by Jon DeVore, 07/29/2009, 11:01 PM

Personally, I love realistic capitalists who say what is what, and over time I’ve become a fan of “Jim the Realtor,” aka northern San Diego County realtor Jim Klinge, whose blog Bubble Info has been linked to by Calculated Risk with some frequency.

It’s possible Klinge and I may not not have similar political views, although I have no way of knowing, but if I was looking for a property in northern San Diego County I would definitely beat a path to his office. He steadfastly offers analysis of his market, mostly residential properties, based on facts, local conditions and historical trends. Plus he’s often hilarious.

Wall Street could use guys like this. Our family had the benefit of a real estate agent who worked like this, and it’s a huge advantage IMHO. It may be your home, but it’s also a business deal, and having someone who knows stuff can be pretty helpful.

Here Jim the Realtor takes a look at a couple of strip malls in his area. I bet the local developers are so glad he puts these things on YouTube.

[youtube]http://www.youtube.com/watch?v=110dykaIre0[/youtube]

5 Responses to “SoCal commercial real estate fun”

1. YLB spews:

Maybe the Pooper should propose moving EFF into one of those strip malls.

Uhh. Yes I know they’re in CA.

2. Blue John spews:

That’s sad. I look at that and wonder if there should be some sort of “regulation” to stop developers from overbuilding like that. It probably wouldn’t work. The “Pave the Earth” community would sue for the right to build regardless of economic realities.
On the other side, the fools should be allowed to build, but shouldn’t be able to pass that debt on to the public.

3. rhp6033 spews:

Blue John @ 2: That’s one of the traditional roles of the “Chamber of Commerce”. Make things as easy as possible for the developers, then let the public pick up the bill when things crash. It was often incorporated into slogans upholding the benefits of a bigger and better “Greater _______” (insert name of any other city here).

I kind of miss Emmett Watson and his “Lesser Seattle” campaign.

Emmett Watson

4. salsamanca spews:

Another money making scheme this time with low income housing.
It all sounds like a classic tale of the bust except that, unlike ordinary people caught up in foreclosure proceedings, Gluck and his partners have made a fortune off Riverton Houses. Just as homeowners often take out some extra cash when they refinance a property, team Gluck pulled out $67 million—the high-roller version of cash at closing.
A homeowner would be on the hook for that extra cash, but Gluck’s group purchased Riverton through a limited liability shell company, which allows it to shelter its refinancing windfall in case of a default. Minus the down payment, the partners walk away with nearly $42 million.
The Riverton deal exemplifies a strategy known as predatory equity: Backed by private equity funds—which get their money from pension funds and wealthy investors—real estate players like Gluck were able to generate massive down payments during the boom. This allowed them to secure interest-only loans for high-risk bets on affordable housing.
Also unlike flipping a house, leveraging affordable housing affects the lives of thousands. Deals by Gluck and other big players have stripped the equity from many of New York’s developments; roughly 70,000 affordable units are overleveraged,
In December, New York Sen. Charles Schumer urged the SEC to investigate, calling the situation “subprime crisis 2.0.”
When an investment like Riverton fails, only the shell company that owns it goes bust. So Stellar Management remains unscathed, and may even end up managing the complex.
http://www.motherjones.com/politics/2009/07/mortgage-default-landlord-edition

5. uptown spews:

Here is a nice blurb about Ocean Collection. I just can’t see why it failed (haha). Maybe it’s because if folks have to get in there cars to drive to the store, they will drive a little further to existing stores. Seems to be plenty of commercial property already in the area.

You too could live at the end of a runway (Bressi Ranch). Notice lighter brown areas where more subdivisions were supposed to go. Notice empty lots in existing developments.