I am a big believer in supporting your local economy in every way you can - this article reinforces my belief that creating a relationship with your local bank is important. While you might not do every deal with them - local banks have an intimate knowledge of their geography and the players within it and can offer invaluable advice and counsel.
Sphere: Related ContentBELFAST (May 15): The owners of the Stinson Seafood property on the Belfast waterfront have announced a June 24 auction of the entire parcel.
The sale will be handled by Tranzon, the international auctioneers with an office in Portland. Spokesman Mike Carey said Thursday, May 15 that the sale will be subject to owner confirmation and is not a foreclosure or bankruptcy procedure.
 |
| The shiny new Footbridge stands in sharp contrast to the skeletal Wakeag Landing project to its south. (File Photo) |
The firm plans to advertise regionally and nationally in both print and Internet outlets, he said.
Carey said Belfast Bridge LLC, the owners who planned to turn the former sardine plant into a multi-use complex called Wakeag Landing, have considered an auction of the property throughout the marketing campaign. “They feel they have taken the project as far as they can” Carey said, “and they want to pass it on to someone who will take it into the end zone.”
Though the real estate market is depressed nationally, “There’s a lot of excitement about Belfast,” Carey said. “You’re a small, quirky, funky town and you’re now reinventing yourself again. Now is the time to sell because now is the time to buy.”
The property was listed for $1.5 million before it was purchased by developer Tom Roberts and partners in 2004 and was last listed by a real estate agency for $3.1 million, Carey said.
The owners have not established a minimum price for the auction, he said.
The City Council last month extended the contract rezoning agreement that Roberts reached with the city in 2006 so it would be available to new owners. The agreement calls for construction of condominiums, retail spaces, a marina and boat-repair facility and a dock for local commercial fishermen.
City officials have reported continuing interest in the property by buyers.
click here to visit Village Soup
Sphere: Related ContentCurrent Market Conditions Don’t Seem To Have Caught Up with Sellers, While Buyers Think Everything Should Be Deeply Discounted
Much has been made of the impact of the credit crunch on the slowdown of commercial real estate investments. But just as impactful as the lack of available credit right now, is that buyers and sellers have not yet come to terms with the the ‘new reality’ and remain at opposite extremes in terms of pricing, which further exacerbates the current deal paralysis gripping the market.
There is almost no investment real estate market at this time, say industry executives and brokers we surveyed for this story. Some 1031 exchanges are getting done out of necessity to meet tax obligations and some institutional properties are trading due to the flow of foreign capital taking advantage of the depressed dollar but the spread between buyer and seller is far too dramatic for “bread and butter” deals to get done.
If you would like to read the full story, please go to:http://www.costar.com/News/Article.aspx?id=13DEAE780258528E13339CE2D3598402
Sphere: Related ContentFrom this report it is safe to say that the high flying days of loan on anything and let the ever-increasing market cover your mistakes has come to an end. Wish I’d sold my bank stocks 18 months ago…
The fourth quarter 2007 FDIC Quarterly Banking Profile (QBP) is now available on line. FDIC-insured institutions reported net income of $105.5 billion in 2007, a decline of $39.8 billion from the record $145.2 net income that the industry earned in 2006. Higher provisions for loan losses—primarily due to weakness in residential mortgage and construction loans—and sharply lower trading revenue were primarily responsible for the drop in full-year earnings. The bulk of the earnings decline was attributable to a few large institutions, but fewer than half of all insured institutions (49.2 percent) reported increased net income in 2007. In addition, the FDIC reported that fourth-quarter earnings dropped to $5.8 billion, their lowest level since the fourth quarter of 1991.
2007 NAA/Morpace Industry Overview Brochure
Available to Download
The NAA 2007 end-of-year industry overview brochure is now available for members to download. Click here to view.
Okay, after this I promise to find some other sources of information, but Mark over at CoStar does a great job reporting from credible sources and keeping up with trends…here is another finger on the pulse update:
The Waiting Game: Lenders, Borrowers Grapple With Uncertainty Over Property Values, Cap Rates
The Real Estate Journal published an article yesterday morning that is interesting from several perspectives. Their articles lean toward simplicity out of, what I believe is, the K.I.S.S. mentality of writing for the masses. Nevertheless, this article highlights a multitude of topics that could be expanded upon, but I’m going to hook items 1 and 2 as they relate to this blog content.
1. “You don’t know what’s worth until you sell it” - I should print this on my business cards. The power of perception is a wonderful thing - it allows us to dream and leads to research and innovation - unfortunately, if unchecked, it sometimes also leads to delusions of grandeur - when it comes to the real estate this next statement is a natural tendency - [dreaming] “leaves ample room for mental mischief. You can happily imagine that your house is a wonderfully stable investment, because — unlike your stocks — you aren’t receiving continuous price updates. You can also happily imagine that your home sports some grand valuation.”
which leads us to item 2: “The expense ratio is HUGE” - That mortgage payment and utility bill doesn’t seem as overwhelming when we are seeing the direct benefit of writing that check every month - BUT, when that house is empty and you’re still writing the check, numbers like this are significant “Each year, between maintenance costs, property taxes and homeowners insurance, you might be paying a sum equal to 3% or 3.5% of your home’s value.” To put this in concrete terms - you’re $400K house costs you between $12K and 14K a year - minimum! That doesn’t include your debt service folks.
So you ask, what’s my point? Well, first let’s start with my point isn’t that everyone should be selling at auction. There are times and places where auctions are the most effective and impactful means of resolving a real estate situation, but auction are not appropriate for all real estate transactions. My point is mostly - don’t quibble over a couple of thousand bucks here or there on the sale of your house - in the end it really won’t matter and usually your money today is worth more than your money tomorrow.
Sphere: Related ContentCoStar - New Money Pouring into Funds Targeting Distressed Deals
I never claim to be on the bleeding edge of information and news, but I was just discussing this exact situation with a client yesterday - Our opinions were very similar to ones in this article. What also rings true from this situation is that each deal/project/development must be viewed individually and will be analyzed differently by each buyer/buying entity. As an example I looked at a residential development deal last month and thought at a 40% to 50% discount it really makes sense. Come to find out the owners just received an offer that nets out at approx. 25% discount off the last asking price - now I would be hard pressed to tell you where this buyer in finding an additional 15% to 25% in this project, but hey all the best to him and congratulations to the owner/sellers - to me that’s a home run!!
CoStar - New Money Pouring into Funds Targeting Distressed Deals
Sphere: Related ContentYour very own blogger was quoted in the most recent CoStar Watch List
The level of thoughtfulness, intelligence and market insight of Watch List readers and the chance to receive and share that knowledge has been one of the primary motivators behind this column and for which I am entirely humbled and grateful. This past week has been a prime example of that.
The Federal Reserve Board’s actions in January lowering key interest rates 1-1/4 points over the span of two weeks prompted several e-mails. Readers are suggesting that while the Fed cuts may have buoyed short-term hopes, they won’t be enough to keep real estate markets from sinking further. The problems that need to be addressed are no longer just about money and have overflowed out of the U.S. pool and are spread out across the globe…
…What is happening in Vegas is being mirrored elsewhere in the country.
“Our phones just started ringing again with earnest. It is almost like the Northeast has come out of the deep freeze and stopped shivering enough to dial the phone,” writes Mike B. Carey, national account coordinator for Tranzon Auction Properties in the Portland, ME, office. “Buyers are once again aggressively chasing Class A and B locations. Class C and single-family residential is still struggling to attract the interest it did two years ago as the speculators have either smartened up or been wiped out (more of the latter, than the former). All in all the conversations I have been having with clients and buyers over the last two weeks indicate a bit more optimism, cautious as it may be, about the real estate market in general. That said, buyers are still very conservative and are unwilling to push the pricing envelope assuming the markets are either stagnant or still receding.”
It’s the caveats that Kingham, Law and Carey hint at that other readers addressed head on. The optimists are assuming that there is a spread in risk, which there is not, writes Dr. John Doede, a doctor of chemistry and physics and a “semi-retired private investor” in Phoenix, AZ,… Click Here for Full Article
Sphere: Related ContentI’ll make the prediction now: Countrywide won’t survive 2008 without either a major foreign cash infusion or bankruptcy protection. Want to buy a huge chunk of the U.S’s largest lender at a cut-rate price?
Reuter’s Article