April 26, 2009

Tim Leigh’s Weekend Market Report
Hoff & Leigh, Inc.
Leasing; Sales; Management; Buyer or Tenant Representation
4445 Northpark Drive, Suite 200
Colorado Springs, CO 80907
April 26, 2009

Attached is our complete listing of all properties for sale in Colorado Springs, based on property type - office, industrial and condo. This is the most complete listing that we are aware of. It’s our goal to provide this information, updated weekly. We develop these lists by basic research and cross-checking data points from the PPCIE, local broker's individual web sites, The Turner Book and any other public information domain we can find.

You are receiving this information because, at some point, you asked or a friend referred your name to be included in our e-mail Insider’s List. If you no longer wish to receive this information, send an e-mail reply to me (tim@hoffleigh.com) and ask to be removed. Alternatively, if you know someone who could benefit from the receipt of this information, forward this e-mail to them, and suggest they contact us, so we can consider adding them to our exclusive list.

All Market Average Office Building Sale Price PSF = $112.58 (DOWN from $112.62 last week.)
We are currently tracking 116 office buildings for sale.
This is 1,217,007 square feet, which represents a total market value of $137,009,900.

All Market Average Industrial Building Sale Price PSF = $76.55 (UP from $76.06 last week.)
We are currently tracking 101 industrial buildings for sale.
This is 1,455,810 square feet, which represents a total market value of $111,441,606.



Tim’s Market Notes:

“It has been said that affliction is a school of virtue; that it corrects levity and interrupts the confidence of sinning.”
Hans Sennoholz
Age of Inflation

Luckily for me, it’s overcast and cool this morning. With the advent of spring, warm temperatures & blue-bird days, I’m less inclined to spend time inside. My AADD drives me outdoors. I guess that’s why I’m in sales. It gives me a chance to mill around and talk and get paid for it. I mean, come-on; is that really a job?

I’ve been thinking about the economy & investments since a friend of mine spit-in-my-eye last week. He reported that Ford Motor was now trading at $6.00 per share. He knew I had concocted a scheme last January (while on a trip to Hawaii) where I’d buy some shares cheap; hold them for profit and take the family on a big Hawaiian vacation next January. (He knew I had day-traded Ford last summer for nice profits.) I actually executed on the plan, but with the downturn, ran out of nerve. Suffice to say, had I any cheek, we’d be in for a 1st class family vacation to Hawaii in 2010! As it is, it looks like it’s the River Walk and the Motel 8 in Pueblo. It was the same with Well’s Fargo. I was told (pre-crash) in confidence that from $20 per share, it should triple. I watched it tank at $7.50 and knew (I knew) I should run to Scott Trade and place an order. I didn’t get that far that day because I was too busy milling around and talking and missed the money-making bus. Of course, Well’s is back to $20. I console myself knowing that there’s always another bus.

Dominique Kochtu was my Econ 101 professor at the University of North Dakota nearly a Zillion years ago. You have to wonder what qualifications he brought to the table. This was an institution where the standard for admission was possession of a valid North Dakota driver’s license. (And while I’ve lost my license at least twice since then (that I can recall), at the time, I was qualified.) I’m just saying – he most likely wasn’t offered a job at Harvard. But he seemed to teach us well and he was generally entertaining. I managed to learn a little about supply & demand. I learned that the most important impression was the first impression; the most important element to successful dress was a white shirt & red tie; and the most important part of the marital relationship was that a wife must be able to entertain the boss; and that I should aspire to acquire a table setting for 12 as soon as possible.

Every Monday, I’d drag into his 8:00 AM lecture-hall and he’d scream in his annoying, high-pitched Korean shrill, “You crazy Bastards! All you tink about is Frenchie Bar, beer and girls; you need focus!” Easy for him to say – he wasn’t 19 and hadn’t just rolled-in from a hard sleep on a cold floor.

So what’d I miss?

I think he talked about monetary policy. That’s where governments control the supply & cost of money in order to reach set goals. I think he talked about expansionary policy; (where the government increases the supply of money); and it’s likely, although I’m not sure because I was either half-asleep or just in a daze, he talked about contractionary policy; (where the government decreases the supply of money). He may have said “contractionary policy is used to fight inflation” and something like “expansionary policy is used to fight unemployment.”

And what about unemployment? According to the Bureau of Labor & Statistics, we have a terrible unemployment problem growing worse. Not to be Mr. Doom & Gloom, but until this turns around we’re not out of the woods. Normally, national full-employment is achieved at around 5%. The national unemployment rate is now 7.5%. That’s considered really high. The national unemployment rate measure is known as U3. It’s the official rate. It’s the one the government likes to use because it’s benign. The real number, however, is known as U6. That’s U3 plus all the discouraged & under-employed workers. Think about your mom or sister or dad or brother working at Starbuck’s. It’s not likely that was their first career choice. (Frankly, real estate was most likely their first choice, because as we all know – and say it with me. . . “If you can’t make it anywhere else, you can always make it in real estate!” Your relatives working at Starbuck’s are the discouraged & under-employed. The national U6 number is 13.5%.

While I was at Half Moon Bay last week (doing my part to ensure that the hotel staff was able to keep their jobs), I noticed the situation in California. Their unemployment rate just passed 11%. What do they say? “As California goes, so goes the country? Or was that GM? In either case, it can’t be good. Maybe we should start a new saying – “We should aspire to go as North Dakota goes!” Let’s see; easy access to higher education; no state deficit; no real unemployment. Hmm. I wonder what’s in that flood water?

Monetary policy (lowering interest rates) normally creates demand for money. Offering low rates or FREE money is a trick used central banks to create better business conditions. (The Fed Funds rate is now almost zero – you can’t get much lower than that, unless you give money away – to banks; ah, cough; can you say TARP?) Theoretically, some smart person would use low-to-no cost funds to create new jobs (reduce unemployment) and earn profit. It’s a nice argument on a Monday morning after a weekend of too many 3.2 beers.

So, how bad is unemployment? If you’re not working, it’s bad. If you’re working, it’s not that bad. I used to tell Shannon & Holly, if you want life-time employment, “Work hard & be happy.” I think they do and are. Here’s another concept I tried to teach, “Show-up on time; do a good job; don’t leave a mess.” And if you want to rise to the top, “stay late”. There may be some employee coaching material in there for you.

National lay-off-events (that’s where a company unloads at least 50 employees), rose to its highest level since 1995. The top 10 worst states to look for a job because of their high unemployment rates are: MI – 12.6%; OR – 12.1%; SC – 11.4%; CA- 11.2%; NC – 10.8%; RI – 10.5%; NV – 10.4%; IN- 10%; KT – 9.8%; Washington, DC – 9.8% (only). There’s good news in all of this. Colorado’s unemployment rate’s only 7.5% and Colorado Springs is only 8.4% - and it looks like we’re going the right direction. The other good news is that Washington, DC’s on the right track. While their rate is only 9.8%, I’m told it’s growing! And what about those crazy Amish? The Indiana based colony finally decided to let its people claim & accept unemployment benefits. I guess they figured that the cost of black dresses, strange hats & whips exceeded their principals. The Amish and the government - hard times do make strange bedfellows.

Unemployment is a world-wide problem. Spain reports, for example, a 17.4% unemployment rate. They expect mass rioting this summer as unemployment benefits run out; same in Turkey and other Mediterranean countries. The International Labor Organization reports, globally, there are 1 billion unemployed. That’s about 1/3 of the global workforce. That’s a startling number. People with nothing to do get into trouble - 3.2 beer & Frenchie Bar – you know what I’m saying. And a friend of mine just told me that in Venezuela, his home country, 90% of the people live in poverty which has produced a culture of chaos & anarchy. And while you can’t find any reporting like this in the popular media, he told me he told me how his mother was recently kidnapped and held at gunpoint for ransom and how he narrowly missed the same fate and how it’s not uncommon, for example, that if someone wanted his car, they’d just shoot him on the street and take it with no consequences.

Back to Frenchie Bar, 3.2% beer, co-eds, Dr. Kochtu and economic theory; I think he talked about fiscal policy. As I recall, that’s where the government uses spending & taxing to influence the economy. It’s where the government collects too much money to do too many things and it costs too much. Realize, I didn’t mine paying my fair share on the 15th because as a patriot and I understand that my government uses our money so wisely. I just wish we could go back to those heady days in 1913 when the newly instituted income tax was only 1%. At that rate, at that time and under that system, 99% of Americans were exempt from taxation. Hear the only smart words out of Jimmie Carter’s mouth, “It is time for a complete overhaul of our tax system. It is a disgrace to the human race.”

Less taxes; more jobs. I wonder if there’s a connection? There may be a new economic theory. Hmm.

Want to know more? Contact me at Tim@HoffLeigh.com

Here’s what we do:
Property Leasing; sales; property management; Buyer or Tenant Representation.

Concierge Services:
We offer property management & maintenance concierge services. We have vendors for most property needs. It’s like having a full-time property manager at a fraction of the cost. If you’d like to know more about this service; how you can become involved; how you become a “recommended vendor” call me: 719-630-2277.


Focus on Charity

We’re committed to being active community partners. We endorse & support the following charities & non-profit organizations. In spite of challenging financial times, we hope you’ll remember the financial needs of your favorite charity or non-profit. If you don’t have one, these guys could use your help. They add significant value to our community & quality of life.

The Salvation Army: Feeding 52,000 people every year.
The Red Cross: They provide emergency assistance at every disaster in the Pikes Peak region
The Boy Scouts: Assisting 10,000 kids in the Pikes Peak Region, they nurture young men into responsible adults.
The United Way: Everybody’s partner in funding non-profits.
Chamber of Commerce: The business community’s voice in local politics.
Economic Development Committee: Helping the city grow jobs and employment.

Want to know more? Contact me at Tim@HoffLeigh.com

Have a profitable week!

Sincerely,

TJL
Tim Leigh
719-337-9551
Tim@HoffLeigh.com


To view our Office Matrix List please click below
http://hoffleigh.com/OfficeInsider.aspx

To view our Industrial Matrix List please click below
http://hoffleigh.com/IndustrialInsider.aspx