Scott Miller's November 2011 Newsletter

How to Analyze & Sell Apartment Buildings
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Orange County: Thursday, November 17
National University: 3390 Harbor Boulevard, Costa Mesa, CA 92626


Fidelity National Title Q3 2011 Fact Sheet Now Available

Fidelity National Financial, Inc. (NYSE:FNF) is the leading provider of title insurance, mortgage services and diversified services. FNF is the nation’s largest title insurance company through its title insurance underwriters - Fidelity National Title Insurance Company, Chicago Title Insurance Company, Commonwealth Land Title Insurance Company and Alamo Title Insurance - that collectively issue more title insurance policies than any other title company in the United States.

FIABCI/AREAA/CREDAA Is joining the SMBA for our Real Estate Networking Happy Hour and The SMBA’s Annual Holiday Party

http://www.seattlemba.org/blast/20111213_HolidayParty.html
Join FIABCI International Real Estate Federation, AREAA (Asian Real Estate Association of America), CREDAA (Commercial Real Estate Distressed Assets Association) and SMBA (Seattle Mortgage Bankers Association) at our upcoming Happy Hour and Holiday Party networking event.
Club Auto Kirkland - Harold LeMay Museum 11200 Kirkland Way, Kirkland, WA 98033 To view the LeMay Club Auto in Kirkland click here.
Enjoy appetizers and a holiday buffet dinner, and spread some holiday joy by participating in the canned food drive! Spouses and significant others are welcome. There is a small registration fee for this event.
Registration for this event will open November 16, 2011.
Come. Meet. Participate. Connect!

Local

A "Crystal" centerpiece for Federal Way?
Building a real downtown for Federal Way, Take Three.
This past week the South King County city's council tentatively agreed to sell a chunk of its sprawling center to a Massachusetts company that has proposed an eye-catching, 15-building complex on the site.

Phoenix apartment developer expands NW office
Phoenix-based Alliance Residential Co Alliance Residential Co Latest from The Business Journals Commercial Real Estate RoundupNorth Boca Village Center sold at 64% discountAlliance Residential to develop apartments in Lewisville, Fort Worth Follow this company . has hired a new regional manager to grow its portfolio of apartment projects in the Pacific Northwest.

Renton Housing Authority to break ground on new townhomes off Sunset
The first steps toward a major revitalization of the Sunset area of the Highlands was taken Monday with the groundbreaking for eight, four-bedroom townhomes.

Slide show: SBA loans reach historic high
New government incentives caused lenders to make a record volume of Small Business Administration Small Business Administration Latest from The Business Journals SBA begins training for women-owned businesses SBA begins training for women-owned businesses U.S. Bank sets SBA record Follow this company loans in fiscal year 2011 - but the surge may end this year as the incentives have now expired.

Jeff Bezos: America's 28th-largest landowner
Amazon.com Inc. Amazon.com Inc. Latest from The Business Journals DBJ Tech Watch for Monday 10/24: News of the Oracle-RightNow deal, Google Music and moreAmazon subsidiary now delivering groceriesDBJ Weekend Tech Watch for 10/22-23: News of Google, Apple, Yahoo, Netflix and more Follow this company CEO Jeff Bezos is the nation’s 28th largest landowner, according to a list by The Land Report, a magazine and web site of American landowners

CBRE Capital Partners pays $42.5M for Smith Tower note
A German bank has sold $42.5 million in "nonperforming" loans on Seattle’s iconic Smith Tower and the adjacent Florence Building to CBRE Capital Partners, a unit of CBRE Investors.

Schuster Realty Partners buys Tukwila office park
The Schuster Realty Partners LLC has paid $7.5 million for the 78,000-square-foot Fairway Center in Tukwila.

Pacific International Bank CEO abruptly resigns
Pacific International Bank Pacific International Bank Latest from The Business Journals SBA lending boomed in Q4 2010Five new community banks continue push to raise capital as economy downshiftsKorean Americans form bank Follow this company CEO Woosung "Edward" Park stepped down today after 10 years at the helm. The Seattle bank's chief credit officer, Paul Sabado, was named as an interim replacement, pending regulatory approval.

Seattle real estate site Redfin raises $14.8M in venture capital
It’s a big day for funding news, and you can add Redfin to the list……

Zillow posts record revenue, announces acquisition
Still riding high after its successful public offering in July, Zillow.com announced a new acquisition and said it has raised its full-year outlook after seeing record revenues and traffic in the third quarter of 2011.

Buyers circling luxury retail center
Schnitzer West LLC Schnitzer West LLC Latest from The Business Journals Shops at the Bravern put up for saleSchnitzer West sells two buildings for 0M Schnitzer West sells two buildings for 0M Follow this company has put up for sale its luxury retail shopping center in downtown Bellevue…..

Mastro bankruptcy trustee gets $35.8M in judgments
U.S. Bankruptcy Judge Marc Barreca on Tuesday awarded $35.8 million in judgments to the trustee in the contentious bankruptcy of missing Seattle real estate developer Michael R. Mastro.

Seattle metro home values fall 5.7% from Q3 2010
Home values in the Seattle metro area fell 1.5 percent from the second quarter of this year, and 5.7 percent from a year ago, to $257,000, according to Zillow.com Zillow.com Latest from The Business Journals King County housing prices take another tumbleZillow posts record revenue, buys Calif. firm for .8MZillow posts record revenue, announces acquisition Follow this company ’s home values index for the third quarter of 2011.

Mastro's largest creditor facing involuntary bankruptcy
In a continuing effort to recover the hundreds of millions owed to creditors in Seattle real estate developer Michael R. Mastro’s bankruptcy, trustee Jim Rigby is trying to force Mastro’s longtime business associate and friend Thomas R. Hazelrigg III into an involuntary Chapter 7 bankruptcy.

National

Motel Is Latest Stopover in Federal Forfeiture Battle
TEWKSBURY, Mass.—The $57-a-night Motel Caswell, magnet for hard-luck cases, police patrol cars and the occasional drug deal, is the unlikely prize in a high-stakes tug-of-war between conservative legal activists and the government.

New York Placing Tallest Order
A Los Angeles real-estate company founded by two former Israeli paratroopers and a Drexel Burnham Lambert executive has emerged as one of the country's most active property buyers. Now it is poised to unveil plans for its main showpiece: New York's tallest residential tower.

Washington's Office Market Dials Back
The rising pressure to control federal spending is beginning to take a toll on Washington landlords.
The Washington region's office market in the third quarter registered its worst performance since late 2009, a sharp contrast to a boom the area saw throughout 2010.

Shopping in Scottsdale The sale of the Shea Scottsdale shopping center just outside Phoenix helps explain a curious phenomenon taking place in retail real estate.

The Nation's Most Avid Trophy-Home Buyer?
One of the nation's most voracious consumers of trophy real estate is back on the hunt.
Since the mid-1990s, software billionaire Larry Ellison has accumulated hundreds of millions of dollars worth of top-shelf properties around the world. The portfolio of Oracle Corp.'s co-founder includes five adjacent lots in Malibu, Calif.; a Newport, R.I., mansion formerly owned by the Astor family; a historic garden property in Kyoto and an estate in Rancho Mirage, Calif., with a private, 19-hole golf course.

Housing Lift Proves Fleeting
Sales of previously owned homes slipped in September as Americans were hit by economic uncertainty, high unemployment and tight lending.

Blackstone to Pay $1.08 Billion for Suburban Offices
Blackstone Group LP (BX), the world’s largest private-equity firm, agreed to pay $1.08 billion to buy Duke Realty Corp. (DRE)’s suburban office holdings in cities including Chicago, Dallas and Atlanta, according to a statement.

New Jersey's Newport Tower Trades for Record Price
They don't call it the Gold Coast for nothing. In the largest sale of a single office property ever recorded in New Jersey, the 36-story, 1.05 million-square-foot Newport Tower at 525 Washington Blvd. on the Hudson River waterfront sold this week for $377.5 million.

New rule a major condo headache
WASHINGTON — Is a little-publicized switch in federal mortgage policy causing huge problems for condominium sellers, buyers and homeowner-association boards across the country — even depressing prices and blocking refinancings?

Foreigners' Sweetener: Buy House, Get a Visa
The reeling housing market has come to this: To shore it up, two Senators are preparing to introduce a bipartisan bill Thursday that would give residence visas to foreigners who spend at least $500,000 to buy houses in the U.S.

New Tricks for Old Malls
Sobered by store closings and the rise of online shopping, owners of U.S. shopping centers are filling space and drawing visitors by turning to unusual tenants like gun ranges and go-cart tracks.

Lightstone Chief Defends a Bankruptcy
Real-estate investor David Lichtenstein, who faces a court order to pay lenders a $100 million penalty for his 2009 decision to put his Extended Stay hotel chain into bankruptcy, says he's being branded the bad boy for doing the right thing.

Saving the Clock Tower
Marriott International Inc. has agreed to buy Manhattan's famous Clock Tower building, raising the prospect that the company will use the historic property to revive a struggling new hotel brand.

Apartment Values Rise, as Do Rents
Strong growth of rents and occupancy levels of rental apartments have pushed some building values to record levels as Americans shift away from home ownership.

Dubai launches domestic property fund
Dubai has launched a fund focused on its domestic real estate market as the government moves to underpin property prices, which have fallen two-thirds from their 2008 peak. The government’s Investment Corporation of Dubai and Brookfield Asset Management will both inject seed funding of $100m into the fund, which will be capped at $1bn.

Trials in Low-Rent Bastion in Silicon Valley
Apartment giant Equity Residential has run afoul of a working-class community at the northern end of Silicon Valley by trying to buy the area's largest complex of rent-controlled housing, which has been coveted by investors for years.

Top of the World
Want to look out from the top of One World Trade Center? The line starts forming in 2014.
Last month, the Port Authority of New York and New Jersey and Durst Organization, began a formal search for companies to run the observation deck at the top of what is to be North America's tallest tower.

CBRE Completes Purchase of ING's Real Estate Investment Business.
CBRE Group Inc. on Monday completed a $900-million acquisition of ING Group's real estate investment management arm in Europe that makes the Los Angeles company the global leader in that business.
Carlyle Cuts Fees to Sell New Fund
Carlyle Group, the large private-equity firm that is preparing for a public share listing, has had to cut fees and offer other unusual incentives to lure investors to a new $2.3 billion real-estate fund.

The Science of a Settlement
It won't be fun for Citigroup Inc. and the Securities and Exchange Commission to defend their proposed $285 million settlement at a Wednesday court hearing ordered by a very skeptical federal judge

The Comeback Trail
The real-estate landscape is strewn with hard-hit developers and investors trying to scratch their way back to the top. But for Victor MacFarlane, a former darling of the nation's largest public pension fund, the comeback trail looks especially daunting.

Related Goes Blue
Stephen Ross's alma mater is being good to him.
Last month, the University of Michigan Board of Regents approved a $35 million commitment from its endowment to a real-estate fund run by Related Cos., the New York real-estate firm run by Mr. Ross, a 1962 graduate of the school.

Time Out for a Willis Tower Sale
The owners of the Willis Tower in Chicago, North America's tallest building, have decided to take a "marketing time out" in their effort to sell the property, according to one of the brokers involved in the effort.
REITS
REITs Outperform Market in October
Real-estate stocks outperformed the broader market in October as many commercial landlords reported robust earnings.

Valuations, Fundamentals Key in Current REIT Market
Stable fundamentals and attractive valuations have today’s commercial real estate market on firmer footing than it was during the financial crisis of 2008, said Jonathan Litt, managing principal of Land and Buildings Investment Management LLC.

Canadian REIT Buys Net-Leased BJ’s Wholesale Club for $16M
VOORHEES, NJ-Canadian real estate company H&R REIT has acquired a retail condominium net leased to BJ’s Wholesale Club at 152 Route 73 here for $15.9 million—or $138 per square foot—according to Marcus & Millichap Real Estate Investment Services, which represented both buyer and seller. But the deal wasn’t without its challenges.

Strategic Storage Trust, Inc. Acquires Fifth New Jersey Facility
TOMS RIVER, NJ, Oct 26, 2011 (MARKETWIRE via COMTEX) -- Strategic Storage Trust, Inc. (SSTI), a publicly registered non-traded REIT targeting the self-storage market, recently purchased a 630-unit self-storage property in Toms River, NJ for a purchase price of approximately $5.7 million. SSTI's New Jersey self-storage portfolio now includes five facilities totaling approximately 4,200 units. The new site will be rebranded under the SmartStop(TM) Self Storage trade name.

International

Title Policy vs. Legal Opinion

Approved Countries*

Spain Hit by Downgrade, Falling Home Prices
MADRID—Spain was hit by a double whammy Tuesday when Moody's Investors Service downgraded the country's government-bond rating, citing fading growth prospects, and the government said housing prices fell further in the third quarter, a concern for embattled banks.

New law will let Cubans buy and sell real estate for first time in half-century
HAVANA — For the first time in a half-century, Cubans will be allowed to buy and sell real estate openly, bequeath property to relatives without restriction and avoid forfeiting their homes if they abandon the country.

Real estate regulator bill will improve transparency: Selja
New Delhi : The real estate regulator bill, to be tabled in the coming winter session of parliament, will improve governance and transparency in the sector, union Housing and Urban Poverty Alleviation Minister Kumari Selja said Friday.

Starwood sees commercial real estate opportunities in Europe volatility
The CEO of commercial real estate investment trust Starwood Property Trust (STWD: 18.90 -0.37%) said the current banking and sovereign crisis in Europe is creating a wealth of opportunity for investments, both domestic and abroad.

Argentine real estate: ditching the dollar?
A strange thing has started to happen in Argentina’s real estate market: since new foreign exchange controls were introduced this week, some people have started to buy property… in pesos.

Asia Pacific Poised to Outperform Other Global Commercial Property Regions in 2012
According to global real estate firm Jones Lang LaSalle, the changing face of the region - urbanisation, population growth, output of commodities and manufactured goods and cost competitiveness in the services sector - are the main economic drivers for Asia Pacific to continue to outperform other regions. Capital inflows from Asia and other regions will continue to also propel the Australian commercial market in 2012

CBRE Completes Purchase of ING's Real Estate Investment Business.
CBRE Group Inc. on Monday completed a $900-million acquisition of ING Group's real estate investment management arm in Europe that makes the Los Angeles company the global leader in that business.

India: Now Real Estate Sector Needs Reform: Vinod Behl
The Supreme Court ruling banning real estate transactions on the basis of power of attorney and making sale deed compulsory for property sale is a welcome step that will make secondary market transactions fool-proof. It will check the evasion of stamp duty and black money dealings no doubt. But there is still an urgent need for an overall reform of real estate that is facing a credibility crisis among consumers and investors alike.

Property Theft In Costa Rica
The idea that somebody would steal your property seems an inconceivable notion. However, in Costa Rica it can and does happen. I will point out how it happens and what you can do to minimize your risk.

Distressed
The Distressed Debt Report

'Zombie' Properties Come Back to Life
Four months ago, Ky Nguyen was paying about $6,000 a month in rent for his small, 1,600 square-foot dental office, part of a mostly vacant strip mall in Manteca, Calif.

Miami Condos on Upswing
The sale of a huge block of vacant apartments in a foreclosed Miami development has marked an important milestone in the city's housing recovery: The condo glut is coming to an end.

A Tiff Develops Over Loan Change
"Another month, another large loan modification."
So begins a Deutsche Bank report over the restructuring of a $325 million loan on a Manhattan office building that has touched off a dustup in the tight-knit world of commercial mortgage-backed securities.

Old Debts Dog Europe's Banks
European banks are sitting on heaps of exotic mortgage products and other risky assets that predate the financial crisis, adding to pressure on lenders that also are holding large quantities of euro-zone government debt.

Related Cos. Gets Subpoena in Fannie Mae Probe
The Related Cos., a closely held New York developer, was served with a subpoena as part of a federal inspector general's investigation of a business transaction with Fannie Mae, according to people familiar with the matter.

Pinch on China Developers
SHANGHAI—A shuffle in the ownership of a piece of prestige Shanghai real estate demonstrates the pressures besetting China's property developers.
RE Trends
Plots & Ploys
A deal to sell a three million square-foot portfolio of office buildings pulled off a fitting feat for the Halloween holiday: It came back from the dead.

New Mortgage Plan Floated
State and federal officials are pushing a plan that could help some "underwater" borrowers get refinancing assistance in the latest government bid to break a legal impasse with big banks over alleged foreclosure abuses and ease problems in the housing market.

State Rules on Foreclosure
The highest court in Massachusetts ruled that a homeowner who bought a foreclosure that hadn't been properly conducted by the foreclosing bank in 2006 didn't have legal ownership of the property.

Faulty mortgages have cost 5 biggest home lenders $69 billion
JPMorgan Chase disclosed $1.3 billion of new expenses tied to faulty mortgages and foreclosures in its third quarter, pushing the bill for the five biggest home lenders since 2007 to almost $69 billion.

Mortgage Insurer Wilts
A key piece of the nation's mortgage market is showing new cracks.
Arizona regulators have taken over a big mortgage insurer and put restrictions on its claims payments, the latest indication that the housing bust is not finished taking casualties—and that lenders and investors are likely to suffer more losses.
Home Lending Revamp Planned
Federal regulators on Monday unveiled a major overhaul of an underused mortgage-refinance program designed to help millions of Americans whose home values have tumbled.

CIT Is Upbeat on the Economy
CIT Group Inc., nearly two years out of bankruptcy, is showing there is life after near-death.
Despite swinging to a third-quarter loss, the lender to small and midsize businesses on Tuesday struck an upbeat tone about commercial-loan demand, saying the U.S. economy doesn't appear to be headed toward a double-dip recession. CIT also reported headway in efforts to reduce its high-cost debt, a source of pressure on recent quarterly results.

Apartment Values Rise, as Do Rents
Strong growth of rents and occupancy levels of rental apartments have pushed some building values to record levels as Americans shift away from home ownership.

Construction Starts Are Slowing Down
The construction industry will see little growth next year due to the slow economy, according to a forecast by McGraw-Hill Construction.

Seattle metro home values fall 5.7% from Q3 2010
Home values in the Seattle metro area fell 1.5 percent from the second quarter of this year, and 5.7 percent from a year ago, to $257,000, according to Zillow.com Zillow.com Latest from The Business Journals King County housing prices take another tumbleZillow posts record revenue, buys Calif. firm for .8MZillow posts record revenue, announces acquisition Follow this company ’s home values index for the third quarter of 2011.

Governments on the Prowl
While some state and local governments are selling office buildings and other properties to deal with the downturn, others are taking a different tack.

C(RE) BLOGS
The Mortgage Crisis: Some Inside Views
Occupy Wall Street is denouncing banks and Wall Street for "selling toxic mortgages" while "screwing investors and homeowners." And the federal government recently announced it will be suing mortgage originators whose low-quality underwriting standards produced ballooning losses for Fannie Mae and Freddie Mac.

Romney's Finest Hour
A friend of ours quipped recently that Mitt Romney could do his Presidential candidacy a lot of good if he took even a single position that is unpopular in the polls. Well, we can report that he has done that on housing policy, that he's being pummeled for it, and that it may be his finest campaign hour. It also contrasts favorably with the latest temporary, ad hoc and futile housing effort from President Obama.

Scott Miller's Welcome to the Jungle Blog Part III
Well, as I see it the Government has given the banks lots of access to money, as well as shored them up with cash to ensure that we did not have a cataclysmic collapse of the banking sector. Agree or not with that it happened and lending did not increase. If anything it decreased and the banks held the money close to their chest and invested it to raise their own value not their customers. Now we are sitting with around 22% or so of all homeowners owing more that what their home is worth. Worse in the hard hit areas like NV, AZ, and FL but the average nationally, and we have and unemployment rate problem +9%.

Foreclosures Up in October, but Default Notices Drop in Nevada
Foreclosure filings rose by 7% in October from the previous month to the highest level in seven months, offering a sign that banks are slowly working through the procedural fixes required by regulators as a result of processing abuses that surfaced last fall.

Military Families Lost in Housing Shuffle
Members of the U.S. military and their families have been thrust into a difficult spot due to the housing bust. They can be ordered to move, often across the country. And if their home has dropped in value, many are forced to sell it as a loss.