COMMENT OF THE DAY: HOW STAGING SELLS HOUSES “Reminds me of house shopping a couple years ago. We were looking at a house in Brenham, as a weekend home. Pretty normal decorating scheme, until we got to the master bedroom. Purple walls, gold trim, lots of dangling gold items from lamps and headboards, pillows everywhere, a purple & maroon shag carpet–my wife & I looked at each other, and both mouthed “New Orleans whorehouse†to each other. . . . We ended up buying the place!” [SH snooty, commenting on Remembering the Purple Bedroom of Her Teenage Years]
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Buying and Selling
Who was it again that bought the West Oaks Mall out of bankruptcy earlier this month, for the bargain price of $15 million? Just an L.A. investment group called Pacific Retail Capital Partners. That firm’s principals, then with a company called Somera Capital, are the same people who sold the 1.1-million-sq.-ft. mall at Westheimer and Hwy. 6 in 2005 to Investment Partners of America, the “investment” vehicle of high-rolling 1031 Exchange king Edward H. Okun, after a quick 2-year spiff-up.
Okun paid Somera $102 million. Yes, that Edward H. Okun.
This time, the mall’s a whole lot cheaper, but it’s not in such good shape, either. Mervyn’s and J.C. Penney are gone. The rest of the mall is at 60 percent occupancy. “Over the past couple of years, several tenants tried to renew,” Somera Capital’s (and now Pacific Retail’s) Stephen Plenge tells Globe St., “and no one would return their phone calls.” The new owners say the Mervyn’s wing is likely to be redeveloped.
- West Oaks Mall Goes Back to Former Owner [CoStar Group]
- Buyer Takes 1M-SF West Oaks: Again [Globe St.]
- Los Angeles company acquires West Oaks Mall [Houston Business Journal]
- Previously on Swamplot: Okun Gets 100 Years; How Many for the West Oaks Mall?, Comment of the Day: Former West Oaks Mall Owner To Retire in New Home, JCPenney at West Oaks Mall: To the Bank, Delinquent Debt: West Oaks Mall Sale!, West Oaks Mall: Your Exchanges Are No Good Here
Photo of West Oaks Mall visitors: Joel Barhamand
TEAS NURSERY: NOT FOR HOMEBUILDERS A private Bellaire foundation run by two brothers has snapped up the remaining 5 acres of Teas Nursery at 4400 Bellaire Blvd. Jerry and Maury (“Boâ€) Rubenstein haven’t announced their plans yet, but a press release reports they are hoping the property “could be retained for the benefit of all Bellaire residents.” The Teas family will continue to occupy the site until the middle of February. [Swamplot inbox; previously on Swamplot]
COMMENT OF THE DAY: ENDEAVOUR RESCUE PLAN “Original asking prices for the 80 unit tower ranged from $425k to $2.5 million. After all the hype about sales, it looks like the developer was only able to sell 36 units. Now Regions has unloaded 44 units for an average price of $216k plus back taxes and interest. OUCH! And what can we read between the lines of this comment? ‘The group also said it would pay normally budgeted homeowner assessments for 2010 for any condo owner current on their assessments for 2009.’ It sounds to me like MANY of the 36 original buyers are behind on their maintenance fees. Wonmore is trying to incentivize them [to] get current by offering to pay all their fees for 2010??? That sounds like an awfully big incentive? Are they trying to solve an awfully big problem? When condo associations go broke, look out below. . . .” [Bernard, commenting on Wonmore in Bankrupt Endeavour]
WONMORE IN BANKRUPT ENDEAVOUR The sale of 44 unsold condos in high-flying developer Robin Parsley’s bankrupt Endeavour highrise on Clear Lake in Pasadena was approved by a court last week. “The winning bidder was a partnership named Wonmore Ltd. The group agreed to pay $9.5 million plus past-due taxes and interest, according to Houston attorney Walter Cicack, who represented Wonmore. The group also said it would pay normally budgeted homeowner assessments for 2010 for any condo owner current on their assessments for 2009. . . . The 30-story Endeavour, at 4821 NASA Parkway, had been in legal limbo since earlier this year when its developer filed for Chapter 11 bankruptcy protection the day before the building was scheduled to be sold in a foreclosure auction. Regions Bank was listed as a creditor in the bankruptcy with a claim of $20.8 million.” [Houston Chronicle]
COMMENT OF THE DAY: REPORTS OF THE DEMOLITION OF 946 ARLINGTON HAVE BEEN GREATLY EXAGGERATED 
“7677 Home IS remodeling and enlarging this home. The demo permit is for the awkward addition on the back of the home and some of the existing structure to start the remodeling process. The property is under contract and the plans show that most of the existing structure will remain.” [Heights Realtor, commenting on Daily Demolition Report: Truck Tired]
H. Dan Miller, senior managing director of the Houston office of Holliday Fenoglio Fowler, commenting on the sale he recently brokered of the fully leased 30,000-sq.-ft. office building and bank drive-thru on an L-shaped property at 10411 Westheimer in Westchase, which received 18 offers within a week:
You had an irreplaceable location at the corner of Westheimer and Beltway 8 and three streets of frontage. I wish I had 10 of these types of buildings.
- 30,000-SF Office Attracts 18 Offers [Globe St.]
- 10411 Westheimer Executive Summary (PDF) [Holliday Fenoglio Fowler]
Photo: Holliday Fenoglio Fowler
WEINGARTEN’S SELLOFF CONTINUES The 283,841-sq.-ft. Central Park Northwest off Dacoma St. and the 100,600-sq.-ft. Jester Plaza near Oak Forest are the latest industrial properties to leave the Weingarten Realty fold. And there’s more to jettison: “The company’s vice president/director — industrial properties Kelly Landwermeyer told GlobeSt.com the disposition of the industrial service center on 3500-3582 W. T.C. Jester Blvd. is part of Weingarten’s overall disposition strategy of non-core industrial asset, which includes service centers and flex properties. He says another asset is under contract and scheduled to close within the next few weeks. ‘There are another half-dozen on various pre-contract stages in the pipeline,’ he explains, adding that there are no set deadlines for closings by the end of 2009.” [Globe St.; previously on Swamplot]
WHERE FLOODWATERS WILL PARK DOWNTOWN The Buffalo Bayou Partnership helped the City of Houston and the Harris County Flood Control District acquire a just-under-2-acre site Downtown for $7.3 million last week: “The property, which is currently being used as a surface parking lot, is sandwiched between Buffalo Bayou on the north and Commerce on the south, stretching from La Branch to Caroline. Roughly half of the land was acquired from a 15-person investment group led by David Loftus. The other half was bought from members of the Loftus family. Loftus says he acquired the site in 2002 with plans to erect a parking garage. After hearing about civic leaders’ intentions for the land, Loftus says he decided to wait and sell it instead. The land will be used to widen the bayou in an effort to mitigate flooding. The site will also double as a park with hike and bike trails during dryer times. Both projects are a part of long-term visions for the bayou system.” [Houston Business Journal]
HAR is out with its September home-sales figures, giving Swamplot’s spreadsheet-side correspondent a chance to eulogize the spring-summer selling season:
Home prices and volumes are flying south for the winter. With this volume downturn for the year, we have most likely seen the highs and sales volumes will now complete their third year of contraction. Prices were down 2-3% in the month, depending on whether you follow the median price or the average price. Pending sales are well below sales for the month, suggesting a further seasonal contraction in October.
This month featured an upturn in foreclosure sales as a percentage of the total. Foreclosure sales were 18.6% up from 16.7% the prior month. Luckily, foreclosure sales are still way down from the 32% peak in January.
But aren’t all those foreclosures going away soon?
POST OFFICE SALES: NEVER MIND Those gargoyles-on-sticks facing Downtown from Randall Davis’s Metropolis condo building get to keep their view. Nancy Sarnoff reports that two post offices offered for sale earlier this year (including the River Oaks P.O. adjacent to the Metropolis) have been taken off the market: “‘Bids were just so low we stopped that project for the time being,’ said Charlie Phillips, postal operations analyst for the [U.S. Postal Service]. Those properties are at 1900 West Gray at Dunlavy and 2802 Timmons, near West Alabama.” No report yet on the outcome of bidding for the Downtown Post Office at 401 Franklin St. [Prime Property; previously on Swamplot]
Houston Rockets owner and real-estate power forward Les Alexander appears to be doing his single-handed best to boost the upper end of the New York City real estate market. Who’s gonna help him out? Last week, he finally closed on a 6,321-sq.-ft. empty penthouse atop a new Robert A.M. Stern waterfront condo building in the West Village — for $25 million in cash. After pausing to take a deep breath, Alexander then put the unit back on the market — for $39.5 million.
New York real estate blog Curbed says Alexander’s move “has to be the most audacious and downright crazy real estate move of 2009 (though there’s still time!):”
In a matter of hours, the penthouse has gone from selling for $3,955/sf to asking $6,249/sf. Talk about appreciation!
Didn’t the buzzer on that game already sound?
The bare-bones pad features 4 corner terraces, but just a single bathroom and small Kitchen — enough to meet city requirements. The condo building is named Superior Ink, in honor of the factory that was torn down to construct it.
- Superior Shocker: $25M Penthouse Already Back on Market [Curbed]
- 400 West 12th Street [Prudential Douglas Elliman Real Estate]
Photo: Related Companies
COMMENT OF THE DAY: WILSHIRE VILLAGE LOGIC “I am really amazed at this debate. The principle is very simple. The land is too valuable for the revenue generating capacity of existing structures. You can’t rent those spaces for enough money, no matter how you remodel. This is definately a high density project and could be high-rise site in a better market, where are you going to find north of 7 acres in an area like this? The Fiesta across the street is in the Cohen family, so that could be in play. The Cohen family is surrounded by real estate guys. The real shame here, is that you have complicated personalities that probably prevented any new construction during a time in which it would have been viable, so now they are trying to market a property in a climate that almost no one can get financing that would make a deal work. A new project would have provided comfortable living space in a convenient and desirable location, with maybe even a mixed use component. You tear down 40+ year old properties, that have a great deal of deferred maintanence, for marketing purposes, and now they can showcase those beautiful magnolia trees, which I hope they can preserve as many as possible, but it has to make economic sense. I am sure that if someone will make a fair market value offer, and they are a credible buyer, they would sell. Death to rumors. The dirt could be as much as $100 a foot, if you turned back the clock 2 years. It is special so may still demand it.” [Alexander, commenting on All Cleaned Up and Ready for Sale: What Can We Get for Wilshire Village?]
A REALTOR’S TANKLESS JOB HAR’s consumer site won’t let you search for data in new fields that indicate whether a home has LEED or NAHB Green certification, AC with a high SEER rating, or other energy-related features yet, but listing agents have at least begun filling in the blanks: “For now, the word is still getting out – I doubt that all homes with Green features are being noted as such. There is also evidence that some of the homes are tagged incorrectly -Not even 90 days in to having these fields available there is not enough data yet to state whether or not homes with certain features definitely sell for more money than those without . . . Personally I have been amazed at the number of homes in the Houston area that have Solar PV or Solar Hot Water. The other trend that appears to grow by the week in MLS is the number of homes with Tankless Hot Water Heaters and Older homes with Low-E windows.” [Turning Houston Green, via Swamplot inbox]
Globe St.’s Amy Wolff Sorter says the buyer of the foreclosed Greenbriar Park North apartments near Greenspoint has “a strong track record” of rehabbing complexes. That should help:
Wade Schmitz with Hendricks & Partners’ Houston office tells GlobeSt.com that CNC Investments was the former owner and like many owners during the mid-2000s, had bought too much with too much debt that couldn’t be refinanced. Schmitz, who marketed the asset for Bank of America adds that the 1980s complex at 818 Richcrest Dr. attracted a great deal of interest. . . .
“There were down units that needed to be brought back online,†Schmitz says. “The property had been neglected, and needed someone to take care of it.â€
How neglected? Of 400 units in the complex, only around 60 are occupied.
Don’t want to miss out on all the foreclosed-apartment-complex rehab fun? Be patient, more is coming:
