Menu
|
|
The Industry Insider - June 2, 2009
|
|
Headlines
Top Story
Court Rules Against Exclusive Cable Rights in Apartments
Industry News
Amid Housing Bust, Phoenix Begins a New Frenzy
Western National Property Management Begins Western U.S. Expansion
New Jersey Apartment Residents Find Deals Galore
Apartment Residents Work Options in Hard Times
Mid-America Apartment Communities Announces Q2 2009 Dividend
Freddie Mac to Sell $1 Billion in Securities
College Students Flock to Potential Jobs in D.C. Market
Apartment Vacancies, Rent Increase in Durango, Colo.
UDR Reduces Common Dividend and Declares Preferred Dividends
Vacancy Rates for Okla. Homes and Apartments About 5 Percent
Storm Properties Inc. Targets $25M in Multifamily Buys
Legislative/Legal News
Chicago's Downsized Housing Inspections Could Be Risky 
Radon Tests Sought for Maine Apartment Communities
Charlotte Police Proposal for Apartment Owner Registry on Hold
California Apartments Lightly Enforce Barbecue Ban
Top Story
Time Warner Cable Community Solutions has proven success partnering with MDU owners, providing quality voice/video/data products to their residents.
Court Rules Against Exclusive Cable Rights in Apartments
Digested From "No Exclusive Cable Rights in Apartments, Court Says"
USA Today (05/26/09) by Nedra Pickler
A federal appeals court has ruled that cable companies cannot have exclusive rights to provide service in apartment communities that they wire. The decision from the Court of Appeals in Washington, D.C., upheld an earlier FCC ruling that banned such exclusive agreements on the grounds that they are anti-competitive. The deals entailed a provider exchanging a valuable service like wiring a multi-unit apartment community for cable in return for the exclusive right to provide service to all of its residents. FCC officials ruled that cable operators could no longer enter into such agreements and existing ones could not be enforced. The National Cable & Telecommunications Association and a couple of affiliated property groups sued, charging the FCC did not justify the change in policy or take into account the retroactive effects. The appeals court, though, determined that federal commissioners acted within the limits of the law.
Web Link | Return to Headlines
Industry News
Amid Housing Bust, Phoenix Begins a New Frenzy
Digested From "Amid Housing Bust, Phoenix Begins a New Frenzy"
New York Times (05/23/09) by David Streitfeld
In Phoenix, there is a seemingly endless stream of foreclosed homes flooding the market. On some days, hundreds are put up for auction at the county courthouse. At the same time, there is a large supply of foreclosed families who can no longer qualify for a loan. Sensing opportunity, investors have descended on the market and are snapping up these troubled residential properties. They are then renting them back to the previous owners at rates lower than their previous mortgage. MDA DataQuick reports that absentee buyers, who can either be investors or individuals purchasing a vacation home, bought nearly 4 of every 10 homes sold in the Phoenix area during April. That is a 50 percent jump since the fourth quarter of 2007. There is always a risk, of course. Lou Jarvis, director of investor relations for the locally based Brewer Caldwell property management firm, cautions, "If Phoenix loses population, then buying houses here is a bad bet."
Web Link | Return to Headlines
Western National Property Management Begins Western U.S. Expansion
Digested From "Western National Property Management Begins Western U.S. Expansion to Grow Third-Party Fee Management Portfolio"
Western National Press Release (06/01/09)
Western National Property Management continues to expand into the nation's Western region, opening a Phoenix office as part of its efforts to grow its third-party fee management portfolio. The new office will be managed by Sandi Cashen, a 20-year veteran in the Phoenix apartment sector. It is already in the process of closing four new third-party management contracts locally. Western National Property Management President Thomas K. Shelton states, "Western National Property Management currently provides its services to more than 150 apartment community companies and private owners. The Phoenix office will help our firm expand our operations throughout the region." Looking ahead, Shelton expects to pursue opportunities in such markets as Denver, Las Vegas and throughout California.
Return to Headlines
New Jersey Apartment Residents Find Deals Galore
Digested From "Renters Find Deals Galore"
New York Times (05/29/09) by Antoinette Martin
New Jersey's rental apartment sector is starting to show signs of weakness, a trend that has shifted the advantage to residents. Analysts report that average monthly rents are on the decline statewide. Meanwhile, such incentives as one or two months of free rent have become increasingly common even at some of the Garden State's newest communities. In downtown Red Bank, for instance, the new Metropolitan opened in late 2008 as a 37-unit condominium before switching to rental apartments near the end of this year's first quarter. A month-free-rent deal quickly drew 15 residents. "We’ve noticed 'vacancy creep' across northern New Jersey. Where it used to always be 99 percent occupancy, now you see 96, 95, 94." reports Jonathan Moore, a vice president at the Value Companies, which owns 3,500 apartments in four states. Value is currently offering some form of resident incentives at roughly 50 percent of its communities. Statewide, the average rent declined 1.2 percent in this year's first quarter, reports Marcus & Millichap. Company researchers predict that for this year, the decline would be 3 percent to $1,229 per month. At the same time, some marketers of condominiums say they are seeing a slight uptick in the number of interested buyers due to low mortgage rates and tax-credit programs.
Web Link | Return to Headlines
Apartment Residents Work Options in Hard Times
Digested From "Apartment Dwellers Work Options in Hard Times"
Daily Democrat (Calif) (05/31/09) by Elizabeth Kalfsbeek
The down economy has had an impact on apartment communities in California and elsewhere. The article's author queried management at three different apartment types in the Golden State -- a traditional multifamily housing community, a luxury apartment community and an affordable housing site -- for their insights on the crisis. Tara Covell, assistant residential manager for Westgate Village Apartments, states, "A lot of people in one-bedrooms have actually been buying homes. People in three-bedrooms, with an extra bedroom for an office or child, have been downsizing to two-bedroom apartments." Covell attributes the recent vacancies at her community to the recession and people losing their jobs. She notes, "There has been a lot of downsizing for residents, but we are more than willing to work with [residents] on payment arrangements if they are getting behind." An emerging side effect of the foreclosure surge is that more apartment communities are rethinking their pet policies and are no longer prohibiting residents from owning cats, dogs and other animals. Price is also becoming a factor. At Eaglewood Apartments, a luxury community, manager Carrie Rose has cut prices three times in the past month alone. She reasons, "People are losing their jobs and moving out because they can't afford to stay. Our vacancy rate is definitely higher than normal due to the economy, though we haven't seen much traffic from the foreclosure market at this property." Affordable housing communities, meanwhile, have been largely unaffected by the down economic conditions. As tax credit properties, they maintain 100-percent occupancy most of the time.
Web Link | Return to Headlines
Mid-America Apartment Communities Announces Q2 2009 Dividend
Digested From "Mid-America Apartment Communities, Inc. Announces Quarterly Common Dividend"
PRNewswire (05/28/09)
Mid-America Apartment Communities Inc.'s (MAA's) board of directors had approved a second-quarter common dividend of $0.615 per share, which will be payable on July 31 to shareholders of record as of July 15. The Tennessee-based apartment REIT regularly declares its quarterly dividend in advance of its earnings announcement, which it expects to make on Aug. 6. MAA currently has ownership stakes in 42,157 rental units across the nation's Sunbelt region.
Web Link | Return to Headlines
Freddie Mac to Sell $1 Billion in Securities
Digested From "Freddie Mac to Sell $1 Billion in Securities"
Washington Post (05/27/09) P. A13
With Deutsche Bank as lead underwriter, Freddie Mac plans to sell $1 billion worth of guaranteed securities backed by multifamily housing loans originated since 2008. Roughly $850 million of the securities have first losses taken by more junior securities, offering some default protection and giving them stellar credit ratings. Meanwhile, an estimated $80 million of non-guaranteed junior securities backed by these multifamily loans is already committed for sale to an investor group.
Web Link | Return to Headlines
College Students Flock to Potential Jobs in D.C. Market
Digested From "College Graduates Flock to Area"
Washington Post (05/26/09)
The Washington, D.C., metro area is attracting a steady flow of recent college graduates mainly because the chances of landing a job remain high despite the ongoing recession. George Mason University economist Stephen Fuller observes that the D.C. area is "adding jobs in [service-providing industries] and in health care and in the federal sector. And the jobs we're losing in the region [such as construction and retail sales] tend not to be college graduate-type jobs." University of Toronto business professor Richard Florida recently named the District of Columbia as the best location in the country for recent college graduates based on such factors as the cost of living and the number of jobs available. Challenger, Gray and Christmas reports that U.S. unemployment for 25- to 29-year-olds topped 11 percent in January, the highest since 1983. Overall, nationwide unemployment is running at about 9 percent. In the Washington area, though, it is only around 6 percent.
Web Link | Return to Headlines
Apartment Vacancies, Rent Increase in Durango, Colo.
Digested From "Vacancy Rate, Rent Increase in Durango"
Durango Herald (CO) (05/25/09) by Chuck Slothower
According to a new University of Denver study, Durango apartments had the sixth-highest rent in Colorado. The average monthly rent in Durango was $829.31 during the first quarter, a 3.9 percent increase from $798.33 during the same period a year earlier. Only Aspen, Eagle County, Glenwood Springs, Fort Collins and Summit County were more expensive. Eagle County ranked as the priciest, with the average apartment renting for $1,070 a month. Aspen apartments placed second at $1,032 a month. While apartment rents climbed in Durango, so did the vacancy rate. Researchers tallied a 6.1 percent vacancy rate, an increase from 4.5 percent in the first quarter of 2008. The statewide apartment vacancy rate rose from 8.1 percent to 8.5 percent year over year. According to University of Denver business professor Gordon E. Von Stroh, who conducted the survey, apartment residents are looking to save money wherever they can. He concludes, "People are just becoming a little bit more conservative. If they can save a few dollars by rooming with someone else, they're doing that." The survey polled apartment owners and managers in 17 major market areas throughout Colorado. Durango was the only Southwest Colorado locale surveyed.
Web Link | Return to Headlines
UDR Reduces Common Dividend and Declares Preferred Dividends
Digested From "UDR Reduces Common Dividend and Declares Preferred Dividends"
Business Wire (05/26/09)
UDR Inc.'s board of directors has declared a Q2 2009 dividend of $0.18 per common share, which will be payable July 31 to shareholders of record as of July 10. This marks the 146th consecutive quarterly dividend paid by the Denver-based apartment REIT on its common stock. UDR President and CEO Tom Toomey adds, "Given our desire to further strengthen UDR's balance sheet, the board of Directors has decided to establish a dividend rate that increases retained capital by approximately $79 million over the next 12 months. This action, combined with the existing $1.2 billion of cash and credit capacity allows the company to effectively navigate the challenging economy and be better positioned to take advantage of opportunities as they emerge." As of the end of this year's first quarter, UDR owned 44,571 apartments and had another 2,046 rental units in various stages of development.
Web Link | Return to Headlines
Vacancy Rates for Okla. Homes and Apartments About 5 Percent
Digested From "Vacancy Rates for Oklahoma Homes About 5 Percent"
Newson6.com (05/26/09)
A new study by the U.S. Postal Service and HUD shows that about 5 percent of Oklahoma's homes and apartments sat vacant for more than 90 days during this year's first quarter. The analysis further showed that Oklahoma City had some of the highest vacancy rates in the state. Indeed, one Oklahoma City neighborhood near the Capitol reported a first-quarter housing vacancy rate of more than 27 percent as of March 31. City Planner Russell Davis says many residents have migrated out of Oklahoma City for better housing and cheaper rent elsewhere. It should be noted, though, that Oklahoma's vacancy rates are still well below those in other northern Rust Belt states.
Web Link | Return to Headlines
Storm Properties Inc. Targets $25M in Multifamily Buys
Digested From "Storm Targets $25M in Multifamily Buys"
GlobeSt.com (05/25/09) by Bob Howard
Looking to diversify its portfolio, Storm Properties Inc. has announced plans to acquire $25 million worth of apartment communities in Los Angeles County over the next couple of years. David Simard, president of the longtime owner and developer of industrial facilities, predicts, "There is going to be a value window to acquire multifamily rentals toward the end of this year or in early 2010." The California-based firm is looking to buy multifamily housing assets that are either completed and leased or under construction and nearly completed. Simard remarks, "We have the capability to finish a project in-house, so if there is an asset that is in trouble, we can step in and finish it." Storm is focusing its search efforts for apartment communities only in Los Angeles County. Storm, which plans to hold the various communities it acquires on a long-term basis, has never owned apartments.
Web Link | Return to Headlines
Legislative/Legal News
Chicago's Downsized Housing Inspections Could Be Risky
Digested From "City's Downsizing of Inspections Could Be Risky"
CBS 2 Chicago (05/29/09)
Chicago is currently down 40 building inspectors, meaning fewer experts are keeping an eye on apartment communities' elevators, code violations and other dangers. Today, there are only 57 inspectors in the entire city assigned to issues such as vermin and structural problems at pre-existing buildings. CBS 2 investigative reporter Pam Zekman has also learned the city is down eight electrical inspectors, a dozen plumbing inspectors and three elevator inspectors. Elevators are supposed to be inspected on an annual basis. Now, Zekman is reporting that the Windy City has a new "master plan" to make up for the lost staff. Under the new plan, Chicago will only inspect buildings every three years, shifting the responsibility to owners to use licensed contractors and tradesmen for annual code inspections. This will free up the limited number of inspectors to respond to complaints. City inspectors will continue to perform inspections of all new construction.
Web Link | Return to Headlines
Radon Tests Sought for Maine Apartment Communities
Digested From "Radon Tests Sought for Apartment Buildings"
Sun Journal (ME) (05/26/09)
Legislators are currently pushing a bill that would make Maine the first state in the country to require that apartment communities be tested for potentially dangerous levels of radon. The legislation, championed by Rep. Jim Martin (D-Orono), would require apartment owners to test their communities at least once every 10 years beginning in 2012. The bill has already received the unanimous endorsement of the Legal and Veterans Affairs Committee. Martin, an apartment owner himself, introduced the bill at the request of a constituent.
Web Link | Return to Headlines
Charlotte Police Proposal for Apartment Owner Registry on Hold
Digested From "Police Proposal for Landlord Registry on Hold"
WCNC (NBC North Carolina) (05/25/09) by Mark Boone
Seven months after Charlotte-Mecklenburg Police began drafting tougher rules for absentee apartment owners, the proposal has run up against some opposition from city leaders and apartment management firms. Deputy Police Chief Ken Miller first suggested the idea of an owner registry last fall, telling city leaders that approximately 33 percent of the violent crimes committed at area apartments were occurring at only a handful of communities. In many cases, these derelict owners live out of state and are hard to reach. Ed Garber, an east Charlotte community leader and proponent of the proposed database for apartment owners, comments, "The police need to be able to contact people quickly. They have no way of holding anybody accountable." Earlier this month, local law enforcement presented a draft of their proposed ordinance to the Charlotte City Council's community safety committee. Under the ordinance, owners who fail to address problems at those communities identified by police could have their registration revoked by the city. Committee member Edwin Peacock is one of several concerned about the costs and logistics of maintaining such a database. Meanwhile, such industry groups as the Charlotte Landlord Association have criticized the police proposal, contending that most owners and managers do not need additional government oversight.
Web Link | Return to Headlines
California Apartments Lightly Enforce Barbecue Ban
Digested From "Barbecue Ban More Smoke Than Fire at Many Inland Apartments"
Riverside Press-Enterprise (CA) (05/24/09) by John Asbury
In 2008, California fire officials adopted the International Fire Code as a state regulation. At the same time, they rejected one recommendation to ban propane and charcoal grills on patios or balconies at apartment communities. Instead, the state left it to elected officials in individual cities and counties to decide if they want to ban or otherwise restrict grilling in multifamily housing settings. The international code bans any open-flame cooking devices on balconies that lack a sprinkler system or within 10 feet of multi-unit dwellings. Kirsten Carr of the California Apartment Association cautions that a fire from a barbecue would spread more easily and put more people in danger at apartment communities than at single-family homes with open backyards. To date, several California markets have banned barbecues at apartments, but only a handful in the Inland Empire area. Carr adds, "This is obviously for safety purposes." Even in those areas where the code has been adopted, though, it is not well enforced. For the most part, apartment community managers are the main enforcers. Among those that have banned grills at apartments out of concern that fires could spread to multiple apartments is Riverside and Moreno Valley. Riverside Deputy Fire Marshal Joan Breeding notes that the code is being enforced during building inspections or when responding to complaints about barbecues being used at apartments. Some apartment owners are offering communal grills on community common grounds as an alternative.
Web Link | Return to Headlines
Abstract News © Copyright 2009 INFORMATION, INC.
|
|
|