Ignore Our Dust

Please ignore our dust here at Cash On Cash, but we are doing some site maintenance, updating some sections of the blog, and doing some modifications to the layout and color scheme. Why do I mention this? Because it might look a little different from day to day.

Same great info, but with an updated look. That is my hope. I haven't given the site a facelift since CoC when on the air in 2006. I thought it was time for an update....

So please come back often. But bear with my construction.

Hardhats are optional....

Market Volatility May Be The Watchword (For A While)

The market goes up, the market goes down.

And we're not just talking about stocks, but some commercial real estate values. Generally, we are seeing improvements in values across the board, but is it a pattern? The jury is out on that just yet...

There were gains in reported commercial real estate prices in September in Moody's, and in October in Real Capital Analytics. Specifically, the Moody's REAL Commercial Property Price Indices increased 4.3 percent in September, the largest gain in the history of the CPPI, according to Globe Street news service in interviews with industry gurus. Ironically, the previous month's report noted that commercial property prices slipped to their lowest levels in 10 months.

All this just further illustrates the volatility brokers and investors face.

For the full story at Globe Street, click here. All in all it is an interesting overview, showing declines in multi=unit housing in the Top 10 MSAs. Yet office is up and industrial slipped hard. In Central Ohio, industrial -- while hard hit earlier -- seems to be climbing back, office is stable and retail is improving. And MUH? Well in this area, except for distressed B & C properties, apartments have stayed very stable and even strengthened in value.

It just goes to show that national stats cannot be applied to local or even regional trends. Columbus is not Las Vegas is not Cleveland is not Fort Myers is not Austin is not Los Angeles ..... and so on. Nevertheless, we still have some volatility ahead, and the question of whether lenders will dump commercial properties still is top of mind. Conventional wisdom says we will see a tsunami of sorts with commercial being dumped on the market in 2011.

Time will tell.....

A Look Back, And Ahead....

A good time to review fundamentals, where we've been, and where we are going.....

A Tale Of Two Properties

Okay, this has nothing to do with investment real estate but I found it worth passing along.

I came across a great piece today about home sales. And the question asked was, and I am paraphrasing here, "what would you think is the most expensive home on the market in the U.S.?"

If you guessed it is in California you would be right. But it is not Candy Spelling's sprawling property -- a spacious 55,000+ square feet -- listed for a cool $140 million. That comes out to $2,700 per square foot.

No, based on square footage, the most expensive home is a beach "shack" in Carpinteria, Calif. The cozy 641 square foot cottage is listed for $5.3 million. But on a square footage basis, get ready, it is priced at around $7,000.

What makes this place so special? Well, it has an ocean view. And then that's about it. There is the sound of rushing traffic nearby. About the only people around are surfers, and there is no significant acreage that goes with it.

Click here for more on a tale of two properties. An interesting look at two very different properties.

No takers for either property yet.....

Seriously, the small home phenomenon continues to grow. I recently sat in on a presentation by a representative of a company that manufactures small homes -- Eco-Cottages they are called. I can't help but see one sitting on a piece of remote real estate my family owns. About 550 square feet, heavily insulated to keep it warm during bitter Midwest winters, but covered in windows so that the occupant can feel they are a part of nature, and not secluded from it.

I am partial to the Palmeco model. I can envision it nestled against the Knob Hill of a certain farm on a snowy day....

Rock Steady Growth Recognized At Industry Leading Publication

Commercial Property Executive, sort of the bible of publications for owners and managers of institutional-grade commercial properties, has as its cover story this month a rock solid piece on the head of our sister company, Prudential Mortgage Capital.

During the past several years, PMC has been climbing the Mortgage Banker's Association's annual ranking of commercial real estate loan originators. According to the publication, the company stood in sixth place in 2009, up from 15th in 2007. At midyear this year, Prudential Mortgage Capital had originated close to $3.76 billion in commercial property loans.

David Twardock, Prudential Mortgage Capital president, is optimistic about the industry. His hallmark has been taking the initiative -- and NOT playing defense. He has forged relationships with Prudential Real Estate Investors, another sister company. From the outside looking in, one might think that all of our groups work together. But historically, they have not. Similarly, we at Blue Rock Realty Advisors also are forging relationships of this type, both with PMC and PREI. That synergy makes a difference, and PMC is a leader with whom it makes sense to do business. And Twardock's creativity is forging numerous possibilities. The company's growth has been steady through both good and bad times.

The article is a good read, and worth taking the time to look at. I have established a link to the site here.

Investment sales are up, the Fed is working to keep interest rates low -- something that historically has favored commercial real estate. Twardock's philosophy is that of being a team player. The article is largely a profile of his career and how he has steered PMC to its current level.

Team. That means something in today's commercial investment property business. It has long been my philosophy, and it is the backbone of most successful brokers, owners and property managers, alike. And trust. Twardock notes that to earn trust you must have a solid communication plan that you follow, not just talk about.

Says he: "You have to lay out the issues, lay out what you are going to do about it and tell them where you're going next."

I couldn't agree more.

Kudos To PCRE Columbus

Columbus CEO magazine, the monthly glossy magazine covering business news from throughout Central Ohio has named Prudential Commercial Real Estate as the Best Real Estate Brokerage (Commercial) for 2010.

It is all part of Columbus CEO's "Best of Business" roundup for 2010.

Kudos to the team, and thanks to the editors at the magazine for the recognition!

Very nice.

A New Venture -- Blue Rock Realty Advisors

Recently, two colleagues and I at our Prudential Commercial office have established a new venture -- Blue Rock Realty Advisors.

Jack Turner, Greg Will and I are targeting larger projects -- $5 million and above office buildings, retail centers, etc. We currently are working on jump-starting a stalled $100 million development project in Central Ohio.

Turner has a wealth of retail and multifamily housing development background, and is a commercial specialist with Pru Commercial Columbus. Greg is Pru Columbus' director of property management, coordinating all property oversight initiatives for our property management clients. Greg has many years experience as multi-unit housing and senior housing finance director and liaison for syndications funded by pensions and REITs.

A strong team to be sure. We will have more to say in the near future. But for now we are busy laying the groundwork for some high-end projects that, I am sure, will be noteworthy in the coming months and years.

Happy Veteran's Day!

I am sitting in my Columbus Real Estate Exchangors (CREE) meeting as I write this, and we just had a nice tribute to our military veterans on this Veteran's Day. My dad was a vet, gone now 17 years. One of the "greatest generation" who never talked about his experiences when he came back from the Pacific Theater of operations during WW2.

Thank you, veterans, for your service to our country!