June 4, 2010
'DAZED AND CONFUSED': 44th Annual NAREE Conference: Covering Real Estate in the Second Decade of the 21st Century
By David M. Kinchen
Huntingtonnews.net Real Estate Writer
Austin, TX (HNN) - Question: What does the 44th annual real estate journalism conference of NAREE and the 1993 coming-of-age movie "Dazed and Confused" have in common?
Answer: For one thing, both took place in Austin, Texas, called by some America's greenest big city (although bike friendly and public transportation rich Portland, Oregon might dispute that claim).
Covering real estate for a daily newspaper or website has never been easy and it's getting more difficult all the time, judging by the advice offered up on the first day and a half of the conference at the Austin Hilton (family obligations limited my stay to the first part of the conference, one of many I've attended since joining NAREE in 1971).
Writer/Director Richard Linklater's "Dazed and Confused" derived its title from the Led Zeppelin song of the same name...which wasn't used in the movie because of the refusal of Robert Plant to grant permission (Jimmy Page agreed). The cult film -- one of my favorites -- depicts a group of teenagers during the last day of school in 1976. It featured many future stars, including Matthew McConaughey, Ben Affleck, Milla Jovovich, Parker Posey, Adam Goldberg and Cole Hauser.
It's easy for reporters to become "Dazed and Confused" covering real estate. At a Thursday, June 3 commercial real estate panel discussion, Steve Brown, who's been doing it for 30 years (!) at the Dallas Morning News, recalled going down to the courthouse and examining the foreclosure documents nailed to the wall. It's easier today, he related -- with a service providing the information to Brown's computer -- but knowing what to look for and rounding up the usual suspects is still a job for a seasoned reporter -- and nobody in NAREE, with exception of Lew Sichelman and perhaps the present writer -- is more seasoned than Brown!
Hazing of the young reporters assigned to the real estate beat -- now largely part of the downsized business sections in most newspapers -- may not involve actions like the paddling of freshman by upper classpersons that took place in the movie, but it might seem that way to reporters assigned to the commercial real estate beat.
On the panel with Brown, Wall Street Journal writer Kris Hudson detailed the coverage of the refinancing structure of two Chicago luxury hotels. You have to be a CPA -- or an experienced reporter -- to decipher the profit and loss statements of the hotels and other troubled commercial properties.
As Walter Molony of the National Association of Realtors pointed out at another session, "Data without context is noise." Those of us who still cover real estate today are familiar with Molony's data, both leading and lagging indicators, from NAR and other sources.
A good example of misleading numbers came out on Friday, June 4, with the release of job creation data by the Department of Labor. The good news: the gain of 431,000 jobs in May was hailed by President Obama as a sign the U.S. economy is getting stronger. The bad news is that 411,000 of those jobs were temporary workers hired for the 2010 Census. U.S. private employers hired fewer workers than expected in May, just 41,000 -- compared with 218,000 in April.
Mike Inselmann of Metrostudy provided context at a Thursday, June 3 session on the mid-year outlook for home building. Without jobs there is no home buying, he pointed out, noting that there was a whopping one million fewer workers in the U.S. economy at the end of 2009 compared with the end of 1999. He called it the "Lost Decade" and added more context by commenting on the lack of a boom and bust cycle in Texas, especially compared with California, Nevada, Arizona and Florida.
The fundamentally sound and diversified economy of the Lone Star State -- the second most populous after California -- added a million jobs in the Lost Decade, contributing to the no-bubble housing markets of every metropolitan area in Texas, including Houston, Dallas-Fort Worth, San Antonio and Austin. Inselmann is president and co-founder of Metrostudy, which covers more than 40 markets in 16 states, giving it a broad perspective.
On the panel with Inselmann was Chris Werth of the Pulte Group, the nation's largest residential builder. He reinforced Inselmann's description of the relatively sound Texas metro housing markets, saying that the state is a good market for Pulte, especially since its acquisition for $1.3 billion in stock of Dallas-based Centex a little over a year ago.
The April 2009 Centex acquisition also gave Pulte large tracts of land in Texas and the Carolinas, two of the most resilient real estate markets, and a presence in 29 states and Washington, D.C.
The new company, which will include the Del Webb and Fox & Jacobs brand homes, will keep the Pulte name and headquarters in Bloomfield Hills, Mich.
Werth, based in Dallas and president of the Central Texas Division of Pulte, and the third panelist, Will Holder of Trendmaker Homes, both agreed with Inselmann's assessment of the bubble-free Texas market and all three attributed the state's relatively enviable position to low taxes and few restrictions on building. Without the restrictions that are present in markets like Portland, Oregon, for instance, Texas builders weren't forced to impose demand-based home price increases.
At a panel discussion of foreclosures, Jack Schakett of Bank of America, said 80 percent of BofA's clients are current on their mortgage payments, adding that the Charlotte, NC banking giant is working with the 1.4 million who are having trouble doing so.
Irvine, CA-based RealtyTrac Inc. is very familiar to real estate reporters for its monthly foreclosure reports. On the panel with Schakett was Rick Sharga, a senior vice president of RealtyTrac, who said that the foreclosure crisis will continue at least through the fourth quarter of 2010, with a second big wave due when adjustable mortgages reset. Short sales and REO sales will continue to be a factor, but not enough of one to solve the foreclosure problem, Sharga added.
A third panelist, Travis H. Olsen of Loan Resolution Corp. (LRC) , based in Scottsdale, AZ, which uses a proactive to foreclosures, said that, despite efforts of LRC and others, a lot more people will walk away from upside-down loans in the near future. He's in a position to know, being based in one of the ground-zero underwater and foreclosure states, but he noted that all real estate is local, even in the greater Phoenix area where he lives and works.
A highlight of Wednesday evening was the tour of The Austonian, a 178-unit high-rise, 56-story building at Second Street and Congress Avenue, the tallest residential building west of the Mississippi River. Units range in price from $559,000 to $8,000,000, with an average price of just over $1.5 million. According to information supplied to those attending the conference, 55 units are in contract as of March 10.
Architect Scott Ziegler of Ziegler Cooper Architects, Houston, and developer Terry Mitchell of Momark Development LLC, outlined the green nature of the high-rise, no surprise to those who live in such buildings -- especially when they pay their monthly electric bills. The building is designed to capture rainwater (which was demonstrated Wednesday night with a downpour) and occupy a small footprint for such a large building.
The observation deck of The Austonian (a weird name since residents of Austin are referred to as "Austinites") affords magnificent views of the area, including the state Capitol building and the University of Texas complexes to the north and Lady Bird Lake (formerly called Town Lake) to the south.
At 683 feet, the building is the tallest in Austin, overtaking the 360 Condominiums, and is also the tallest all-residential building in the state of Texas and Texas' tallest building outside of Dallas and Houston.
NAREE attendees toured a model apartment, a one-bedroom unit, and some discovered a "man cave," a room with recliners and a gigantic flat-screen HD television. A downpour prevented attendees from journeying a few blocks down to the Congress Street bridge to view the famous bats of Austin.
Photo: View looking north from the observation deck of The Austonian, with the Texas capitol building and the University of Texas-Austin in the distance. Photo by Dave Kinchen
Dave Kinchen began his newspaper career in January 1966 at the Hammond (IN) Times. He begain coverering real estate in 1970 at The Milwaukee Sentinel and joined the staff of the Los Angeles Times in 1976. He was there until 1990. Kinchen was president of the National Assn of Real Estate Editors in 1984. He joined NAREE in 1971 and is an Honorary Life Member.
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'DAZED AND CONFUSED': 44th Annual NAREE Conference: Covering Real Estate in the Second Decade of the 21st Century
By David M. Kinchen
Huntingtonnews.net Real Estate Writer
Austin, TX (HNN) - Question: What does the 44th annual real estate journalism conference of NAREE and the 1993 coming-of-age movie "Dazed and Confused" have in common?
Answer: For one thing, both took place in Austin, Texas, called by some America's greenest big city (although bike friendly and public transportation rich Portland, Oregon might dispute that claim).
Covering real estate for a daily newspaper or website has never been easy and it's getting more difficult all the time, judging by the advice offered up on the first day and a half of the conference at the Austin Hilton (family obligations limited my stay to the first part of the conference, one of many I've attended since joining NAREE in 1971).
Writer/Director Richard Linklater's "Dazed and Confused" derived its title from the Led Zeppelin song of the same name...which wasn't used in the movie because of the refusal of Robert Plant to grant permission (Jimmy Page agreed). The cult film -- one of my favorites -- depicts a group of teenagers during the last day of school in 1976. It featured many future stars, including Matthew McConaughey, Ben Affleck, Milla Jovovich, Parker Posey, Adam Goldberg and Cole Hauser.
It's easy for reporters to become "Dazed and Confused" covering real estate. At a Thursday, June 3 commercial real estate panel discussion, Steve Brown, who's been doing it for 30 years (!) at the Dallas Morning News, recalled going down to the courthouse and examining the foreclosure documents nailed to the wall. It's easier today, he related -- with a service providing the information to Brown's computer -- but knowing what to look for and rounding up the usual suspects is still a job for a seasoned reporter -- and nobody in NAREE, with exception of Lew Sichelman and perhaps the present writer -- is more seasoned than Brown!
Hazing of the young reporters assigned to the real estate beat -- now largely part of the downsized business sections in most newspapers -- may not involve actions like the paddling of freshman by upper classpersons that took place in the movie, but it might seem that way to reporters assigned to the commercial real estate beat.
On the panel with Brown, Wall Street Journal writer Kris Hudson detailed the coverage of the refinancing structure of two Chicago luxury hotels. You have to be a CPA -- or an experienced reporter -- to decipher the profit and loss statements of the hotels and other troubled commercial properties.
As Walter Molony of the National Association of Realtors pointed out at another session, "Data without context is noise." Those of us who still cover real estate today are familiar with Molony's data, both leading and lagging indicators, from NAR and other sources.
A good example of misleading numbers came out on Friday, June 4, with the release of job creation data by the Department of Labor. The good news: the gain of 431,000 jobs in May was hailed by President Obama as a sign the U.S. economy is getting stronger. The bad news is that 411,000 of those jobs were temporary workers hired for the 2010 Census. U.S. private employers hired fewer workers than expected in May, just 41,000 -- compared with 218,000 in April.
Mike Inselmann of Metrostudy provided context at a Thursday, June 3 session on the mid-year outlook for home building. Without jobs there is no home buying, he pointed out, noting that there was a whopping one million fewer workers in the U.S. economy at the end of 2009 compared with the end of 1999. He called it the "Lost Decade" and added more context by commenting on the lack of a boom and bust cycle in Texas, especially compared with California, Nevada, Arizona and Florida.
The fundamentally sound and diversified economy of the Lone Star State -- the second most populous after California -- added a million jobs in the Lost Decade, contributing to the no-bubble housing markets of every metropolitan area in Texas, including Houston, Dallas-Fort Worth, San Antonio and Austin. Inselmann is president and co-founder of Metrostudy, which covers more than 40 markets in 16 states, giving it a broad perspective.
On the panel with Inselmann was Chris Werth of the Pulte Group, the nation's largest residential builder. He reinforced Inselmann's description of the relatively sound Texas metro housing markets, saying that the state is a good market for Pulte, especially since its acquisition for $1.3 billion in stock of Dallas-based Centex a little over a year ago.
The April 2009 Centex acquisition also gave Pulte large tracts of land in Texas and the Carolinas, two of the most resilient real estate markets, and a presence in 29 states and Washington, D.C.
The new company, which will include the Del Webb and Fox & Jacobs brand homes, will keep the Pulte name and headquarters in Bloomfield Hills, Mich.
Werth, based in Dallas and president of the Central Texas Division of Pulte, and the third panelist, Will Holder of Trendmaker Homes, both agreed with Inselmann's assessment of the bubble-free Texas market and all three attributed the state's relatively enviable position to low taxes and few restrictions on building. Without the restrictions that are present in markets like Portland, Oregon, for instance, Texas builders weren't forced to impose demand-based home price increases.
At a panel discussion of foreclosures, Jack Schakett of Bank of America, said 80 percent of BofA's clients are current on their mortgage payments, adding that the Charlotte, NC banking giant is working with the 1.4 million who are having trouble doing so.
Irvine, CA-based RealtyTrac Inc. is very familiar to real estate reporters for its monthly foreclosure reports. On the panel with Schakett was Rick Sharga, a senior vice president of RealtyTrac, who said that the foreclosure crisis will continue at least through the fourth quarter of 2010, with a second big wave due when adjustable mortgages reset. Short sales and REO sales will continue to be a factor, but not enough of one to solve the foreclosure problem, Sharga added.
A third panelist, Travis H. Olsen of Loan Resolution Corp. (LRC) , based in Scottsdale, AZ, which uses a proactive to foreclosures, said that, despite efforts of LRC and others, a lot more people will walk away from upside-down loans in the near future. He's in a position to know, being based in one of the ground-zero underwater and foreclosure states, but he noted that all real estate is local, even in the greater Phoenix area where he lives and works.
A highlight of Wednesday evening was the tour of The Austonian, a 178-unit high-rise, 56-story building at Second Street and Congress Avenue, the tallest residential building west of the Mississippi River. Units range in price from $559,000 to $8,000,000, with an average price of just over $1.5 million. According to information supplied to those attending the conference, 55 units are in contract as of March 10.
Architect Scott Ziegler of Ziegler Cooper Architects, Houston, and developer Terry Mitchell of Momark Development LLC, outlined the green nature of the high-rise, no surprise to those who live in such buildings -- especially when they pay their monthly electric bills. The building is designed to capture rainwater (which was demonstrated Wednesday night with a downpour) and occupy a small footprint for such a large building.
The observation deck of The Austonian (a weird name since residents of Austin are referred to as "Austinites") affords magnificent views of the area, including the state Capitol building and the University of Texas complexes to the north and Lady Bird Lake (formerly called Town Lake) to the south.
At 683 feet, the building is the tallest in Austin, overtaking the 360 Condominiums, and is also the tallest all-residential building in the state of Texas and Texas' tallest building outside of Dallas and Houston.
NAREE attendees toured a model apartment, a one-bedroom unit, and some discovered a "man cave," a room with recliners and a gigantic flat-screen HD television. A downpour prevented attendees from journeying a few blocks down to the Congress Street bridge to view the famous bats of Austin.
Photo: View looking north from the observation deck of The Austonian, with the Texas capitol building and the University of Texas-Austin in the distance. Photo by Dave Kinchen
Dave Kinchen began his newspaper career in January 1966 at the Hammond (IN) Times. He begain coverering real estate in 1970 at The Milwaukee Sentinel and joined the staff of the Los Angeles Times in 1976. He was there until 1990. Kinchen was president of the National Assn of Real Estate Editors in 1984. He joined NAREE in 1971 and is an Honorary Life Member.
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