Swamplot Archives by Tag: Financing

Friday, November 20, 2009

The Surrender of Greenway Plaza: Morgan Stanley’s Great Houston Office Building Investment Flop

November 20, 2009 – 2:52 pm

What do all these Houston office towers have in common?

That’s right — they’re all part of the vast Crescent Real Estate Equities empire, which at the peak of the market 2 years ago comprised 54 properties in all, stretching from Texas to the California coast. That’s when Morgan Stanley snatched up the whole thing for a mere $6.5 billion, thanks in part to a little $2 billion loan from Barclays Capital.

Today, Morgan Stanley announced it is giving up on the whole thing. Back to the bank all those properties go. All of them. (Okay, minus a few that were jettisoned along the way.)

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2:52 pm | 1 Comment | Read more about Commercial Real Estate, Neighborhoods: Downtown, Neighborhoods: Galleria, Neighborhoods: Greenway Plaza, Office Buildings, Real Estate Investing
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Thursday, November 12, 2009

Take the Money and Iran

November 12, 2009 – 7:26 pm
   

“Federal prosecutors are seeking to seize the Islamic Education Center at 2313 S. Voss, just north of Westheimer, as part of a move against the Alavi Foundation, nonprofit organization with suspected ties to the Iranian government: “Faheem Kazimi, chairman of the board of directors of IEC, said tonight that the center leases its building from Alavi Foundation. No other connection exists, he said. . . . The Center’s premises on South Voss is occupied by one of Houston’s largest Shiia mosques and Al-Hadi School of Accelerative Learning, a private Islamic school. . . . The mosque . . . will remain open while the forfeiture case works its way through court in what could be a long process. What will happen to them if the government ultimately prevails is unclear. But the government typically sells properties it has seized through forfeiture, and the proceeds are sometimes distributed to crime victims. There were no raids Thursday as part of the forfeiture action. The government is simply required to post notices of the civil complaint on the property. Prosecutors said the Alavi Foundation, through a front company known as Assa Corp., illegally funneled millions in rental income back to Iran’s state-owned Bank Melli. Bank Melli has been accused by a U.S. Treasury official of providing support for Iran’s nuclear program, and it is illegal in the United States to do business with the bank.” [Houston Chronicle]

7:26 pm | 3 Comments | Read more about Financing, Neighborhoods: Briargrove, Quicklink, Religious Facilities
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Tuesday, November 10, 2009

Raising Funds for the New Houston Ballet Building: Just Wait Until Nutcracker Season

November 10, 2009 – 2:38 pm

An article on Bloomberg.com forwarded by a reader provides an update on the progress of fundraising efforts for the Houston Ballet’s new building Downtown planned for the block surrounded by Congress, Smith, Preston, and Louisiana streets. You’ll remember that back in August, Ballet managing director Cecil C. Conner told the Chronicle’s Molly Glentzer that the board had raised “about 70 percent of the funds” needed for the $53 million building — which the organization hopes to have ready for move-in by 2011.

What’s the latest news, 3 months later?

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2:38 pm | 4 Comments | Read more about Financing, Institutional Buildings, Neighborhoods: Downtown, Neighborhoods: Theater District, New Construction
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Friday, October 30, 2009

Inside the Dilick Pickle: Those Trustee Sale Documents for Wilshire Village

October 30, 2009 – 2:52 pm

By popular demand — and in hopes that even more exciting or sordid detail might be gleaned from the legalese therein — we’re making available the trustee’s sale notices for Wilshire Village that were sent to Swamplot yesterday. The notices describe the foreclosure peril faced by Alabama & Dunlavy Ltd., the limited partnership apparently controlled by Matthew Dilick of Commerce Equities. That partnership owns the 7.68-acre now-vacant property at the corner of West Alabama and Dunlavy.

Here they are:

Think there’s more — or less — to these documents than meets the eye? Find any clues, factoids, or muck hidden between the lines? Think any of it helps explain the bizarre sequence of events that’s taken place at Wilshire Village over the last few years? Let us know!

Photo of Sign at Wilshire Village, 1701 West Alabama St.: Swamplot inbox

2:52 pm | Add a Comment | Read more about Financing, Foreclosures, Land for Sale, Neighborhoods: Lancaster Place
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Thursday, October 29, 2009

Comment of the Day: Sweet Ass Wilshire Village Park

October 29, 2009 – 5:36 pm
   

“Some quick math… 7.68 acres = 334,541 SF. Amegy loan = $10,742,000 = 32.11 PSF. Wedge loan = $3,000,000 = 8.97 PSF. Total loans = $41.08 PSF. It seems to me that the dirt should be worth a lot more than $41 PSF. . . . Amegy doesn’t appear to have a lot of risk of loss in the deal. . . . It’s clear they’ve decided to force the owners hand rather than sit back and let the owners try to sell for max $$$, which ain’t easy in this market. A BK by the owner will only delay the process for so long. Amegy obviously wants their cash back. Even without a foreclosure, it seems that this parcel is going to trade hands soon. Somebody needs to round up some cash real quick and buy this prime piece of dirt and turn it [into a] sweet ass park.” [Bernard, commenting on Surprise! Wilshire Village Facing Foreclosure]

5:36 pm | 6 Comments | Read more about Comments, Financing, Foreclosures, Neighborhoods: Lancaster Place, Parks, Quicklink
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Surprise! Wilshire Village Facing Foreclosure

October 29, 2009 – 1:34 pm

The Wilshire Village soap opera continues: A source sends Swamplot two trustee’s sale notices for the now-demolished 7.68-acre apartment complex at the corner of W. Alabama and Dunlavy.

How deep into it is the owner? There’s a first lien of $10,742,000 to Amegy Bank, now “wholly due and payable”! That lien dates from January 31, 2006 — the same date, according to HCAD, that the owner, a limited partnership named Alabama & Dunlavy Ltd., took over the property.

The second notice documents problems with Alabama & Dunlavy Ltd.’s separate mezzanine financing with Wedge Real Estate, in the amount of $3 million. That separate promissory note appears to date from May 30th of 2008. Both trustee’s sale notices are dated earlier this month.

Our source comments:

It is rather interesting that Wedge Holdings is the mezz lender, with Wedge being Mayor Bill White’s former company. I feel certain that Matt [Dilick] will avert foreclosure by filing bankruptcy, if he has not already done so.

Oh but if if if foreclosure somehow isn’t averted, where and when might eager Swamplotters be able to snap up this fine scraped property?

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1:34 pm | 19 Comments | Read more about Demolitions, Development Strategies, Financing, Foreclosures, Neighborhoods: Lancaster Place
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Monday, October 26, 2009

Comment of the Day: The Value of Failed Developments

October 26, 2009 – 2:29 pm
   

“The financial failure of Mosaic is not related to zoning or neighborhood protection. Mosaic represents a massive mixed-use project that will (eventually) fill up and further the civic goals of increasing population density and adding positively to the streetscape. In the mean time, the FDIC and out-of-state investors are paying the property tax bill on units that aren’t occupied by people that would stress our infrastructure. Where’s the downside in that? If the alternative were a vacant lot, Mosaic is far preferable from a civic perspective. . . .” [TheNiche, commenting on Only the Towers Remain Standing: Mosaic and Friends Break the Bank]

2:29 pm | 10 Comments | Read more about Comments, Condos, Development Strategies, Financing, Highrises, Neighborhoods: Hermann Park, New Construction: Residential, Quicklink
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Friday, October 23, 2009

Only the Towers Remain Standing: Mosaic and Friends Break the Bank

October 23, 2009 – 12:22 pm

With its most recent achievements, the Mosaic earns its place in Houston’s spec-development record books: Last month the 29-story condo tower near Hermann Park — wedged between Almeda and 288 — scored the loan-default trifecta, having notched a bankruptcy, mass foreclosures, and an attendant bank failure to its credit all within a single calendar year.

Chicago’s Corus Bankshares, which held a $71 million loan for the Mosaic, foreclosed on all 271 unsold units (out of 394 total in the building) in September, just days before the bank itself was seized by the FDIC. A few weeks later, the federal agency sold 40 percent of the bank’s real estate loans to a team of private-equity firms calling itself Northwest Investments and led by Starwood Capital Group — for 60 cents on the dollar.

Any further fun at the Mosaic will be courtesy of the FDIC, reports Nancy Sarnoff:

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12:22 pm | 40 Comments | Read more about Apartments, Bankruptcies, Condos, Financing, Foreclosures, Highrises, Neighborhoods: Hermann Park, New Construction: Residential
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Tuesday, August 18, 2009

Houston-Area Mortgage Storm Surge: Now a Quarter Under Water

August 18, 2009 – 6:28 pm
   

Another few months, another one of those studies from research firm First American CoreLogic — this one using data from the end of June. By that date, the firm says, 26.15 percent of all Houston-Sugar Land- Baytown-area mortgages were in a “negative equity” position. Add in the “up to their eyeballs” crowd of mortgage-holders who are within 5 percentage points of owing more than their homes are worth, and the figure rises to 33.86 percent. That’s a marked increase from the figures in the firm’s March study, which used data from September 2008. [First American CoreLogic; previously on Swamplot]

6:28 pm | 11 Comments | Read more about Financing, Hazards, Houston Data, Price Trends, Quicklink
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Tuesday, August 11, 2009

Okun Gets 100 Years; How Many for the West Oaks Mall?

August 11, 2009 – 11:54 am

High-stakes real estate swindler Edward H. Okun was sentenced last week in a Virginia courtroom to 100 years in prison for absconding with about $126 million in funds entrusted to his qualified intermediary company by 1031 exchange investors. Meanwhile, back on the corner of Westheimer and Highway 6, one of his former properties went up for sale.

Okun’s Investment Properties of America bought the West Oaks Mall for $110 million in 2005. The sellers of the bankrupt property might expect to get $20 million for the million-sq.-ft. mall today, reports Globe St.’s Amy Wolff Sorter:

The mall’s anchors include Dillard’s and Macy’s, which own their own space, and Sears, which is on a lease. [Holliday Fenoglio Fowler's Robert] Williamson says the Sears lease is up in 2010, but negotiations are underway to keep the retailer in place.

When Okun bought the mall from Somera Capital and CoastWood Capital a little less than four years ago, the asset was 95% leased, and sported $10 million worth of exterior and interior improvements. IPA had even larger plans for even more renovations on the 33-acre site, Williamson says.

Less than a year later, the owner was able to secure $86 million of permanent financing for the mall. Yet by late 2007, IPA had filed for bankruptcy protection to stave off foreclosure. Okun’s troubles and a failing economy dropped the mall’s occupancy to a little less than 70%.

How’s the mall looking these days?

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11:54 am | 4 Comments | Read more about 1031 Exchanges, Buildings for Sale, Commercial Real Estate, Foreclosures, Fraud, Leasing, Malls, Neighborhoods: Alief, Retail
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Monday, August 3, 2009

Comment of the Day: Another Grand Parkway Revenue Study

August 3, 2009 – 4:00 pm
   

“I think it’s time to feature just which entities have acquired land adjacent to this boondoggle. List which individuals hold controlling interest and then we can discuss interesting sidelights like contributions to various elected officials.” [devans, commenting on Investing in the Grand Parkway]

4:00 pm | 2 Comments | Read more about Comments, Financing, Freeways and Toll Roads, Proposed Developments, Quicklink, Sprawl
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Wednesday, July 29, 2009

Investing in the Grand Parkway

July 29, 2009 – 11:29 am
   

Commuters struggling to cross the Katy Prairie on congested House Hahl Rd. will be happy to learn that traffic relief is on the way: Harris County’s commissioners voted yesterday to apply for $181 million in federal stimulus money for the Segment E marshland cut-through of the Grand Parkway, which will connect major employment and shopping centers in Katy and Cypress. $20 million in engineering and other contracts for the project were awarded a few months ago, but the commissioners yesterday approved a “comprehensive traffic and revenue study” for the segment. The study, which won’t be complete before construction begins in February, will help support claims that the road will be able to pay for itself, with tolls. [Houston Chronicle; more from Houston Tomorrow, both via Off the Kuff]

11:29 am | 13 Comments | Read more about Financing, Freeways and Toll Roads, Quicklink, Sprawl
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Friday, July 3, 2009

La Maison in Midtown: The Power of a Good Night’s Sleep

July 3, 2009 – 11:54 am

There’s a new $2 million bed and breakfast going up in Midtown? The Chronicle’s Nancy Sarnoff reports that the project’s developers were “able to persuade a lender” to finance construction of their 3-story “New Orleans-style” B&B, which has already broken ground at 2800 Brazos, at the corner of Drew St.:

“It was a little challenging early on in the process,” [developer Genora] Boykins said. “The thing that made the difference is we really didn’t give up on the vision we have.” . . .

That sort of positive thinking is apparently nothing new for Boykins, an attorney for Reliant Energy who serves on the Downtown Management District board of directors — along with her La Maison partner, Centerpoint Energy community relations VP Sharon Owens.

Kirbyjon Caldwell, the pastor of 14,000-member Windsor Village United Methodist Church, provides more insight into Boykins’s real-estate techniques in Chapter 3 of his now-decade-old bestseller, The Gospel of Good Success: A Road Map to Spiritual, Emotional and Financial Wholeness:

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11:54 am | 20 Comments | Read more about Financing, Neighborhoods: Corinthian Pointe, Neighborhoods: Midtown, Neighborhoods: Windsor Village, New Construction
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Wednesday, June 24, 2009

Fighting the New Appraisal Rules

June 24, 2009 – 11:15 am
   

A Swamplot reader draws attention to a “rumored email” purporting to show that the National Association of Realtors is gearing up for a campaign against the Housing Valuation Code of Conduct that went into effect at the beginning of May. The HVCC was meant to safeguard the independence of appraisals — in part by prohibiting loan officers, mortgage brokers, and real estate agents from selecting the appraiser for a particular property. The email, posted on a San Fernando Valley real-estate blog, indicates that the NAR is pushing Congress to impose an 18-month moratorium on the new code. Our reader wonders if recent stories of “unfair appraisals” — such as this one — are the result of a larger “orchestrated campaign” against the new rules. [Effective Demand; Swamplot inbox]

11:15 am | 3 Comments | Read more about Buying and Selling, Financing, Home Prices, Quicklink
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Wednesday, June 17, 2009

The Federal Reserve’s Extended Stay in Houston

June 17, 2009 – 1:49 pm
   

Extended Stay Hotels, which operates 21 extended-stay hotels in Houston under the Homestead Studio Suites, StudioPLUS Deluxe Studios, Extended Stay America, and Crossland Economy Studios brands, declared Chapter 11 bankruptcy earlier this week. How is the Fed involved? “The Federal Reserve holds $744 million of various junior classes of debt and $153 million in the senior debt that the central bank assumed after the collapse of Bear Stearns, which held a sizable amount of the hotel chain’s debt. The losses are mounting for the Fed on those Bear Stearns assets, which continue to sour. Extended Stay loans were held on the Fed’s balance sheet via a company called Maiden Lane that the central bank lent $29 billion in June 2008 to purchase $30 billion of Bears’ assets.” [Deal Journal; more at Calculated Risk]

1:49 pm | 4 Comments | Read more about Bankruptcies, Financing, Hotels, Quicklink
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