Housing
Bailout conference
Interesting symposium last week in LA, put on by HUD. Public agencies, private foundations, banks and nonprofit organizations made presentations on their plans for dealing the vacant inventory of single family homes.
Pretty large gathering, maybe 150 people, held in the Federal Reserve Building, at Olympic in the south part of Downtown. I had to get on an invite list to get in the building, but it turned out that old friends from HUD were the organizers and it was no problem.
The mood was pretty upbeat, considering the gravity of the task, to get the backlog of homes in shape to resell, and into the hands of responsible homeowners. Until this inventory is absorbed, the homebuilding sector of the economy will be stalled.
HUD is in charge of the money, $3.9 billion nationally. Some of these funds are administered through the State, and some through counties and local jurisdictions. The funds are treated as an addition to Community Development Block Grant monies, the federal revenue sharing program. CDBG regs are less restrictive in this case, recipients can earn up to 120% of area median income, instead of 80%, the normal limit. Funds are expected to be used within 18 months, or they will revert to the Feds.
Some models have been developed, but I haven't seen detailed descriptions of how the programs work. Generally, we are encouraged to target specific neighborhoods with concentrations of defaults, both for efficiency in the contracting and renovation process, and for community impacts.
A number of attending banks have procedures for "first look" by the nonprofit consortia trying to deal with the inventory--even the much maligned Fannie Mae. In exchange for volume sale, the banks will offer a 15% discount to the nonprofits- the funds require that the intermediaries obtain an average 15% discount. Only BofA insisted that they would only transfer properties at full market without discount "in accordance with our fiduciary obligations to our investors". (Didn't those investors already reap windfall profits and then receive hundreds of billions of taxpayer dollars when profits dipped?)
For me- old connections, lots of business cards and plenty to think about, on how I could be involved consulting. I have never been involved in real estate transactions of this sort or scale (my experience is all multi-family, and mostly very low income Skid Row projects with specialized financing); but neither had anyone else in the room. So I think of major land/data projects I have worked on like general plan/zoning consistency for the city of LA, and I think I could handle it.
My "After Hours" route home
I had a nice denouement after the event. I walked with one of the planners from HUD back to the office and visited old colleagues. A few surprises, and lots of smiles. My friend Pauline gave me some leads on possible business.
Then I went over to the Marriott Hotel to check out the Neighborworks conference. I was recently put on their consulting list, but I'm still figuring out how work is doled out. I didn't arrive at a good time to find out, everybody was on a break.
Since I'd taken the express bus into town, I headed back towards 9th and Figueroa, back where I'd started. It was 2:35 when I started and I had until 3:15 to get to my stop. When I got to 5th Street, I figured I'd cross downtown to the next bus stop, 1st and Spring. (I didn't want to go directly there, Bunker Hill is steep and I was recoverign from my hike on Saturday.) So I went by Pershing Square to Broadway, more or less meandering.
I turned onto Broadway with the conscious thought, "Why am I taking this route?" But that area is really familiar to me from ten years that I worked in City Hall or nearby offices. I headed north on Broadway, thinking I might cut through Biddy Mason Park or take another route. I got to the front door of Grand Central Market, and there was Dwayne, one of my best friends. I say "best friend" though I don't see him, it's been almost 9 years. But we promise to see each other, and had actually traded a few calls just last week.
Dwayne had the flu so I can't say he looked great. We chatted a few minutes and I asked him something serious about our mutual friend who died in October- at that point his bus arrived and I went on to mine.
I got to the corner of First and Spring not quite knowing where the Foothill Transit bus stop would be, and the LA Times security couldn't tell me. I was thinking how handy it was to have a few extra minutes when I saw the Foothill Transit bus pull up in front of City Hall and I looked at my cell phone- 3:16! So I gave my power yell (you never heard it) and the bus waited. I did my first sprint in quite awhile, and made it on.
No fare. The fare box was broken so it didn't cost me a dime to get home (it's $3.30 in non-rush hours). The only thing was the route- this bus seemed to make a lot of stops, and I didn't expect it to drive deep into Covina. No bus number on the inside, but it kept heading east out to Pomona. Then it passed the stop where my car was at the Park-and Ride. sure enough, I had run to catch the wrong bus, the number is on the side at the front, but you board the middle.
No harm done, I got a ride back to my car from my roommate.
Interesting symposium last week in LA, put on by HUD. Public agencies, private foundations, banks and nonprofit organizations made presentations on their plans for dealing the vacant inventory of single family homes.
Pretty large gathering, maybe 150 people, held in the Federal Reserve Building, at Olympic in the south part of Downtown. I had to get on an invite list to get in the building, but it turned out that old friends from HUD were the organizers and it was no problem.
The mood was pretty upbeat, considering the gravity of the task, to get the backlog of homes in shape to resell, and into the hands of responsible homeowners. Until this inventory is absorbed, the homebuilding sector of the economy will be stalled.
HUD is in charge of the money, $3.9 billion nationally. Some of these funds are administered through the State, and some through counties and local jurisdictions. The funds are treated as an addition to Community Development Block Grant monies, the federal revenue sharing program. CDBG regs are less restrictive in this case, recipients can earn up to 120% of area median income, instead of 80%, the normal limit. Funds are expected to be used within 18 months, or they will revert to the Feds.
Some models have been developed, but I haven't seen detailed descriptions of how the programs work. Generally, we are encouraged to target specific neighborhoods with concentrations of defaults, both for efficiency in the contracting and renovation process, and for community impacts.
A number of attending banks have procedures for "first look" by the nonprofit consortia trying to deal with the inventory--even the much maligned Fannie Mae. In exchange for volume sale, the banks will offer a 15% discount to the nonprofits- the funds require that the intermediaries obtain an average 15% discount. Only BofA insisted that they would only transfer properties at full market without discount "in accordance with our fiduciary obligations to our investors". (Didn't those investors already reap windfall profits and then receive hundreds of billions of taxpayer dollars when profits dipped?)
For me- old connections, lots of business cards and plenty to think about, on how I could be involved consulting. I have never been involved in real estate transactions of this sort or scale (my experience is all multi-family, and mostly very low income Skid Row projects with specialized financing); but neither had anyone else in the room. So I think of major land/data projects I have worked on like general plan/zoning consistency for the city of LA, and I think I could handle it.
My "After Hours" route home
I had a nice denouement after the event. I walked with one of the planners from HUD back to the office and visited old colleagues. A few surprises, and lots of smiles. My friend Pauline gave me some leads on possible business.
Then I went over to the Marriott Hotel to check out the Neighborworks conference. I was recently put on their consulting list, but I'm still figuring out how work is doled out. I didn't arrive at a good time to find out, everybody was on a break.
Since I'd taken the express bus into town, I headed back towards 9th and Figueroa, back where I'd started. It was 2:35 when I started and I had until 3:15 to get to my stop. When I got to 5th Street, I figured I'd cross downtown to the next bus stop, 1st and Spring. (I didn't want to go directly there, Bunker Hill is steep and I was recoverign from my hike on Saturday.) So I went by Pershing Square to Broadway, more or less meandering.
I turned onto Broadway with the conscious thought, "Why am I taking this route?" But that area is really familiar to me from ten years that I worked in City Hall or nearby offices. I headed north on Broadway, thinking I might cut through Biddy Mason Park or take another route. I got to the front door of Grand Central Market, and there was Dwayne, one of my best friends. I say "best friend" though I don't see him, it's been almost 9 years. But we promise to see each other, and had actually traded a few calls just last week.
Dwayne had the flu so I can't say he looked great. We chatted a few minutes and I asked him something serious about our mutual friend who died in October- at that point his bus arrived and I went on to mine.
I got to the corner of First and Spring not quite knowing where the Foothill Transit bus stop would be, and the LA Times security couldn't tell me. I was thinking how handy it was to have a few extra minutes when I saw the Foothill Transit bus pull up in front of City Hall and I looked at my cell phone- 3:16! So I gave my power yell (you never heard it) and the bus waited. I did my first sprint in quite awhile, and made it on.
No fare. The fare box was broken so it didn't cost me a dime to get home (it's $3.30 in non-rush hours). The only thing was the route- this bus seemed to make a lot of stops, and I didn't expect it to drive deep into Covina. No bus number on the inside, but it kept heading east out to Pomona. Then it passed the stop where my car was at the Park-and Ride. sure enough, I had run to catch the wrong bus, the number is on the side at the front, but you board the middle.
No harm done, I got a ride back to my car from my roommate.