Real estate wrap: Nevada company doesn't think South Jersey is a gamble

Real estate wrap is the Philadelphia Business Journal's weekly list of recent real estate deals. Topping the list this week: DP Partners, confident in the South Jersey industrial market, has decided to begin construction of a second speculative distribution center in Logan, Gloucester County.
The Nevada developer completed the construction of its first spec building, a 359,573-square-foot structure, last year and said it is in negotiations for a tenant to take all of the space. The new building will stand 365,760 square feet on nearly 25 acres and is expected to be completed by the fourth quarter. The projects are part of DP's plans to construct what it calls the LogistiCenter on 1,000 acres off Center Square Road in Logan.
Young Windows Inc. leased 18,000 square feet at the 422 Business Center in Oaks, Pa., for manufacturing and warehousing space. Beacon Commercial Real Estate represented the tenant.
Meridian Capital Group of New York lined up $4.9 million in financing for Whitehall Apartments at 410 Lancaster Ave., Haverford, Pa. The complex has 88 residential apartments and 14 commercial units totaling 5,187 square feet.
SBC Realty of Horsham, Pa., bought the Regina Rose apartments for $780,500 from St. Andrews Development Co. of Elkins Park, Pa. The complex has 13 apartments. Marcus & Millichap arranged the transaction.
Masonic Jewish Alliance of America leased 4,300 square feet in the Lawrence Business Park at 388 Reed Road, Broomall, Pa. CB Richard Ellis handled the lease.

Vail Resorts 2Q profit climbs on increased real estate sales

By Sandy Shore
ASSOCIATED PRESS
2:10 p.m. March 12, 2007
DENVER – Ski resort operator Vail Resorts Inc. on Monday reported a 23 percent increase in second-quarter earnings, bolstered by strong real estate sales and more visitors to its Colorado slopes.
The company also said lodging revenue rose 2.2 percent, which put resort revenue – a combination of on-mountain and lodging businesses – up 9.5 percent.
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The results for the quarter ending Jan. 31 provided a snapshot of how the ski season is progressing for Vail Resorts, which operates four resorts in Colorado and a fifth in California. Its stock rose 6 percent in trading.
Net income totaled $53 million, or $1.35 per share, compared with $43 million, or $1.12 per share, in the previous year's fiscal second quarter.
Excluding stock-based compensation expenses, Vail Resorts said net income would have been $54.1 million, or $1.38 a share, compared with net income of $44.1 million, or $1.15 a share, in the previous year's second quarter.
Revenue in the most recent quarter increased 25 percent to $361 million from $288 million a year ago.
The company reports revenue in three segments: mountain, which includes on-slope businesses, up 10.5 percent to $272 million; lodging, up 2.2 percent to $32.8 million; and real estate, up 479 percent to $56.2 million.
Analysts surveyed by Thomson Financial had forecast overall revenue of $317.7 million.

w.vailresorts.com

AEW Real Estate Income Fund (AMEX: RIF) announced that the Fund's Board of Trustees has approved the liquidation and termination of the Fund. After co

Perseus Realty and Westbrook Partners sold 2440 M St. NW for $50 million to Washington Real Estate Investment Trust.
The 112,000-square-foot medical-office building is 96 percent leased. During its ownership, Perseus Realty did a extensive renovation of the interior and exterior of the eight-story structure, which was built in 1986.

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"Perseus Realty took an undervalued and mismanaged medical office building with an 82 percent occupancy rate and below-market rents and turned it into one of the leading medical facilities in the area that now commands competitive rental rates from some of the top physicians and specialists in the area," says Tom Howland, managing director of Perseus Realty Capital, who represented the seller. Perseus Realty Capital and Perseus Realty are separate entities.
Rockville-based Washington Real Estate Investment Trust (NYSE: WRE) expects to achieve an yield of 6 percent in the first year.

AEW Real Estate Income Fund Announces Liquidation

AEW Real Estate Income Fund (AMEX: RIF) announced that the Fund's Board of Trustees has approved the liquidation and termination of the Fund. After considering the small asset size of the Fund, the lack of prospects for significant growth in assets and several alternatives to liquidation, the Board concluded that it would be in the best interests of the Fund and its shareholders to liquidate and terminate the Fund. As of March 8, 2007, the Fund had $93,942,390 in assets attributable to the Fund's common shares and $28,000,000 attributable to the auction preferred shares for total assets of $121,942,390. The Fund will begin the orderly liquidation of its assets in accordance with the plan of liquidation approved by the Board. It is expected that the liquidation of the Fund's assets and the termination of the Fund will be completed within 60 days. The Fund will issue an additional press release to announce the date as of which the transfer agent books of the Fund will be closed and the amount and timing of the liquidating distributions to shareholders. The AEW Real Estate Income Fund, a non-diversified closed-end investment management company, is advised by AEW Management and Advisors, L.P., an affiliate of AEW Capital Management, L.P. (AEW), which is a subsidiary of IXIS Asset Management US Group, L.P. AEW is a real estate investment manager, providing advisory services to investors worldwide, focusing on directly held real estate assets, real estate equity securities, real estate opportunity funds and international investment. AEW and its affiliates currently manage over $30 billion(1) of capital, which is invested in $41.5 billion(1) of real estate and securities in North America, Europe and Asia. For further information, visit www.aew.com or www.ixisag.com/aew_rif/. # # #

7 slimy landlord tactics

Yes, many of the stories are true. Repair ripoffs, outrageous fees, security deposit scams . . . these are some of the ugly tricks that landlords pull on tenants. By Maureen Farrell, Forbes.com
A corker from the annals of slimy-landlord lore:
About 10 years ago, a large Manhattan real estate firm bought an apartment building that contained a few rent-controlled units. Deregulated, those units would be worth perhaps five to seven times more on the open market -- if the developer could nudge the remaining tenants down the road, that is.
One of them, a senile older woman who had been living there for decades, refused to leave. The law was on her side: In New York City, tenants can't be evicted from rent-controlled apartments if they have lived there continuously since at least July 1971. What happened next comes from a source at the real estate firm who chooses to remain anonymous.
Soon after the purchase, the woman fell ill. While bedded up in the hospital, the company moved all of her possessions into another apartment set up to look just like her previous one, except that it was more than a dozen blocks away.
"This woman wasn't completely aware of her surroundings," says the source. She also had no family, so the company paid her nurse to keep up the ruse and even moved her old doorman into the new building for a few weeks to greet her. "The fact that she saw some familiar faces was enough to carry her for a few weeks." (The company eventually sold her original apartment as a co-op for a hefty price tag.)
Squeezing the most out of properties
Most property owners don't have the guile or the resources to pull off such a stunt. Still, overly opportunistic landlords are a sad fact of life. No matter if the housing market is torrid or soft, they are always looking for ways -- some downright slimy -- to squeeze the most out of their properties. Your best defense: A few ounces of prevention and some knowledge of the law.
Of all the nasty maneuvers, threat of eviction is the scariest. But many of those threats don't have teeth. Generally speaking, yearly leaseholders are safer than those who rent month to month. In most states, landlords must prove that tenants with annual leases have violated their agreements before they can evict. Monthly tenants, on the other hand, can be booted without cause with a 30-day notice in most states, barring a few exceptions such as discrimination. Residents of rent-regulated apartments have a right to automatic lease renewal (unless, perhaps, they don't have all their faculties).
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Repair runaround
Most tactics don't involve such blatant strong-arming. Take repair requests. A landlord could add a clause in your lease stating that you must pay to fix that leaky sink, busted refrigerator or recalcitrant space heater. That's a crock. In fact, the law deems such clauses "unenforceable," and it's the landlord's job to foot the bill.
The best recourse: Put all repair requests in writing (in case you end up in court), and be sure to record the date and time of each. If your landlord doesn't follow up after a few phone calls, hire a repair person and forward a copy of the bill. Refusing to pay part -- or all -- of next month's rent until the problem is fixed works, too.
You apartment may not have taken a beating, but your security deposit might. Call them "creative deductions"--$100 for chipped paint, $200 for ripped carpeting and so on. The big problem: By the time you get your dented deposit back, you've already moved out, so what can you prove? Head this hassle off before you move in by doing a walk-through with your landlord, checking off any imperfections and taking pictures.
Put the findings in writing and make your landlord sign the document. Then, a week before you move out, do the same thing again. If you end up in small-claims court, you'll be well armed.
Roommate rights
Landlords also may try to whack you extra for taking on a roommate or an extended house guest -- even though federal housing statutes prohibit landlords from raising rents on tenants who do so. There are limits, of course, so you can't pile in your whole extended family. What's typical is two individuals per bedroom, plus one. So, up to three people (including children) can reside in your one-bedroom apartment before the landlord can jack up the rent or issue an eviction notice.
If your landlord really gives you the creeps, consider buying renter's insurance. The cost is minimal (maybe $10 to $30 a month) compared with what you might lose in repair costs and lawyers' fees. (Read more about renter's insurance, here.)
Really fed up with your landlord? Extract your own pound of flesh by knowing the law. Example: Tenants in Chicago can collect twice the amount of their security deposits if they can prove that landlords stick rent checks and security deposits in the same bank account, says attorney Aaron Krolik. (Most banks can help you track down this information.) If that doesn't work, Chicago renters can double their pleasure if their landlords blank on paying the stipulated interest on security deposits, currently 1.7% a year.
These niggling technicalities are slimy in their own right -- and just the sort of thing that clogs up the courts. Then again, they asked for it.
7 slimy landlord tactics
Click on each link for tips on fighting back.
Repair rip-offs: Your landlord may try to charge for fixing that leaky sink, busted refrigerator or recalcitrant space heater. That's a crock. Under most state laws, renters are entitled to reside in a safe, habitable dwelling on the landlord's dime. That means landlords must fork over for repairs and broken locks -- and do it in a reasonable time frame.
Dented security deposits: Your apartment may not have taken a beating, but your security deposit might. Call them "creative deductions"--$100 for chipped paint, $200 for ripped carpeting and so on. The big problem: By the time you get your dented deposit back, you've already moved out.
Roommate charges: In expensive cities like New York and San Francisco, taking on a roommate is a quick (if crowded) way to slash living expenses. Your landlord knows this and may try to charge you for the extra bodies, which can be illegal depending on the number of roommates you take in.
Usurious late fees: Landlords can make a pretty penny on late payments. State laws are squishy on what constitutes a "reasonable" fee, and there are plenty of property owners who will charge stiff penalties. Reasonable fees start at $5 a day and head up to 6% of a month's rent. Worst-case scenario: an eviction notice.
Illegal spaces: Converting garages, basements or recreation rooms into apartments is a no-no without proper zoning approval. So is living there. If the authorities find out, you'll soon be looking for new digs.
Key money: When rents aren't set by the laws of supply and demand, as is the case with rent-controlled or rent-stabilized apartments, black markets spring up. To skirt the rent cap, slimy landlords will accept extra fees --called "key money" -- from prospective tenants looking for an edge.
Threat of eviction: Landlords can find plenty of excuses to evict you, from lease technicalities to the occasional late payment. This one has a nasty ring to it, but in many cases, no teeth.
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As nation changes, so do homebuyers

Single women, financially secure like never before, account for more than twice as many home purchases as single men do, and minority ownership is rising.By Les Christie, CNNMoney.com

Changing American demographics and social norms are altering the real estate landscape: The average homebuyer is very different compared with buyers of generations past.
The biggest group of homebuyers by far is still married couples, accounting for 61% of all homes bought, according to the National Association of Realtors.
But single women now purchase 22% of all homes. Single men account for only 9% of purchases.
Pat Vredevoogd Combs, the president of the National Association of Realtors, says that shows real change. "Thirty-five years ago, when I started out as a Realtor, a single woman couldn't even get a mortgage," she says.
Part of the reason why women have become so big a buying bloc is that more women are single than ever before. The New York Times recently concluded, after an analysis of Census Bureau data, that 51% of all American adult women now live without a spouse.
Women are more financially independent than ever before, too. They account for about 57% of all college graduates, almost the reverse of the ratio of 40 years ago.
All this has changed not only circumstances for women but attitudes as well.

"Women are more confident and financially savvy than ever before," Vredevoogd says. "Plus there are good mortgage products out there that work well for them."
Vredevoogd says women benefit from many of the nontraditional mortgage choices they have today. These include small cash-down loans that enable recent graduates and divorcées, who may not have a big nest egg available, to achieve homeownership sooner.
Minority homeowners on the rise
The generous assortment of mortgage loans has also helped another emerging demographic: minority homeowners, who now account for 30% of all homes bought.
During the 10 years through 2005, homeownership among African Americans grew from 44% to 48%, according to Vredevoogd. Among Hispanics it grew from 43% to 49% and among Asians from 51% to 60%.
All these groups made significant progress toward achieving the level of homeownership of 72% that the nation as a whole enjoys.
Second-home buyers from abroad
One rising group of homeowners that requires little, if any, assistance consists of buyers from abroad. Just as more Americans are buying vacation homes in foreign countries, so are deep-pocketed foreigners buying second homes here.
Janet Branton, the vice president of business specialties for the National Association of Realtors, says overseas buyers made about $41 billion worth of residential real estate purchases in the United States during 2005.
More foreign buyers hail from Germany than any other location. They account for 13% of the total purchases from overseas. Latin Americans are right on their heels, also at 13%. Other countries at the top of the list include Japan and the United Kingdom, both at 10%.
Many of these overseas buyers, Vredevoogd says, acquire vacation properties in resort areas such as South Florida, Palm Springs, Calif., and the ski resorts of the Rockies and Sierra Nevada.

Bohemian today, high-rent tomorrow

Creative types are essential to urban and regional economic growth. Here's why artists are an indicator of coming gentrification -- and the 10 cities artists should flock to now. By Maya Roney, BusinessWeek
Slide show: Top 10 places for artists
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Want to know where a great place to invest in real estate will be five or 10 years from now? Look at where artists are living now.
Sociologists and policymakers have long touted art and culture as a cure-all to economically depressed neighborhoods, cities and regions. The reason? It has been proved that artists -- defined as self-employed visual artists, actors, musicians, writers, etc. -- can stimulate local economies in a number of ways.
Artists are often an early sign of neighborhood gentrification. "Artists are the advance guard of what's hip and cool," says Bert Sperling, the founder and president of Sperling's Best Places, based in Portland, Ore., and the compiler of BusinessWeek.com's list of the Best Places for Artists in America.
Creativity leads to growth
Artists, because of their typically lower incomes, usually need to seek out cheaper neighborhoods where they can afford the rent. But because of their creativity, they are able to fix up these areas, eventually attracting hip boutiques, galleries and restaurants. Not all artists are starving. Though some achieve success through writing, acting, painting or dancing, others get tired of scraping by as waiters or bartenders and sometimes apply their abilities in more-entrepreneurial ways.
Anne Markusen, an economist and professor at the University of Minnesota's Humphrey Institute of Public Affairs and a leading researcher on the effects of the arts on regional economics, once profiled an abstract painter whose work is now displayed on ceilings and in MRI machines in hospitals across the country. In Markusen's research, artists have also been found to stimulate innovation on the part of their suppliers. For example, a painter may need a certain type of frame that is not manufactured, forcing the frame maker to create a design that happens to also work well for other artists.

But Markusen also maintains that artists bring more than culture to a community. "Businesses don't often understand the extent to which art affects them," Markusen says. "(Artists) are just as important as science and technology companies."
Nonarts businesses also use artist contractors to improve product design, help with marketing or even use dramatic theory to solve employee relationship issues. Being a cultural center also helps local businesses attract employees who want to be able to regularly go to the ballet or the theater, hear authors read from their latest books or attend art-gallery openings.
Follow the money
Due to the individual nature and economics of their work, artists are also some of the most itinerant professionals out there. When relocating, they often look for cities and towns that already have high concentrations of artists and a young and racially and ethnically diverse population. The presence of a nurturing art community in the form of art societies and centers is also essential, especially to young artists.
A low cost of living is important, but many artists make financial sacrifices to live near an art-rich urban center or in a cheaper neighborhood. Few struggling artists can now afford to live in neighborhoods like New York's SoHo and Greenwich Village, or even Williamsburg, which once were artistic havens before attracting wealthier residents. Now you are more likely to find New York-based artists in the Bronx, Brooklyn or even Philadelphia.
In addition to the presence of like-minded individuals, proximity to wealth is also important. The fact of the matter is that artists can seldom earn a living, let alone become rich, selling to other artists. They need wealthy benefactors to buy their paintings or support their local symphony, which explains why each of the places in the U.S. that we found to be the best for artists are in or near centers of wealth.
Los Angeles, No. 1 on our list, is most commonly associated with the film industry. While the city provides great opportunities for actors and directors, there are equally rich prospects for musicians, artists, writers and dancers. Of course, the majority of these people can't afford to live in Beverly Hills -- at least not until they get their big break -- and instead opt for more affordable digs in areas such as Echo Park.
Where to go now
BusinessWeek.com and Sperling's Best Places came up with a list of the best places for artists in the U.S. by identifying the metro areas that have the highest concentrations of artistic establishments. We also looked at the percentage of people ages 25 to 34, population diversity and concentration of museums, philharmonic orchestras, dance companies, theater troupes, library resources and college arts programs. A lower cost of living played a part in the selection of some cities but had to be overlooked elsewhere because of other very favorable factors.
Some of the top 10 are traditional art "supercities." One reason Los Angeles leads the list is because it has 56 artistic establishments for every 100,000 people, a diversity index of 84.2 and an arts-and-culture index of 100 (on a scale of 1 to 100). New York City and San Francisco are also in the top 10. Other places are midsize cities such as hippie havens Santa Fe, N.M., and Boulder, Colo., and country-music nucleus Nashville, Tenn. Smaller, less obvious additions include Carson City, Nev., which ranks third for its high concentration of arts establishments, and Kingston, N.Y., in the Hudson River Valley.
Ready to quit your day job and make art your profession? These metro areas are good places to start. With all the economic benefits you'll be providing, they should welcome you with open arms.
The top 10 places for artists (click on the links to read more about each locale):
Los Angeles
Santa Fe, N.M.
Carson City, Nev.
New York
Kingston, N.Y.
Oxnard-Thousand Oaks-Ventura, Calif.
Nashville, Tenn.
Boulder, Colo.
San Francisco
Nassau-Suffolk counties, N.Y.