August 12, 2010 Adaptive-Reuse/Transportaion/TOD/Architecture Trends and Issues

This is our last night of class. It went pretty fast because of all the interesting subjects we talked about. Tonight was no exception. We started of talking a transportation and rail lines. Rail is very important to the state of Texas. Rail infrastructure i s very expensive to put in, but it doesn't take a lot of upkeep after in use. San Fransisco has started construction on the first high speed rail system in the United States. It is going to cost 4.2 billion dollars and create 48000 jobs. An interesting conversation in class was about GM and how they gave deep discounts to small towns on buses so they wouldn't utilize the rail system. It was a plan by GM to keep more cars on the road. Population is growth is going to be crazy from reading many articles in the next fifty years. Its expected to grow mostly in the south and west. Transportation infrastructure will have to change to keep up with the growth in population. California has passed a bill that wants cars to drive lower mileage each day to keep carbon emissions lower. This has caused many to think about developing TODs somewhere.
Adaptive reuse is still a niche market, but will change wen everyone shifts back to core urbanization. It is becoming popular for retail and office buildings to move into these kinds of buildings. Owners are getting higher rental rates and also have a lower vacancy.
Some developers don't want to do these projects if they can not get a substantial tax reduction. It's just not affordable if those initiatives are not there.
We had many articles looking at different adaptive reuse projects all over the country.
At the very end of class we talked about what we thought were the major things going on in commercial Real Estate. These were the top 5
-Mix use/ urbanization
-Technology
-Gov. sponsor projects
-sustainability/LEED
-Asset Repositioning

August 5, 2010 Residential / SFR / MFR / Appraisal/Valuation / Development / Construction Trends and Issues

We started the night talking about how DFW has been growing a great deal, but since the recession has begun, it has slowed down. It's probably going to be a year before the market picks back up. Though there is still a lot of construction going on in the area. In our class we discussed why this could be possible and concluded that it's because material costs have decreased and therefore developers want to take advantage while it's cheap to build. Multi-family residents will be more popular in these bad times because some can't secure financing for a home mortgage or their house has already been foreclosed on. Slowing single family resident construction has been caused by many things, but one reason is that banks aren't lending as much for housing developers to start housing developments. The bank is doing this because they are wondering where the demand is going to be coming from. Home building construction is a big section of the economy. When it drags, it slows many other things down with it. On the public side, construction has increased because the stimulus money is finally hitting the land and letting public construction start. We read an article about the ipad and how it is being used a lot on construction sites. The contractors are using them to look at all the specs. for the building and the process is becoming more efficient. It is also helping to save on printing costs; the company mentioned in Tennessee saved $179,000 just on printing costs. D. R. Horton, a major home builder, had a 50.5 million dollar profit in June, 2010. This is good considering the major loss they had this time last year. D. R. Horton believes they did well this June because of the tax credits. They believe the months to come will be very slow because the tax credits have stopped. Even more bad news is that construction contracts in Dallas have fallen 51% from last year. An interesting article talked about how a decommissioned fire station and a decommissioned police station both sold for $1; one was valued at 1.4 million and the other was worth $250,000. We had a conversation in class wondering what we as students thought about MFR being furnished. The question was asked whether more people would live there and like it. An interesting fact that Dr. Forgey told us is that right before the housing collapsed, builders were furnishing houses and adding the furniture to the mortgage.

Switching subjects to appraisal, an interesting article talked about how the governor of Florida wants properties to be reappraised to see what losses the oil spill brought and making BP pay for the losses. Valuation for tax purposes is now hitting properties all across the country. It will take a while for the local governments to get better.

The Obama administration and HUD are pushing money at the sustainability materials for Multi Family and Single Family Residents. Sustainability is a big thing coming up into the market. The niche has tremendous opportunity to grow in the future. Lenders need to get serious about sustainability and realize that upfront costs may be beneficial in the future.

If people are employed they move out of their parents house and if they are unemployed they find people to stay with to be able to save money. The economy is so messed up and experts keep changing their opinions and predictions about what is going to happen in the future. There is currently a shrinking demand for housing because of unemployment and lending being tight.

There is a new reform bill that will result in more accurate appraisal but will make valuations costs more. Appraisal regulations are changing for the first time in 20 years. The bill is trying to increase personal protection and transparency.

Trinity River Vision Authority-July 29

We went up the street for class this evening to meet with the Trinity River Vision Authority to talk to them about the way they are going to develop around the Trinity River. It was very nice to meet with them and it was a great presentation. Shanna Cate gave the presentation. To make this project possible there were many different partners tied into the project. There are two major parts to the project. The Trinity Uptown project and also the Central City project. The Trinity Uptown project will be a private component of the project that will consist of 800 to 1000 acres that will be classified as mix use land. 2/3 of the land will be required to be residential so it won't take away from down town business The city gave a survey to many residents and it asked what they wanted from the Trinity River. The results came in a the majority wanted a water front they could go to. At the present citizens don't have this because of the flood that came through during 1949. After that disaster a levee system was put into place and since then Fort Worth has been disconnected to the river that runs right through the city. The levee system was designed for the 1960 population and because of all the growth around the city in recent years the runoff has become greater. This has caused many drainage problems. All together there are 5 different river vision projects. The other major project Central City is a public infrastructure project for flood protection. It will have 12 miles of water improvements and all the projects will add 16000 jobs.
To get this great idea Fort Worth went around looking for the best model and they found it in Grandville Island, Canada. To look at how the currents run down the river and how to position new developments. The city constructed a trinity river model the size of a football field. It also helps them do flood studies. They have figured out the best thing to do is to have the east side be a bypass channel and have new development and the west side be for recreation.
This project is huge it will cost around 1 billion dollars and have a 12 yera construction time frame. It will have 3 bridges, a bypass channel, Isolation gates, dam, and channel lock. The first bridge will start construction next year. With this Trinity River Vision it brings 2400 acres out of the flood zone. To make the the project look even better 80000 trees will be planted and a 6500 person amphitheater will be built. Also mountain bike trails will be made and a ferry taxi will be on the river to get you from the stockyards all the way down to down town. What is really different about this project form the Dallas one is that the Fort Worth project has all of its financing in place. 60% of the project is federal and the rest comes from the water district and the city. The project is on schedule and I can't wait to see it completed. It looks like a great place for tourism and also a great place for residents to go wind down and have some fun. All together it was a great presentation.