Commercial Real-Estate blow up...

NEW -> Contingent Buyer Assistance Program
[quote author="tenmagnet" date=1226652448][quote author="graphrix" date=1226651916]This isn't multi-family or retail, but 100 Discovery in Irvine was foreclosed on last week for about $1.2mil. I'm not sure exactly what type of space it is, but the lower addresses of Discovery are office buildings that house companies like Fluor and State Street. I will try to check it out next time I am there, but I would imagine it is a similar space to that of the lower addresses.</blockquote>


Let me be specific, two weeks ago I sat thru a pitch on retail.

It ended up being Cantaloop?s building.

Turns out the developer needs cash to finance the rest of the project.

From what I can tell, Cantaloop?s shop is on the front pad.

They?re asking $4.7M at a 7 cap.

I?ve seen nothing but garbage at a lower price point 6-7 cap.

Commercial needs to come down substantial here in the OC.

Maybe it?s starting to but we have a ways to go.</blockquote>


Ugh... the thought that they need cash in this environment scares me. The success of that center, and that of Cantaloop is dependent on those other retail spaces being open to drive in traffic. I hope that financing gets done, and gets done soon.



BTW, I was just adding my ?2 on one side of commercial. I can however add some nice chartpr0n from CBRE or Voit on the retail sector of commercial if you like.



<blockquote>Btw, nice sweater yesterday</blockquote>


You like that huh? I thought you would appreciate it when I picked that to wear. You were a bit shorter than I expected though.
 
[quote author="graphrix" date=1226653710]



<blockquote>Btw, nice sweater yesterday</blockquote>


You like that huh? I thought you would appreciate it when I picked that to wear. You were a bit shorter than I expected though.</blockquote>


I happen to like that sweater. You should have seen the shirt he had on underneath...



And now I find out that I picked the worst time to go get us appetizers. ;-)
 
[quote author="graphrix" date=1226653710]



You like that huh? I thought you would appreciate it when I picked that to wear. You were a bit shorter than I expected though.</blockquote>


Really?

I?m taller than you.

Should?ve hopped out of that chair and gotten yourself a better look.



I thought you?d be more muscular.

Maybe it was the sweater or your lack of shoulders.

Either way, hit the gym and lift some weights.

Look at the bright side at least you weren?t sportin a gut



Just like old times!
 
Ten, you are right that sellers are slow to move. Similar to the single family market, the market is being made by the truly motivated sellers. So far, there aren't very many of them that have been willing to meet the market. But where sellers have met the market in the last 60 days, it has been at north of a 6% cap and getting close to a 7% cap.



The motivated sellers are going to be the developers that have construction loans coming due that they can't re-fi. Or 'value add' groups with high leverage bridge loans that they can't re-fi. Also recently there have been a couple of institutional sellers (pension fund advisors) that have decided to meet the market, likely due to 'allocation' issues from the de-valuation of their stock portfolios.



The retail market is going to take this whole thing on the chin worse than the multi family market.
 
[quote author="tenmagnet" date=1226654824][quote author="graphrix" date=1226653710]



You like that huh? I thought you would appreciate it when I picked that to wear. You were a bit shorter than I expected though.</blockquote>


Really?

I?m taller than you.

Should?ve hopped out of that chair and gotten yourself a better look.



I thought you?d be more muscular.

Maybe it was the sweater or your lack of shoulders.

Either way, hit the gym and lift some weights.

Look at the bright side at least you weren?t sportin a gut



Just like old times!</blockquote>


Ahhh... yes... now I remember Z introducing me to you. Too bad you didn't mention the fact that it was you. I would have gotten up to give you a proper handshake, as well as show you that you are not taller than me. I will hit the gym a little more often, and the next time we meet you can appreciate the time I put into the gym and sit to chat for a bit. I'm not sure why you wouldn't think you would fit in, as it took some time for me to remember you. So you pretty much blended in with the crowd, but I am sure you trying to do that and didn't want to make scene. Afterall, it was IR's night and that is what the weekends are normally like for you. Too bad you didn't stick around longer to meet BK, but you also would have been able to meet skek and IR2. They might have broader shoulders than me, but it would be helpful if you gave them some cardio routines. That, and you would see how those plugs have worked out for deuce.



Next time stay and chat a while. At least you don't have to worry about your honey-do list getting longer because you stayed out well past your hall-pass time.
 
[quote author="skek" date=1226658806][quote author="graphrix" date=1226658642]They might have broader or shoulders than me, but it would be helpful if you gave them some cardio routines.</blockquote>


Ouch! I resemble that remark.



Hey, you can socialize my wallet all you want, but now you're getting a little <em>too</em> personal!</blockquote>


Hey, you said it, I didn't really mean it. You wore a shirt that would hide a gut if you had one. But... you did say...



[quote author="skek" date=1226050613]Daniel Craig with an extra 20 lbs around the middle, maybe.



<em>The name's skek, James skek.</em>



Am looking forward to QOS, though.</blockquote>
 
[quote author="Joe33" date=1226658065]Ten, you are right that sellers are slow to move. Similar to the single family market, the market is being made by the truly motivated sellers. So far, there aren't very many of them that have been willing to meet the market. But where sellers have met the market in the last 60 days, it has been at north of a 6% cap and getting close to a 7% cap.



The motivated sellers are going to be the developers that have construction loans coming due that they can't re-fi. Or 'value add' groups with high leverage bridge loans that they can't re-fi. Also recently there have been a couple of institutional sellers (pension fund advisors) that have decided to meet the market, likely due to 'allocation' issues from the de-valuation of their stock portfolios.



The retail market is going to take this whole thing on the chin worse than the multi family market.</blockquote>




Last week, I had lunch with a broker.

He brought up a deal in Newport Beach off the 73.

Good location and all but the asking cap was 5.20

Politely pointed out that there?s no financing available that low.

All he kept repeating was Newport Beach and appreciation.

I wanted to reach across the table and stab him with my fork.
 
[quote author="tenmagnet" date=1226714610][quote author="Joe33" date=1226658065]Ten, you are right that sellers are slow to move. Similar to the single family market, the market is being made by the truly motivated sellers. So far, there aren't very many of them that have been willing to meet the market. But where sellers have met the market in the last 60 days, it has been at north of a 6% cap and getting close to a 7% cap.



The motivated sellers are going to be the developers that have construction loans coming due that they can't re-fi. Or 'value add' groups with high leverage bridge loans that they can't re-fi. Also recently there have been a couple of institutional sellers (pension fund advisors) that have decided to meet the market, likely due to 'allocation' issues from the de-valuation of their stock portfolios.



The retail market is going to take this whole thing on the chin worse than the multi family market.</blockquote>




Last week, I had lunch with a broker.

He brought up a deal in Newport Beach off the 73.

Good location and all but the asking cap was 5.20

Politely pointed out that there?s no financing available that low.

All he kept repeating was Newport Beach and appreciation.

<strong>I wanted to reach across the table and stab him with my fork.</strong></blockquote>


What stopped you?
 
[quote author="WINEX" date=1226718895][quote author="tenmagnet" date=1226714610][quote author="Joe33" date=1226658065]Ten, you are right that sellers are slow to move. Similar to the single family market, the market is being made by the truly motivated sellers. So far, there aren't very many of them that have been willing to meet the market. But where sellers have met the market in the last 60 days, it has been at north of a 6% cap and getting close to a 7% cap.



The motivated sellers are going to be the developers that have construction loans coming due that they can't re-fi. Or 'value add' groups with high leverage bridge loans that they can't re-fi. Also recently there have been a couple of institutional sellers (pension fund advisors) that have decided to meet the market, likely due to 'allocation' issues from the de-valuation of their stock portfolios.



The retail market is going to take this whole thing on the chin worse than the multi family market.</blockquote>




Last week, I had lunch with a broker.

He brought up a deal in Newport Beach off the 73.

Good location and all but the asking cap was 5.20

Politely pointed out that there?s no financing available that low.

All he kept repeating was Newport Beach and appreciation.

<strong>I wanted to reach across the table and stab him with my fork.</strong></blockquote>


What stopped you?</blockquote>


He was paying for lunch.
 
[quote author="tenmagnet" date=1226630308][quote author="blackvault_cm" date=1226629431]



I hear you. Many days I feel I'm the only one eating at Zovs and chilling at Peets. Then again I don't have anywhere else to go.</blockquote>




It?s kind of sad.

I go to the same places.

Seems to pick up a little on the weekends but during the week it?s very quiet.

In my opinion, rents are way too high for retail business to thrive.

Most are in survival mode right now, playing defense.</blockquote>
How's Javier's in Crystal Cove doin? I haven't been there in a while (I used to remember having to make reservations during the week to get in).
 
[quote author="tenmagnet" date=1226651615]Joe33,



Find me retail here in the OC at and 7.5 cap or better, and we?ll do business.

It?s just not out there yet.

Especially at the lower price point.

Transaction volume in commercial re has dried up.

Look at the latest numbers from CB.

Cap rates need to move higher and in some cases they already are.

Unfortunately, there?s still a long way to go, thus retail remains overpriced.

Not all sellers have gotten the memo yet.

I believe they will starting in ?09</blockquote>
The reasons why transaction volume has dropped off a cliff are because there is a wide spread between the bid price (what buyers are willing to pay) and the ask price (what the seller is willing to take) along with the fact that it's tougher to find financing for purchases. Cap rates will take a step up when you see forced liquidations of commercial properties from landlords trying to survive upcoming maturities or when the landlords throw the keys back at the bank (because most perm loans were non-recourse).
 
[quote author="usctrojanman29" date=1226756432][quote author="tenmagnet" date=1226630308][quote author="blackvault_cm" date=1226629431]



I hear you. Many days I feel I'm the only one eating at Zovs and chilling at Peets. Then again I don't have anywhere else to go.</blockquote>




It?s kind of sad.

I go to the same places.

Seems to pick up a little on the weekends but during the week it?s very quiet.

In my opinion, rents are way too high for retail business to thrive.

Most are in survival mode right now, playing defense.</blockquote>
How's Javier's in Crystal Cove doin? I haven't been there in a while (I used to remember having to make reservations during the week to get in).</blockquote>


I was there tonight with my wife. I like the place and atmosphere...but honestly the food is just ok to me.
 
[quote author="caycifish" date=1226654378][quote author="graphrix" date=1226653710]



<blockquote>Btw, nice sweater yesterday</blockquote>


You like that huh? I thought you would appreciate it when I picked that to wear. You were a bit shorter than I expected though.</blockquote>


I happen to like that sweater. You should have seen the shirt he had on underneath...



And now I find out that I picked the worst time to go get us appetizers. ;-)</blockquote>


Actually graphcakes, the sweater was kind of a <a href="http://www.youtube.com/watch?v=KQv-c4460xE">Cosby Sweater...</a>
 
[quote author="skek" date=1226713610][quote author="graphrix" date=1226659531]Hey, you said it, I didn't really mean it. You wore a shirt that would hide a gut if you had one. But... you did say...</blockquote>


I never said it wasn't true...</blockquote>


A few thousand sit-ups should take care of that.
 
[quote author="skek" date=1226996999][quote author="tenmagnet" date=1226993868][quote author="skek" date=1226713610][quote author="graphrix" date=1226659531]Hey, you said it, I didn't really mean it. You wore a shirt that would hide a gut if you had one. But... you did say...</blockquote>


I never said it wasn't true...</blockquote>


A few thousand sit-ups should take care of that.</blockquote>


No kidding, ten. I haven't seen the inside of a gym in 18 months. Not good.</blockquote>




C?mon skek,

You were an athlete.

You?ll get it back.

The holidays are right around the corner.

Enjoy the next few months then start training again first of the year.

At least you?re not going bald right?
 
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