Great payout wasn’t sale motive [South Florida]

Great payout wasn’t sale motive [South Florida]

Looking back, it was a heck of a land deal.

Seven investors, five of whom were Bradenton High School chums from the late 1940s, bought 60 acres along a scenic stretch of the Braden River in 1978 for $350,000, about $1.2 million in current dollars.

There, in the middle of nowhere, they built the 476-unit Horseshoe Cove RV Resort, a quintessential Florida destination for snowbirds and the 55-and-older crowd.

Now, the aging group of investors is cashing out. They agreed last week to sell Horseshoe Cove for $24 million to a company that manages 30 or so such communities throughout Florida, including RV parks in Ellenton and Punta Gorda.

High and Low Finance – Trail of Bad Loans Leads to the Couple Next Door

High and Low Finance – Trail of Bad Loans Leads to the Couple Next Door

In the spreading mortgage crisis, there are many homeowners who were tricked into taking out loans they could not afford, or who failed to understand the risks they were taking.

This column is not about them.

Instead it highlights a trail of foreclosures left by a Florida couple, Scott and Deanne Hopp. They bought and sold house after house, and seem to have done well at it for a time. They specialized in buying houses with less than no money down, borrowing more cash than they actually had to pay.

One of their homes caused a scandal when it was featured in the local newspaper as being used for sex parties promoted on the Internet. (The report said that some partygoers had to pay a fee, but that others had been admitted free in return for agreeing to allow the party organizers to use videotapes of their party activities.)

The Hopps protested that was not their fault, that a tenant had organized the parties without their knowledge. Simply renting out the house was a violation of the terms of their mortgage, but the lender, Countrywide Financial, evidently did not notice. A month after the scandal broke, it gave the couple another million-dollar loan to buy a house four miles away.

Lead damages lawsuit settled

Lead damages lawsuit settled

Paul W. Nochumowitz, who has been one of Baltimore’s biggest ground rent owners, has agreed to a $1.53 million settlement of a lawsuit that accused him of living lavishly from ground-rent income while claiming he was too poor to compensate former tenants harmed by exposure to lead paint.

The settlement ends a contentious court fight between Nochumowitz and bankruptcy trustee George Liebmann, who accused the ground rent owner in U.S. Bankruptcy Court in Baltimore of concealing his wealth to escape liability for lead paint injuries in rental housing he owned.

“Those concerned feel it is a satisfactory result,” Liebmann said Thursday.

Liebmann said most of the money would be divided among more than a dozen families suing Nochumowitz and a business partner, alleging lead paint poisoning of their children during the 1990s. The money will be paid by Nochumowitz, the business partner, and members of their families.

Real Estate Investors May Resort to Prayer

Real Estate Investors May Resort to Prayer

As the president of Silverstein Properties, Larry Silverstein, recently remarked on my television show: “The capital markets’ dislocation in real estate is the worst I have seen in my 55 years in real estate.”

The dislocation of those markets has had a critical effect on the sales of commercial properties in New York City. Few properties are selling at values that were achieved in 2006 and 2007, and sales volume is down at least 15% from its peak.

“Investment sales for properties which were closed or under contract for the first six months amount to $14 billion, which is off from the total volume of $38 billion for first six months of 2007,” the chief operating officer for the New York metro region at Cushman & Wakefield, Joseph Harbert, said.

“Foreign investors, mostly from the Middle East, China, Ireland, Sweden, and Germany, accounted for 40% of the purchasers of property during the first half of the year,” he added.

Adjusting to a softer real estate market

Adjusting to a softer real estate market

A big reason that Fiona Saulness has saved as much as she has for retirement is real estate.

Not only has the 52-year-old made a good living as a realtor, her investments in her Arizona house (which she owns free and clear) and a Seattle condo (which she rents out) have helped her amass nearly three-quarters of a million dollars in home equity.

But if she continues to focus so much on real estate – at the expense of her investment portfolio – it may threaten her retirement plans down the road. In part because she’s been hoarding money in case she finds a third property, her hodgepodge of a portfolio is offtrack.

She currently has a quarter of a million dollars sitting in cash. Yet she needs to make more on her investments than cash pays, since she can’t count on earning what she did as a realtor at the market’s peak – in 2006, she made more than $200,000.

McCrary case cautions athletes

McCrary case cautions athletes

Michael McCrary had known Edward Giannasca for half a decade, and, until the former Baltimore Raven realized that he’d been cheated out of millions, he thought of the longtime developer as a stand-up guy.

McCrary trusted Giannasca so much that, with few questions asked, he handed him a $3million check three years ago for a real estate project that would convert a building in New Orleans into condominiums.

Giannasca, though, betrayed that loyalty, pocketing along with his other partners about $12 million in insurance money after Hurricane Katrina spoiled the deal and telling McCrary that the insurance claim they’d filed had been denied, a Baltimore circuit judge ruled Wednesday.

The judge ordered Giannasca and others, including developer Stuart C. “Neil” Fisher, to pay $33 million in damages to McCrary, who says he’ll use his experience as a cautionary tale for current and former NFL players.