Easy Cash Uplifting Investors

Easy Cash Uplifting Investors

The fuel behind New York’s record-setting real estate bonanza is the sizzling market for capital, and both buyers and lenders predict that cheap financing will be available for real estate investors into the foreseeable future. The availability of investment capital set fire to the real estate investment sales market last year, when transactions topped $30 billion. Considering the preliminary sales that are in contract for 2007, I would not be surprised to see the following advertisement: “For sale in New York City, office buildings, rental apartment complexes, hotels, and retail locations, priced from $100 million to $2 billion. Financing available for up to 100% of total purchase price, nonrecourse, interest only, and flexible terms.”

Real estate investors are confident capital will continue to flow into New York’s office market, where vacancy rates are dropping and rents are on the rise. One of the most active lenders in 2006 was Wachovia Securities. Last year, the bank was the leading lender in the $5.9 billion financing for Peter Cooper Village and Stuyvesant Town, the largest mortgage ever provided for a single property. “Capital is plenty; it also is now a freely tradable commodity,” a managing director at Wachovia Securities, Robert Verrone, said. “We only originate financing for what we can sell; so long as we can sell it, we will originate it.”

Ritz owner: Toss damages

Ritz owner: Toss damages

Attorneys for the owner of the Ritz-Carlton, Sarasota, and home builder Taylor Woodrow Inc. are asking a judge to toss out the $34 million in punitive damages the pair were hit with in November.

Capping an eight-hour hearing Tuesday, attorneys for C. Robert Buford and Taylor Woodrow requested that Circuit Court Judge Becky Titus nullify a jury’s award that ended a five-week trial last fall tied to the luxury resort.

“It was improper for the jury to be permitted to apply punitive damages to an issue in which reasonable people could disagree,” said Taylor Woodrow attorney Christopher Griffin.

Tuesday’s hearing marked the first time Ritz-Carlton co-owner and Core Development Inc. founder Kevin Daves had met his adversaries in court since Nov. 23, when jurors concluded Buford and Taylor Woodrow committed fraud and conspiracy and were liable for other actions associated with the 88-unit Beach Residences condos connected to the Ritz-Carlton Beach Club, on Lido Beach.

Savvy S. Floridians cash in by renting homes to game fans

Savvy S. Floridians cash in by renting homes to game fans

More than 100,000 visitors are about to descend on South Florida for the country’s largest sports event. What’s a homeowner to do?

Hundreds of them are seizing the money-making moment and offering their homes to Super Bowl fans. Asking from $150 a day to more than $15,000 for the week, South Floridians are posting online pitches of pads from Pompano Beach to South Beach.

”I already have 10 e-mail responses. One woman called me from California at 2 a.m.,” said Romina Llanes, a day after posting her one-bedroom South Beach condo on craigslist.com for $500 for three days.

Condo owners are hoping booked hotels and high room prices near the Feb. 4 game will steer some Super Bowl visitors their way. Owners of single-family homes are appealing to small companies and groups that need larger spaces. They’re posting photographs, maps, glowing descriptions and promises of fun in the subtropics.

No slump in S. Florida apartment market

No slump in S. Florida apartment market

The South Florida condominium market might be languishing, but according to at least one brokerage the apartment market remains robust, with low vacancies, rising rents and strong demand from both tenants and investors.

Every year, Marcus & Millichap Real Estate Investment Brokerage Co. publishes the National Apartment Index, an analysis of 42 apartment markets around the nation. These markets are ranked based on criteria such as forecasted employment growth, vacancies, construction, housing affordability and rental growth.

In the 2007 index, New York City moved up four places to claim the top spot, surpassing last year’s leader, Orange County, Calif., which dropped to second. Fort Lauderdale ranked sixth, Miami, No. 13, and West Palm Beach, No. 15. All three South Florida markets fell on the list from last year due to instability in the local real estate market. But they still have strong underlying fundamentals that make brokers bullish for the long term.

Foreclosures put added burden on association-run communities [South Florida]

Foreclosures put added burden on association-run communities [South Florida]

If you think you’re paying more to live in your condo, townhouse or gated community, consider this: It may get worse before it gets better.

Experts fear that with homes selling slowly, owners who can no longer afford payments may soon abandon them. If that happens, those left behind in communities run by associations must make up the missing share of money to maintain roofs, roads, landscaping and pools.

“We’re seeing a 100 percent increase in the number of files turned over to us [by associations] for lien and foreclosure,” said Gary Poliakoff, whose Fort Lauderdale-based law firm, Becker & Poliakoff, represents 4,200 associations in Florida.

In Broward County, his firm has more than 900 active collection files. The Palm Beach County office has 200 active cases, but those “communities are more upscale so the stresses aren’t as great as quickly as they are compared to Broward, with its higher number of retirement communities,” Poliakoff said.

Buyer Beware These High-Yield Stocks

Buyer Beware These High-Yield Stocks

If you look at the historical returns for mortgage REITs over the past several years–17.5% five-year compound annual total return for the FTSE NAREIT Mortgage REIT Index as of Nov. 30, 2006–you’d think that these investments can’t miss. However, at Morningstar, we believe mortgage REITs bear significant risk, and we’d advise all potential investors to dig deep before taking the plunge.

What Exactly Is a Mortgage REIT?
Generally speaking, a REIT is a company that invests in income-producing real estate assets–at least 75% of total assets–and distributes a minimum of 90% of its income as dividends. In fact, many REITs distribute 100% of income to avoid corporate taxes. Despite not being taxed at the corporate level, the majority of the dividend paid to shareholders is taxed as ordinary income, which is higher than the normal rate for dividend income. To understand the tax consequences of investing in REITs, we would suggest contacting your tax advisor.