National market report

<i>Commercial and residential real estate news briefs from the most active U.S. markets</i>

Boston

Therese Murray, Massachusetts State Senate president, said the approval of casinos in her state may be a foregone conclusion. The Senate has been debating whether the permitting of casinos in the state could help Massachusetts’ budget, which saw a $243 million revenue shortfall in September, according to the Patriot Ledger. While Murray said that the construction of casinos could help unemployment figures, opponents say that increased costs for the state’s infrastructure would negate the benefits.

Chicago

The Chicago Cubs filed for Chapter 11 bankruptcy protection, as the Tribune Company plans to sell the team, along with Wrigley Field and all related team properties, to the family behind TD Ameritrade. The bankruptcy paves the way for the $845 million deal, according to the Associated Press. There was no word as of press time whether the new owners plan to change the iconic stadium’s name after the deal is finalized.

Detroit

In an effort to keep a soon-to-be-shuttered prison in business, local officials in Standish, Mich, are considering allowing recently transferred Guantanamo Bay detainees to be relocated there. The property, located in the Detroit suburb, could sit unused if the proposal is turned down, but locals still remain largely opposed to the idea. Few local citizens would be hired to help run the facility, according to the Detroit News, and some people in the community are concerned about the stigma that could be attached to the neighborhood if the plan goes through.


The Las Vegas strip at night

Las Vegas

While Las Vegas may be best known for its nightlife, casinos and booming tourism industry, some financial experts are calling for more-diverse industry in the area, pointing to rising hotel vacancies and home foreclosures. As the Las Vegas Sun reported, the city is home to the largest foreclosed commercial property in the U.S. and has the highest home-foreclosure rate of any large city in the country. University of Nevada, Las Vegas, economist Keith Schwer said that Las Vegas’ financial decline is similar to that of Detroit, largely because the two cities are each dependent on one specific industry. Unlike the auto manufacturing industry, however, it seems unlikely that casinos will get a federal bailout.

Los Angeles

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Homeowners in the mudslide-prone Los Angeles metropolitan region are finding difficulty acquiring home insurance, according to a report from the Los Angeles Times. Experts say that flood insurance is not comprehensive enough for many of the area’s homeowners, and that it often doesn’t extend to mudslide coverage. This is a big problem for many Los Angeles suburbs, like Pacoima Canyon and Arroyo Seco, where the chance of mudslides in the rainy season is as high as 80 percent, according to the U.S. Geological Survey.

Orange County, known for its luxury real estate and wealthy residents, is seeing fewer buyers seeking large-scale mansions. While many luxury home-builders — and residents trying to resell their high-end homes — have been able to hold out for well-to-do buyers and keep prices high, the Los Angeles Times reports that they might not be able to hold on much longer. The rising number of vacant homes in the region, combined with relatively few interested buyers, is causing some in the market to feel the long-delayed real estate pinch.

New Orleans

Less than a month after being rejected by a federal jury, a New Orleans family that claims its Federal Emergency Management Agency trailer contained dangerous levels of formaldehyde is asking that a judge allow for two nonbinding summary jury trials, the Associated Press reported. The plantiffs’ attorney said that while these are, essentially, mock trials, they can help encourage a mass settlement in the case. This case is one of many in the region involving several families displaced by Hurricane Katrina who say that their government-issued trailer homes gave off hazardous fumes.

Tourism groups are taking a new tack to draw visitors into New Orleans by emphasizing the city as a gardener’s paradise. Jeanne Nathan, an official from the New Orleans Botanical Garden, said that government and residential gardens are New Orleans’ “last best-kept secrets.” Nathan hopes the city’s many garden shows and festivals may spur fall tourism, a traditionally slow season for travel in the U.S.

Philadelphia

John Taylor, a Pennsylvania state representative, introduced a bill aimed at stymieing the flow of abandoned lots in Philadelphia. The bill would create a land bank similar to one in Flint, Mich., which seizes empty properties after one year and then forecloses on them after two. “Philadelphia has to have the will, direction, and resources to go through the process of bringing in an inventory, taking over properties and disposing of them,” Taylor told the Philadelphia Inquirer. “Up until now, there’s been no plan.” There are currently around 23 acres of abandoned space in Philadelphia, according to the Pennsylvania Horticultural Society, a trend that encourages crime and accidents. According to the city Redevelopment Authority, there are an estimated 40,000 abandoned and vacant lots in Philadelphia.

San Francisco

Twenty years after the Loma Prieta earthquake, which devastated the Bay Area, destroying schools and hospitals, the San Francisco Chronicle reports that many of the region’s public facilities have undergone retrofitting to prepare for the next big quake. But while infrastructure might be better equipped for disaster, residential structures severely lag behind, in part because, as many experts believe, homeowners lack the incentive to retrofit their homes. Officials say that the situation is particularly dire because many of the Bay Area’s homes were built before building codes were updated in the mid-1970s. The Chronicle reports that new mandatory retrofit laws are beginning to be considered.

Washington, D.C.

Commercial real estate construction in Bethesda, Md., and other surrounding Washington, D.C., suburbs showed a drastic downturn in the third quarter of this year, which may help the market stabilize, according to industry analysts. A surplus of commercial space caused Maryland to see the highest vacancy rate in the state in 20 years, but a report from brokerage CB Richard Ellis said that around 600,000 square feet of space was constructed in the Washington, D.C., suburbs in the third quarter this year, down from 2.6 million square feet constructed during the same time period a year earlier.