Property Grunt

Saturday, May 29, 2010

Low Hanging Fruit

The next wave is here.

It was after the first couple of months of the financial meltdown, that I began to receive emails from a site called Property Campaign. At first I blew these emails off as a spam, but then I discovered that these people were definitely legit. Which brings me to the commercial real estate bubble.

Greenspan: Commercial Real Estate Bubble Has Already Popped

Former Fed Chairman Alan Greenspan believe a bubble in commercial real estate has already popped. “Real estate prices generally are down 50%,” Greenspan told me in my exclusive “This Week” interview. “With prices already down and adjusted, if we were going to get severe secondary reactions, they would have occurred, and they would have occurred if it weren’t for the fact that the rest of the economy is showing some degree of buoyancy.”

I have to agree with him on this matter. Yeah. I know it is a first.

These ads alone below is enough evidence for me.

The American auto industry has been taken a beating since the financial meltdown, on an anecdotal level I recently met someone who got one of those deals of the century. He basically got an insane deal for a car and was only required to pay the principal in a very attractive monthly payment plan. Although the model he bought was quite recent, the dealership had to clear the decks for new inventory.

The rental car industry has been hit severely because revenue streams are reliant on the traveling/tourism industry. Besides the usual reasons why people would travel to Florida, the real estate bubble in that area was a huge boon for the rental car industry for speculators who needed to look at properties. Now everything has dried up.

You would think that a warehouse would be the last place that would get hammered by the economy but it has taken more than a fair share of its lumps. If you think about it, it makes perfect sense. If consumer spending is down, there is no reason for retailers to purchase stock, if there is no stock to be purchased, there is no need to store it any where. And if the economy is recovering, the owner of this property is going to get out while they still can.

This listing does not surprise me. As everyone knows the restaurant industry has been taken a severe beat down, so these particular investors are getting the hell out of dodge.

A common theme with these properties is Florida, so it is not surprising that investors in that state are in dire need of liquidating.

Condo development is completely out of vogue, especially in California. No surprises here.

I have also been getting a lot of ads for strip malls.

Blame consumer spending. The owners of this property are unsure of how sustainable their tenants will be in the near future, so why take a chance? Take the money and run.

These seem like good tenants, in fact one could argue they qualify as anchors. But their viability depends on consumer spending which is on very shaky ground.

Now this is where things start to get out of whack.

Now mind you, this is the first ad for medical space I have seen, but it concerns me because medical office space is considered to be bullet proof. In fact if I had a ton of cash, I would dump it into this market. However, it is understandable why people are on edge about medical space due to the Obama Healthcare plan.

Now here's where it gets s**tastic.

I got a bunch of these types of ads for properties for sale. What concerned me is that these tenants are ideal for any commercial landlord and what makes them more valuable is that they are near a Wal Mart.

From what I have been told the real estate model for Wal-marts is they find a location, build it and then bundle it up with other super centers and sell it to a syndicate.

I find it quite disconcerting that someone wants to unload a Wal-mart because those stores are annuities. Hell, they are blue chips in the real estate world. As far as I am concerned there is nothing safer. But here we are.

Is this a great time to invest in commercial real estate? Absolutely. But there is a lot of low hanging fruit out there and you better be someone who has a lot of liquidity and an excellent track record for not getting in over your heard.

Unless you have plans for development or have a tenant ready to go, it would be prudent to exercise extreme caution in properties that are associated with restaurants, cars, California and Florida.

Don't be afraid to low ball. You are taking just as much risk as everyone else is.

Happy Hunting.

Friday, May 28, 2010


As I have said before in previous entries, the Doorman is a powerful presence in real estate.

In my experience, I have never seen a Doorman get violent. Until now.



I am not taking sides but as someone who has worked with paparazzi and understands their nature, this volatile situation does not surprise me.

The Doorman is the last person you want to go toe to toe with. If they are union, they will have better benefits, insurance coverage and access to better lawyers.

Tuesday, May 25, 2010

John Wayne Bill Indeed.

What they are asking for is science fiction.

When it comes to gun right, I am pretty much indifferent, but I strongly believe that people should make an effort to educate themselves in how to properly utilize them and the consequences of using them.

Police Officers are unique because they not only do they receive the education in using firearms but they are also to required to learn from the streets.

Which brings me to this article.

Bill May Forbid Cops From Shooting to Kill

I understand the logic behind this bill but all they are doing is further hamstringing from doing their job. Contrary to popular, the general consensus amongst is that the lost thing a cop wants to do is pull their weapon and use it. When a cop uses their gun int eh line of duty, a big party is thrown where Internal Affairs, the District Attorney and depending on the situation other government officials and community activists. It requires a lot of paperwork and meetings. Lots of meetings. It is a huge pain the ass. I haven't even touched the mental and physical consequences.

In fact some of the best cops are the ones who are not associated with having a body count.

I understand the logic of this bill but this is not the answer. If this bill passes you are going to count on having more dead and wounded cops. If criminals know their chances of survival in a gunfight with the police have increased, they will definitely take that advantage and you are going to have more dead and wounded cops.

What the politicians should do is require more training of police officers and examine and address unjustified police shootings. Issuing these types of restrictions is just going hamper cops from doing their job.

Awhile back, a officer from the NYPD explained the bizarre nature of shootings. He told me that it was natural that a cop will go through an entire magazine even though it will feel like they fire maybe 3 shots. The adrenaline dump will hit them so hard that it will create tunnel vision. It is also not uncommon for police officer to mistake a ricochet or even debris caused by a bullet as being shot at.

And this is just scratching the surface of what cops have have to deal with. This bill is not going to help them any more.

Yesterday, a mother from China picked up the body of her daughter who beaten to death and raped.

And we are still dealing with the repercussions of that douchebag bomber of Times Square.

Are these people completely unaware of what is going on now?

Monday, May 24, 2010

How not to be a power broker

From D.C to any school board,power and influence are commodities that are bought and sold. I do not think what Sarah Ferguson did was wrong. It is her execution that was completely sloppy and unprofessional.

First of all, if she was really serious about this she should have just set up her own lobbying firm and joined forces with people who have experience as power brokers. Not only to lead her but to also to give her access to other networks of influence. She should also have hired herself the most powerful attorney to make sure that not only her interests were protect but also to make sure she did not do anything incriminating.

The Queen Mum is pissed but not at her but at her son Prince Andrew. Even though they are divorced, he should have taken more responsibility to ensure that his ex-wife the loose cannon was strapped down securely. And with Fergie's history of embarrassing the royal family, Prince Andrew should have been better prepared. Even though he was not on the take, it still does not look good for him.

If Fergie has done this in the past, he should have suspected she was not helping certain parties out of the goodness of her own heart.

“I have not got a bean to my name,” she is quoted as saying. “I’m a taxpayer, a British taxpayer, and I left the royal family for freedom, and in freedom it means I am bereft. I’m hopeless.”

-Sarah Ferguson

This woman needed cash. Why else would she shill for Weight Watchers?

What Prince Andrew should have done was upped her alimony to the point where she did not have to shill for herself. And the moment he noticed that she was hawking access to him, he should have set up a company for her and hired people who were loyal only to him and give them strict instructions to watch her so she did not f**k things up.

More importantly, he should have also hired someone to manage her finances to ensure she did not burn through all her cash.

The sad thing about all of this is that if Fergie had actually made the effort to fully understand her position, mastered the the nuances and subtleties of being a power broker and aligned herself with the right people, she would have been force to reckon with that even the Queen Mother would have to respect. Now she is just a f**king joke.

Notice the trend with Eliot Spitzer and what is going on in Albany?

People are not making the effort to understand the rules of the game. For whatever they either ignorant or do not care to learn. And they pay dearly.

Friday, May 21, 2010


Jin and Sun: Never Forget

I have a lot on my plate which I have been able to clean off but now the next course awaits me. However, I will still maintain my presence on this blog.

No, I have not been away nor have I been doing this. I have just been, how should I say, recalibrating myself.

But I have been keeping tabs on what has been going in the world and I have a lot to say about it.

Friday, May 14, 2010

No Malicious Intent

But no common sense either.

Last night, a large area of Gramercy Park went into lock down because of a report of a suspicious vehicle. And there was good reason to be concerned due to the similar description of the Times Square bombers vehicle. Thankfully that wasn't the case.

It turned out the owner was a gardener who had left the gas cans in his car while attending a Buzzcocks concert.

This was his reaction.

By midnight, the owner of the vehicle, who had been at the concert, returned and was none too happy -- especially when he saw that cops had blown out his windows with two controlled blasts.

"What happened! What happened!" he kept asking police. "What's wrong? I didn't do anything."

What the f**k is the matter with you? Do you not have any f**king common sense? Do you not read the f**king news?

You did nothing wrong but that is no excuse for not being aware of your surroundings.

Remember that person who invited me to that event? This is something he might do. He had a tendency of not thinking things through and when he was faced with option he refused to take it out of pride.

Here's an example.

Awhile back a friend of mine invited myself and "that friend" to a lunch party. Now I wanted to leave at least 45 minutes before it was time but he started pissing and moaning that there was no need for us to leave that early and that we would get there in plenty of time since the restaurant was nearby. I acquiesced because I just wanted to shut him up.

Now the restaurant was nearby but "that friend" forgot to factor public transportation not cooperating with us. We ended up being about 10 minutes. And guess who looked like an a**hole? Moi. Why? Because this was the first time both friends were meeting each other and I was acting as the intermediary.

Now "that friend" did not have any malicious intent in that situation but his inability and unwillingness to use common sense put me in a very poor light.

I am sure this gardener is a very nice guy. But that is no excuse for not thinking things through.

People, it is not about just about being aware of the bad guys but also being aware of whether your behavior is going cause unnecessary friction. Mind you, there are certain things that are out of our control, however, it isn't very difficult to think
"I should leave those gas cans at home."

Thursday, May 13, 2010


They are definitely putting the heat on teacher. But not in a good way.

Teaching is probably one of the most undervalued professions in this country. Which is ironic since teachers develop what is perhaps our most valuable resource: Our children.

Contrary to popular belief, it is not an easy job. It appears that teachers work from 9am-3Pm and get summers off. But it is more like teachers work from 7am to 6pm because they need to prepare their day before classes start and they need to deal with other business after the school day is over. And even though they are paid during the summer, a lot of teachers pick up extra work to supplement their salary because they are not being paid in Wall Street bonuses. I know of one teacher who worked as a truck driver during the summer. And I haven’t even begun to talk about the rigors of dealing with children.

Which leads me to this unsurprising trend of teachers taking pay cuts due to the current economic climate.

In New York’s Suburbs, Teachers Feel Budget Ax

Here are some key takeaways.

School superintendents and board members say they have been caught in the middle, left with no choice but to reduce teacher payrolls — either through salary concessions or layoffs — to offset sharp revenue drops from state aid cuts, declining property values and resistance to higher taxes. “At a certain point, there’s nowhere else to go” to achieve savings, said Michael V. McGill, the superintendent in Scarsdale, whose 460 teachers are among the best paid in the nation, earning $54,442 to $135,000. Faced with the prospect of 20 layoffs, a majority of Scarsdale’s teachers voted to reopen their contract to shave one percentage point off an expected raise of 3.25 percent in each of the next two years. That would save $1.9 million.

I want to clarify something, if the teachers did not agree to these conditions, the board of education would have no choice but to break out the machetes and hack away at anything in their path. Why? Scarsdale is a UNION FREE SCHOOL DISTRICT. In other words the teachers have no leverage in this situation. Therefore there was never a “prospect of layoffs.” It would have been inevitable.

So why would any teacher want to consider working in Scarsdale?

“At a certain point, there’s nowhere else to go” to achieve savings, said Michael V. McGill, the superintendent in Scarsdale, whose 460 teachers are among the best paid in the nation, earning $54,442 to $135,000.


Obviously teachers are not happy with this and have been standing their ground. And they have pissed off a lot of people.

But Robert J. Rader, executive director of the Connecticut Association of Boards of Education, noted “a lot of concern, and a lot of anger” over teachers’ unions that have steadfastly refused to make concessions even as practically every other school group has.

In Waterford, Conn., the teachers’ union rejected a proposal to replace two professional-development days with unpaid furloughs next year but reversed itself after the district agreed to provide some training at other times, said Randy Collins, the superintendent. In Pelham, N.Y., where schools are the center of town life, some residents began speaking up at school board meetings last year to ask why teachers were not doing more to help.

This quote just, well, just read it.

“I have never heard such accusations against teachers,” said Frank Orfei, a social studies teacher for 32 years. “Many teachers feel like we’ve been made scapegoats of an economic crisis that we didn’t have anything to do with.”

Gee. You just figured that out just now? Whether we like it or not we are all bailing water on a sinking ship. And anyone not towing the line is dragging us down.

It sucks, but it is what it is.

Of course to add more fuel the fire for New York State teachers is this new development.

Agreement Will Alter Teacher Evaluations

The agreement, reached in time for the state’s second bid at $700 million in federal education grants, would scrap the current system whereby teachers were rated simply satisfactory or unsatisfactory. Instead, annual evaluations would place teachers in one of four categories — highly effective, effective, developing and ineffective. While the deal would not have any immediate effect on teacher pay, it could make it easier for schools to fire teachers deemed subpar.

“We believe that if done correctly this will change the landscape dramatically,” said David M. Steiner, the state education commissioner. “This is not a gotcha system. This is about creating professional development that can really improve education.”

Teachers would be measured on a 100-point scale, with 20 percent points based on how much students improve on the standardized state exams. Another 20 percent would be based on local tests, which would have to be developed by each school system. After two years, 25 percent would be based on the state exams and 15 percent would come from the local tests.

Scarsdale teachers earn their pay and then some. After all they were pretty much forced to cobble together a curriculum that that could compete with the APs.
Unfortunately just like any other school district, it has its share of people who have no business being teachers. However these developments make a non-union school district a very, very unattractive place work in.

Think about it. If you are a jerk off teacher who is more interested in spending time with a select few and marginalizing those that you feel that are not worth your effort or enjoy tormenting students, you are not going to last to long in Scarsdale.

Complaints are going to be made and you are going to be ordered to actually do your job. And nothing is more dangerous to a teacher than parents with money. You are better off working in a district that has a union because you will have a more secure position in dealing with the headaches.

Now this is a possible a win-win for the unions because if there is an exodus of teachers who feel that the high salaries of the union free school district are not worth it, they are going have their pick of the best and brightest. Or whoever has the best connections.

Now if you are a teacher who actually loves what they are doing and is willing to give their all especially to the runts of the litter. You have nothing to worry about.

This is further evidence that no one is safe. Security is an illusion and everyone needs to make every effort to ensure their survival.

Monday, May 10, 2010

All Hail The Death Dealer

You will be missed Frank Frazetta.

Walking Tall?

I wonder what Buford Pusser would say.

Strategic Default: Walking Away from Mortgage

Watch CBS News Videos Online

This has been going on for quite awhile. I am not surprised.

People were basically emotionally hijacked when they jumped into the real estate market. They did not take a hard look at their finances and the repercussions of the deals they were making. They just wanted a house at any cost. A lot of these people who are leaving can afford to stay in their homes, but after doing the math, they realize they owe more money on the mortgage while the value of their house is declining. So they turn in the keys and walk.

If you think about it, what keeps people paying their mortgage? Besides needing a place to live, it is protecting their credit and their sense of honor.

But consumers are no longer feeling emotionally attached to their homes and to their obligations. Wall Street and Corporate America has shown that walking away is the cost of doing business. And those people sleep pretty well at night.

The purpose of business is making a profit. If it is not making a profit, you either figure out a way to make a profit or cut your losses.

All these people are doing is taking a page from the same book that Tishman Speyers read in the Stuy town deal. There is no money in this deal for them, so they are pulling out of the deal.

Of course these their credit is going to be mangled beyond recognition but they figure that the money they save will make up for that and time will heal their credit. And as long they have a non-recourse mortgage, they should be alright.

However, this is just a further indication of how f**ked up the housing and credit markets will be in the near future. The foreclosure process is not the most efficient of procedures and there will be a lot of low hanging fruit in our future.

And with the relative ease of how one can walk away, lenders will definitely go back to the drawing board on figuring out how to increase the pain of owners who walk even though they have the money to pay their mortgage. I predict non-recourse clauses will either be stricken or be made extremely expensive to install.

Despite the fact that Federal programs to modify mortgages have pretty much failed. The Federal government will no doubt dump more cash into this money pit. And where do you think they will get that money? Here's a hint. Look in the mirror.

I believe in free will. Take whatever actions you want but be ready to accept the consequences. For those of you who decide to walk. Just remember, no one put a gun to your head to buy that house. And if you think you are going to walk away scott free with just a black mark on your credit report, you are going to still have to pay for it one way or another. In Manhattan, if a landlord sees a foreclosure on a credit report, they won;t even return your phone call. And if they decide to take you on as a tenant, you are going to have pony up a lot more to stick around. The result will be that any type of transaction that requires a credit report is going to amount to a considerable expense for someone has taken a strategic foreclosure. Of course there will a huge growth in services that repair credit.

Strategic foreclosures are not something be to taken lightly. If you live in an area that is recovering and has everything you need, you might want to consider sticking around.

Friday, May 07, 2010

We did not dodge a bullet, we dodged an idiot.

We are very lucky, We avoided what could have been a very deadly event."

Mayor Michael R. Bloomberg

One lesson I have learned about life is that no matter how bad things are for you, there is always someone who has it worse.

Another lesson that I have learned is that person who is worse off than you, sometimes they can accomplish things that are quite surprising.

Ladies and Gentlemen,

I give you Sheila Radziewicz

There is a ton of coverage on the Times Square Bomber but what irks me about this bomber is that he was given every opportunity to make something of himself.

From the NYT.

They took their places in the wood-paneled courtroom, 58 people from 32 countries. They listened as a federal magistrate banged the gavel and said it was “a wonderful day for the United States”— the day they would become Americans.

The magistrate talked about Thomas Jefferson and told the group that they could run for office — only the presidency and the vice presidency were off limits, according to a tape recording of the proceedings in a Bridgeport, Conn., courtroom last year, on April 17. On her instructions, they raised their right hands and repeated the oath of citizenship.

In January 2002 Mr. Shahzad obtained an H1B visa, a coveted status meant for highly skilled workers and good for three years, with a possible extension. Records show that Elizabeth Arden, the cosmetics giant, applied for a visa for Mr. Shahzad; he worked there as a temporary clerk in the accounting department in 2001, through an employment agency called Accountants Inc., according to a timecard found in his trash.

Do you know how hard it is to get a H1B visa let alone citizenship in America? It's a f**king pain the ass. I have a friend of mine who has stay out of the country for two years in order to better their chances at getting a green card.

This piece of s**t, I am not saying his name, got everything he needed an immigrant desires from America. An education, residency and a place to raise a family.

Life wasn't perfect for him. It has been reported that he was part of the teeming masses that were in foreclosure. And like many people he was unemployed.

But are these reasons to go up and attempt to kill a massive amount of people in Times Square?

According to reports he was unremarkable, but even if though the POS got his MBA from a lower tier schools and his work experience wasn't at Goldman Sachs, in certain parts of the world that will take you very far.

All the POS had to do was pull up stakes and star new somewhere else. With his background he could have been a super star in his homeland.

But does he do that? NO! F**ktard goes back home and decides to spend time a club Taliban and learns, no, make attempts to learn how to be a terrorist. And F**King fails.

I don't know what the f**k they teach these a**holes but they have to stop it. I mean end it now because obviously they are not doing it right.

If watch a lot of crime films like the Getaway , Reservoir Dogs and Heat, that after pulling off a caper that attracts a lot of unwanted, you get immediately get the hell out of dodge. Yuu don't wait over two days to leave.

This guy was a numb nut of the highest order, he left his house keys in the car bomb and had to get the spare apartment keys from his landlord.

One can only hope is that the longer they keep up this up, sooner they will end up blowing themselves up.

Which brings me back Sheila Radziewic. This woman has arms. Yet she is on her way to getting a black belt in Tae Kwon Do. This is a woman who was destined to have a rough life. But does she give in to resentment or anger? Does she give in to despair?


She began living on her own at 19. She lives in Salem now and helps women navigate the court system as a local advocate coordinator for HAWC, Healing Abuse Working for Change, which helps victims of domestic violence.

At 23, Radziewicz earned her driver's license. The state helped fashion a car for her that she drives with her feet.

One of the things that pisses me off is when someone gets everything in life and then does something really stupid. This is why this POS really makes me angry and I hope they make an example of him. The ramifications of his actions are going to be felt by innocent hard working people who are trying to make a life of their own.

It is also imperative we do everything we can to discourage this type of activity for own good.

Bruce Lee once said that the most dangerous person to fight is a person who has no background in fighting. This is because those types of people are completely unpredictable and have a strong tendency to do anything. This pretty much applies to clean skins.

America needs to send a message to potential clean skins that it is in their best interest to stay clean.

Thursday, May 06, 2010

Day Trader's Paradise.


Markets Plunge, Then Stage a Rebound

Did Trader's Mistake Cause Wall Street's Big Drop?

Mistake, accident, whatever.

Someone just made a s**tload of money.