Mailing Gets Under My Skin . . .

I can't believe what I got in the mail yesterday!!! A solicitation, via the National Association of Realtors, to buy life insurance annuities. This drives me nuts, especially since I can do better with real estate investments than I can with most stocks, bonds, annuities, etc.

Its funny, I bump heads occasionally with my "colleagues" at Prudential Financial, who sell insurance products for wealthbuilding. And we compare notes, and they tell me they don't want me anywhere near their clients. Because mine is a better argument.

Anyway, I have GOT to find out who to call at the NAR about this solicitation! Why in the HECK are they pushing insurance vehicles instead of the product in which we all specialize???? Sheesh!!

Fed's Bernanke Finally Chimes In On Subprime Mess

Rising delinquencies and foreclosures, said Federal Reserve Chairman Ben Bernanke in remarks yesterday, "are creating personal, economic, and social distress for many homeowners and communities -- problems that likely will get worse before they get better."

Thank you Mr. Bernanke for echoing what I have been telling clients for more than three months now. I'm glad for the validation.

Ownership vs. Securities Investments

Reason Number 89,652 (okay I'm exaggerating a little, but I wanted to get your attention) to own your OWN investment real estate, and avoid unregulated risk in the market . . .

THIS AFTERNOON Bear Stearns told investors in a letter that two hedge funds that invested in securities backed by subprime mortgages have very little or no value. The news, coupled with last week's decisions by ratings agencies to downgrade their ratings on billions of securities backed by subprime loans, could force other securities firms to write down the value of such investments.

Look At The Green Grow!

A new McGraw-Hill Construction report states that 2009 will be a tipping point for green building. The report predicts that within two years sustainable buildings will comprise 16 percent of large corporations' real estate portfolios. Why? Because energy costs are the largest controllable expense in office buildings.

McGraw-Hill cites the following payback on green commercial real estate: 8-9 percent decrease in operating costs; 7.5 percent increase in building value; 6.6 percent ROI improvement; 3.5 percent occupancy increase; and 3 percent rent increase.

Fridays Keep The Business Interesting

You never know what will happen when you're in the office on a Friday afternoon.

I recently completed a lease project with a major Atlanta exhibition company that was looking for retail space in Central Ohio. High profile exhibition that the entire community is talking about. I'm now looking for space for this same company in another Midwest market. I would not have had the opportunity had I not been in the office on a Friday afternoon. Ironically, they needed an architect. I called a few I knew and who were referred, and the gentlemen who did a fantastic job for this client answered his phone . . . when? . . . on a Friday afternoon.

Along the same lines, I've got a West Coast company coming into Central Ohio and we have found a couple possible spaces for them to lease. I'm also on a task force of Prudential CRES agents representing a California-based IT client that is developing the nation's most secure online data center -- inside a mountain in eastern Kentucky. We are the leasing agents for the Tier 4+ facility that will ultimately be 10 times the size of the NORAD complex in Colorado's Cheyenne Mountain.

Its why I love this business. I get to work with so many different people and companies. And once more I'm sitting here rambling while waiting for a case in the jury pool at Franklin County Municipal Court.

Blackstone Buys Hilton Hotel Chain

Wow! Being on jury duty gives you a lot more time to catch up on your reading. As you might have guessed, as of this writing I still have not been called to a case.

It has been announced that Blackstone Group -- the formerly private investment fund that purchased Equity Office several months ago -- has purchased the Hilton Hotel Chain. Big money for everyone! As of this transaction, the total dollar value of hotel transactions in 2007 has surpassed that of all of 2006.

Little Paris Hilton will surely have extra $$$ in her portfolio now to dig her out of trouble the next time!! But seriously, the acquisition is different for Blackstone this time, in that they plan to hold most if not all of these properties for the foreseeable future. In the Equity transaction, Blackstone spun off many of Equity's holdings, creating a bigger cash reserve for the acquisition minded firm, which took itself public last week

NBC News Misleads Public On Power of Hedge Funds

Did anyone notice the big lead story NBC's Today show had late last week about the booming "success" of hedge funds, and how the wealthiest of the wealthy are getting wealthier using them?

Now, what NBC News missed is that hedge funds have been around for decades. What they got right was that some creative investment gurus are using them for even more spectacular gains (though there is incredibly high risk) using vehicles that are not regulated to ensure people don't lose their shirts.

What NBC DID NOT MENTION is that hedge funds have been imploding for more than a month. Why? Because a lot of these funds were invested heavily in companies making home buying loans to high risk borrowers. And anyone who hasn't been in Europe -- or ill -- knows that the residential real estate market has been on the skids largely due to millions of dollars in bad loans. And yet, they still aired a story that was riddled with misinformation.

So people walked away from the story thinking that 1) hedge funds are the place to make oodles of money (not right now or for the foreseeable future), and 2) that real estate funds of one sort or another are the only place to make money.

Once again, the media ignores the power of purchasing investment real estate to "hold."