The Real Estate OC

California High Speed Train Project Update

2009-06-18T10:05:00.000-07:00

According to MSNBCs article today, the California High Speed Train Project is one of the top projects being considered for funding by the Obama Administration stimulus package.

Other Mid-West high speed rail projects are all competing for the $8Billion. Even if California received the full amount, that would only be about 17% of the projected $45 Billion price tag. If some of this money is granted and combined with the bond issue approved by California voters, the project will have secured somewhere between 25% and 35% of the funding.

The published federal guidelines are requiring states with projects to act quickly to meet rigorous financial guidelines for their proposals on a short timeline, according to a press release issued by the federal Department of Transportation. The memo also states that the money is to be distributed in September in order to get the various projects started.

The pre-approval of the bond measure by California voters is a big plus in our consideration for the money as additional funding and political will has already been established.

Other areas under consideration for high speed rail are Texas, Florida, the Pacific Northwest, the Midwest, the Gulf Coast, the Southeast, northern New England, Pennsylvania and New York.

The story also states:

The Midwest project foresees upgrades of three existing routes: Chicago-St. Louis; Chicago-Madison, Wis., via Milwaukee; and Chicago-Pontiac, Mich., through Detroit. Later, they'd upgrade a St. Louis-Kansas City, Mo. route. The governors of the eight Midwest states — Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Ohio and Wisconsin — wrote Transportation Secretary Ray LaHood in April appealing for money for the region, one of the hardest hit by the recession.

According to the article California would use the federal funds for lines connecting San Francisco and San Jose, and Los Angeles and Anaheim, with the bond money going to work on the 800 mile stretch from Sacramento to Los Angeles.

Considering the wide scope of the plan, it would be a great step forward in President Obama's stated goal to build U.S. infrastructure and promote high-speed rail programs nationwide.

Effectively, it would replace the extensive nationwide rail system this country in the first half of the 20th century which was dismantled in favor of the interstate freeway program that gave transportation priority to the automotive industry.

Ultimately, hubs at endpoints could be connected to interstate lines creating a new nationwide network similar to those in other countries and Europe.

Source: http://www.msnbc.msn.com/id/31413166/ns/us_news-life/

High Speed Train would Change the Face of California

2009-05-28T15:39:00.000-07:00

Now this is a topic I have heard about my entire life. I remember my mother telling me about it when I was a small child. Ever since, the story has periodically resurfaced in various guises.

However, now it seems as though there is funding and political will.

The State of California has even set up a very cool, high-tech web site where you can simulate trips to and from various points on the line as well as proposed routing. Today's press release shows that they are meeting this afternoon with Obama administration representatives to try and obtain $8 billion in federal stimulus funding. This would be added to the already taxpayer approved Prop 1A which passed in November, 2008 for almost $10 billion in bond funding.

The estimated $45 billion project had overwhelming support from Governor Schwartzenegger and the state legislature.

The train which would travel at 220MPH between Sacramento and San Diego with feeder lines proposed from the San Francisco Peninsula that would connect near Chowchilla and one under consideration from Oakland that would serve the East Bay and connect to the main line near Manteca.

Travel times are projected to be quite impressive: San Francisco to San Jose in 30 minutes, Burbank to San Francisco in under 2 hours and 35 minutes, San Diego to most areas in the Los Angeles area in under an hour.

The Combination of the bond issue and the Federal Stimulus money would not quite account for 40% of the proposed budget.

The project is indeed ambitious and the benefits are quite clear: decreased freeway congestion in the major parts of the state, decreased need to improve airport and highway infrastructure, decreased carbon dioxide emissions and fuel use, stimulate jobs in a large portion of the state etc.
It is a very exciting project that shows much promise and benefit to Californians.

If it is successful, it will have a significant impact on many industries: Auto fuel, the airline routes between Northern and Southern California, the auto industry, businesses and communities along the main auto corridors (primarily highways 5 and 101), and a huge impact on commute and residency patterns.

With inexpensive and quick transportation, suburban communities further away from metro centers would have easy access to the main job hubs. Tracy to Silicon Valley, areas such as Riverside and Palmdale to the greater LA area. Not to mention the areas that do not have easy access to the proposed roughly 26 terminals. These areas would become less desirable economically and reflect in the real estate values.

Historically, there are precedence. Just look at what happened to the old highway system and icons like Route 66 when the interstate highway system was built. And likewise gold-rush towns many of which became ghost towns, towns and cities that cropped up along rail routes in the 19th and early 20th century, or settlements along the old wagon train routes that declined when lines were changed or replaced by the interstates. These were major changes that affected the face of the U.S. Landscape, social interaction, and living and work patterns for significant numbers of the population.

The project, though ambitious, certainly meets the criteria of President Obama's several campaign goals: Greener economy, environmental improvement, decrease global warming, economic stimulus, etc. As such it should play well from the political spectrum, and if the necessary money could be injected it would be a huge political benefit for for the State and Federal governments.

If this project finally breaks ground in my lifetime, I will be amazed, only because it, like the old steam engines, has been so long in coming and taken so many decades to build political will and momentum. But it does look like a beneficial and ambitious project that will herald a new California and all of the benefits and detriments that come with a major shift in transportation technology. It looks like things are on the right track as long as the current budget and economic climate don't derail it.

SO. CAL REAL ESTATE. WHERE'S THE BOTTOM??

2009-05-19T16:57:00.000-07:00

In circumnavigating the Southern California Real Estate blogosphere,

(I assume that is the correct term since it is a “sphere” or would “surf” be more apropos? After all, you can't “surf” a net or a web either? Let's stick with the navigation metaphor.)

I have found confirmation of our own experience of the real estate market trends and the statistics as presented by Altos Research.

Alhambra, CA has been exhibiting a lower available property inventory down, and decrease in the number of days on the market per property. The median sale price has increased.

Buena Park, CA has seen a slight positive reversal and stabilization in statistics since May 1.

Burbank, CA since May 1, has exhibited lower house prices along with decreased inventory and an increase in number of days on Market.

The Costa Mesa, CA market has shown a sharp price increase since 3rd week of April; Dom still high. Inventory low.

The coastal community of Palos Verdes Estates experienced a decrease in median sales price, high inventory of houses on the market and high number of days on the market.

Prices have increased since April in Pasadena, CA yet the days on market remain on the high side with a stable inventory of properties for sale.

As you can see, there are significant differences between communities. Although it is difficult to generalize give this kind of data, the higher cost neighborhoods like the coastal communities, tend to have more sluggish real estate markets.

Areas that have had more of a price decline over the past few months and have more entry-level properties are the ones that are stabilizing or showing signs of recovery.

As the statistics show, trends are different between communities, price ranges, and even between neighborhoods (for instance Southern Pasadena when separated from Pasadena shows a continued decline, where Pasadena as a whole shows a stabilizing trend).

Any conclusions? Well one thing that can be determined is that a market “bottom” will occur at different times and in different places. From the increases in sales, multiple offers and over-bidding going on in some of the communities that have lost the most value, the curve indicates that there is already a bottom forming. Not so in other areas.

If anyone is waiting for a bottom to occur before buying, I would recommend against it. In the first place, you can only identify the bottom once the trend has reversed and prices begin to increase. In the second place, if you get a good deal, have stable income, good financing and incentives, it won't matter in the long run if you saved an additional 10 or 15% on the purchase price. The trick is being conservative with your finances and buying what you can afford...don;t trust the lender to be the judge of that. (We've already seen what THAT leads to!)

OC's Data Quick Numbes Up

2009-04-08T15:43:00.000-07:00

For the 22 business days ending March 12 – DataQuick’s freshest stats — Orange County home buying patterns showed:

70 of O.C.’s 83 ZIP codes had losses gains in their respective median selling price. Overall, prices were -25.3% vs. a year ago.
3 of O.C. ZIPs had median sales prices above $1 million in the period Compare that to 11 million-dollar ZIPs when the county median price peaked in June 2007. Since that pricing pinnacle, there’s been a -41% drop in the countywide median price!
54 of O.C. ZIPs had year-over-year sales gains in the period. Overall, sales were +37.3% vs. a year ago.
17 of O.C. ZIPs has sales gains of 100% or more in the period.

Check out the full post from Lazner here

Great Park Update

2009-04-08T15:24:00.001-07:00

Quick notes from the recent meeting that took place on March 19, 2009. via press release.

1. Great Park Chief Executive Officer Mike Ellzey and the Great Park Design Studio presented a 36 month Park Development plant to the Great Park Board of Directors on March 10, 2009

2. The proposed Plan covers a first phase of development for approximately 500 acres of the Park

3. Three distinct areas are included in the proposed plan including a recreation district, an agriculture district, and a lake and cultural district

4. The districts include the first eight tournament level soccer fields in the sports park, the completion of the 27.5 acre Preview Park surrounding the Great Park Balloon, a 125 acre "working farm," event lawns, picnic meadows, a cultural terrace site, a performance bowl, a 20 acre lake and 7.3 miles of walking and bicycle paths.

Who knew? One quarter of Fullerton Considered To Be Blight

2009-04-01T13:00:00.000-07:00

On May 5, The Fullerton City Council will hear a motion that would consider expanding the city’s redevelopment area by 1,165 acres. That would put nearly 25 % of the entire city under the redevelopment agency and potentially allow the city to use eminent domain to take property from owners as well as divert property taxes to subsidize development.

Map Of the "blighted"

The Friends for Fullerton's Future has more

Possible Ponzi Scheme Sighted In South County

2009-02-25T11:24:00.001-08:00

Orange County real estate lender Dan J. Harkey is being sued by investors for $15 million. Mr. Harkey, who’s married to State Assemblywomen Diane L. Harkey (R-Dana Point) (more on her later), is said to have mislead investors with slick marketing tactics which included the mass mailings of DVD 's featuring Harkey leading investor meetings. If anyone has one of these please feel free it in.

Mr. Harkey is said to have paid off non-renewing investors with money from new investor. The alleged ponzi scheme, has purportedly been reported the Security and Exchange Committee and the FBI have been notified. The former has said to have subpoenaed thousands of documents.

The lead Plaintiff in the case, retired Orange County attorney Lloyd Charton, said he was owed more than $1 million and had this to say about Orange Counties Bernard Madof, "He scammed us. The representations that Dan Harkey made about the safety of the loans were untrue. He was bringing in new money to pay off investors on the same loan, and that's a Ponzi scheme."

To add further intrigue, the lawsuit claims that a portion of the proceeds were used to finance the Mrs. Harkey's recent election campaign. Shockingly, Dave Gilliard, the assembly woman's political consultant has said that the $1.7 million she contributed to herself was money she had made independently of her husband.

In his defense, Mr. Harkey contends that he’s a victim of the current state of the market and called the ponzi scheme allegation "nonsense". Whether the allegation will stick has yet to be seen, but I suspect these type of stories will began to appear more frequently.

A-Town Is Not A Rapper

2009-02-18T15:40:00.000-08:00

Anyone remember "A-Town"?

Me either.

Here's what I found.

Once upon a time A-Town was to be the Crown Jewel in Anaheim's Platinum Triangle. The plan was turn the once-industrial area into a modern urban village. The area between the 5, 57, and 405, was to consist of high-rise buildings, with views of Angel Stadium, parks and boutique shops. The plan was to create an instant modern day Greenwich Village, replete with Bridge and Tunnel crowds, Jamba Juice and smog. In total, the 54-acre development would= total about 3,813 homes, including 14 high-rise towers, along with about 200,000 square feet of retail space. its portion of the development would contribute 22 million in tax revenue a year. However, the project currently, the development is stalled. The Anaheim City Council recently allowed the Lennar Corp a 5 yea r extension on the project, which despite the current state of mess, they say are still committed to the overall, Lennar closed deals worth about $300 million to snatch up the land, said Louis Tomaselli, a broker with Voit Commercial Brokerage in Orange

Now the land sits empty. In November, the City Council granted Lennar a five-year extension on its agreement. It will be interesting to see what happens with the project and all the money wrapped up in it. As always, we'll keep you updated.

Not Sure What To Do With That Extra 25 Million Laying Around?

2009-02-16T16:20:00.000-08:00

An 8-acre lot in downtown Laguna beach just hit the market for $25 million bucks. The site is broken down into 4 separate lots and is believed to be the largest undeveloped swath of land in the city. The lot which is broken down down into one, 7.75 acre parcel and 3 smaller plots, sits above above City Hall and police department.