1July2009
Posted by John under: News.
The parallels are almost eerie. A world-famous singing sensation, known for his distinctive wardrobe and bizarre behavior, dies of heart failure amidst a pile of prescription drugs. Fans line up outside the gates of his estate—waiting to pay their respects to the King. It’s Michael Jackson, we’re talking about though, not Elvis. But there is still plenty of speculation that Jackson’s famous home—Neverland Ranch—could become a tourist attraction ala Presley’s Graceland.
For days rumors swirled that his family was considering a public viewing of Jackson's body at Neverland, a 2,800 acre spread, located 33 miles northeast of Santa Barbara, Calif. News crews booked hotel rooms. AT&T and Verizon were allegedly moving in emergency cell phone antennas. The appearance of a cement truck at the ranch on June 30 had readers of celebrity gossip site TMZ.com speculating there may even be a crypt under construction.
The man who controls the ranch, real estate investor Thomas Barrack, is mum about the long term plans. Barrack’s Colony Capital bought the $22 million mortgage on the property just before it went up for auction last year. It’s now owned in a joint venture with Jackson’s estate, says Barrack spokesperson Joanne Lessner. She released an effusively worded letter from Barrack to local residents on June 30. Citing pioneering California missionary Junipero Serra, Jackson’s 2005 acquittal on child molestation charges and “a Western tradition of kindness and hospitality,” Barrack asks his neighbors to bear with the public onslaught and let the world take in the “magic elixir” of the Santa Ynez Valley.
Locals say it is highly unlikely Barrack or the Jackson family could get permission to build a Graceland-like tourist attraction at the site. Local real estate broker and long time area resident William Etling recently blogged about the issues that might prohibit such a development. The ranch, he notes, is zoned for agricultural not commercial use. After talking with a local mortician, Etling says it is unlikely that Jackson’s body could legally be buried on the property.
There there’s the issue of the community support. Last year voters in Santa Barbara County shot down a candidate for supervisor who was seen as pro-hotel development. Locals, including celebrity residents such as Bo Derek and David Crosby, have vigorously opposed expansion plans by the local Chumash Indian casino. Lately locals have taken to calling the ranch Never!-land.
As a real estate broker, Etling would seemingly have an interest in seeing more development of the bucolic region, which saw a surge in tourism five years ago after the movie Sideways was filmed there. But Etling says the largely wealthy area residents have no interest in opening more of their valley to John Q. Public. “It would depreciate our property to have that carnival,” he says. “It’s not that type of place. It’s very stable. There’s not a lot of mobility.”
Jackson’s ranch is located about five miles north of the tiny wine country hamlet of Los Olivos. It’s one of the most beautiful spots in the country, blessed with rolling hills, vineyards and cool, damp air from the nearby ocean.
It is a part of the world Barrack knows well. He’s owned a ranch and vineyard near Neverland for three decades. Last year he reached a settlement with neighbors that allowed him to open his Happy Canyon Winery to wine salespeople and critics but not for public wine tastings, which locals had opposed.
Retired venture capitalist Bob Field, who says his own property overlooks Barrack’s vineyard, has another suggestion for his neighbor—dismantle Neverland and take it piece by piece to Las Vegas, where Barrack’s company owns the Las Vegas Hilton and an interest in Station Casinos—a string of gambling joints aimed at local residents. “This is a small valley,” Field says. “We don’t have the roads, hospitals or airport. It will take him multiple years to develop anything here. It would cost him a fraction of that in Las Vegas. The day it opened, there would be many times the visitors.”
If a Neverland museum doesn’t get developed in Vegas or Los Olivos there are other cities that might welcome it. The mayor of Jackson’s hometown of Gary, Indiana is practically begging to have the star’s remains find a permanent home there.
1July2009
Posted by John under: News.
Tropicana Atlantic City Casino & Resort is set to come under new ownership, just over one year after owner Tropicana Entertainment L.L.C. filed for Chapter 11 protection. But it's not a big-name gaming company that will take over the property's reigns. The United States Bankruptcy Court in Camden, N.J., has green-lighted a "stalking horse" asset purchase agreement calling for pre-petition lenders--a group that includes billionaire investor Carl Icahn's Icahn Capital--to take hold of the asset in return for forgiving $200 million of debt owed by Tropicana.
1July2009
Posted by John under: News.
Investors purchase stocks online. Will they buy somebody’s mortgage over the Web as well? A start-up called BigBidder.com hopes so.
The backers of BigBidder already run fre.com), a site that sells homes online.
Paul Lyons, a senior vice president of the company, says BigBidder is auctioning off home loans owned by banks, mortgage companies and other investors. The loans are both performing and non-performing—--the latter meaning the homeowners aren’t making their monthly payments. Lyons says much of the site’s sales are in “re-performing” loans, meaning the home owner was delinquent until the lender changed the terms of the loan and now the borrower is making payments again.
BigBidder charges the buyer a fee of from 1% to 5% of the loan purchase price, depending on the size of the loan. Some recent deals include an $83,000 first mortgage carrying a 9.8% interest rate on a 3 bedroom house in Gas City, Indiana. It sold for less than half of the loan amount. Meanwhile, a $100,000 adjustable rate second mortgage on a home in North Hills, California currently carrying a rate of 6.2% sold for just 25 cents on the dollar. Both of those loans were performing.
Lyons says documentation, such as the original loan application and credit reports on the borrower, is available on the Web site. I’m not recommending anyone dive into this kind of investment, certainly not without a lot of thought and research. Judging by those discounts the sellers don’t think these loans are going to get paid back in full any time soon.
30June2009
Posted by John under: News.
The latest Standard & Poor’s/Case-Shiller housing index numbers out today show the market falling less dramatically than it had been earlier in the year. The 10 and 20 city indices were both down 18% in April, versus the same month in 2008. But that decline was less severe than it had been in January, February and March.
"The pace of decline in residential real estate slowed in April,” says David Blitzer, Managing Director and Chairman of the Index Committee at Standard & Poor's. ”Every metro area, except for Charlotte, recorded an improvement in monthly returns over March. While one month’s data cannot determine if a turnaround has begun, it seems that some stabilization may be appearing in a few of the regions."
The worst hit cities include Phoenix (down 35%), Las Vegas (-32%) and San Francisco (-28%). Best performers were Denver (only down 4.9%), Dallas (-5%) and Boston (-7.7%). Dallas has held up the best since its market peaked in June 2007, falling only 9.6%. Phoenix fared worst, off 54% from its June 2006 peak.
Cameron Findlay, the Chief Economist of mortgage site LendingTree.com, says the clearest sign of where the housing market is now, lies not in a national price index from two months ago but in the cost of mortgages today. Rates on a 30 year conventional mortgage have dipped down to 5.37% from a recent high of 5.74%. That’s telling us the housing market hasn’t recovered. The Fed is still committed to buying $300 billion of long-term Treasury bonds to inject more liquidity into the system, he notes.
“There was a wide anticipation that the Fed would ease off on, not purchase as much,” he notes. “Bonds started selling off, rates started rising.” That's changed. Findlay expects rates to stay at this level at least until the Fed finishes its bond buying in September or until more convincing signs emerge that the housing market has come back.
“It’s still down,” Findlay says of the Case-Shiller index. “The only positive news is that Colorado slightly improved. There’s still extreme pressure due to (mortgage) delinquencies.”
29June2009
Posted by John under: News.
I stopped by Dwell on Design, a home design show sponsored by Dwell magazine at the Los Angeles Convention Center this weekend. This was the kind of event I expected to be really slow during the Great Recession. It cost $25 to get in and had a lot of cool, but pricey products on for sale, everything from $3,000 Ligne Roset arm chairs (and they are cool) to my bottle of Vitamin Water which cost $3.80 including tax (convention center pricing). There was actually a pretty decent-sized turnout.
The big hit seemed to the handful of prefab homes on display. Green Inc. is a Los Angeles company that makes dwellings out of converted shipping containers. That’s one of their homes above.
Modern-Shed makes the most stylish sheds you’ve ever seen. Like the Green Inc. structures, Modern-Shed’s products start at around $10,000. The company wisely positions them not as a hipper replacement for the $1,000 aluminum shed you could buy at Sears but as a low-cost addition to your home. While my wife and I liked that idea, my mother-in-law and niece didn’t seem to too keen on sleeping in the shed.
Also generating a lot of interest was a 400 square foot cottage made from reclaimed wood and other products. The cottage was very cool, kind of a cross between a shabby chic country house and the Unibomber's cabin. It’s made by an Austin company called Reclaimed Space, which auctioned off that actual home on eBay. The winning bidder paid $75,000. I remember one of the staffers in the house saying that home typically sold for $60,000, although in this case half the proceeds went to Habitat for Humanity.
28June2009
Posted by John under: News.
The frozen credit market and shattered economy have caused the interruption or outright cancellation of development project after development project across the country, but such is not the case for an unlikely 1.8 million-square-foot mixed-use endeavor in Plymouth, Mass., about 40 miles south of Boston. Having just secured the Plymouth Planning Board's approval of a master site plan, developers of Plymouth Rock Studios can now proceed with on- and off-site activities for the fully funded, $500 million film and television studio compound.
27June2009
Posted by John under: News.
Ory Schwartz, senior director of NorthMarq Capital's Los Angeles
office, has arranged an $18 million first mortgage for Meadowridge
Apartments, a 176-unit multi-family complex located in Santa Clarita,
Calif.
26June2009
Posted by John under: News.
The combination of a deep recession and widespread law-enforcement funding cuts will most likely spell a banner summer for burglars. If your house makes a good target - it's upscale, off the beaten path, and in or near a city - an alarm system is your best defense, according to Temple University economics professor Simon Hakim, who studies security and policing. Installing one will reduce your risk of a break-in by two-thirds. To determine what you really need, follow the guidelines below.
26June2009
Posted by John under: News.
Are banks overwhelmed and understaffed for all the work coming out of the housing bust? On June 24, Ciitgroup said it was temporarily suspending new loans brought to them by independent mortgage brokers as it seeks to fix “quality control” issues regarding loan documentation. Rob Jenson, a real estate agent with the Jenson Group in Las Vegas says he’s been trying for eight months to get Bank of America to approve the sale of house for less than the loan amount, a so-called short sale that banks say they are working more diligently to accommodate. “It’s insane,” Jenson says. “It’s getting worse.”
The house Jenson is having problems selling was originally listed for $795,000 in November. It's a five bedroom, 4,500 square foot home in the Vegas suburb of Summerlin. Jenson immediately got a full-price, all-cash offer which he submitted to the bank late last year. “It took two to three weeks to get a workout negotiator,” he says. “Then they order an appraisal, additional documents from the seller.” Two months later the bank said okay to $795,000, but by then the buyer had moved on.
That started the process all over again. Jenson brought in another buyer, but this one needed to get a loan. By then the house had fallen in value. The property appraised at only $747,000 and the buyer couldn’t get a mortgage for the higher purchase price.
Jenson said the bank negotiator he’s been dealing with said she’s got 145 files that she is working on at once. “Bank could create some jobs,” a frustrated Jenson says. “They should hire more negotiators.”
25June2009
Posted by John under: News.
With rumors circulating of a sale price around $100 per square foot,the sale of the 66-story American International Group headquarters in Lower Manhattan likely set the bar for the biggest sale in the areamarket thus far in 2009.