247 million in financing will allow Nexus Cos. to construct what will be the tallest residential property in Orange County. The property will be comprised of two 25-story buildings and is slated for completion in early 2008. Units are expected to be priced from $500,000 apiece to more than $2 million.

Manatee has high hopes for condo project

2006-08-01T04:10:00.000-04:00

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BY CHRISTOPHER O'DONNELL

ELLENTON -- Manatee County revamped its affordable housing plan in October in response to rocketing house prices that have put home ownership out of reach for many low- and middle-income families.

County officials are hailing a new condo project in Ellenton as the first in the county to combine affordable, "work force" and market-priced housing.

At least 25 percent of the 136 condos developed by the Barrington Group will be offered at about $160,000, a price the county classifies as affordable.

Another quarter will be priced at about $192,000, considered "work force" housing. The rest would be sold at full market prices, about $230,000 to $250,000.

The project will be built on a 15-acre site on Ellenton Gillette Road at 29th Street East.

"They're actually proposing to do all three in the same project, which is wonderful," said Suzie Dobbs, the county's affordable/work force housing coordinator. "Hopefully, there's something for everyone."

Buyers paying full market prices would get more square footage and an attached garage. Each of the 14 proposed condo buildings will include each type of housing.

"We're hoping to avoid that feeling, 'Oh, that's an affordable housing project,'" said Ronda Gallehue, a vice president with the Barrington Group. "That's not really the case. People have to have jobs; they just can't make over a certain amount."

Local governments in Southwest Florida have been trying to draft effective affordable housing programs in the last few years as rocketing house values have priced lower- and middle-income families out of home ownership.

U.S. Department of Housing and Urban Development guidelines consider families that spend more than 30 percent of their gross income on housing to be "cost burdened."

It's a classification that contains more than a quarter of Manatee households, according to recent Florida Housing Data Clearinghouse statistics.

The county's guidelines for affordable and "work force housing" are based on family size and income.

A family of four with an income of $70,080 or less would qualify for "affordable housing" that costs no more than $160,000. A same-size family with an income no higher than $75,000 would pay no more than $192,000 for work force housing.

Developments that include at least 10 percent "work force" or 25 percent affordable housing qualify for a faster approval process.

With construction and labor costs continually rising, the chance to cut down the review time to six months -- a process that normally takes between 18 and 24 months -- can mean big savings for developers, Dobbs said.

The problem of finding and retaining employees in a market where the median home price is about $322,000 is also forcing home builders to include lower-priced housing, Dobbs said.

"We do have certain developers that really want to do this because there's such a lack of housing below the $300,000 range that it's handicapping them," Dobbs said.

$50 Mln Hotel Project Proposed for Dulles Station in Herndon, Va.

2006-08-01T01:59:00.000-04:00

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A South Carolina hospitality company backed by Miami Dolphins owner Wayne Huizenga is vying for a piece of the planned $1.1 billion Dulles Station in Fairfax County.

OTO Development, already building a hotel at National Harbor in Prince George's County, is negotiating to buy 11 acres in Dulles Station for a $50 million hotel project.

The company wants to construct a 182-room Sheraton and a 153-room Hyatt Place, a new boutique line of lodging from Hyatt, at the site in Herndon, says President and CEO Corry Oakes.

OTO is quickly becoming a major player in hotel development in Greater Washington.

Aside from the Dulles Station and National Harbor projects, the company is under contract to build two additional hotels in Fairfax County and one on Route 7 in Loudoun County. It's also in the final stages of negotiations for five more local hotels, Oakes says.

"We're big believers in the D.C. market," he says. "We're pursuing several deals at this time." OTO's proposal to rezone the Dulles Station property off Sunrise Valley Drive is set for a July 27 public hearing with Fairfax County's planning commission. If approved by the commission, the plan would need a final nod from the county's board of supervisors.

"The county has been good to work with so far, but we're not assuming anything until a final approval," Oakes says. "We're also meeting with citizens groups. If everything goes to plan, we'll move ahead as quickly as possible."

OTO (www.otodevelopment.com) was founded in 2004 by Huizenga and George Johnson Jr., the former CEO of Extended Stay America. In its short existence, the company has already developed more than $200 million in hotel projects around the country. It has projected a total of $1 billion worth of projects nationally between 2005 and 2008.

One of OTO's projects is a 151-room Hampton Inn and Suites at National Harbor, a $2 billion development expected to be ready for visitors in the spring of 2008.

At Dulles Station, several projects are starting to come together in a development that will eventually encompass 2.7 million square feet with 1,100 residential units, 1.5 million square feet of office and hotel space and 70,000 square feet of retail space.

The developer's majority landowner, Herndon-based Crimson Partners, is building a 169-unit condominium complex that should be finished by the end of the year, says Kevin Dougherty, Crimson's managing partner. Units are selling from the upper $200,000 range to the mid-$400,000 range.

Trammell Crow Co. meanwhile is progressing with construction on a six-story, 185,000-square-foot office building slated to be finished at Dulles Station in May 2007.

The company (www.trammellcrow.com) has started design work on a companion office building that would be 12 stories and 360,000 square feet, says Steve Shelesky, Trammell Crow's managing director of development and investment in Northern Virginia.

Canadian real estate markets set records in first-half '06

2006-08-01T00:12:00.000-04:00

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Resale housing activity in Canada's major markets in the first half of 2006 set a new record for the first six months of any year, The Canadian Real Estate Association reported this week.

Sales activity is on pace to set a new annual record this year despite expected softening in the second half of the year, the association reported.

Actual unadjusted home sales via the multiple listing service in Canada's major markets totaled 186,177 units in the first half of 2006, a 3.6 percent rise over the previous record for first-half activity set in 2005.

Sales activity was particularly strong in Calgary and Edmonton, the association reported, and new records for resale housing activity in the first six months of the year were set in those cities and Regina, Saskatoon, Winnipeg, London, Sudbury, Ottawa, Montreal and Quebec City. Seasonally adjusted MLS home sales in the second quarter of 2006 numbered 84,391 units - which represents a slight decline from the record levels posted over the past year.

Actual unadjusted sales reached the second highest level on record for the second-quarter period, and were 0.5 percent below activity levels reached during second-quarter 2005. Seasonally adjusted home sales activity eased by about 1 percent from the previous month to 28,185 units in June 2006. Monthly sales activity ebbed in Toronto, Edmonton, Halifax, and a number of other markets, which more than offset monthly gains in Calgary, Ottawa, Vancouver, Winnipeg, Montreal, and London.

Actual unadjusted MLS residential new listings totaled 308,923 units in the first half of 2006 - a new record for the first six months of the year and the highest level on record for any six-month period. New listings were up by 4.6 percent from the first half of last year and were 2.3 percent higher than the previous record set in the first half of 1990, which is the only other six-month period on record in which new listings topped 300,000 units, the association reported.

"There are no signs that new listings have peaked, as seasonally adjusted quarterly and monthly new listings reached their highest levels in more than 15 years," the association also announced. Victoria and Montreal led the increases, with seasonally adjusted new listings in the second quarter reaching the highest level since fourth-quarter 1990. "A rebound in Calgary helped to push major market new listings to the highest monthly level since May 1991."

The major market MLS residential average price at mid-year was up by 11.8 percent compared to December of last year. It was also up by 12.2 percent year-over-year in the second quarter, which tied with the second quarter of 2004 for the highest year-over-year price growth of any quarter in the past 15 years. The 6.8 percent jump in price from the last quarter was also the highest quarterly increase since 1989.

Average price in the second quarter of 2006 set new quarterly records in almost every major market in Canada. The major market MLS residential average price reached $269,000 (in U.S. dollars) in June - up 11.8 percent from the same month last year.

Average price has posted double-digit year-over-year gains in every month during the first half of 2006, the association announced, and reached the highest monthly level on record in June in Calgary, Edmonton, London, Montreal and Quebec City.

The average home price fell from the record levels reached in May 2006 in a number of other markets.

CREA Chief Economist Gregory Klump said in a statement, "The housing market is tightest in Alberta, where a sizzling job market is stoking buyer demand and fueling remarkable price increases. The rise in new listings in Montreal and Toronto gives buyers in those centers a wider selection of homes to choose from, and will keep price increases in those markets below those for major markets in British Columbia and Alberta."

The association noted in the announcement that average price information can be useful in establishing trends over time, but does not indicate actual prices in centers comprised of widely divergent neighborhoods or account for price differential between geographic areas.

The Canadian Real Estate Association represents about 85,000 Realtors.

Ritz at Bachelor going condo-hotel

2006-07-31T22:24:00.000-04:00

Brought to you by

Julie Dunn

The Ritz-Carlton, Bachelor Gulch is converting 120 of its 237 guest rooms into 50 wholly owned condominiums, making it the latest high-end mountain property to announce a condo-hotel conversion.

"The demand for new ownership opportunities in Bachelor Gulch is just immense, so we felt it was a great time to bring it to market," said Steven Holt, director of public relations at the property, which is at the Beaver Creek ski area.

The Ritz-Carlton Residential Suites will range in size from 430 square feet for a studio unit to 1,383 square feet for a two-bedroom model. The condos will go on sale July 27, with prices from $720,000 to $2.96 million. Slifer Smith & Frampton Real Estate is the listing broker.

Other similar projects are also in the works. Last month, Florida developer SunVest Communities USA announced plans to invest $20 million to turn the Club Med resort in Mount Crested Butte into a condo hotel.

In May, the Park Hyatt Beaver Creek announced it would undergo a $20 million renovation, including the conversion of 54 hotel rooms into 15 fractional-ownership units.

The 1/20-share condominiums range in price from $80,000 to $220,000.

"It's a good way to get some significant dollars out of an existing hotel," said John Montgomery, a hotel consultant with Horwath Horizon in Denver.

The Ritz-Carlton's two-phase conversion project began in April and is expected to be completed by July 2007.

Owners will have access to all of the hotel's amenities, including twice-daily housekeeping service and valet parking. They can place their units in a rental pool when they're not using them.

There is some risk to condo-hotel conversions, said Montgomery, because "some of the units will go into the rental pool, but some will sit empty, which is dead real estate for the community."

He said, "Resort areas like to see new bodies in their beds every night, because those are the people who are out skiing and shopping." Holt expects a majority of the condos to be put into the rental pool.

The AAA Five Diamond-rated Ritz-Carlton, Bachelor Gulch opened in November 2002 and cost $162 million to build. Miami-based Gencom Group bought majority ownership of the property from Vail Resorts Inc. in 2004.

Inman News - Real Estate News and Advice for Buyers, Sellers & Investors

2006-07-31T11:06:00.000-04:00

Inman News - Real Estate News and Advice for Buyers, Sellers & Investors

Web-based marketing integral to real estate industry

2006-07-31T11:03:00.000-04:00

Brought to you by

MARILYN BOWDEN

These days, anyone in the market for a new home or a beachfront condo can get a better idea of what's available by browsing the Internet instead of the Sunday paper. According to the National Association of Realtors, there are now some half-million Web sites in cyberspace hawking dream homes.

The Internet has been an important selling tool for the real-estate industry for nearly a decade. But during the recent residential boom, some have taken it to a new level, using the Web as the primary marketing tool to snare buyers for preconstruction projects which exist only in the developer's imagination. For this class of sellers, the Web has replaced the sales center; the virtual tour has nosed out the model unit.

Consumers need to exercise caution before leaping into an investment in a property that, as the market softens and some projects inevitably fall by the wayside, might never be anything more than a computer-generated fantasy.

The rise of virtual marketing

"Historically, the sales office would open before there was a project," says Mark Zilbert of South Florida's Zilbert Realty Group, which specializes in Internet sales. "But with the emergence of the speculator market, which really drove preconstruction sales, we entered the era of the instant sellout. By the time the sales office was built, there was nothing left to sell."

While developers were once leery of Internet listings, Zilbert says, broader outreach at lower cost has converted many to the gospel of virtual marketing.

A well-designed Web site is now a must for large projects, says Liam Sullivan, spokesperson for real-estate marketing firm Cotton & Co. The company currently has more than 60 Web sites up and running for projects all over the United States and the Caribbean.

"It's a tool that people have come to expect," Sullivan says. "People want to shop from their living rooms. Eventually they might visit the project site, but some of them buy just off the Web."

Sullivan says virtual tours using sophisticated technology can convey a much better idea of what a project will look like than a visit to a construction site.

An integrated approach

All this doesn't mean that all developers are ready to forsake tried-and-true methods. Many prefer an integrated approach.

"While we use the Internet to expose our product, we rarely consummate a sale that way. So we're not doing away with bricks and mortar,'' says Pamela Liebman, CEO of The Corcoran Group, a New York City-based residential developer and marketer.

No matter how quickly a project "sells out," a sale isn't really a sale until the unit is delivered and the contract closed, says Edgardo Defortuna, president of Fortune International, a Miami-based real estate and development firm.

"Even if we are mostly sold out, we still build a sales office and models," he says. "There has to be something to keep the buyer excited during the two or three years the project may be under construction."

Another thing the Internet will never be able to replace, Defortuna says, is the relationship between seller and buyer. "There is no substitute for personal contact," he says.

The industry online

Industry statistics make it clear that the real-estate profession is not in danger of losing ground to Internet sales.

Citing a recent survey of 135,000 homebuyers by the National Association of Realtors, NAR spokesman Molony says that though 77 percent used the Internet to search for properties, 81 percent used an agent to consummate the sale.

"The Internet is the norm today," Molony says. "But people still want a Realtor to explain the contract and handle the paperwork."

Statisticians for The National Association of Realtors deal only with resale properties, which are documented on multiple listing services. Tracking the preconstruction market is more difficult because there hasn't been any coordinated catalog of what's available at what price - until recently. Dean Isenberg, a Florida Realtor and entrepreneur, has introduced sell-your-preconstruction.com, a nationwide listing service he hopes will become "the eBay of preconstruction properties."

Let the buyer beware

Seasoned brokers say anyone buying a product that doesn't yet exist needs to be careful.

"It's relatively easy to sell preconstruction over the Internet," says The Corcoran Group's Liebman. "People think they're getting a bargain, and getting it easily. But in exchange, they have to go by the word of the developer and the offering document, without actually seeing what they're getting."

Internet buyers, she says, "need to read those offering documents very carefully, and have an attorney read them as well."

Mortgage rates are headed into hibernation until the next Federal Reserve rate-setting meeting.

The benchmark 30-year fixed-rate mortgage fell 12 basis points to 6.77 percent, according to the Bankrate.com national survey of large lenders. A basis point is one-hundredth of 1 percentage point. The mortgages in this week's survey had an average total of 0.28 discount and origination points. One year ago, the mortgage index was 5.84 percent; four weeks ago, it was 6.93 percent.

The benchmark 15-year fixed-rate mortgage fell 10 basis points to 6.39 percent. The benchmark 5/1 adjustable-rate mortgage fell 8 basis points to 6.47 percent.

Inman Real Estate News - Real estate licensees can get a better deal on houses

2006-07-31T09:11:00.000-04:00

Inman Real Estate News - Real estate licensees can get a better deal on houses

Condo craze continues with 41 per cent increase

2006-07-29T19:34:00.000-04:00

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TORONTO, July 19 /CNW/ - There were more new high-rise condominium suites
sold in the Greater Toronto Area in June than ever before as condo sales
smashed the all-time record for market share, Desi Auciello, president of the
Greater Toronto Home Builders' Association, said today.
    "With an all-time high 2,397 new high-rise condos sold in June, home
buyers were snapping up a new condo every four minutes the sales offices were
open," said Auciello.
    High-rise unit sales were up a whopping 41 per cent while total new home
sales were up just two per cent as a result of an offsetting 28 per cent
decline in low-rise (single-detached, semi-detached and townhome) sales.
    According to RealNet Canada Inc., the association's independent source of
new home market information, an astounding six out of every ten (60 per cent)
new homes sold in June were high-rise suites.
    "Frankly, we never thought we'd see the day when low-rise product would
represent the minority of our sales, particularly to this extent," Auciello
stated. The previous high-rise market share peak was 46 per cent while the
annual average (2005) is 42 per cent.
    Auciello attributed the continuing condo craze to affordability and
choice. "As house prices rise, home buyers seeking a toehold in the market are
obviously turning in increasing numbers to the condo market," said Auciello,
noting that the RealNet new home price index for high-rise condos ($314,370)
is $80,000 less than for low-rise homes ($393,398).

    <<
    -------------------------------------------------------------------------
                    Low Rise             High Rise               Total
               June   June    %      June   June    %      June   June    %
    Region     2005   2006 Change    2005   2006 Change    2005   2006 Change
    -------------------------------------------------------------------------
    Durham      542    240   -56%      31     81   161%     573    321   -44%
    Halton      222    344    55%      45      7   -84%     267    351    31%
    Peel        698    468   -33%     110    474   331%     808    942    17%
    Toronto     144     85   -41%   1,145 1,652    44%   1,289 1,737    35%
    York        636    486   -24%     375    183   -51%   1,011    669   -34%
    GTA       2,242 1,623   -28%   1,706 2,397    41%   3,948 4,020     2%
    -------------------------------------------------------------------------
                                                   Source: RealNet Canada Inc
    -------------------------------------------------------------------------
    >>

    The index is essentially the average asking price of all the remaining
new homes and condos currently available for sale, as calculated by RealNet
Canada Inc.
    The new home price index is based on currently available new home
offerings, weighted by remaining inventory, for projects of 15 or more units,
excluding ultra-luxury product across the GTA.
    With the first six months of the year in the books, total new home sales
of 21,866 units are down five per cent compared with the first half of 2005.
High-rise sales are running two per cent ahead of last year while low-rise
sales have declined by 10 per cent.
    The top five municipalities in the GTA for June were Toronto, 1737;
Mississauga, 585; Brampton, 355; Markham, 262 and Vaughan, 213.

    With more than 1,400 members, the GTHBA is the voice of the residential
construction industry in the Greater Toronto Area. Established in 1921, the
association is comprised of land developers, home builders, professional
renovation contractors, sub-contractors, suppliers, service, professional and
financial firms. We are proudly affiliated with the Ontario and Canadian Home
Builders' Associations.

65-Unit Condo Project Planned for Milwaukee

2006-07-28T10:34:00.000-04:00

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A developer plans to build 65 condominiums overlooking the Milwaukee River on N. Commerce St., creating a new residential project on one of that street's few remaining riverfront sites.

Jim Metz said Monday that he hopes to begin construction by late fall or the spring of 2007 on his six-story development, which will take about a year to complete. It will replace two small industrial buildings, at 2056 and 2070 N. Commerce St., that Metz plans to demolish in September.

Most of the units will have two bedrooms, with around 1,600 to 1,700 square feet, and will be priced at around $290,000, Metz said. The development will include one-bedroom units with prices starting at around $175,000, he said.

The development also will have 10,000 square feet of commercial space, including a 5,000-square-foot restaurant with a patio overlooking the river, Metz said. He said he's close to signing a lease with a restaurant operator.

The project will include two levels of parking, with 160 spaces, Metz said. Development costs will total around $15 million, including $1.45 million that Metz recently paid for the parcels, which total just more than 56,500 square feet, according to assessment records. The parcels were sold by Robert Page of Tampa, Fla.

The riverfront location will allow Metz to include boat slips and a riverwalk. Aside from being along the river, the location has the advantage of being near N. Humboldt Ave., which serves as a connector to the shops, restaurants and night clubs on nearby E. Brady St., Metz said.

"It's a phenomenal site," Metz said.

His other projects include the nearby Kane Place, which has 14 condos just south of E. Kane Place between Humboldt Ave. and Pulaski St. The units are nearly complete, with 13 of them already in the process of being sold, Metz said.

Metz said Kane Place also will have a street-level pizzeria that will be operated by Marc Bianchini, whose family also operates Osteria del Mondo and Cubanitas restaurants.

Metz's latest development marks yet another project for Commerce St., where numerous condo buildings have sprouted in recent years.

The current projects include The Edge, a 133-unit project that Chicago-based Tandem Developers LLC plans to build on 2 acres at 1890 N. Commerce St., just upriver from the Holton St. bridge. Tandem has been marketing those units since spring.

Legacy Real Estate Development LLC's 72-unit Union Point, which is bordered by Commerce St., Riverboat Road and Humboldt Ave., is nearing completion.

Also, the 21-unit Park Terrace row houses were recently developed by Vetter Denk Architects Inc. at 2001-2049 N. Commerce St. Just behind the row houses are 16 additional homes under construction.

Finally, Mandel Group Inc. continues development of the 75-unit Rivercrest project, on Commerce St., east of N. Humboldt Ave.

Jacksonville, Fla.'s Eagle Harbor to go Condo

2006-07-28T10:24:00.000-04:00

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The property, which is off County Road 220 in northern Clay County, will be renamed Cobblestone at Eagle Harbor.

The units will be available in one-, two- and three-bedroom configurations. Sales and marketing will be handled by Coldwell Banker The Condo Store.

Hollywood, Calif., Land Sells for $19.8Mln

2006-07-28T10:21:00.000-04:00

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Orest Mandzy

A Los Angeles development venture has paid $19.8 million for a collection of land parcels in Hollywood, Calif.

The venture, CSGF Pacific ABS Hollywood partners two developers with a financial partner and was arranged by Madison Partners of Los Angeles. Madison also arranged for the purchase of the three parcels, which total 2.3 acres and were acquired from from three separate owners.

The development venture is expected to construct a mixed-use project, which would include residential condominiums and retail space, on the site.

The three parcels, which are just west of the junction of Hollywood Boulevard and Western Avenue, are:

- 5512-20 Hollywood Boulevard, which was purchased from Holly Tree Village Partners and FLJC Co.;

- 5530 Hollywood Boulevard, purchased from a local partnership and

- 5544-50 Hollywood Boulevard, which was purchased from Alexander Becker Carpets Inc. and the Becker Revocable Trust.

For-Sale Signs Multiply Across U.S.

2006-07-24T14:00:00.000-04:00

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The housing market continues to weaken in much of the country as inventories of unsold homes rise and many sellers cut their asking prices, a quarterly survey by The Wall Street Journal shows.

There is no sign of a broad collapse of housing prices about a year after the once-hot coastal markets entered a long-anticipated cooling phase. But the general level of prices is edging down in some areas and leveling off in others, while the supply of homes for sale keeps rising.

The number of homes on the market in Orlando, Fla., for example, is nearly five times the year-earlier level, while the inventory has quadrupled in Phoenix and Tampa, Fla., and nearly tripled in the Washington, D.C., area.

In another sign of the housing market's growing weakness, the Commerce Department said housing starts fell 5.3% last month from May, to an annual rate of 1.85 million.

Barnes & Noble Files Suit to Stop Mall's Residential Project

2006-07-21T11:01:00.000-04:00

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Barnes & Noble, a major tenant in Edina's Galleria shopping center, has gone to court to halt the development of a $100 million hotel and condominium high-rise on the parking lot of the mall.

In a suit filed in Hennepin County District Court, the Dallas-based bookseller says the development by Galleria owner Warren Beck threatens to alter the character of the mall and hurt its business. The suit says the development, called the Westin Edina Galleria Residences, violates the terms of the lease Barnes & Noble has had at the center since 1991. Among other things, it says the lease prohibits the shopping center site from having "living quarters, sleeping apartments or lodging rooms."

Hennepin County District Judge Charles Porter recently granted a request by Barnes & Noble that prohibits Beck from beginning work on the hotel and condo portion of the project, pending the outcome of a trial. Construction of the 18-story tower, which is to house a seven-story Westin Hotel and 11 floors of condos, has been scheduled to start late this year.

But Porter denied Barnes & Noble's request to also stop work underway on a parking ramp that is part of the project. The ramp is to be completed by early December, according to court documents.

In a phone interview Monday, Beck said he is "looking forward to proceeding with the project." He said about 60 percent of the 82 condo units have been reserved.

According to court documents, Beck is selling the condominium units with contingencies that would allow the purchase agreements to be canceled if the development isn't allowed to proceed.

The Westin is one of three hotels of that brand currently planned for the Twin Cities area by New York-based Starwood Resorts & Hotels. The others are to go into the former Farmers & Mechanics Bank Building in downtown Minneapolis and the proposed Bridges of St. Paul mixed-use project.

The court documents also say that if Beck were prevented from building the hotel and condo, he would consider other uses for the site, including an office tower or additional stores.

Carley adds a partner to bolster spire deal

2006-07-20T16:07:00.000-04:00

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DAVID ROEDER

Since first revealing his alliance with architect Santiago Calatrava for a spired, 124-story building on the lakefront about a year ago, developer Christopher Carley has encountered plenty of skeptics. He's poised this week to strike a deal that will quiet some of them.

On Thursday, Carley is due to close on the acquisition of the property involved in the project. A source close to the situation said the land in the 400 block of East North Water Street, at its intersection with Lake Shore Drive, will sell for more than $60 million.

To close on the land, Carley has taken on a partner. The source said it is Shelbourne Development Ltd., based in Dublin, Ireland. The company has completed residential and commercial projects in Ireland, Great Britain and France.

Shelbourne's executive chairman is Garrett Kelleher, who, according to the company Web site, set up shop in Chicago in the 1980s to do loft conversions before returning to his native Ireland about 10 years later.

Terms of the partnership could not be learned, but the source said Carley will continue with day-to-day oversight of the project. "Shelbourne has a very large development group with deep strength in construction management," the source said.

It's possible Shelbourne could be a conduit for European investors. Carley, chairman of Fordham Co., has reported that about 20 percent of sales inquiries for what he's calling the Fordham Spire has come from overseas.

Reached Tuesday, Carley declined to comment. Plans call for the building to have 300 residential condominiums and 150 hotel units, some of which also may be sold. He has estimated the project's cost at $600 million, but materials costs are escalating quickly, and some experts believe Calatrava's unique, seemingly twirling design will be prohibitively expensive to build.

Carley is negotiating with hotel operators and project financiers. The source said Walsh Construction will be his general contractor and that the real estate firm Jones Lang La Salle Inc. is representing the project to lenders.

If completed as planned, the building would be the tallest in the United States but is not expected to be taller than the Burj Dubai office building under construction in the United Arab Emirates. The height of that Skidmore, Owings & Merrill LLP design is a state secret.

MANDARIN COMBAT: The U.S. Environmental Protection Agency said it's been trying to gain access to the future site of the Mandarin Oriental hotel at the northwest corner of Lake and Stetson. The EPA wants to check for thorium, a radioactive material that has turned up in Streeterville construction sites and in the Lakeshore East project. But the developers have denied access to the agency for about a year, said its spokesman, Mick Hans, and on-site coordinator Verneta Simon.

Construction magnate Gerard Kenny is president of the development firm that controls the site. Kenny said he has his own consultant checking for thorium and wants to present the findings to the EPA before opening the site to its inspection. So far, no thorium has turned up, Kenny said.

A spokesman for the city's Buildings Department said city agencies are trying to ensure the EPA gets access. The proposed 65-story Mandarin, while warmly praised by Mayor Daley, has yet to pass city planning review.

Thorium is no threat to most people, but could pose a hazard to construction crews. It has been traced to a manufacturer of lanterns in Streeterville during the early 20th century.

BUILDING ON BUILDERS: White Sox Chairman Jerry Reinsdorf and Robert Judelson, who used to be the "J" in the old JMB Realty Corp., are opening a third fund for their venture, the Fund for Builders LP. It buys model homes from developers, then sells them when the project is complete to cash in on appreciation. In about a year and a half, it has invested more than $40 million with six builders.

Also, Reinsdorf named his son, David, as the firm's vice president of asset management. A former LaSalle National Bank executive, David has more than 20 years' experience in residential construction and finance. Tim Lyons, formerly of Grubb & Ellis Co. and Balcor Co., was named chief financial officer.

CALENDAR NOTE: Here's a community-organizing idea others should try. The Streeterville Organization of Active Residents gathers Saturday with an aldermanic aide to walk the neighborhood and write down where public improvements are needed. They should note the missing street signs. SOAR will gather for breakfast at Max & Benny's 332 E. Illinois, and head out at 9 a.m.

DOING THE DEALS: Trammell Crow Co. arranged the $6 million sale of a 106,000-square-foot building at 1200 Business Center Dr., Mount Prospect. The tenant, Northfield Laboratories, bought it from First Industrial Realty Trust Inc.

New Study Pinpoints Top Places

2006-07-19T17:03:00.000-04:00

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Some of the nation's hottest housing markets are cooling, but the strength of the economy is balancing the risk of home-price declines, according to PMI Mortgage Insurance Co., which released its U.S. Market Risk Index on Tuesday.

The average risk score for the country's largest metropolitan statistical areas was 288 in the first quarter, one point up from the last quarter and 70 points up from a year ago. During the quarter, 25 metropolitan areas saw increases in risk, while 20 saw decreases.

Nicky Hilton to Launch Hotel Line

2006-07-19T16:55:00.000-04:00

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NEW YORK - Hilton Hotels Corp. heiress Nicky Hilton said Friday she is launching a line of hotels called "Nicky O" this November in Miami.

A Chicago location will follow. Designer Roberto Cavalli will design a 5,000 square foot penthouse suite at the South Beach, Miami hotel.

Suites will range from $300 a night to $5,000 a night.

Zilbert Realty Group in Miami is handling sales and marketing for the South Beach location, which is also offering 94 condo suites selling between $500,000 to $7 million.

Nicky Hilton is the granddaughter of William Barron Hilton and the great granddaughter of Conrad Hilton, who founded Hilton Hotel Corp. in 1946.

Hilton Hotels fell 65 cents, or nearly 3 percent, to $25.56 in midday trading on the New York Stock Exchange.

$500m downtown project gets initial OK

2006-07-19T09:30:00.000-04:00

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Prominent developer Ralph Sanchez and the principals of the Ponce Circle Development are sparing no expense in an attempt to get the $500 million Old Spanish Village project approved by the Coral Gables City Commission. And it appears to be working.

At the July 11 meeting, developers presented videos, scores of printed materials (including a coffee table book) and had numerous consultants waxing poetic about the virtues of the massive 6.5 acre project which encompasses three full city blocks bounded by Ponce to the west, Galiano Street to the east, Palermo to the north and Malaga Avenue to the south.

So far their efforts have paid off handsomely considering the city commission not only approved six applications, with 4-1 votes, to clear the way for the project (including the first reading of a change of land and zoning as well as a site plan review) at the meeting but even the sole commissioner who voted against the project, William Kerdyk, Jr., left the meeting impressed with the project's presentation.

When the commission wasn't gushing in praise of Sanchez and the development effort, it was busy ignoring staff recommendation from Planning Director Eric Riel.

Riel admitted that the project met several city objectives with its proposed planned area development (PAD) but that there were too many inconsistencies to allow it to move forward as is.

Specifically, Riel said that the project did not sufficiently address traffic, parking and landscaping issues with enough zeal and provided too little green and open space.

He also said the project did not address the issue of affordable housing which has been sorely lacking in the city.

The director did present an alternative staff recommendation which would include 20 percent more green space, payment to mitigate the loss of 34 parking spaces and the addition of 75 more visitor parking spaces for the project, but that proposal was largely ignored by the commission.

"The project is consistent with the Charrette and does include aspects to preserve historic buildings but mostly our objections come from the lack of open space, parking and other additional improvements," he said.

In his closing remarks, Riel practically conceded defeat when he described the project as a "good project" which probably would have received his staff's recommendation had it not been for a single family home smack dab in the middle of the project whose owner refused to sell to developers.

Riel had as much luck convincing the seemingly awestruck commission to vote against the project as he had trying to do the same with the city's Planning and Zoning Board, when they approved the project 4-1 on June 14.

After Riel had his chance, developers commenced their comprehensive presentation with historical expert Arva Moore Parks and architect Jorge Hernandez to sell the project.

In researching the site of the project, which was once part of the historic Arts and Crafts Section of the City, and comparing them to current plans, Parks said that she was struck by a vision of the community that city founder George Merrick originally intended.

Hernandez was equally effusive saying that Park's mere involvement in the projects spoke to the developer's vision.

He went on to describe the specifics of the project saying it was broken down into four quadrants: the 2801 block which will include a 15-story building along Ponce, 6-story apartments buildings along Palermo and Sevilla Avenues and 3-story townhomes on Galiano Street; the 3001 block which will be built out nine stories throughout the front side with townhouses in the rear; the assemblage of townhouses along the southeast section of the project, all of which are three stories high; and the existing historic Arts Center Building which is being completely renovated.

The project will include retail and commercial components along the ground floor of the Ponce buildings but is mostly residential in nature. The total development of the project is 895,815 square feet, slightly less than what developers say they could develop as of right commercially. There are a total of 458 units in the entire PAD.

Developers said they agreed to add 50 parking spaces to the project bringing the total to 1070, almost 100 more than what was required by code.

At the meeting developers also paraded out a virtual army of lawyers including two of the city's most experienced development lawyers, Laura Russo and Zeke Guilford, to make sure the project went through.

Russo said the project used George Merrick's vision as its organizing principal while another heavyweight attorney Jeff Bass eviscerated Riel's claims that the project represented an example of spot zoning.

"This is not spot zoning or reverse spot zoning and the fact that (Riel) anchored his comments (by saying that) means that he derived an erroneous legal conclusion and does not constitute a substantive professional (opinion)," Bass said.

Mayor Don Slesnick acknowledged that he was troubled by staff's recommendation and the fact that its own board overruled its decision.

"The Planning Department staff had their chance but that is not what Planning and Zoning Board wanted," the mayor said.

Numerous citizens also chimed in with opinion on the project with most, including members of the Coral Gables Chamber of Commerce, expressing their support.

Others, including Orlando Capote, owner of the single family home in the middle of the project, expressed reservations but even they did not seem to be put off by the project.

Nearby resident Maria Puente said her biggest concern was the density and height of the proposed buildings and that some of the rendering put forth by developers were misleading in their scale. Still, Puente said the area was in need of revitalization and would be amenable to the project with some revisions.

"The area could use some redevelopment and we do want it to grow but I think there needs to be a little more work," Puente said.

As the discussion on the developer's applications dragged on, the commission's eventual approval seemed more and more likely.

"I came to terms with the fact that the city is changing a long time ago," said Vice Mayor Maria Anderson. "It's not 'if' we are going to grow it's how we are going to grow."

I think this is a catalytic project and it is going to change the city in a very positive way."

While Kerdyk was impressed with aspect of the project and the lengths that developers went to the sell their vision, his troubles with the project's density would not allow him to give his support.

The commissioner also feared that the conversion of single family homes to commercial might set a dangerous precedent in the city.

"I can't recall that it ever happened here. Philosophically I have an issue with that. If developers can come in and rezone property what's to stop them from doing it (elsewhere)," Kerdyk said.

Like Riel, Kerdyk acknowledged that aspects of the project were positive but insisted that a project of this magnitude should be driven by the city not a developer.

"I want the dog to wag the tail - not the tail to wag the dog," he said.

Commissioner Ralph Cabrera agreed in theory but said that reality teaches a different lesson.

"You're right, we should do it, but guess what we didn't. And somebody with vision and the financial resources did," he said.

Consumer interest in second homes grows

2006-07-18T16:59:00.000-04:00

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When it comes to second homes, Americans remain fairly bullish, with sizable numbers saying they plan to purchase second homes soon and wouldn't mind flying -- not driving -- to reach them, according to findings of a new consumer survey by HomePages.com, operated by HouseValues.

The HomePages.com survey of more than 1,300 adult consumers found that 21 percent say they are considering purchasing a second home within a year, while another 42 percent said they're considering buying within the next two to six years.

Interestingly, nearly one-third (29 percent) of those considering purchasing second homes don't consider its proximity to their current homes a major factor, saying they'd be willing to fly to reach them.

"Vacation and investment homes remain a strong and prominent part of the real estate market, both as a means of providing an escape and providing supplemental short-term and long-term income," said Ian Morris, chief executive officer of HouseValues.

Indeed, a quarter (25 percent) of respondents said they are considering a second home for investment purposes, while 22 percent said they wanted one for "enjoyment" such as weekend getaways, vacations and family use.

In terms of proximity to geographic features, 40 percent of respondents said features such as water or mountains would not be a factor because "it's an investment property." Among those who do consider geography an important factor in where they buy, 36 percent listed proximity to water as key, followed by mountains (17 percent), golf courses (5 percent) and the desert (2 percent).

Although 29 percent said they would be willing to fly to reach a second home, the largest percentage -- 43 percent -- said they'd prefer it be within a one-hour drive of their primary residence. Nineteen percent said they'd be willing to drive up to two hours, while 9 percent said they'd be willing to make up to a six-hour drive.

Asked what factor would most likely cause them not to buy a second home, 32 percent of respondents listed rising home prices, followed by rising mortgage rates (18 percent) and job insecurity (12 percent). Thirty-eight percent listed a variety of other factors.

The online survey respondents comprised 65 percent women and 35 percent men visiting HomePages.com and JustListed.com. The survey was the latest in an ongoing series of informal polls conducted by HouseValues via the company's national HomePages.com consumer real estate Web service.

Federal Trade Commission - Competition in the Real Estate Marketplace

2006-07-17T10:39:00.000-04:00

Federal Trade Commission - Competition in the Real Estate Marketplace

A federal site where you can report unfair practices in the real estate industry.

Chicago Condo Towers Proposed

2006-07-14T10:58:00.000-04:00

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DAVID ROEDER

The winning bidders for the Scottish Rite block on the Near North Side are showing development plans to the neighbors. The scenario calls for two condo towers on the block's parking lot and preservation of the buildings that occupy the rest of it, including a former cathedral at 929 N. Dearborn.

Mike Skatulski, senior managing director at Mesirow Financial Real Estate, said the towers would be about 30 stories tall and together include 450 to 520 units. Lower floors would be set aside for commercial space and for parking that can't be seen from the street, he said.

The Mesirow division, run by veteran developer Richard Stein, has joined with Enterprise Cos. in agreeing to pay more than $50 million for the block, bounded by Walton, Delaware, State and Dearborn. The seller is the Scottish Rite, a fraternal organization.

Skatulski said the project won't be as tall or dense as others being added to the Near North Side. He hopes the somewhat reduced scale and a commitment to preserve the existing structures, all of which go back to the 19th century, will ease the way politically. The cathedral could be donated to a nonprofit group, and one prospect Skatulski identified is the Newberry Library, which is immediately west of the site.

Representatives of some community groups were briefed about the plans Tuesday night. Skatulski said Chicago's Pappageorge/Haymes Ltd. will provide the architecture.

PITTSFIELD PLAN: Add the landmark Pittsfield Building, 55 E. Washington, to the list of downtown office edifices whose owners are considering new uses. Sources said the building, popular with doctors and dentists, is relocating tenants on seven or eight floors to free space in hopes of landing a hotel. Those floors could be sold while ownership keeps the rest of the building.

Built in 1927, the Pittsfield has undergone recent renovations to its lobby and elevators. It was running about a 25 percent vacancy rate before the hotel idea came along. But one wonders how many boutique hotels downtown can stand. The building owner, Miami Beach-based investor Robert Danial, could not be reached.

LEGAL LEASE: The law firm Barack Ferrazzano Kirschbaum Perlman & Nagelberg LLP has leased the top six floors at 200 W. Madison, taking 97,000 square feet in the building owned by Tishman Speyer Properties and Transwestern Investment Co. The firm signed a 15-year lease and is moving from 333 W. Wacker.

LINCOLN LODGE: Spiffier rooms and higher prices are in the offing for the old Days Inn of Lincoln Park, 1816 N. Clark. WexTrust Capital bought it last January for $15.5 million and plans a renovation to take it upscale. The first part of the project is ditching the Days Inn tie. It is being renamed, inaccurately, the Gold Coast Hotel and management has been turned over to Portfolio Hotels and Resorts. WexTrust is looking for a prestigious restaurant to take the ground-floor space.

LOCATION, LOCATION: Duke Realty Corp. is starting construction on an 88,000-square-foot industrial building at 11501 W. Irving Park in Chicago. It's just outside O'Hare Airport's south cargo entrance, and Duke believes it won't be long before its first building inside city limits will have tenants.

"With more than 1 million square feet of industrial product being condemned in the O'Hare Modernization Program, demand for first-generation space near the airport is increasing," said Andy James, senior vice president at Duke. Completion is due in the spring. Colliers Bennett & Kahnweiler Inc. is the leasing agent.

EAST LOOP LIFE: The British-style pub and grub chain Elephant & Castle is taking ground-floor space in Village Green Cos.' renovated apartment building at 185 N. Wabash. It will be the chain's third Chicago location and expands the drinking and dining options for the growing residential district of the East Loop.

DOING THE DEALS: Maurice Fisher, known for his involvement with major malls in the Chicago area, heads a partnership that has purchased the old Ethan Allen Furniture building at 820 E. Roosevelt, Wheaton. The 20,000-square-foot building will be converted into a retail and office center. Champion Realty Advisors LLC brokered the sale. . . . TCB Development Co. acquired a 21-acre business park at 600 Territorial Drive, Bolingbrook, for $7.2 million. The deal includes a 97,000-square-foot building and two 7-acre sites suitable for development. The campus, formerly owned by Molex Inc., can accommodate up to 300,000 square feet. . . . CB Richard Ellis Inc. represented Kester, a supplier of electronic connectors, in its relocation from Des Plaines to 64,000 square feet at 800 W. Thorndale in Itasca, where the company signed a 10-year lease. . . . Owners of the Inn of Chicago, 162 E. Ohio, will re-light the hotel's rooftop sign July 20 as part of a party heralding a planned renovation.

Hotel, Condo Building Planned for Downtown Chicago

2006-07-14T10:29:00.000-04:00

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By TOM DAYKIN

A Florida-based hotel developer is proposing a nine-story building with 120 extended-stay hotel rooms and 18 residential condominiums in downtown Milwaukee's largest night life area.

The $20 million development, which would include 10,000 square feet of street-level restaurant and retail space and one level of underground parking, is planned for the southeast corner of N. Water St. and E. Juneau Ave. The site, now a parking lot, is just north of the former Brew City Bar-B-Q building, 1114 N. Water St., which is being converted into a Bar Louie restaurant and tavern.

The project is being proposed by Development Opportunity Corp. of Fort Myers, Fla.

"We feel there is a demand for additional extended-stay rooms," said Phil Hugh, president of Development Opportunity and its affiliated hotel management firm, DOC Hospitality.

The hotel's rooms would be marketed to people staying in Milwaukee during corporate training assignments, those needing a place to stay while relocating to the Milwaukee area, and vacationers looking for larger rooms, Hugh said. All the rooms will be suites, with stoves, microwaves and refrigerators, he said.

The hotel might use the Staybridge Suites brand, Hugh said. That brand is owned by Intercontinental Hotels Group, which also owns Holiday Inn, Hotel Indigo, Candlewood Suites and other brands.

Development Opportunity is discussing financing options with various lenders, Hugh said. He hopes to begin construction by October and complete the project by January 2008.

Hugh's firm is working on the project with a local investors group, Market Street Partners II LLP, which owns lots at 1124 N. Water St. and 223 E. Juneau Ave.

Market Street wants to buy adjacent lots, totaling about 9,200 square feet, from the city's Redevelopment Authority to create a 30,200-square-foot development parcel. The authority will review that $443,340 purchase offer at its Thursday meeting, said Andrea Rowe Richards, spokeswoman for the Department of City Development.

Hugh is a former senior vice president at New York-based Cendant Corp., which owns several hotel brands, including Ramada, Howard Johnson and Super 8.

Development Opportunity, which Hugh started nearly three years ago, is renovating a 123-room hotel in Fort Myers, which is scheduled to reopen in August as a Holiday Inn. Development Opportunity also is developing a 62-room Hotel Indigo in Fort Myers, a 24-room boutique hotel in Pittsburgh and an 86-room Candlewood Suites in the Pittsburgh area.

The Staybridge Suites plan is the latest of several downtown hotel proposals that have surfaced recently as business travel has increased.

Others include developer Doug Weas' plans for a 150-room Renaissance ClubSport by Marriott, part of an 18-story mixed use project, at the southeast corner of N. Broadway and E. St. Paul Ave., in the Historic Third Ward.

Also, Chicago developer Richard Curto wants to build a 125-room boutique hotel and a 140-room hotel catering to business travelers as part of his mixed-use developments east of N. Water St. and north of E. Ogden Ave., in the Park East area.

Condo Market Freeze Causes Multifamily Sales to Hit Brakes

2006-07-14T10:06:00.000-04:00

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By Jillian S. Ambroz

The multifamily investment sales market is slowing down after a fierce run-up that was fueled largely by condominium converters.

But interest in rental properties remains strong and is expected to strengthen.

The month of May marked the first time in five years that the sector saw a decline in sales deals for two consecutive months. About $3.8 billion in apartment sales closed in May - a 30 percent drop from a year ago, according to Real Capital Analytics. For the year so far, the market has seen a 14 percent increase in sales. But that can be attributed to several REIT mergers and portfolio acquisitions.

The condo-conversion market has become downright frigid. The number of units selling for conversions is off by more than 90 percent from the peak in September 2005 when 111 properties totaling 27,784 units sold for a total of just over $4 billion, according to Real Capital, a New York research firm.

By comparison, May saw 19 properties with 2,706 units slated for conversion trade for a total of $334.3 million. That's a nearly 50 percent plummet from April, when 25 properties sold for a combined $655.8 million.

"The condo craze has quietly come to a virtual halt," Jay Massirman, a vice chairman with CB Richard Ellis' multifamily group in Miami, said. "There are some projects that are still viable, but many of the investors and speculators have backed off the market."

There are a lot of reasons for the sea change. Perhaps the biggest is lackluster consumer demand for units. Other reasons include higher interest rates, which have had a big impact on converters' ability to go through with their proposed projects as well as consumers' ability to finance the purchase of units; higher insurance and construction costs.

The condo craze in Florida began about five years ago. The drop-off started about five months ago in cities like Miami and Ft. Lauderdale, Rosendo Caveiro, a director with Cushman & Wakefield's Miami office, said.

The Florida market is looking at some 60,000 units statewide that are in some mode of condo conversion, Massirman said. Some of those could end up becoming for-rent apartments. Others simply won't be completed.

Lenders have become far more stringent in providing debt. "If they do loan money for building new luxury condos, the developer will not have to just provide reservations, they'll want contracts with real money," Caveiro said.

Meanwhile, high construction costs have put a damper on the development of new rental projects, in Florida and elsewehere.

In the first quarter, 11,221 units were completed, according to Reis, down from 21,637 a year ago. Meanwhile, 14,351 units were converted to condos. That compares with 25,770 units that were converted a year ago. The result is that the nationwide inventory has stayed flat at 8.9 million units.

So the national vacancy rate has improved, to 5.6 percent in the second quarter from 6.4 percent last year, according to Reis.

The average national effective rent grew to $936/unit in the second quarter, a roughly 4.5 percent increase from a year ago, according to Reis Inc.

So investors remain hot for rental properties.

Take San Francisco, which is still in recovery mode. Not too long ago, properties with condo maps in place were a hot commodity. That's no longer the case.

"The yield threshold for the converter has gone up substantially," said Phil Saglimbeni, a broker with Marcus & Millichap's Palo Alto, Calif., office. "The apartment guys are getting the deals. There's more perceived risk in selling to converters," he said.

Archstone-Smith, for example, has been among those actively pursuing rental properties. It just acquired a 322-unit complex in Fremont, Calif., for $79.6 million. It also paid $120 million for the Key West apartments in Manhattan and $165 million for the Marlborough House in Manhattan. Both New York deals were brokered by Douglas Harmon of Eastdil Secured.

"Any drift apparent in cap rates since the beginning of the year for solid conversion candidates has been almost entirely offset by increasing rental rates, and a broader and deeper worldwide appetite for large, stable, rental properties or portfolios," Harmon said. He added that high-end condo opportunities "have not lost any of their luster," while the "the condominium bloom fades from the rose of more pedestrian rental properties."

In New York, rents are higher and have increased even more than elsewhere in the country. Rents stood at $2,370/unit in the first quarter, up 6.2 percent from the same period a year earlier, according to Reis.

"New York rents have exploded," said Richard Bassuk, president of The Singer & Bassuk Organization, a Manhattan mortgage broker.

So lenders, which have become conservative when it comes to financing condo deals, are aggressive when courting rental transactions. "Lenders are willing to finance a much broader spectrum of developers doing residential rental development," Bassuk said. "This willingness to provide financing for rental projects has caused many developers to re-evaluate their plans to see whether once again residential rental development is attractive."

Condo-office conversion planned

2006-07-14T09:40:00.000-04:00

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BY MATTHEW HAGGMAN

A Brickell Avenue office building hit hard by Hurricane Wilma will be sold and converted into office-condominiums, adding to a growing trend in South Florida's commercial real estate market.

Developer Edgardo Defortuna, who made his name building and selling residential condos, has agreed to pay $68.5 million for the 20-story, 235,532-square-foot Colonial Bank Centre building at 1200 Brickell Ave. in Miami.

The deal, expected to close within the next two months, would be Defortuna's second office-condo conversion and the third on Brickell Avenue in three years. The others are 1000 Brickell and Defortuna's 1110 Brickell.

''I am positive the demand is there [for office-condos],'' from users and investors, said Defortuna, who heads Fortune International in Miami. He said 1110 Brickell is sold out.

``The buyer who used to buy a residential condo as an investment to rent is now switching to office or commercial space because they are concerned about overbuilding in the residential market.''

In recent years developers increasingly have bought office buildings and divided them into individual condo units for sale, primarily targeting small and medium-sized businesses whose space needs are largely fixed and business owners from Latin America, where it is more common to own office space.

Their pitch: It's better to build equity -- particularly when interest rates are relatively low and property values may increase -- than pay rent. They also argue buying eliminates the risk of rising lease costs.

But the concept remains untested in South Florida over the long haul. Many companies -- especially large ones -- prefer paying rent because it allows them to expand and contract as business needs dictate.

For now, planned or already completed office-condo conversions account for about 11 percent of the market, according to commercial real estate brokerage CB Richard Ellis. The firm notes many of the planned conversions may never happen.

The largest office-condo conversion announced to date -- the 21-story, 295,000-square-foot SBS Tower in Coconut Grove.

''I don't think it will be a flash in the pan,'' said Hank Bush, principal with Miami's Bush Development, an active office-condo converter in South Florida. ``It will never be 60 percent of the market, but I think it will be a significant component.''

Colonial Bank Centre, meanwhile, suffered extensive damage following Hurricane Wilma last year. The high winds punched out numerous windows in the tower that has Morton's Restaurant on its ground floor.

Defortuna said the windows are being fixed, and all repairs must be finished before closing.

Tenants include Kroll, an international investigations firm, and real estate development company Terra Group.

''1110 Brickell was a tremendous success for us,'' said Defortuna, referring to his first office-condo conversion. ``We are finished with that building, and now this one is double its size.''

Construction Costs Stall Many Las Vegas Condo Projects

2006-07-14T09:17:00.000-04:00

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By HUBBLE SMITH

Rising land and construction costs have created major barriers for entry into the Las Vegas high-rise luxury condominium market, giving early projects such as SoHo Lofts, Panorama and Sky Las Vegas a clear advantage over newcomers, executives of two projects under construction said.

Anything built on or around the Strip is going to sell for $1,300 to $1,500 a square foot, said David Pourbaba, president of Sky Las Vegas, which recently topped out construction of its 45-story tower next to Circus Circus.

"They will be priced to make the land and construction cost work," he said. "It's all relative. People pay $2,000 and $3,000 a foot in New York and London."

At the end of the second quarter, there were 246 existing luxury condo units on the market for resale at an average price of $1.1 million, or $631 a square foot, local research firm Applied Analysis reported. Units sold during the quarter averaged $787,000, or $459 a foot.

A market snapshot shows 135 projects with 91,934 units proposed for Las Vegas, including 2,321 existing units, 1,379 canceled units and 6,888 suspended units. About 13,500 are under construction and 16,286 are planned and pre-selling.

"From our perspective, it's nice to be on the front end of that wave," said Dusty Allen, managing member of the 275-unit Streamline tower being built by Martin-Harris Construction at Las Vegas Boulevard and Ogden Avenue.

Of the 15,811 units proposed for downtown Las Vegas, about 900 are under construction, he estimated. They include Streamline, SoHo Lofts, Newport Lofts and Juhl.

Among the projects that have been announced for downtown but have yet to break ground are Club Renaissance, Sandhurst, Cielo Vista, Liberty Tower and Gateway Las Vegas.

"The price per square foot to build has gone up significantly," Allen said. "Fortunately, we were able to lock in our construction prices early and provide a price-per-square-foot basis lower than $600. We still have some units priced under $500 a square foot."

Pourbaba estimated that hard costs for construction of Sky Las Vegas, with M.J. Dean as general contractor, have risen 8 percent to 10 percent to about $200 million. "What do they say? It ain't over till the fat lady sings," he said.

A lot of predevelopment planning went into the project, including purchasing steel and concrete at prices from two years ago, Pourbaba said. As a result, few changes were made to the plan.

Most of the projects canceled in Las Vegas were due to lack of construction companies capable of doing the job, not lack of buyers, he said.

Certainly, there is insufficient demand to absorb all of the luxury condo units in the pipeline, Applied Analysis principal Brian Gordon said. Observers have predicted that 25 percent to 50 percent of the proposed units will get built.

"While projects that are currently under construction have reached the critical mass in terms of sales to provide sufficient financing, the remaining 16,300 units vying for potential buyers will either prove their ability to move forward in the next 12 months or not," Gordon said. "Construction cost dynamics and consumer perceptions about extended sales periods decrease the likelihood for success for many of these projects."

Location, branding and experience remain keys to success, Gordon said. Projects announced by major operators and development companies are likely to enter the market with greater success.

Nearly 40,000 units in the pipeline are categorized as the hybrid condo-hotel and maintain some sort of rental program. About 70 percent are located around the Strip, including The Residences at MGM, Platinum, Project CityCenter and Cosmopolitan.

2-tower plan surfaces for Scottish Rite block

2006-07-13T11:08:00.000-04:00

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BY DAVID ROEDER

Representatives of some community groups were briefed about the plans Tuesday night. Skatulski said Chicago's Pappageorge/Haymes Ltd. will provide the architecture.

L.A. Mixed-Use Project Gets Recap

2006-07-13T10:45:00.000-04:00

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The Ratkovich Co. has recapitalized The Alhambra, a 1 million-square-foot mixed-use development outside of Los Angeles in a deal valued at more than $200 million.

The Los Angeles developer is partnering with AIG, which is taking out the stake that Connecticut General Life Insurance Co. had in the 45-acre property. And Goldman Sachs has agreed to provide $130 million in financing.

In addition, a $6.15 million loan was placed on the property's retail component, The Shops at The Alhambra, a 17,693-sf neighborhood center. The financing was arranged by Holliday Fenoglio Fowler LP, which also arranged the equity recap along with Grubb & Ellis.

Three years ago, Connecticut General Life had purchased a stake in the property for $27.5 million. IStar Financial had provided $87 million in debt.

The property at 1000 South Fremont Ave. in the city of Alhambra, consists of six mid-rise office structures. It was developed in 1999 as the headquarters for CF Braun Engineering. Now, tenants include a mix of commercial, public sector and education companies such as the USC Keck School of Medicine, Tenet Healthcare and the L.A. County Sheriff's Department.

The Shops at The Alhambra is connected to the main campus by a pedestrian bridge. Retail tenants include Starbucks, Jamba Juice, Subway and Pick-Up Stix. Overall, the property is more than 95 percent leased.

The new venture plans to add a residential component to the property. Plans call for more than 300 condominiums and townhouses, plus a state-of-the-art L.A. Fitness Center gym. In addition, there are seven acres that can be developed in the future.