Socal Multiunit Real Estate

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – SEPTEMBER 2010

By Jodi Summers

This month, we’ll look at the big picture for multiunit properties – SMILE *< : ) - it’s all good. Apartment properties should continue to be a bright spot in your real estate investment portfolio for years to come. President George Bush’s tax cuts are set to expire on December 31, 2010. New Year’s Day, capital gains taxes will revert to 20% from their 70-year low of 15%. (To add insult to injury, the tax rate on dividends for top earners will jump from 15.0% to 39.6%, barring a slight of pen from Secretary of the Treasury Tim Geithner.) If history repeats itself, and a déjà vu of 1986 - when significant tax code revisions took effect and the capital gains rate increased from 20% to 28% - investor liquidations are likely to double the total realized capital gains from the previous year.

The current state of the apartment market offers more good news. Demand for apartments has moved well beyond employment gains with the absorption of nearly 46,000 units nationally during the second quarter -> the strongest gain since 4Q 2000. This aggressive lease-up of apartments resulted in a vacancy drop to 7.8%, a trend that should continue through year-end. Unless there is “a systemic shock that halts job creation,” the California Employment Development Department predicts that an additional 65,000 units will be absorbed through the second half of the year, dropping vacancies to 7.4% nationwide by year-end.

Multiunit investments are going to start looking really good. Since 2002 - the year before the capital gains tax rate was reduced to a 70-plus-year low - the number of 1031 exchanges has fallen by nearly half. As capital gains taxes rise, the volume of 1031 exchanges is expected to increase substantially, as sellers will be note be motivated to take profits from the investment real estate sector.

The future is bright. Expect the multiunit market to heat up. Regardless of the decline in investment values, many investors will adopt a liquidation strategy, locking in their profits rather than waiting for investments to appreciate sufficiently to offset the 5% tax hike.

Experts say perceived tax-related risks may encourage them to continue selling assets in 2011.

We’re here to help you with industrial properties. Please contact Jodi Summers - jodi@jodisummers.com or 310.392.1211, and let us move forward together.

**

http://www.edd.ca.gov/About_EDD/pdf/urate201010.pdf

http://www.labormarketinfo.edd.ca.gov/?pageid=1003

http://www.santamonicapropertyblog.com/wp-content/uploads/2009/12/solar-multiunits.jpg

http://www.mredllc.com/photos/property/424/07588424.jpg

http://blog.marcusmillichap.com/

http://www.santamonicapropertyblog.com/wp-content/uploads/2009/02/cairo-pyramid.jpg

http://cdn.dornob.com/wp-content/uploads/2010/05/huge-multi-unit-condo-exterior.jpg

LOS ANGELES IS AWARDED $30 MILLION FOR RETROFITTING REAL ESTATE

By Jodi Summers

All the banter that Los Angeles mayor, Antonio Villiarigosa has been causing in Washington with his green / energy saving ideas for Los Angeles are paying off. Recently, Vice President Biden announced that Los Angeles County was awarded $30 million to “ramp-up” energy efficiency building retrofits.

Los Angeles was one of 25 communities selected to receive a slice of $452 million in Recovery Act funding under the Department of Energy’s Retrofit Ramp-Up Initiative. The initiative promotes the concept that communities, governments, private sector companies and non-profit organizations will work together on pioneering and innovative programs for concentrated and broad-based retrofit projects.

A simple example of how the Retrofit Ramp-Up Initiative would work would be to have the same construction crew upgrade all the homes on the same block at the same time. The White House notes that this way of doing business, “…Saves contractors time and money. They can pass the savings on to their customers. And it’s just a much more efficient way to operate.”

Biden said the program, part of $80 billion in the Recovery Act for a clean energy economy, will help consumers save money on their energy bills, lower greenhouse gas emissions and create green jobs.

The models created through this program are expected to save households and businesses about a $100 million annually in utility bills, while leveraging private sector resources, to create what funding recipients estimate at about 30,000 jobs across the country during the next three years.

“Investing in retrofits is a triple win,” Vice President Biden observed, adding the program will result in retrofits for hundreds of thousands of U.S. homes and businesses over the next three years.

“This initiative will help overcome the barriers to making energy efficiency easy and accessible to all – inconvenience, lack of information, and lack of financing,” said Energy Secretary Steven Chu. “Block by block, neighborhood by neighborhood, we will make our communities more energy efficient and help families save money. At the same time, we’ll create thousands of jobs and strengthen our economy.”

In addition to the $452 million Recovery Act investment, the 25 projects will leverage an estimated $2.8 billion from other sources over the next 3 years to retrofit hundreds of thousands of homes and businesses across the country. The government noted gleefully, that the program funding was eight times oversubscribed, with more than $3.5 billion in applications received for the just over $450 million in Recovery Act funds available, (kind of like applying for UCLA). That puts it in course for additional investment in energy-saving and job-creating projects like these nationwide.

Retrofit Ramp-Up Awards

The following governments and non-profit organizations have been selected for Retrofit Ramp-Up awards. These projects are planned to begin in fall 2010. Final award amounts are subject to negotiation:

Austin, Texas - $10 million

Boulder County, Colorado - $25 million

Camden, New Jersey - $5 million

Chicago Metropolitan Agency for Planning - $25 million

Greater Cincinnati Energy Alliance, Ohio - $17 million

Greensboro, North Carolina - $5 million

Indianapolis, Indiana - $10 million

Kansas City, Missouri - $20 million

Los Angeles County, California - $30 million

Lowell, Massachusetts - $5 million

State of Maine - $30 million

State of Maryland - $20 million

State of Michigan - $30 million

State of Missouri - $5 million

Omaha, Nebraska - $10 million

State of New Hampshire - $10 million

New York State Research and Development Authority - $40 million

Philadelphia, Pennsylvania - $25 million

Phoenix, Arizona - $25 million

Portland, Oregon - $20 million

San Antonio, Texas - $10 million

Seattle, Washington - $20 million

Southeast Energy Efficiency Alliance - $20 million

Toledo-Lucas County Port Authority, Ohio - $15 million

Wisconsin Energy Conservation Corporation - $20 million

**

http://www.energy.gov/news/8870.htm

http://www.whitehouse.gov/the-press-office/vice-president-biden-kicks-five-days-earth-day-activities-with-announcement-major-n

http://content.usatoday.com/communities/greenhouse/post/2010/04/white-house-awards-452-million-to-retrofit-homes-businesses/1

http://www.inhabitat.com/wp-content/uploads/2010/02/Smart-Grid-Obama.jpg

REAL ESTATE RETROFITTING STATISTICS

Edited by Jodi Summers

* Residential and commercial buildings consume 40 percent of the energy and represent 40 percent of the carbon emissions in the United States. Building efficiency represents one of the easiest, most immediate and most cost effective ways to reduce carbon emissions and save money on energy bills while creating new jobs.

* Existing techniques and technologies in energy efficiency retrofitting can reduce energy use by up to 40 percent per home and lower total associated greenhouse gas emissions by up to 160 million metric tons annually.

* Residential and commercial retrofits also have the potential to cut energy bills by $40 billion annually.

**

http://www.energy.gov/news/8870.htm

http://www.matternetwork.com/images/Matter/house_insulation_installation_3251.jpg

http://apolloalliance.org/wp-content/uploads/2010/04/evergreen_solarmed2.jpg

http://content.usatoday.com/communities/greenhouse/post/2010/04/white-house-awards-452-million-to-retrofit-homes-businesses/1

GREEN WALLS KEEP MULTIUNIT PROPERTIES COOLER

GREEN WALLS KEEP PROPERTIES COOLER

By Jodi Summers

We discussed green roofs, now let’s cover green walls. Covered in vegetation, green walls can be 25% cooler than regular building walls in summer, remove air pollutants, and they look great.

Historically speaking, green walls aren’t exactly a new idea: The Romans planted grape vines along building walls, resulting in faster growing and sweeter grapes for wine. The structures are also prevalent in Europe, where modern-day green roofs first took off.

What the ancient Romans devised is now be adapted for 21^st century applications. Steven Peck, president of Green Roofs for Healthy Cities, a Toronto industry association, observes that interest in green walls is growing, estimating that green roof installations have increased at about 30 percent a year over five years.

Locally, the Rainbow Apartments off San Julian Street in the heart of skid row has a 34-foot-long vegetable wall filled with strawberries, tomatoes, basil and other herbs and vegetables. Residents of this step up housing facility are surprised at how the garden has united them.

“It brings us together as a group, kind of like therapy, to see something growing and flourishing,” Jannie Burrows said.

The wall was installed with the assistance Urban Farming, as part of the nonprofit’s Food Chain project. Urban Farming also erected “edible” walls at the Los Angeles Regional Foodbank, the Miguel Contreras Learning Center and the Weingart Centidenter.

The Food Chain project, said Urban Farming founder Taja Sevelle, enables residents in some of the city’s poorest areas to grow food in underused spaces at a time when food prices are soaring. The walls, she said, “get people to think outside the box. You can plant food in so many different places.”

In the corporate world, PNC Financial Services Group Inc. recently installed a 2,400 square feet green wall on one side of its headquarters in Pittsburgh. It’s the size of two tennis courts and features more than 15,000 ferns, sedums, brass buttons and other plants that create a swirling pattern of varying hues of green above the company’s logo. They are divided among hundreds of 2-by-2-foot aluminum panels that were anchored onto the building’s frame after part of the granite facade was removed.

“We think it’s the right thing to do for our community, for our customers and our shareholders,” said Gary Saulson, head of corporate real estate for PNC. “We wanted to add greenery to an area that didn’t have any. … We really view the green wall as public art.”

Green Living Technologies LLC, of Rochester, N.Y., designed the wall at PNC. The company has also installed walls in New York City, Los Angeles, Chicago and Seattle.

PNC bills its green wall as the largest in North America. On average green walls cost about $100 to $125 a square foot.

The Pittsburgh wall requires only 15 minutes a week of watering during peak growing season — less in winter — provided through the building’s plumbing system.

For non-edible green walls, according to Joanne Westphal, a landscape architecture professor at Michigan State University and part of the school’s Green Roof Research Program, the biggest benefit to green walls is their ability to help cool buildings through shading. They also help capture rainwater and release it more slowly into the atmosphere and stormwater systems. Additionally, green walls can offset the carbon output of one person a day.

http://www.agreenroof.com

http://www.greenroofs.org

http://www.socalgreenrealestateblog.com/?p=514

http://www.google.com/hostednews/ap/slideshow/ALeqM5hKS7UwnC8nR6j4kYQLu6m1X7nBbQD9B9DRK00?index=0

http://www.google.com/hostednews/ap/article/ALeqM5hKS7UwnC8nR6j4kYQLu6m1X7nBbQD9B9DRK00

http://www.insideurbangreen.org/green-wall/

http://www.edgelosangeles.com/index.php?ch=style&sc=home&sc2=&sc3=&id=97540

http://articles.latimes.com/2008/aug/14/local/me-garden14

http://arkitipintel.com/wp-content/uploads/2009/06/amelia_b_lima-green_wall.jpg

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – AUGUST 2010

By Jodi Summers

It seems the Los Angeles multiunit market has turned the corner. No longer are owners and developers sitting idly by waiting for the loan market to change. A velocity study comparing three years of first quarter multifamily transactions in Los Angeles County, shows that sales velocity declined 10.6% in 2008 from 2007; then 18.8% in 2009 from 2008; but increased 19.2% for the first quarter this year over 2009.

Statistics by Clarus Market Metrics confirm this study. Comparing July 08 vs. July 10 the number of multiunit properties in Los Angeles County sold by month is up 32%

And! The number of under contract properties by month is up 92% for the same period.

“It is clear that investors are back in the market,” observes Robert Leveen, a senior vice president of Lee & Associates investment services group. “There will always be a desire to acquire quality assets. They are buying it today at a discount from where it last traded…”

“Most buyers want the best deal they can get,” Leveen notes. “However, there are some that are more realistic and underwrite accordingly.”

Statistics confirm deals are to be had. Comparing July 08 vs. July 10, the median price of for sale properties is down 15% while the median price of sold properties is down 33%.

GlobeSt.com notes that L.A. developers have new 900 multifamily units in the works. Projects range from a 151-unit conversion of a hotel to brand-new luxury apartments and eight affordable housing complexes.

“There is sufficient demand in the marketplace and although there are discounts, certain product will trade with multiple offers, and the discount is not as steep as many buyers would want,” Leveen concludes.

Indeed so, contrasting July 08 vs. July 10: The number of for sale properties is down 40% and the number of sold properties is up 32%.

We’re here to help you with investment properties. Please contact Jodi Summers -jodi@jodisummers.com or 310.392.1211 and let us move forward together.

**

http://www.globest.com/news/1704_1704/losangeles/300864-1.html?ET=globest:e22790:277110a:&st=email

http://www.globest.com/news/1702_1702/losangeles/300812-1.html?ET=globest:e22715:277110a:&st=email

https://www.terradatum.com/

SAM ZELL’S INVESTMENT STRATEGIES

SAM ZELL’S INVESTMENT STRATEGIES

By Jodi Summers

Expectations of a crash in commercial real estate market are “greatly exaggerated,” noted media and real estate magnet Sam Zell recently in Chicago. “Everyone is waiting for the grave dancer to come and exercise his magic potion, but you need two to tango.”

Speaking at the at the first “Invest for Kids” conference in downtown Chicago, Zell noted that owners of office and apartment buildings today have no incentive to sell. By 2011 or 2012 they will likely be able to fill their vacancies, albeit at rates 30% below their peaks, because demand will catch up to supply, he observed.

Optimistically he shared the fact that the U.S. population is growing and with fewer building starts in the past decade, demand for housing will rise.

Then again, Mr. Zell has made some interesting predictions. Financial mogul Sam Zell, owner of the Tribune Co., recently told an Israeli business conference that the U.S. real estate market will be in recovery by spring 2009.

Chicagoan Sam Zell is best known for owning and defaulting such famous media properties as the Los Angeles Times, Chicago Tribune and New York’s Newsday. Media aside, Zell’s fame and $6 billion net worth originate from his mastery of real estate investing principles. This mastery, demonstrated repeatedly over a 40-year career, results from Zell’s acute understanding of real estate market mega-trends and his dedication to turning around troubled properties.

Zell got into real estate investing in the 1960s, during the time he received his bachelor’s (1963) and law degrees (1966) from the University of Michigan. It started when he finagled his way into a property management role with a local landlord. Next, Zell began buying distressed properties, fixing them up and rent them to students. Zell was a hands-on landlord who put a lot of energy into scouting and fixing up locations.

According to About.com, “In 1969, Zell and his partner Robert Lurie formed Equity Properties Management Corp. to centralize Zell’s rapidly diversifying investments in real estate. In the 1970s, Zell expanded beyond his initial interest in residential real estate and began to acquire office space under the aegis of Equity Office Properties Trust, or EOP. Zell structured his business as a series of real estate investment trusts, or REITs, under the Equity umbrella. EOP was one REIT; Equity Residential Properties Trust was another. The REIT structure allowed Zell to radically reduce his corporate income taxes. In addition to exploiting the REIT tax structure, Zell polished his skills as a salesman and convinced an increasing number of investors to entrust their money to him.”

Zell, with Robert H. Lurie went on to found the Equity Group Investments, LLC, which spawned three real estate public companies, including: Equity Residential, the largest apartment owner in the United States; Equity Office Properties, the largest office owner in the country; and Manufactured Home Communities, a mobile home company. In addition, Zell has created a number of public and private companies.

He proceeded to grow his office properties - Equity Properties Management REITs into strong national brand names. This project met with marginal success, as enterprises tended to buy office space based on local differentiators such as price and management, not on national differentiators such as brand name. Zell had to sell some office space for less than what he paid for it, but this did not cost him his whole empire, and he sold this part of his portfolio to Blackstone for $36 billion in 2006, and in 2007, Zell acquired a portfolio of newspapers owned by the Tribune Co., including the Chicago Tribune, Los Angeles Times, Newsday and Baltimore Sun. …an odd time to buy newspaper franchises.

Currently, Zell recently raised $625 million to invest in “credit opportunities.”

“In every market and in every situation there is opportunity,” Zell concluded.

“In my 40 years in real estate, I’ve found there is only one metric that matters — replacement cost.” He noted that the spread between a building’s replacement cost and its economic value is as wide today as it was in 1993 — mainly because the cost of construction has increased.

**

http://www.businessweek.com/the_thread/hotproperty/archives/2005/11/zells_favorite.html

http://www.chicagorealestatedaily.com/cgi-bin/news.pl?id=36105&print=1

http://www.socalmultiunitrealestateblog.com/?p=201

http://homebuying.about.com/lw/Business-Finance/Real-estate/Sam-Zell-Real-Estate-Magician.htm

http://en.wikipedia.org/wiki/Sam_Zell

http://www.businessweek.com/the_thread/hotproperty/zell2.jpg

http://reason.com/assets/mc/mwelch/2009_10/SamZell.jpg

http://www.richsamuels.com/nbcmm/zell/images/zellhs.jpg

http://images.businessweek.com/ss/08/07/0731_zell/image/zell.jpg

LOS ANGELES WINS THE ENERGY STAR GRAND PRIZE…AGAIN

By Jodi Summers

Bravo to all of you greening your properties. According to our friends at the environmental protection agency, approximately 3,900 commercial buildings earned the Energy Star rating in 2009, representing annual savings of more than $900 million in utility bills and more than 4.7 million metric tons of carbon dioxide emissions. Impressively, nearly 9,000 buildings across the nation have earned the Energy Star for superior energy efficiency during the past 11 years.

A standing ovation for our beloved Los Angeles. The EPA ranked us as first on its annual list of metro areas with the most energy-efficient buildings. We led the field with 293 buildings labeled Energy Star in 2009, up from the 262 that qualified the city as No. 1 in 2008.

Kudos also go to our nation’s capitol. Washington, DC, ranked fourth place in 2008, is now in second, with 204 Energy Star buildings, up from 136 the previous year.

Energy Star is a voluntary labeling program run by the EPA and U.S. Department of Energy. In order to qualify, a building or manufacturing plant must score in the top 25 percent based , on the agency’s National Energy Performance Rating System and use less energy, reduce operating expenses and cause fewer greenhouse gas emissions.

Roll the credits - the top 25 cities with the most energy star labeled buildings in 2009 are:

1. Los Angeles, CA

2. Washington, DC

3. San Francisco, CA

4. Denver, CO

5. Chicago, IL

6. Houston, TX

7. Lakeland, FL

8. Dallas-Fort Worth, TX

9. Atlanta, GA

10. New York, NY

11. Minneapolis-St. Paul, MN

12. Portland, OR

13. Boston, MA

14. Seattle, WA

15. Detroit, MI

16. Sacramento, CA

17. San Diego, CA

18. Austin, TX

19. Miami, FL

20. Phoenix, AZ

21. Ogden, UT

22. Charlotte, NC

23. Indianapolis, IN

24. Des Moines, IA/Fort Collins, CO/Philadelphia, PA

25. Louisville, KY

**

http://www.greenbiz.com/news/2010/03/23/la-takes-top-spot-epa-green-building-rankings

http://www.costar.com/News/Article.aspx?id=624F645516667EF93A09A56906607F8E&ref=100&iid=174&cid=383F14EEE265B182474DA2442BACBBBF

http://gateway.costar.com/imageviewer/GetImage.aspx?webimage=EPA+Energy+Star.JPG

http://lakelandflforeclosures.com/images/lakelandatnight.jpg

http://www.staronetickets.com/images/Seattle.jpg

http://away.com/images/outside/200808/ogden-ut.jpg

http://pics4.city-data.com/cpicc/cfiles28462.jpg

GREEN REAL ESTATE – GOOD FOR CALIFORNIA, GOOD FOR THE COUNTRY?

By Jodi Summers

Once again, when it comes to green, what’s good for California tends to become good for the country. The US Environmental Protection Agency and the Department of Energy have formed an action group to help states achieve the maximum cost-effective energy efficiency improvements possible in offices, buildings, industries and homes by 2020. Dubbed the State Energy Efficiency (SEE) Action Network, they are seeking to create a national version our statewide CALGREEN building code.

The CALGREEN Code was devised California Building Standards Commission is setting minimum green-building criterion that may, at the discretion of any local government entity, be applied.

“You will have a whole bunch of cities that never would have included this in their building doing it, and doing it in a way that won’t kill the economy,” observes Matthew Hargrove, a vice president with the California Business Properties Association. “Outside the coastal areas it will be helpful - like in West Sacramento, where they looked into creating a green building code but balked because it’s cumbersome to develop and they didn’t have the resources.”

Take the whole bunch of cities concept and spread it across a bunch of states. The DOE and EPA noted that 32 state public utility commissions requested help from the agencies last year regarding energy efficiency programs. SEE will be working with states to provide technical assistance and policy and program issues to advance energy efficiency efforts. Those state efforts may include financing solutions, residential efficiency programs and improving availability of energy usage information.

No doubt SEE’s goals will be similar to what we set forth in California. The purpose of CALGREEN’s codes is to improve public health, safety and general welfare by enhancing the design and construction of buildings through the use of building concepts that have a positive environmental impact, and by encouraging sustainable construction practices in the following categories:

• Planning and design

• Energy efficiency

• Water efficiency and conservation

• Material conservation and resource efficiency

• Environmental air quality

As California did with CALGREEN, now SEE and other DOE programs will help states develop strategies and action plans to improve the energy efficiency of existing building and reduce costs and emissions.

One small step for man, one giant leap for mankind.

**

http://www.businessgreen.com/business-green/news/2257243/agencies-action-buildings

http://www.socalmultiunitrealestateblog.com/?p=673

http://www.socalgreenrealestateblog.com/?p=764

http://www.hydrogenthusiast.com/uploaded_images/doe-786712-787007.gif

http://www.inhabitat.com/wp-content/uploads/2010/01/calgreen-ed01.jpg

http://www.socalofficerealestateblog.com/wp-content/newuploads/2009/08/calgreen_code_page_01.jpg

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – JUNE 2010

by Jodi Summers

According to the California Department of Finance, on January 1, 2008 Los Angeles had a population of 10,363,800 residents. Statistics indicate that this is an increase of 844,500 persons since 2000. The County’s population would make it the eighth largest state in the nation, just behind Ohio and ahead of Michigan. Everyone needs a place to live – so if you think about it, multiunits are always a good investment in Los Angeles County.

Compare May-08 vs. May-10 in Los Angeles County, the median price of for sale properties is down 10% and the median price of sold properties is down 63%.

Smart investors know this the is bottom of the apartment market in the more desirable parts of
town. This theory is bolstered monthly by a variety of reports. The Case-Shiller Home Price
 Index notes a  very uneven housing market, with significant recovery in some places and
continued decline in others. Housing prices have held up better in wealthier and more
productive regions, with higher concentrations of knowledge, professional and creative work,
and high-tech industry as well as higher levels of amenity (measured as working artists and
cultural creatives) and openness (measured as greater percentages of immigrants). Sounds
a lot like Los Angeles, which is why the  Number of Under Contract Properties by Month is up
115% compared with two years ago.

Did you know that Los Angeles County has 112 public and private colleges and universities? Our higher learning institutions include UCLA, USC, California Institute of Technology, and the Claremont Colleges to top-rated specialized institutions, like the California Institute for the Arts, the Art Center College of Design, the Fashion Institute of Design and Merchandising, and the Otis College of Art. Medical education is also a strong point; Los Angeles has two each of medical schools, dental schools, and eye institutes, plus specialized research and treatment facilities like the City of Hope. The County’s community colleges offer many innovative programs, including culinary arts, fashion design, multimedia, and computer assisted design and manufacturing.

We sound like a smart group, and the strengthening of our real estate market confirms that Los Angeles would fall into the wealthier and more productive regions of our company. Actually, three California cities are in top six growing real estate markets, according to the Case-Shiller Home Price Index. San Francisco posted the largest gain — 16.2% over the past year. San Diego (10.8%), Cleveland (6.7%), Minneapolis (6.5%), L.A. (6%), and D.C. (5.6%) also posted significant gains.

The report notes that “Housing prices have fallen further in locations with lower incomes and wages to begin with, with blue-collar manufacturing economies, lower levels of skill, and lower levels of amenity and openness. Expect that pattern to continue.”

Savvy investors purchasing apartment properties over the past years have used a variety of
financing  methods to make up for the weakness in the commercial loan market. As the stock
market tanked,  many investors pulled money out and paid cash for multiunits, or worked out seller
carrybacks. Now  the Mortgage Bankers Association is saying commercial lending for multiunits
is coming back. The MBA’s Quarterly Survey of Commercial/Multifamily mortgage originations
states that 1Q 2010 commercial and multifamily mortgage loan originations were 12% higher than
during the same  period of 2009.  Sales are way up. Comparing May-08 vs. May-10 in Los
Angeles, the number of sold properties is up 72%

The National Association of Realtors confirms that the apartment market is strengthening. Chief economist Lawrence Yun noted that the only bright spot in commercial real estate is apartments. “Demand for units should increase in the second half of the year as new jobs are created in the improving economy and new households are formed,” he concluded.

**

http://www.laedc.org/reports/LA%20County%20Profile.pdf

http://latimesblogs.latimes.com/money_co/2010/05/vacancy-rates-will-continue-to-rise-in-most-types-of-commercial-real-estate-such-as-office-and-industrial-buildings-until-the.html

http://www.theatlantic.com/national/archive/2010/05/housing-prices-and-the-great-reset/57287/

http://www.creativeclass.com/creative_class/_wordpress/wp-content/uploads/2010/05/YearOverYear.jpg

http://www.costar.com/News/Article.aspx?id=359D8A406145159176A40807B924DC84

https://www.terradatum.com/agentmetricsonline/report_chart_view.td

MAYOR VILLARAIGOSA’S 30/10 INITIATIVE WILL BRING MORE HOUSING OPPORTUNITIES TO LOS ANGELES

By Jodi Summers

What causes the most pollution in Los Angeles? Vehichles. How do we solve that issue? Better mass transit. Mayor Antonio Villaraigosa’s latest solution for greening Los Angeles is the 30/10 initiative - the mass transit financing method that the mayor proposed to the federal government so that Los Angeles can build their 30-year mass transit model in 10 years’ time.

Montiel believes that the 30/10 initiative can transform public housing by creating projects such as Jordan Downs, a 700-unit, 103-building public housing apartment complex in Watts, and one of 14 sites citywide that have potential for improvement through transit-oriented and vertical development.

The 30/10 proposal would allow Metro to construct the full Westside extension, but also two easterly extensions of the Gold Line, two new branches for the Green Line, several busways in San Fernando Valley, a link along I-405, and new light rail lines downtown, along Crenshaw Boulevard, to Santa Monica, and via the West Santa Ana branch corridor. The West Santa Ana branch corridor would be served by commuter rail. All by 2020. Green multiunit complexes would dot the new transportation lines.

“We are trying to define density not as a bad word, but as a word that can have elegance to it, and be green, and be smart,” the mayor said. “Yet the city needs to change even more, and the 30/10 plan is one of the routes to that change.”

The 30/10 proposal that went to Washington looks something like this:

o Current long-range transportation plan assumes $18.3 billion in transit expenditures over 30 years. 65% of funds would come from Measure R, with 23% from New Starts and 12% from other sources.

o The 30/10 Initiative would allow total expenditures to be reduced to $14.7 billion because of avoided inflation, since projects would be completed in ten years, twenty years ahead of schedule. More cost savings could also be possible because of a cheaper construction market.

o Of that $14.7 billion, $5.8 billion is expected to be available from existing sources, with around $8.8 billion still necessary, which could be provided through a loan from the federal government.

o Measure R would then pay back its $8.8 billion in debts for projects completed between 2010 and 2020 with $10.4 billion in tax revenue received between 2020 and 2040.

In Washington, Mayor Villiarigosa got support Oregon Democratic Representative Peter DeFazio, who chairs the House Subcommittee on Highways and Transit. California Democratic Senator Barbara Boxer also supports the effort. Secretary of Transportation Ray LaHood signaled that he was open to the opportunity in a meeting in Los Angeles

“Four years ago, when I talked about the subway to the sea, people laughed,”

Villaraigosa recalls. “But we are going to build it. All of these transit plans will happen.”

Initiatives like the 30/10 plan are part of a way of thinking that cities must pursue in order to remain successful, the mayor concludes. “Continue to think through what cities need to do to be more sustainable, to develop their assets, and to leverage the many important components of what a livable city should be like.”

**

http://www.laedc.org/businessscan/index.html

http://www.globest.com/newspics/la_urbanmarketplacepanel.jpg

http://www.thetransportpolitic.com/2010/03/01/how-feasible-is-antonio-villaraigosas-3010-gambit-for-los-angeles-transit/

http://la.streetsblog.org/2010/04/22/3010-survives-the-metro-board-of-directors/

http://articles.latimes.com/2010/feb/26/opinion/la-oe-rutten27-2010feb27

http://www.globest.com/news/1622_1622/losangeles/184054-1.html

http://laist.com/attachments/la_zach/villaraigosa-oath-inaug.jpg

http://www.socalgreenrealestateblog.com/wp-content/uploads/2008/05/subwaymayor-760786.jpg

http://www.socalmultiunitrealestateblog.com/?p=720

http://www.inhabitat.com/wp-content/uploads/rogers1.jpg

http://franchise.business-opportunities.biz/wp-content/uploads/2008/02/economic-downturn.jpg