Archive for category In the News
For Distressed Investors, There is No Where To Go But Up
Posted by Joe in In the News on March 2, 2011
More Deals, More Financing, More Competition Is the Outlook for Distressed Investing
By Mark Heschmeyer for CoStar Group
March 2, 2011
If conditions in commercial real estate have indeed hit bottom, then an increased amount of distressed assets could hit the market this year — and values could also begin to tick up. That is the general consensus of industry professionals that CoStar Group interviewed for their outlooks on distressed investing in 2011.
Contributing to this expectation is a change seen in the dynamic among lenders. Up until very recently, banks have been reluctant to foreclose on distressed loans because they would be forced to take huge write downs – i.e. losses on those assets. So a policy regarding under-performing loans on commercial real estate that has come to be called “extend and pretend” has become prevalent in banking for the last three years.
But if as industry players now suggest that values have stabilized, then the uncertainty that bankers have faced on valuations will begin to clear up.
“We think that the distressed CRE market will continue to see increased deal flow in 2011. As the broader economy recovers, banks are more capable of accurately assessing value and realizing a more clearly defined exit from nonperforming loans which bank balance sheets are now able to handle,” said Kevin Brands, managing principal of Holt Lunsford Commercial in Addison, TX. “Thus, the banks see a bid ask spread narrowing and will show progress in concluding their “extend and pretend” strategy and push the distressed assets onto the market.”
Business partners take over Peach’s Restaurants
Posted by Joe in In the News on February 24, 2011
By GRACE GAGLIANO | Bradenton.com
photo credit: Bradenton.com
Alison Thomas does everything with a smile — busing tables, wiping counter tops and rolling up utensils in napkins.
Her business partner Mary Beth Hansen is the same way, even when realizing that attempting to cook bananas and chocolate chips in a waffle iron will create quite a mess.
“We feel very fortunate for this opportunity,” says Hansen, who along with Thomas purchased all 10 Peach’s Restaurants and its catering business in December.
The longtime friends say they’ve embarked on their greatest business venture yet: owning and operating one of Manatee County’s most popular breakfast and lunch diners. The two purchased Peach’s Restaurants and Catering Co. out of receivership Dec. 7.
A foreclosure suit was filed against the restaurant chain and catering division Jan. 15, 2010, claiming then owner Michael Luciano owed more than $1 million on a $1.3 million loan. Total assets of Peach’s Management Inc. as of Dec. 20 were $5.5 million, according to court records.
“Yes, we are very fortunate this has worked out for us,” said Thomas, who wouldn’t disclose their purchase price. “It was a good deal.”
Sarasota attorney Morgan Bentley, who represented Peach’s in the foreclosure suit, said receiver Joe Hembree was instrumental in putting the business in good standing for its new owners.
“The receiver came in and it was textbook,” Bentley said. “He started making some money for the business, streamlining some things and the restaurant was able to get back on its feet and, hopefully, last years to come. Everyone loves Peach’s, including me
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Latest county numbers show 13% fall in 2009, compared with a decrease in residential properties of only 9% | HeraldTribune.com
Posted by Joe in In the News, Real Estate Updates on June 7, 2010
THE DISCONCERTING PART OF recent real estate statistics is that the value of commercial property is now falling more rapidly than that of residential property.
After dropping by more than 20 percent in 2008, residential property fared much b etter, losing 9 percent of its value last year, according to preliminary figures from Sarasota County Property Appraiser Bill Furst’s office.
But the value of commercial, retail, office and industrial property, which had held steady earlier in the recession, fell by 13 percent in 2009. Vacant industrial land fell by 24 percent last year, rivaling the longtime market leader in bad investments, vacant residential land.
The turn in the numbers is worrisome to Sean Snaith, a University of Central Florida economist.
“It’s like a dismal relay race as the baton gets passed from one sagging sector to the next,” Snaith said. Partly because of the downturn in commercial, Snaith says the real estate recovery may not manifest itself until after 2011.
The figures also bring to mind the oft-quoted findings of a February report by the Congressional Oversight Panel, a group of academics, accountants and former regulators formed to oversee the federal government’s $700 billion bank bailout effort in late 2008.
The panel points out that $1.4 trillion in commercial loans are due to reset over the next four years, and half of them are under water. The foundering of the unwise investments made at the height of the boom is not what worries the panel — it is that a prolonged, deep recession may put sound commercial deals at risk as well.
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Manatee real estate falls by 13 percent | HeraldTribune.com
Posted by Joe in In the News, Real Estate Updates on June 2, 2010
First time county’s values declined more than its neighbors
Property values took a dive in Manatee County, pushing the local tax base down 13 percent, according to figures released Tuesday by the county Property Appraiser’s Office.
It marked the first time since the recession began that Manatee County saw a faster pace of erosion to its tax base than was experienced by its neighbors to the south.
In each of the last two years, Manatee posted annual losses of less than 10 percent to the taxable value of its property, while Sarasota County declines reached 15 percent and Charlotte County’s fell as much as 20 percent in a single year.
But the new numbers show the two southern counties lost less than 10 percent of their taxable values while Manatee is projected to lose 13 percent.
The biggest decline came in Palmetto, where County Property Appraiser Charles Hackney estimates a 19 percent decline took place. Meanwhile, Anna Maria Island saw just a 4 percent drop in values.
Hackney said Anna Maria was spared from large property value declines because of its lack of condominiums and the fact that the island was basically built out before the market explosion that took place from 2004 to 2006.
“I would say Palmetto had several large condominium developments that all hit at the same time three or four years ago,” Hackney said. “In the marketplace those units have taken the biggest hit,” he added, noting that there are condos in Palmetto selling for less than half of what they were valued when built.
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