.
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
June 8, 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 = $109.04 (DOWN from $114.79 last week.)
We are currently tracking 123 office buildings for sale.
This is 1,289,253 square feet, which represents a total market value of $140,578,148.
All Market Average Industrial Building Sale Price PSF = $78.74 (DOWN from $79.22 last week.)
We are currently tracking 92 industrial buildings for sale.
This is 1,278,786 square feet, which represents a total market value of $100,688,856.
To view our most recent Colorado Springs Business Journal Ad please click below
http://hoffleigh.com/Doc/June%205.pdf
Tim’s Market Notes:
When I study the various property lists we generate, I note the market continues to be substantially overvalued vis-à-vis the assessor’s valuations. For example, in just the “office buildings for sale” sector, according to the data we track, the Colorado Springs’ office building market is overvalued by nearly $56,000,000. Until values come-into alignment with the market, sales activity will be less than robust. That’s not to say there are no buyers; there are. We wrote 2 hard contracts last week and have 4 solid sales scheduled to close on the 30th and a lot of activity. I have an out-of-town buyer coming-in next week who wants to be under-contract before he leaves. There are buyers. There are people with money to invest. But, just as in the Age of Aquarius; as the stars must be in alignment so must prices.
Overall, sales activity has been OK but leasing activity has been mediocre; none-the-less, some of last week’s activity was leasing; and management inquiries. For example, I met with the court appointed receiver last week, who is handling the disposition of a portfolio of property for a well known developer. The subject of our conversation was the leasing and management of 5 strip centers; none of them pearls. It was alleged that the owner had been taking cash from theses centers to pay for new development project debt. Of course, as you can imagine, when the receiver did site visits, he discovered that the rents had already been collected; (but not reported); and there were no legitimate leases. I was aghast. I thought, “What’ the world coming too?” I think, Mr. Ponzi, that’s called robbing Paul to pay Peter.
The receiver’s normal business is lending. He’s affiliated with several life companies and he reiterated that this is going to be “The Summer of Reconciliation & Readjustment!”tm From his perspective (as a lender), he told me that many, many loans will re-set this summer and because of banking regulations, borrowers will be called to add equity to reduce their debt or will be forced out of the game.
So, The Bank calls up Joe-the-Plumber (to beat a dead horse) and asks “How’s it going?” “Great!” replies, Joe. “Good; good; good. By the way, you need to send us a check,” The Bank says. “We need to lower your debt to equity ratio.” “What? What does that mean?”, asks Joe. “Your building is not worth what you thought,” replies the bank, “so we need a larger down-payment.” “What?” asks Joe? “I thought we had an agreement. I made the down payment when I bought this place, and have been current on my monthly payments.” The Bank says, “Yes; yes; yes we do have an agreement, Joe, but that agreement says we can change the rules and require more money when we want to.” (Note to self – read the fine print on the next loan!)
Joe doesn’t have any money for his cash-call. The Bank forecloses; repossesses the building and hires a broker to dispossess itself of the asset at a discount. The borrower loses; the bank loses; the market loses; there’s no joy in MudVille tonight. The Slugger took the 3rd swing and was pronounced “Out”.
Prices will fluctuate this summer; at best, good real estate should hold-its-own and marginal real estate will – well, let’s just say, “I don’t think we seen the bottom yet.”
I’m reminded of the time (damn I feel old), when I had 2220 East Bijou under contract with The Navigators for $10 per square foot (that’s not a typo). The deal included these terms: No money down; non-recourse note; the Seller to pay for environmental remediation and the installation of an elevator; and all payments were going to be waived until a tenant was found. Sound too good to be true? That was a real deal. It happened in the last major crash – in the 80’s. Will we see values plummet to that level? I doubt it; but, “Katie, bar the door! I don’t think we’ve hit the ground, yet.”
Have a great week and call me (719-337-9551) if I can assist you with any of your real estate questions!
Hoff & Leigh, Inc.
Leasing; Sales; Management; Buyer or Tenant Representation
4445 Northpark Drive, Suite 200
Colorado Springs, CO 80907
June 8, 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 = $109.04 (DOWN from $114.79 last week.)
We are currently tracking 123 office buildings for sale.
This is 1,289,253 square feet, which represents a total market value of $140,578,148.
All Market Average Industrial Building Sale Price PSF = $78.74 (DOWN from $79.22 last week.)
We are currently tracking 92 industrial buildings for sale.
This is 1,278,786 square feet, which represents a total market value of $100,688,856.
To view our most recent Colorado Springs Business Journal Ad please click below
http://hoffleigh.com/Doc/June%205.pdf
Tim’s Market Notes:
When I study the various property lists we generate, I note the market continues to be substantially overvalued vis-à-vis the assessor’s valuations. For example, in just the “office buildings for sale” sector, according to the data we track, the Colorado Springs’ office building market is overvalued by nearly $56,000,000. Until values come-into alignment with the market, sales activity will be less than robust. That’s not to say there are no buyers; there are. We wrote 2 hard contracts last week and have 4 solid sales scheduled to close on the 30th and a lot of activity. I have an out-of-town buyer coming-in next week who wants to be under-contract before he leaves. There are buyers. There are people with money to invest. But, just as in the Age of Aquarius; as the stars must be in alignment so must prices.
Overall, sales activity has been OK but leasing activity has been mediocre; none-the-less, some of last week’s activity was leasing; and management inquiries. For example, I met with the court appointed receiver last week, who is handling the disposition of a portfolio of property for a well known developer. The subject of our conversation was the leasing and management of 5 strip centers; none of them pearls. It was alleged that the owner had been taking cash from theses centers to pay for new development project debt. Of course, as you can imagine, when the receiver did site visits, he discovered that the rents had already been collected; (but not reported); and there were no legitimate leases. I was aghast. I thought, “What’ the world coming too?” I think, Mr. Ponzi, that’s called robbing Paul to pay Peter.
The receiver’s normal business is lending. He’s affiliated with several life companies and he reiterated that this is going to be “The Summer of Reconciliation & Readjustment!”tm From his perspective (as a lender), he told me that many, many loans will re-set this summer and because of banking regulations, borrowers will be called to add equity to reduce their debt or will be forced out of the game.
So, The Bank calls up Joe-the-Plumber (to beat a dead horse) and asks “How’s it going?” “Great!” replies, Joe. “Good; good; good. By the way, you need to send us a check,” The Bank says. “We need to lower your debt to equity ratio.” “What? What does that mean?”, asks Joe. “Your building is not worth what you thought,” replies the bank, “so we need a larger down-payment.” “What?” asks Joe? “I thought we had an agreement. I made the down payment when I bought this place, and have been current on my monthly payments.” The Bank says, “Yes; yes; yes we do have an agreement, Joe, but that agreement says we can change the rules and require more money when we want to.” (Note to self – read the fine print on the next loan!)
Joe doesn’t have any money for his cash-call. The Bank forecloses; repossesses the building and hires a broker to dispossess itself of the asset at a discount. The borrower loses; the bank loses; the market loses; there’s no joy in MudVille tonight. The Slugger took the 3rd swing and was pronounced “Out”.
Prices will fluctuate this summer; at best, good real estate should hold-its-own and marginal real estate will – well, let’s just say, “I don’t think we seen the bottom yet.”
I’m reminded of the time (damn I feel old), when I had 2220 East Bijou under contract with The Navigators for $10 per square foot (that’s not a typo). The deal included these terms: No money down; non-recourse note; the Seller to pay for environmental remediation and the installation of an elevator; and all payments were going to be waived until a tenant was found. Sound too good to be true? That was a real deal. It happened in the last major crash – in the 80’s. Will we see values plummet to that level? I doubt it; but, “Katie, bar the door! I don’t think we’ve hit the ground, yet.”
Have a great week and call me (719-337-9551) if I can assist you with any of your real estate questions!
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
