Atlanta
Atlanta-based Post Properties plans to sell five Atlanta apartment communities with the hope of raising $500 million, after losing $27 million in the second quarter compared to earnings of $62 million in the same period last year. A $28.9 million impairment charge had been assessed to the company, one of the largest developers of luxury multifamily communities in the U.S., for writing off falling land values and for predevelopment costs from halting projects as financing became more difficult, the Atlanta Journal-Constitution reported. Among the Atlanta apartment communities Post has put on the block are Post Oglethorpe in Brookhaven and Post Woods near Cumberland Mall. Post is also shopping its two luxury apartment buildings in New York City.
Boston
The stage has been set for what will soon become Boston’s largest single-family home, after investment executive Ofer Nemirovsky spent 10 years acquiring two contiguous buildings at Exeter Street and Commonwealth Avenue in the city’s Back Bay neighborhood. When completed, the $23 million mansion will have 24,000 square feet of living space with 15 bathrooms, three children’s bedrooms, six parking spaces and an elevator. The two-year gut renovation project will also feature an exercise room, media room, recreation room and office for the house manager, the Boston Globe reported.
The greater Boston area is emerging as a destination for top information technology companies, with Oracle Corp. the latest firm to make a big splash in the region. The world’s third-largest software maker will begin construction by the end of the month on a 150,000-square-foot complex at its Burlington office park along Route 128, which will double in size after the expansion is complete, the Boston Globe reported. Oracle has acquired six companies so far this year, including its recent $8.5 billion purchase of BEA Systems. The California-based company’s expansion comes on the heels of aggressive moves made by Google and Microsoft in Cambridge and IBM in nearby Littleton.
Chicago
Falling home prices in Chicago over the past year have put many buyers in negative equity, meaning they owe more on their mortgages than their property is worth. About one-third of all the homes bought in 2006 and 2007 in the Chicago area have negative equity, according to a report by real estate data firm Zillow. In the second quarter, Zillow reported 19.8 percent of homes in the Chicago region sold at a loss, up from 13.4 percent during the same time last year. Eighty percent of all homes in Chicago declined in value in the past year, the Chicago Sun Times reported.
With new development condos languishing on the market across the country, at least one developer in the Chicago area is trying to change things up with quirky incentives. Developer Scott Whelan is offering a $3,000 credit at the nearby Bar on Buena, owned by a former classmate at Illinois State University, for buyers at his Uptown condo project at 927 West Agatite Avenue. The incentives have generated showings at the property, where units are priced from $320,000 to $470,000, but did not yield any sales as of mid-August, the Chicago Sun Times reported.
Las Vegas
The average monthly apartment rent in Las Vegas reached $889, rising $9, or just 1 percent, in the second quarter from the same time last year, according to the Applied Analysis research firm. The second-quarter increase is the lowest growth in rent in four years, the Las Vegas Review-Journal reported. Applied Analysis concluded that the highest rents were in the southwest valley, at an average of $1,106 a month, and the lowest rents were in the northeast, at $763 a month. Occupancy in Las Vegas rose 0.2 percentage points between the first and second quarters, reaching 92.9 percent, down from 93.7 percent from the second quarter of 2007.
Los Angeles
Those in the hunt for new condos in Southern California may find some good deals now, but new condo projects have virtually come to a halt with many builders unable to secure financing and others looking to convert units to rentals. For instance, one of last year’s largest planned condo developments in the Los Angeles area, the Related Companies’ 2,600-unit Grand Avenue project downtown, has yet to come out of the ground. Sherman Harmer, co-chairman of the Urban Council of the California Building Industry Association, estimated that applications for condo building permits are down up to 70 percent in most counties in the region, the Los Angeles Times reported.
Philadelphia
Some residential developers putting up new condos on the Main Line in Philadelphia’s western suburbs are waiting until the housing market turns around. At the beginning of 2007, about eight new condo projects were in various stages along the Main Line. Some of the projects have been completed and sold, while others have yet to start construction. Developer and architect Tom Hall’s yet-to-be-built project, Allaire, is up for sale. Michael Main and Jeff Pendergast of Wycklow Development sold six out of eight units at another project but lowered prices to sell faster, the Philadelphia Business Journal reported.
Phoenix
Homes priced under $350,000 in Phoenix are selling quicker than the rest, according to real estate firm John Hall & Associates. Overall, real estate data firm Information Market said 35 percent of the homes and condominiums sold in July were bank-owned through foreclosure. The median price of the foreclosure sales was $160,000, more than $40,000 below the Valley’s median price. In the Phoenix metro area, pre-foreclosures were down in July, falling from 6,893 to 6,397. This is the first significant drop in pre-foreclosures since foreclosures started to rise last summer, the Arizona Republic reported.
San Francisco
With the high-end market in the Bay Area hurting, brokers are coming up with new ways to attract buyers. Luxury broker Olivia Hsu Decker of Sotheby’s International Realty is holding a six-day event in September for interested buyers to view 30 mansions. The event includes wining and dining prospective buyers, who are chauffeured around to see homes in the $4 to $65 million range. About 40 people, mostly from overseas, have already paid $800 for dinner and limo service, with the option of paying more for hotel accommodations and opera tickets, the San Francisco Chronicle reported.
Seattle
First Industrial Realty Trust announced last month the purchase of a 233,000-square-foot portfolio in Seattle comprised of three distribution facilities, vaulting the Chicago-based company into the top five acquirers of industrial real estate in the Seattle-Tacoma market this year. The properties, located in the Kent Valley submarket, the largest in Puget Sound, are 100 percent leased. The sales price was not disclosed. First Industrial’s expansion in the region also includes the development of two buildings totaling 328,500 square feet in Lacey, southwest of Seattle. The company owns an additional 256 acres of developable land in Seattle-Tacoma, which could be built out to 3.8 million square feet.
Washington, D.C.
The Washington, D.C. area’s investment sales market continues to suffer from the credit crunch. During the first six months of 2008, there was $1.4 billion in commercial sales in the District, down 61 percent from $3.6 billion sold during the same time last year, according to Real Capital Analytics. In Northern Virginia, building sales fell 87 percent, down to $914 million from $6.8 billion a year ago. Maryland’s suburban commercial sales decreased 13 percent in the first half of the year, falling to $459 million from $527 million last year, the Washington Post reported.
Springhill Lake, the D.C. area’s largest apartment community, has sold for $275 million to Empire American Holdings. Located at 9230 Springhill Drive in Greenbelt, Md., the community contains 2,877 residential units, which the buyer plans to renovate. The seller in the deal, AIMCO, was represented by Al Cissel and Scott Melnick of local real estate development and brokerage firm Transwestern. The community lies in proximity to the District’s Downtown area and is reportedly more than 90 percent leased.
Compiled by Jovana Rizzo and Linden Lim