AOL Real Estate - Blog http://realestate.aol.com/blog AOL Real Estate - Blog http://realestate.aol.com/blog/media/feedlogo.gif AOL Real Estate - Blog http://realestate.aol.com/blog en-us Copyright 2012 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/Brooklyn Condo Rewrites NYC Luxury Pricinghttp://realestate.aol.com/blog/2010/06/17/brooklyn-condo-rewrites-luxury-pricing/http://realestate.aol.com/blog/2010/06/17/brooklyn-condo-rewrites-luxury-pricing/http://realestate.aol.com/blog/2010/06/17/brooklyn-condo-rewrites-luxury-pricing/#commentsFiled under: ,

OK, kids. Get out your pencils and show your work: When something new in a former industrial area costs less than half of something old in a classic neighborhood, will lots of people buy it?

The Pencil Factory, so named because it used to be a pencil factory, consists of 93 one-bedroom (starting at $372,000) and two-bedroom apartments (starting at $535,000) a couple of short blocks from the Brooklyn, N.Y., waterfront. It covers three lots, attaching a new brick-clad structure to a landmark site where the pencils once flowed. And it may be the cheapest deal in New York City for a buyer who wants to live the lush life (and doesn't mind the rumble of passing trucks).

On Wednesday, according to broker Hans Schenck of Prudential Douglas Elliman, nearly four dozen folks from New York's brokerage community partied on the Pencil Factory rooftop. What made them so giddy?

Nothing less, it seems, than the return of luxury new construction to Gotham's anxious market.
According to Schenck, who showed off a staged unit this morning, response has been "overwhelming" since the property began pre-construction sales earlier this year. Prudential says it has entered contracts on 41 of the 93 units. (Schenck also mentioned that architect Daniel Goldner was so pleased with the construction that he's buying a unit -- which is either a sign that the price is right or a sign that a developer is trying to goose sales.)

The sales proposition is pretty clear: a lot of goodies for not much scratch. Greenpoint is solidly commutable to most business districts in New York, now that a two-lane bike path to the Williamsburg Bridge sits a block from the Pencil Factory's door. There are hipster bars and at least one muffin shop. There's an emerging little park. And in the building there will be a basement gym; a pool table and a Wii; a catered kitchen; an off-site surveillance system; and a washer and dryer in every apartment.

All that for, on average, $515 per square foot for a one- or two-bedroom. Not exactly crazy, especially if you can get a sweet mortgage.

So is the Pencil Factory heralding a new normal in New York real estate -- one where waterfront access, space, and common-area perks mean more than prime location? The once-unrelenting combination of cushy amenities and hurry-up construction has left a lot of Manhattan buyers in debt -- and sometimes in court. Small wonder, then, that a new property at the edge of gentrified Brooklyn sells most of the perks that came standard in Manhattan's boom -- at less than half of Manhattan's peak.

Call it the new math.

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]]>amenitiesbike lanesbrooklyncondosgentrificationgeo:40.730999+-73.959458greenpointpencil factorywaterfront real estatewilliamsburg bridgeAlec Appelbaum2010-06-17T17:02:00 00:00Fannie Mae in Talks on Green Energy Initiativehttp://realestate.aol.com/blog/2010/05/20/fannie-mae-mortgage-program-thwarts-green-energy-initiatives/http://realestate.aol.com/blog/2010/05/20/fannie-mae-mortgage-program-thwarts-green-energy-initiatives/http://realestate.aol.com/blog/2010/05/20/fannie-mae-mortgage-program-thwarts-green-energy-initiatives/#commentsFiled under: ,

Fannie Mae still speaks loudly in the housing market, and a quiet letter it sent has led to intense negotiation about the future of green financing that could seriously affect your mortgage payment and your planet.

In a HousingWatch exclusive, we have learned that influential players inside and outside government are mediating between Fannie Mae and proponents of new, more-affordable financing for green homes. The new financing comes in the form of PACE bonds, which could make green retrofits more widely available to homeowners.

But they also can threaten the government-sponsored agency's first claim on mortgages.

To understand the flap, it helps to imagine Fannie and Freddie as chastened adults who have exhausted their funds and moved back in with Mom and Dad. They want desperately to show that they will no longer take on undue risk when using someone else's money.

Now imagine the PACE (property-assessed clean energy) bonds program, authorized in a handful of cities and states, as the eager younger sibling with cool friends who wants some angel capital from Mom and Dad.
PACE bonds are loans to help homeowners invest in energy performance. They are repaid through an assessment that attaches to the home's property taxes -- so the debt stays with the house, not the person, if the person sells the house. The home should, in theory, fetch a higher price because of its lower energy costs, so the debt would not impede a sale.

But the lien would get in the way of Fannie and Freddie Mac's first claim on the mortgage. And that's where negotiation has begun.

On May 5, Fannie Mae issued a terse "lender letter" with ambiguous language but an obvious point: PACE bonds, as they evolve, had better not get in Fannie's way.

"Fannie Mae supports energy-efficiency initiatives, and is willing to engage with federal and state agencies as they consider sustainable programs to facilitate lending for energy-efficiency home retrofits," said the letter, "while preserving the status of mortgage loans originated as first liens."

Translation: We got here first and we're getting out first.

So Fannie wants to protect its, um, interests while looking cooperative with the Obama Administration's goals. Why can't they negotiate a solution in meetings, rather than through menacing letters?

"This is being discussed as I speak," said someone with an inside track on Fannie's governance, who insisted on anonymity to avoid roiling the markets: "You can imagine that there might be a second lien that would be shorter than the duration of the mortgage and be paid out of the savings on energy bills."

To be fair, noted the source, the Federal Housing Administration is more nervous about losing collateral to a PACE bond because FHA loans have even less equity. Officials at Fannie and Freddie did not respond to a request for comment.

Jonathan Rose, a respected developer and green advocate, has been leading efforts to get Fannie and PACE proponents together. He told me he can sympathize with both sides.

"Fannie and Freddie are afraid," Rose said. "Say somebody buys a house, does the improvements, and sells after five years. Then the taxes are higher than the taxes on comparables. The market does not look at energy costs per home, but they do understand taxes."

Fannie would be loath to accept a mortgage for a lower amount -- or anything else that would reduce its asset recovery.

For Rose, one part of the solution entails making a home's energy use visible in its sale price. "The problem can begin to be solved if you have energy-use labeling with home sales," he said. But this is unlikely to assure Fannie that a PACE house will get a higher sales price, Rose reasoned, because the seller may have invested in efficient technologies and then used them poorly. "These things are deeply behaviorally dependent. They are not an absolute guarantee."

Insiders expect that as PACE evolves, the mortgage giants will ensure that eligible borrowers must be current on their taxes and on their mortgages.

"My sense of the solution is to start with a test, and really work out standards and underwriting criteria with one PACE program," Rose said. "But all that stuff can be figured out, and should, so we can get this thing to scale."

Meanwhile, you'll have to do your own sleuthing to figure out how a home's energy use might affect its overall value. It's worth some research, for both your pocketbook and the planet's sake.

 

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]]>energy efficiencyFannieMaefreddieMacFHA loansJonathan RosePACE bondsproperty taxesunderwater mortgagesAlec Appelbaum2010-05-20T17:00:00 00:00Will Right-to-Rent Act Rescue Foreclosed Owners?http://realestate.aol.com/blog/2010/05/03/will-right-to-rent-act-rescue-foreclosed-owners/http://realestate.aol.com/blog/2010/05/03/will-right-to-rent-act-rescue-foreclosed-owners/http://realestate.aol.com/blog/2010/05/03/will-right-to-rent-act-rescue-foreclosed-owners/#commentsIf your lender forecloses on your mortgage but lets you stay in your house as a tenant, is your real-estate saga more likely to have a happy ending? A new law making its way through the House of Representatives may give you the chance to find out.

The riddle for most cities plagued by foreclosure involves solving two problems at once: helping banks recover unpaid mortgage bills while helping people stay in their homes.

If the banks write off bad loans, they have no money to lend to other borrowers; if the banks foreclose and evict on every owner who can't make a payment, cities empty out. What to do? Raul Grijalva (D-AZ), an ally of House Speaker Nancy Pelosi, has proposed a solution for defaulting owners of "moderate-value homes."

Grijalva's "Right to Rent Act of 2010," introduced on Tax Day, would basically keep the homeowner from having to look for a new house. It works as follows.An owner-occupant, within a week of getting a foreclosure letter, can agree to pay "fair market rent," as determined by an appraiser under the oversight of a judge. As long as the owner--er, tenant--keeps paying rent (subject to adjustments to reflect market comparables), the lender or new owner cannot carry out an eviction "at will."

In theory, this aligns with a lot of enlightened thinking about housing after the subprime meltdown. Thinkers like economist Robert Shiller and the developer-funded sharpies at the Urban Land Institute have concluded that the American obsession with home-ownership distorted the mortgage market, bloated Fannie Mae and Freddie Mac, and tied up too much wealth in collateralized hoo-hah. Not everyone, the reasoning goes, needs to be a homeowner.

But in practice, it's hard to see how this law -- which is just in its first stages -- would financially protect people who owe more than their houses are worth. Are many of these people, caught in the economic updraft, now earning enough to pay a market-compatible rent? Are many of them in housing markets that are so depressed after the mortgage meltdown that rents are cheap across the board? And if the latter is true, how will turning troubled borrowers into troubled renters help cities regain economic strength?

Only the data knows for sure- and while it's encouraging, it isn't quite telling. "Homeowners who are simply underwater would likely be able to afford market rents," says Ingrid Gould Ellen, an economist at New York University who helped current Housing and Urban Development secretary Shaun Donovan prepare for his job. "Of course, the answer is different for unemployed borrowers who are defaulting because they have lost their source of earnings. It's really hard to figure out what to do for these borrowers."

Ellen points out that if the bubble has burst in your town, mortgage payments should be about the same as fair market rents, since nobody should be jacking up home prices on unrealistic expectations of getting rich. Which reminds me: shouldn't a right-to-rent law give lenders some claim on the real value of the house as it appreciates?

Normally, I'm all for anything that will make any neighborhood more densely populated, and I'm certainly going to follow this bill with interest. So far, though, it seems less vital than legislation that would reattach mortgages to the banks that made them.

Letting owner-occupants rent is intriguing, but it wouldn't equal the folly of letting bad-mortgage-bundlers walk.

 

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]]>fannie maefinancial reformForeclosuresNancy PelosiRaul Grijalvaright to rentrobert shillerurban land instituteAlec Appelbaum2010-05-03T18:00:00 00:00Drew Carey Is Wrong About Clevelandhttp://realestate.aol.com/blog/2010/04/29/bill-oreilly-and-drew-carey-plan-clevelands-next-century/http://realestate.aol.com/blog/2010/04/29/bill-oreilly-and-drew-carey-plan-clevelands-next-century/http://realestate.aol.com/blog/2010/04/29/bill-oreilly-and-drew-carey-plan-clevelands-next-century/#commentsUrban planning is architecture's less glamorous sibling: If architecture gets Brad Pitt as a celebrity student, it's only fitting that planning gets TV's Drew Carey.

Carey grew up in Cleveland, a city that desperately needs better public schools and better prospects for the professional people who want to live in its historic neighborhoods--but who can't justify the risk. Starring in a recent video sponsored by a libertarian magazine, Carey helped depict Cleveland's government as a pack of buffoons who have strangled free enterprise. The show implied that if only Cleveland could be more like Houston, which has no zoning law, it would really become a city of attractive neighborhoods.

Trouble is, Carey is more skillful at matching prices on TV than at matching policies to marketplaces. Plenty of cities with rich zoning laws have also created great neighborhoods after periods of decline. It's too easy to blame zoning for a host of depressing problems.

Which is where Bill O'Reilly and John Stossel come into the story.
Here's how it happened. Last month, as part of his gig hosting a series on Reason.tv, Carey introduces a searing look at Cleveland's failures.

The program visits a feckless government-employed market manager, an aggravated (Latino) would-be entrepreneur and a frustrated yuppie (white) couple fed up with underperforming schools.

It then chronicles a saga in which Wal-Mart came to town: A Houstonian cheerleader named Dan Bellow boasted of how quickly developers could get projects in the ground.

The message: Cleveland's "22 different" zoning designations made revitalization impossible.

Stossel and O'Reilly took up the message on O'Reilly's show last month. (But you have to wait out a Prilosec ad before you see the video. Ironic? You tell me.)

Like most ideology, this all feels brilliantly clear and leaves out a lot of inconvenient details. For instance, it's access to well-paying jobs and low-permitting costs, not just the lack of zoning, that makes Houston hum.

A town I used to cover in upstate New York has no zoning: Its main claim to fame now is a cement plant while its comprehensively planned neighbor, Hudson, has become a weekend hangout for Cindy Crawford and other posh antiquers.

New York, Boston and San Francisco -- and even New Haven -- have complex zoning codes that preserve neighborhoods' look and feel. They also have neighborhood-led public debates that keep entrepreneurship, mixed-use and help for the needy in balance.

They're also more desirable places to live -- for people who want the best amenities and most exciting neighbors -- with housing prices that have historically performed strongly over time.

Houston's solution was right, in the most obvious ways, for Houston. But to say that zoning is dumb and leads only to stagnation is worse than a joke: It's an illusion.

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]]>bill oreillyclevelandDrew Careygeo:41.499401+-81.695602houstonJohn StosselTXzoningAlec Appelbaum2010-04-29T16:20:00 00:00Affordable Housing Finds a Home in New Hampshirehttp://realestate.aol.com/blog/2010/04/26/affordable-housing-finds-a-home-in-new-hampshire/http://realestate.aol.com/blog/2010/04/26/affordable-housing-finds-a-home-in-new-hampshire/http://realestate.aol.com/blog/2010/04/26/affordable-housing-finds-a-home-in-new-hampshire/#commentsFiled under: ,,

What's the first phrase that "New Hampshire" brings to mind? Do you think "town hall meeting," "tax-free liquor" or "outer Boston suburb"? You'd get, at most, partial credit for any of those answers.

But if you say "first state in the union to get real about housing for working people," you'd be in a smart position to talk -- and even to invest. Because, indeed, the Granite State has passed the most intelligent law in the country to help middle-class people live near their jobs.

And it's working.

The measure, known as the "Workforce Housing Law," operates like this: Any developer who suspects that a town has stalled on a project that provides "workforce housing" can take the town to court and get a review within six months. It defines workforce housing generously as dwelling places affordable to renters who make 60 percent or less of an area's median income, or to buyers who earn less than the area's median income.

Since the law became official on Jan. 1, towns with names like Londonderry, Stratham and Manchester have endorsed it -- making New Hampshire an unlikely beacon in the national fog over how to create affordable housing for middle-income families.

The law grew out of the interpretation of a 1991 lawsuit and, according to New Hampshire Housing Finance Authority spokesperson Ben Frost, some careful political ballet. It exempts projects that are mostly for singles or couples or retirees. And it leaves towns free to impose restrictions over environmental concerns, including water access. (For a surprisingly legible rundown of the law, view this presentation.)

Most important, it proves that people can live in close quarters in a manner that benefits developers, local businesses and the public coffers. Robert Tourigny is head of NeighborWorks of Greater Manchester, a local chapter of a national housing nonprofit. He e-mailed Frost while the housing-authority spokesperson was addressing a conference in New York, announcing to him that a 16-unit project would go forward.

I caught up with Tourigny via e-mail later. "If not for the recently passed workforce housing legislation, this project would not be happening," he said. "This will be built on a 1.67-acre site. That's 10 units per acre! High-density in these towns is usually considered three or four units per acre."

If our economy is really recovering, we're going to add jobs faster than we add land for new housing or supply financing to rehab the housing that was abandoned in the subprime mess. And our leadership from Washington is muddled on the question of how a developer can rise above local flak. A law like New Hampshire's could be a bellwether as states struggle to provide a trustworthy channel for growth.

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]]>affordable housingdevelopersnew hampshirepermitssmart growthworkforce housingAlec Appelbaum2010-04-26T16:40:00 00:00New York Tenants Take Over Buildings With Small Downpaymentshttp://realestate.aol.com/blog/2010/03/25/new-york-tenants-take-over-buildings-with-small-downpayments/http://realestate.aol.com/blog/2010/03/25/new-york-tenants-take-over-buildings-with-small-downpayments/http://realestate.aol.com/blog/2010/03/25/new-york-tenants-take-over-buildings-with-small-downpayments/#commentsFiled under:

Tenants: have you ever thought you could do a better job keeping up your building than your landlord does? With help from a tireless advocate, some New York City renters are about to get the chance to do just that.

The familiar story -- a building stays full despite questionable maintenance, a landlord fails to pay taxes, the city takes over -- has a happier ending in the Bushwick, Brooklyn and Morningside Heights, Manhattan, just south of Harlem. A group called the Urban Homesteading Assistance Board (UHAB) has corralled a loan for acquiring tax-delinquent properties and a grant to help long-time tenants become shareholders in a new capital structure for the buildings.

And in one case, the renters only had to come up with $2,500. Here's how it works.
With $2,500 of their own money and a part of a $33,700 grant from the state, tenants at the six-unit 164 Bleecker St., in Brooklyn's Bushwick neighborhood are going through paperwork to become owners in the new limited equity co-op. Most of them have been in the building for years, said UHAB spokesperson Dana Variano, one decided to stay a tenant. At 375 Manhattan Ave., in New York, N.Y., a much larger grant of $537,500 helped convert a 20-unit property to the new ownership structure.

In both buildings, a specialized lender called the National Cooperative Bank and the city provided financing, and the city's pension fund bought the bank loan. This is a well-established method for getting decrepit rental units back on the tax rolls and giving tenants the chance to become (property-tax contributing) homeowners.

The mechanics of creating a limited equity co-op place restrictions on reselling the units, but Variano says the restrictions rarely become an issue. "The deal is very advantageous for tenants," she said, "and most never want to move!"

UHAB has 87 buildings totaling 1,646 units en route to new ownership, Variano said. For tenants in tax-delinquent buildings, that pipeline suggests a route out of trouble.


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]]>bad landlordsbrooklynBushwickco-opgeo:40.6966+-73.91979geo:40.80481+-73.95698harlemmorningside heightsmorningside heights real estatenew york citynew york landlordsnew york real estatetax liensAlec Appelbaum2010-03-25T13:30:00 00:00Harlem Developer Gets Creative to Pull Off Financinghttp://realestate.aol.com/blog/2010/03/16/harlem-developer-gets-creative-to-pull-off-financing/http://realestate.aol.com/blog/2010/03/16/harlem-developer-gets-creative-to-pull-off-financing/http://realestate.aol.com/blog/2010/03/16/harlem-developer-gets-creative-to-pull-off-financing/#commentsFiled under:

The Jonathan Rose Companies had to worry a little in 2008, when a 10-parcel site it planned to develop as a rental with the City of New York in East Harlem sat idle because it couldn't find investors. Now, the site is busy with construction -- and looking like a solid performer in a neighborhood full of failed condos.

All it took was a little patience, and a willingness by the developer to find a way to finance it themselves.

The 12-story, 185-unit project in upper Manhattan, called Tapestry, is now coming together two blocks from a major subway and rail station with an airport link, a strategically useful site. And government money to serve a mix of market-rate and moderate-to-low-income working households would seem a surer premise than, say, a spec subdivision in Arizona. But sub-prime lending had scalded the economy so badly in 2008 that the Jonathan Rose Companies used its investment arm to raise $10 million of owner's equity -- roughly 15 percent of the $66 million project -- to move forward.
Now, the company's equity managers are expecting an upside from the project: Paul Freitag, the company's development director, says the building received 9,000 applications for 93 subsidized units. They will start leasing the other 92 next month, and say it should be occupied by May.

"At the time we were closing the deal, the bond market was absolutely frozen," said Freitag. Demand for the subsidized units was never in doubt, but financing was. The risk of shrinking tax revenues in public coffers may have worried other potential investors: New York City's Housing Development Corporation had provided the key capital, and it would have to get repaid before other lenders. In a down economy, government-sponsored loans look safer than private ones, which raised the risk that a private loan for the Tapestry would have gone unrecovered if the project never happened. So Rose Companies put owners' equity into the project. (Other public and nonprofit entities, including the developer Enterprise Community Partners, made smaller grants and low-income housing tax credits filled out the capital picture.)

Lettire Construction, the family-owned Harlem contracting business that managed the job, also evolved into an equity partner.

The project, like all Rose buildings, aims to prove that energy-efficiency and affordability play well together. The mixed-use, mixed-income apartment building at 124th Street and Second Avenue will be built to LEED Silver standards. Freitag said it will include a "green terrace" that leads to the gym and will recapture rainwater -- a crucial move in waterlogged Manhattan -- and send it to towers for cooling air to use in air conditioners. That means the rainwater will stay out of the city's crowded sewers.

The green credentials, plus the income mix, distinguish Tapestry from a somewhat crowded crop of upscale buildings arriving in traditionally low-income East Harlem. Freitag said some failed "luxury condo" projects nearby, now converting to rentals, will provide the company with comparables. (East Harlem came later to the property boom than central and west Harlem, which have a more solid middle-class base and a shinier reputation for historic brownstones.) But even if those buildings fill with tenants, as they probably will, Tapestry may offer a distinct upside to its investors. When you own the building and you're proud of the niche it fills, you get positive returns that last longer than any 30-year bond.


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]]>east harlemeast harlem rentalsequitygreen buildingharlemharlem green developmentharlem mixed-use developmentharlem real estateharlem rentalsJonathan Rosenew york real estatenew york rentalsrentalssewersAlec Appelbaum2010-03-16T14:15:00 00:00What Keeps New York Livable? Lots of Things, Including Carshttp://realestate.aol.com/blog/2010/02/26/what-keeps-new-york-livable-lots-of-things-including-cars/http://realestate.aol.com/blog/2010/02/26/what-keeps-new-york-livable-lots-of-things-including-cars/http://realestate.aol.com/blog/2010/02/26/what-keeps-new-york-livable-lots-of-things-including-cars/#commentsFiled under:

Bike clownsIt may be hard to believe, but a well-organized group of folks think New York City is too friendly to cars. And these folks have brought positive changes in New York over the past couple of years. So it shouldn't be surprising that some of them don't know when to quit.

A new screed against the city government on the influential site StreetsBlog reveals the difference between fighting to green a city and complaining if some things about a city don't fit your shade of green. Noah Kazis cries foul that the New York City government's recent rezoning of several economically sluggish neighborhoods makes ample provision for parking. It would be wiser, he says, to reject "parking minimums that erode the pedestrian environment."

Yep, with double-digit unemployment and service cuts on the subway system, with foreclosures in working-class neighborhoods and broken promises to build new affordable housing, what we need is ... parking reform?
Saying that New York cannot handle more cars ignores the fact that New York's transit system is stretched within an inch of its life. If the city plans for new residents and businesses in the short term but denies them places to park, it would come to a standstill. The city would have made the wrong choice between being "livable" and living.

The city is bravely playing a bad hand when it comes to mass transit. The state government, which is ranked the sickest in the nation, controls the mass transit agency and has just about bankrupted it. The agency is cutting more than 15 percent of its administrative staff and shutting down subway lines.

Into this environment, you want to ban parking from places that don't get enough mass transit now?

Let's think about how to make a high-density city grow. The greenest city we can have is the one that can sustain its economy through good times and bad. But if living in such a city becomes too unpleasant, it will get less high-density and will send people to live in lower-density, more car-dependent places.

Don't take my word for it. Rohit Aggarwala, the transportation historian who guides New York City's environmental agenda as head of the Office of Long-Term Planning and Sustainability, sounded this theme at an urban-design conference shortly after the 2008 election.

"I find a more sustainable approach is to talk about healthy cities," said the man in charge of reducing New York City's carbon output by 30 percent in the next 20 years. "Since average New Yorkers are responsible for only 29 percent of the carbon footprint of the average American, it's important that we not screw it up. If we want to support the most carbon-efficient economy in the United States, do we need to focus on design before basic city management?"

Aggarwala warned that day that worldwide emissions would go up and New York's vitality would go down if doctrinaire decisions sent businesses to "New Jersey or, God help us, Texas."

To be fair, StreetsBlog and its sources are only advocating "transit planning" -- land-use regulations that require space for mass transit service in these rezoned neighborhoods. But the zoning code can always change when the screwball transit agency rights itself. Until then, dedicating land and money to a hypothetical train line probably doesn't make much sense when your goal is to populate an underperforming neighborhood.

And StreetsBlog's purity has done a lot of good. I used to write for the site and have looked on with admiration as some of its mentors, like Jon Orcutt and Andy Wiley-Schwartz, have moved to senior jobs at the city's Department of Transportation and produced pedestrian plazas and bike lanes that make the city saner and cleaner for me and my kid. (Their boss, Transportation Commissioner Janette Sadik-Khan, likes to joke about the StreetsBlog influence that "the inmates are running the asylum.") But sometimes I think the ideal of car-free living undermines the practical business of keeping the city running.

What's more, creating space for more people in a rezoned neighborhood like Willets Point, Queens -- which is currently full of environmentally iffy uses like body shops -- means creating space for more protest, more activism, more entrepreneurship and more debate. And without economic growth, I suspect the transit system will get worse before it gets better- and more compact cities, like New Haven or Boston, might steal some of New York's young families and seniors.

And that's not the kind of walking anybody wants to see.

 

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]]>bicyclingcongestiongreen city transportationNYCnyc subwayplaNYCtimes squareTraffictransitzoningAlec Appelbaum2010-02-26T10:00:00 00:00An Architect's Journey into Haitihttp://realestate.aol.com/blog/2010/02/25/an-architects-journey-into-haiti/http://realestate.aol.com/blog/2010/02/25/an-architects-journey-into-haiti/http://realestate.aol.com/blog/2010/02/25/an-architects-journey-into-haiti/#commentsFiled under: ,

Andres Duany's housing plan for HaitiShortly after the devastating earthquake struck Port-Au-Prince, noted architect pioneer Andres Duany flew to Haiti with plans for building durable, affordable housing in the shattered country.

Duany, a celebrated archtitect who has masterplanned whole towns and claims to have written the definitive book on "smart growth" had big plans. He was going to put in gorgeous cross-ventilated windows and porches. He was going to give the privacy of master bedrooms to families that had only known poverty. And once he arrived in Haiti, he saw his plans were nearly entirely wrong.

"I came with a confidence I should not have had," he told us.

He needed to put in fewer windows, even in the hot Haitian climate, because some folk traditions make windows the object of mistrust. He needed to rethink porches, because some families consider it unkind to eat in front of their houses when starving neighbors walk by on the street. And he needed to think less about rooms and more about beds--cramming in as many as would fit.

Yesterday, Duany debuted his design for prefab housing to go up in Haiti's cities and countryside after the immediate crisis fades. It is, by his count, the fourth or fifth pass he took at the designs.Duany said he had worked in post-Katrina New Orleans and destitute Jamaica but been unprepared for how firmly Haitians cling to tradition after the Port-Au-Prince earthquake. "There's a 30,000 bed deficiency," he said. "You think you can impose rational housing." But what we'd call rational, he said, some Haitians would call bizarre. Even in hot rural areas, some very poor people resisted cross-ventilating windows "because they believed spirits entered through open windows."

"Imagine the frustration," said the architect and co-founder of Duany Plater-Zyberg & Company, whose master-plan for the Florida town of Seaside inspired thousands of neoclassical subdivisions (and the set for "The Truman Show"). "You want to say: you have to have cross-ventilation or you'll boil your ass!"

But Duany's penchant for "New Urbanism"- a layout that favors curbs, traditional houses and porches - meant little to the victims of the quake. He said that input from Haitians on his January visit changed the interiors: master bedrooms are small so that there's more room along walls and floors for beds. At 590 beds per acre and 155-300 square feet per house, Duany said, he tried to create as many beds as he could without compromising structural soundness.

Andres Duany's housing plan for HaitiSo he hooked up with Miami building manufacturer InnoVida Holdings. The company is donating 1,000 homes in Haiti and planning to build a factory in the earthquake-ravaged nation that will open by the end of the year. Working with InnoVida's prototype, Duany created a hinged window opening that's "co-planar" with the InnoVida panel so it doesn't jut out. He learned which Haitians prefer to eat in the rear of their houses to avoid embarrassing passersby who have no food. He found a Swedish start-up, infelicitously called Peepoo that makes a bag that composts human waste for Haitians who prefer houses with latrines. ("At 590 beds per acre, the latrine doesn't work," Duany said crisply.)

These conditions in Haiti and their implications for housing design caught Duany by surprise, "I came in with a confidence I should not have had. That's why I had to do the design three or four times."

Duany briefly acknowledged that NGOs and others have ended Haiti's medical emergency, but he was hardly triumphal about the post-earthquake country. "What"s coming next is the housing emergency," he said.

 

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]]>affordable housingcaribbeandisasterhaitihaiti earthquakehousingnew urbanismVoodooAlec Appelbaum2010-02-25T17:45:00 00:00Atlanta Keeps Property Taxes Up, Poor Neighborhoods Downhttp://realestate.aol.com/blog/2010/02/19/atlanta-keeps-property-taxes-up-poor-neighborhoods-down/http://realestate.aol.com/blog/2010/02/19/atlanta-keeps-property-taxes-up-poor-neighborhoods-down/http://realestate.aol.com/blog/2010/02/19/atlanta-keeps-property-taxes-up-poor-neighborhoods-down/#commentsFiled under: ,

Atlanta neighborhoodAs if foreclosure-wracked neighborhoods aren't suffering enough, it seems they're also paying more in taxes. According to a study released yesterday by the Atlanta Neighborhood Development Partnership, homeowners in low-income neighborhoods in Atlanta that have been hard hit by the housing crisis were overcharged on property taxes by as much as $500 per household.

The problem lies with how states and local officials compute property taxes. They do it without taking the effect of foreclosures on home values into account -- leading to tax bills that can quickly exceed a house's value.

What's really painful, though, is that the neighborhoods in the study suffered a whiplash of investment and abandonment not so long ago. I know, because I helped make it happen.First, the study. The Atlanta Neighborhood Development Partnership (ANDP), an non-profit outfit with a board of directors as weighty as its name, makes grants and loans to promote housing in low-income neighborhoods. It found in 2009 that assessors were valuing houses in its target neighborhoods as if the subprime crash had never happened.

CEO John O'Callaghan told me that, while trying to budget a construction project, the partnership found that a house's annual property taxes would cost nearly $2,000 in a neighborhood where some houses are selling for just $25,000. So it hired Robert Charles Lesser, a respected assessment firm, to see what was out of whack.

The Lesser study pulled data from the FMLS, a multiple listing service, which the report says eliminated any artificially low sales figures from deals between friends or courthouse-steps auctions. In one ZIP code, it found, median property sales values were 79 percent lower than median tax values. Today, a sequel report came out. After a year of advocacy and some progressive legislation (as well as coverage by the Atlanta Journal-Constitution) , assessors have managed to bring tax calculations closer to reality -- but not fast enough.

"The 15 zip codes with the highest foreclosure rates saw an average decline in appraised value of 10 percent, compared to an overall average decline of 7 percent for the five-county area," said the report. But those 15 ZIP codes still contribute 41 percent of the region's tax overpayment.

The ANDP, said O'Callaghan, is trying to promote a law that would give buyers more time to appeal their assessments. This would follow last year's passage of a law requiring county assessors to consider "foreclosure impacts" in tax valuations.

There's something broader worth thinking about here. Foreclosures affect the value of paid-up homes because a house's price reflects the safety and coherence of its neighborhood. In the mid-1990s, I worked at ANDP, helping raise money for housing construction in poor neighborhoods near intown Olympic venues. In some cases, nonprofits were working smartly in these neighborhoods to bring well-managed housing and retail. In other cases, money was moving in faster than expertise. The neighborhoods are still poor.

In the late 2000s, money rushed back into these neighborhoods again in the form of subprime loans. There's a lesson to learn here: money to build great urban neighborhoods should come in small increments, with lots of due diligence, and lots of work to make sure that houses and commercial and educational uses grow in sync.

But as the study shows, nobody has figured that out yet -- which may be the most taxing problem these neighborhoods face.

 

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]]>Atlantaforeclosure impactshome appraisalproperty taxessubprime loansAlec Appelbaum2010-02-19T11:45:00 00:00Green Benefits? 'None' Concedes Developerhttp://realestate.aol.com/blog/2010/02/11/green-benefits-none-concedes-developer/http://realestate.aol.com/blog/2010/02/11/green-benefits-none-concedes-developer/http://realestate.aol.com/blog/2010/02/11/green-benefits-none-concedes-developer/#commentsFiled under: ,

the Kalahari in Harlem, NYCYou see them advertised all over: those shiny new buildings that are both luxurious and eco-friendly. But does buying a "green" unit make you better off? Not according to the developer of one such condo project.

A building in Harlem advertises itself as "the hybrid home," where "luxury meets green." I recently asked the developer to explain what economic advantage his building's green features had given to its buyers.

His answer? "None."

Ah, the things people say when they don't know you're a reporter (though I was holding one of those flipbook notebooks).
The developer, Ron Moelis, was addressing a conference sponsored by the Urban Land Institute about how to build housing that working-class and middle-class people can afford in pricey areas. At the panel -- in the lobby of the Kalahari in Harlem, which Moelis' L+M Development Partners built with a Harlem partner, some Goldman Sachs equity and a big loan from JPMorganChase -- he explained that the green features didn't give buyers better pricing on mortgages or faster closings.

Aren't green features supposed to save money? Sure. And wouldn't that make green buyers better mortgage risks? Maybe. But green claims often outpace green reality. Moelis had "big fights with the engineers," he said, because the purported energy-saving measures in common areas couldn't produce verifiable cost savings compared to other jobs.

Developers often tell reporters that they go green because "it's the right thing to do." But it's an open secret that many buildings (like the Kalahari) boast of building to the famous LEED standard without actually getting certification. The other open secret is that LEED ratings have historically measured promises, not results. (LEED's governors promise that's changing now, as I'll detail in a future post.)

So lenders discount such claims. Green buildings have their fans: Moelis said the city (which basically donated the land) liked the green features, and so did the community. And sure, you'll probably save some money on your utility bills. But, says Moelis, "I didn't see lenders reacting in any way."

Indeed, while Moelis was talking, a slide from his PowerPoint behind him showed why. The Kalahari, the slide said, was "designed to consume 31% less energy than a standard building."

Designed to, sure. But does it? It's hard to know. Here's hoping Moelis' candor inspires homebuyers and lenders to demand measurable green performance -- and reward those who produce it.

 

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]]>greengreen buildinggreenwashharlemKalahariron moelisurban land instituteworkforce housingAlec Appelbaum2010-02-11T16:00:00 00:00Greening Codes to Save Greenhttp://realestate.aol.com/blog/2010/02/11/greening-codes-to-save-green/http://realestate.aol.com/blog/2010/02/11/greening-codes-to-save-green/http://realestate.aol.com/blog/2010/02/11/greening-codes-to-save-green/#commentsFiled under:

Green apartment building in Lower ManhattanEnergy codes, the laws that set minimum levels for energy efficiency in buildings, are getting updates throughout the U.S., most ambitiously in New York City. The changes that can make a big difference are easy to grasp. And they benefit renters and owners at the developers' expense.

Saving money at someone else's cost -- that should grab your interest.....The Urban Green Council, a New York chapter of the national organization that administers LEED ratings, canvassed 200 big shots (from the commissioners of planning and buildings to the developer who controls Penn Station and the president of NYU) over the past year to get suggestions on how the city could change its code.

Many of the recommendations, released earlier this month, would simply make the law require an end to lots of wasteful practices. Apartment dwellers would be able to control their own heat. And motion detectors would turn off lights in empty stairwells, or they would control and reduce lighting in unused laundry rooms of apartment buildings. These seemingly small changes are important, argues economist Ashok Gupta of the Natural Resources Defense Council, who worked on the codes, because they set new baselines for what every owner must do. If implemented, such code changes would lower residents' electricity bills in all multiple-unit buildings.

So why would anybody object? Simple: developers are often set in their cost-cutting ways.

Charlotte Matthews, who heads construction for mega-developer the Related Companies and also worked on the new recommendations, says changes in the outfitting of a building can cause "turbulence." In other words, developers are used to eking out profits from doing some things cheaply, and their lobbyists are ready to argue that no developer should have to spend extra cash so that citizens can save money (and carbon) over the coming decades.

So the Urban Green Council is soft-pedaling their effort to make the codes official. The new codes' proponents also have the implicit support of Related, the city's most powerful developer, and of Mayor Mike Bloomberg. With energy-code reform around the country moving faster, code proponents can argue that their changes will make New York's buildings more attractive for potential residents than those less code-abiding buildings in the "sand states" of Arizona, Florida, California and Nevada.

All that from a little common sense.

 

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]]>building codesenergy efficiencygreen livinggreenwashnew york cityretrofittingwater supplyAlec Appelbaum2010-02-11T14:36:00 00:00Does This Building Make Me Look Fat?http://realestate.aol.com/blog/2010/02/03/does-this-building-make-me-look-fat/http://realestate.aol.com/blog/2010/02/03/does-this-building-make-me-look-fat/http://realestate.aol.com/blog/2010/02/03/does-this-building-make-me-look-fat/#commentsFiled under:

Every February 2, hundreds of (health) nuts run up New York City's Empire State Building. But the city as a whole, despite its culture of walking and seemingly insane runners, is basically trudging towards obesity. But there's hope! A new set of design guidelines, developed with local and national architects, aims to reverse that trend.

The Active Design Guidelines, which four whippet-thin city commissioners unveiled last week at the city's Center for Architecture, represent urban planning's farthest reach as a lifestyle nudge. And they follow common sense. For instance, make a building's staircase well-lit and central (and easy to keep clean) and more people will use the stairs. Put bike parking and showers in office buildings and more people will bike to work. Create nifty plazas with benches and space to spread out and people will walk to them.

But there are more suggestions that could apply in a residential building.

Can New Yorkers think of staircases less like ways out of the subway and more like amenities?


In apartment buildings, the guidelines suggest, mail rooms and management offices should be on adjacent floors "or a pleasant walking distance from individual residences." The thinking is that if you make "daily bouts of walking" necessary to get errands done, people will end up exercising without making a point of it.

The new Cooper Union campus, designed by mischievous superstar architect Thom Mayne's firm Morphosis, includes a shimmering winding staircase and elevators that don't stop at every floor- a tactic that the guidelines endorse and suggest "where feasible."

Also, the guidelines urge condo and co-op owners to spend their common bucks sprucing up in-building playrooms and fitness rooms (Running around outside is so '80s). "High ceilings and generous lighting help make physical activity more convenient and appealing," the guidelines say.

The guidelines have no force of law, but proponents say the approach they describe can make fitness-focused design a clearer win for developers and brokers. And, yes, apartment dwellers.

Now, if you think this all sounds like guidance only for New Yorkers who live vertically, think again. The guidelines urge the placement of farmers' markets and grocery stores selling fresh produce "within walking distance in all residential neighborhoods." That's something any city can aim to achieve with tax incentives and cooperative programs.

Indeed, the guidelines' basic logic- that people will move around if moving around seems pleasant- can fit a suburban plan. Maybe a developer would consider creating walking trails or an outdoor training area rather than contain would-be health enthusiasts in a cramped exercise room. But New York has no lock on fitness-focused design. Just ask Craig Zimring.

Zimring's the Georgia Tech professor who advised New York on creating the guidelines. At the kickoff event, he confessed that he got some funny looks from colleagues when he explained his mission: "coming from Atlanta to make New York more walkable." Maybe that's because walking two blocks in the Big Peach is as heroic as running up the Empire State Building in the Big Apple.

But wherever you are, active living begins at home.

 

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]]>building designdesignfitnesshealthjoggersnew york cityobesityrunnerrunnersstairsstairwayswalkingAlec Appelbaum2010-02-03T12:27:00 00:00Replace Your Old Driveway with One that Sucks (Water)http://realestate.aol.com/blog/2010/01/28/replace-your-old-driveway-with-one-that-sucks-water/http://realestate.aol.com/blog/2010/01/28/replace-your-old-driveway-with-one-that-sucks-water/http://realestate.aol.com/blog/2010/01/28/replace-your-old-driveway-with-one-that-sucks-water/#commentsFiled under:

Green roofs are pretty, energy-efficient, and easy to understand. But they're expensive to set up and often can't coexist with a house design due to load-bearing issues. So why not green your driveway instead?

A landscaped (or 'living') driveway sucks up rainwater, which decreases the amount of runoff that is routed to the local sewer system. It also prevents the heat buildup that occurs when the sun hits concrete or asphalt- and it doesn't crack over time. And it can look good enough to make the neighbors jealous.
Olde Cypress, Florida offers a glimpse of what may become a trendy way to reduce your house's ecological footprint. According to the Naples News, landscape architect Chris Busk got a gig reinventing a driveway at a home in Olde Cypress with "turf blocks [full of soil], pavers and zoysia grass." Zoysia is a heat resistant variety of grass native to Central Asia and Busk tells the Naples News that the owners will never need to cut it. He does warn that they should avoid letting cars sit directly on the grass since zoysia needs eight full hours of sun.

In Syracuse, NY, a nonprofit called the Center of Excellence proposed an experimental landscaping treatment for the driveway of 515 Marcellus Street, a home in the dilapidated Near West Side. The homeowner agreed, says Center director Ed Bogucz- and the resulting pebbly-and-frondy driveway has soaked up rainwater since its creation in 2006. (It's slide 22 in this presentation.) And in Toronto, a blogger Franke James chronicled her development of a green driveway in 2007 and 2008, which led to this story in Toronto's National Post.



You can also make your driveway absorb water with a cheaper fix. Nonprofits have been championing rain-drinking driveways for at least three years. A photo essay on the American Society of Landscape Architects' site shows how rain garden and pervious-pavement features went into a home in Minneapolis' Marcy-Holmes neighborhood (where slanted roofs and more runoff is common). Even though the driveway isn't totally green, it does make the landscape healthier (and cooler).

But back to the living driveway. Of course, finding and installing exotic grasses and turf blocks costs more than planting crabgrass. But consider the costs, time, and precious summer days you save from the agony of asphalt or concrete repair.

 

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]]>designdrivewaygardengrassgreengreen rooflandscapelandscape architectlandscape designRainbowSixVegasrunoffAlec Appelbaum2010-01-28T17:15:00 00:00Lose the Car, Keep Your House?http://realestate.aol.com/blog/2010/01/27/lose-the-car-keep-your-house/http://realestate.aol.com/blog/2010/01/27/lose-the-car-keep-your-house/http://realestate.aol.com/blog/2010/01/27/lose-the-car-keep-your-house/#commentsFiled under: ,

Attention lenders: pedestrians are better risks!

A new study of mortgage defaults in three cities concludes that people who live in areas where they don't need a car are less likely to default on their mortgages than people who live in suburban sprawl. In fact, the likelihood of default went up with the number of cars a household owned.

The study, released today by the Natural Resources Defense Council, suggests that mortgage lenders might consider where someone lives when pricing a loan. The logic: if your car isn't sucking up cash, you have more to pay your mortgage debt.

Specifically, the study found that "default probability increases with the number of vehicles owned." What's more, the findings held true for buyers at different income levels.

The study analyzed 40,000 mortgage records in Chicago, Jacksonville and San Francisco covering loans of different amounts and terms, as well as a census records on car ownership and other data.

The results bolster the case for "location-efficient mortgages" -- a small but growing pool of loans that consider a property's closeness to public transit.

They also suggest that the common practice of "driving until you qualify" -- trekking further and further from the urban core to find a house cheap enough to finance -- is a dead end, says Congressman Earl Blumenauer of Oregon, who endorsed the NRDC study. You'd be smarter to push your lender (and your government) to recognize that your money could be better spent on housing than on gas, car insurance and maintenance.

The findings make sense. Not having to pay off a car loan or buy insurance or gas frees up cash for mortgage debt. The researchers also argue that "location-efficient homes" might hold their value better than other homes, and therefore better enable borrowers to avoid foreclosure through selling or refinancing. (And maybe a bank officer will just be in a friendlier mood if she can take the subway to your house and get a latte before your conference.)

Even a shaky borrower, the study says, can look more creditworthy in a high-density setting. An average borrower in an average Chicago neighborhood, it said, will default in 9.9 percent of cases. But get this: a borrower with the same risk profile in a more compact neighborhood is almost a third less likely to default. And a borrower with a debt/income ratio of 62.5 percent, in a more compact neighborhood, would be no riskier than the more solvent borrower in the typical neighborhood.

NRDC , an advocacy organization, hopes to influence mortgage lenders with the data. It also hopes to influence regulators, said NRDC planner Jennifer Henry in an interview with HousingWatch. "We would say to the government: the kinds of cities we're building, which are influenced a lot by your zoning codes and level of transportation investment, affect how people are able to pay their mortgages."

 

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]]>location-efficient mortgagesmortgage defaultsNRDCsuburban sprawlAlec Appelbaum2010-01-27T16:00:00 00:00Cheap Lube Costs Lives in NYChttp://realestate.aol.com/blog/2010/01/26/cheap-lube-costs-lives-in-nyc/http://realestate.aol.com/blog/2010/01/26/cheap-lube-costs-lives-in-nyc/http://realestate.aol.com/blog/2010/01/26/cheap-lube-costs-lives-in-nyc/#commentsFiled under: ,

Hidden away in the basement of many big New York City buildings is a dirty secret that could be costing New Yorkers their health, even their lives: boilers that burn cheap and dirty oil.

A new report from New York University's Institute for Political Integrity says the city could save up to 188 lives annually if landlords quit using "residual oil," the sooty leftovers from petroleum, to heat their buildings.
In its place, the authors recommend cleaner natural gas.

The study, "Residual Risks," says that soot and toxins from the cheap oil are polluting the air and the windpipes of people who live and work near the buildings. The oil, called #6, is the thickest and dirtiest grade you can buy -- generally the stuff left over after the distillation of petroleum. The pollution it causes "can travel deep into the lungs... and even slip directly into the bloodstream," according to the authors. The soot has been linked to heart disease and asthma, which already occur disproportionately in poor, urban areas.
The authors say the residents of these poor areas are victims of a policy lapse. They draw on readings of nickel, a heavy metal associated with residual oil that can lodge in the lungs, in the air around clusters of buildings in New York City. By tracking nickel concentrations during summer and winter, the researchers estimate the amount of gunk -- the technical term is particulate matter 2.5 or PM 2.5 -- emanating from boilers that use the cheapest grade of oil.

Buildings using the dirty fuel generate up to 29 percent of locally-generated wintertime soot in the city, the researchers found (the majority comes from mid-western power plants, but that's another battle). Since some 9,000 commercial and residential buildings in New York use the stuff, the report contends, it's the city's business to wean landlords off it.

It's not like #6, which resembles tar, is anyone's pride and joy. Mike Livermore, the Institute for Policy Integrity's director, tells me residual oil has lost most of its customer base -- the holdouts being marine vessels and big old buildings in the big old Big Apple.

All the more reason to phase it out. The report argues that the health benefits that would come from requiring landlords to burn something cleaner -- even lighter #2 oil, if piping natural gas doesn't seem feasible -- add up to $5.3 billion over 20 years. They also figure an extra $111 million in annual health benefits for faster conversion, to account for increased productivity after avoided deaths.

Tenants' rights often meet stiff resistance in policy debate. "Landlords are delaying the inevitable," Livermore told me. The data here, though, makes the dirty truth harder to wipe away.

 

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]]>boilersheating oilInstitute forspsnotreqdPoliticalspsnotreqdIntegrityNatural GasNew YorkspsnotreqdCityresidual oilAlec Appelbaum2010-01-26T16:25:00 00:00Treasury Ends A Successful Aid Programhttp://realestate.aol.com/blog/2010/01/14/treasury-ends-a-successful-program/http://realestate.aol.com/blog/2010/01/14/treasury-ends-a-successful-program/http://realestate.aol.com/blog/2010/01/14/treasury-ends-a-successful-program/#commentsFiled under:

The Treasury Department recently announced it was ending a little known program that has successfully stoked states and cities with $23 billion in credit to boost their housing finance efforts. The program, called the Housing Finance Agency (HFA) initiative, has been a bright spot, accomplishing what it set out to do. So why are we winding it down?

The initiative has two parts: the New Issue Bond Program (NIBP), which supported new lending to homeowners by state and local HFAs, and the Temporary Credit and Liquidity Program (TCLP), which backed bonds and shored up existing debt for 90 state and local FHAs. All told, the program has helped over 200,000 homeowners, according to The treasury Dept.

Fitch Ratings late last year upgraded Utah's housing agency, thanks to the HFA initiative, and saluted Idaho's use of the credit. New Hampshire used the Federal backing to build multifamily properties and offer 30-year mortgages at historically low rates -- as cheap as 4.375% with one point in late December.

It might be worth extending a program that had such demonstrable results. Surely we're not out of the woods yet.

 

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]]>affordable housingFHA loansFHAsFitch RatingsForeclosureshousing financespsnotreqdagencytimothy geithnerTreasuryDepartmentAlec Appelbaum2010-01-14T16:40:00 00:00Are E-Car Charging Stations The Next Must-have Amenity?http://realestate.aol.com/blog/2010/01/14/are-e-car-charging-stations-the-next-must-have-home-feature/http://realestate.aol.com/blog/2010/01/14/are-e-car-charging-stations-the-next-must-have-home-feature/http://realestate.aol.com/blog/2010/01/14/are-e-car-charging-stations-the-next-must-have-home-feature/#commentsFiled under:

Could recharging stations for electric cars be the next must-have accessory in upscale housing, now that wine cellars and bathrooms the size of some apartments are out of vogue?

Could be. Electric cars are all the rage at this week's auto show in Detroit. Manufacturers plan to roll out three models in the next three years.

Beyond the Motor City, the Obama administration seems serious about getting a million of these things on the road in the next five years. A McKinsey and Co. study announced this week by New York City Mayor Michael Bloomberg predicts that up to 15 percent of new cars in the Big Apple might be electric in that same time frame.

Problem is, all of those electric car batteries need to be recharged, and that requires infrastructure, in the form of a network of charging stations.
Tesla Motors, an early leader in making electric cars in the US, and competitor Better Place are investing heavily in battery-swapping and charging stations to tap electricity. So, will widespread adoption just add another income stream to gas station owners who diversify? Maybe not. The McKinsey study said consumers might well see freedom from gas stations as a reason to shell out for an early model. Moreover, ease of use and the economics of electricity both favor widely scattered sites for charging e-cars.

In London (pictured), they recharge cars at public stations that sit curbside. Onion Flats, a Philadelphia architect-developer included on-street charging stations in sketches for projects now underway in the firm's home city. Presuming that the early adopters will be the most status-conscious and deep-pocketed consumers (remember all those Hollywood celebs scooping up Hybrid SUVs?) one can imagine a time not far off when developers make access to charging stations a selling point when marketing high end condos and co-ops in New York, San Francisco and other well-heeled, progressive cities.

But think even more widely scattered than that: Tesla stresses how easy it is to juice up one of its cars at home. It compares a car to a cellphone or a clothes dryer. Moreover, alternative energy makes sense for powering electric cars-it feeds into the eco-orientation early buyers will likely have and mitigates the added stress that e-cars will put on the power grid. Alternative energy can come from alternative places - like homes.

Eventually battery technology will evolve, prices will drop and the trend will trickle out to the suburbs, where people increasingly like small, fuel-efficient cars for commuting and running errands. And where they have roomy driveways and garages for experimenting with things like solar panels.

SolarCity, which sells home charging stations for the Tesla, reckons a solar installation for an entire house would cost $16,500 after government rebates. Presumably, an array that only powers a car would cost much less, say around $5,000. If you figure that the average American drives 12,000 miles per year, spends $2.60 per gallon and get 20 miles to the gallon, then the owner of an electric car starts pocketing what he would be spending on gas in less than four years. And if homeowners want to pay for the prestige of an e-car, it stands to reason that they would pay for the privacy and eco-cred of being able to charge it up with alternative energy tied to their houses.

We're probably a long way a way from homeowners forfeiting sale value if they don't have e-car charging station in their driveway, but not as far away as you might think from the day that having such a power source adds value - or at least saleability. It's easy to see forward-thinking developers adding this feature as a perk to distinguish their housing cluster from the one down the road.

It's not as sexy as an oversize Jacuzzi tub, but it's way more useful -- and kinda cool.

 

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]]>battery powerdetroitdetroit autospsnotreqdshowDetroitAutoShowe-carselectric carsmckinsey co.new yorkspsnotreqdcitysolar powerteslaAlec Appelbaum2010-01-14T16:10:00 00:00Toll Brothers, the Elephant of Housing, Comes to Dumbohttp://realestate.aol.com/blog/2010/01/07/toll-brothers-the-elephant-of-housing-comes-to-dumbo/http://realestate.aol.com/blog/2010/01/07/toll-brothers-the-elephant-of-housing-comes-to-dumbo/http://realestate.aol.com/blog/2010/01/07/toll-brothers-the-elephant-of-housing-comes-to-dumbo/#commentsFiled under: ,

Toll Brothers, a national homebuilder that has struggled to implement its plain-vanilla housing formula in New York City's most populous borough, has paid $8.6 million for a parcel near the Brooklyn waterfront.

The company plans to build a 70-unit condominium in the hip, industrial Dumbo neighborhood, according to Brownstoner.com, but the plans have not become public.

News of the sale, which came right before Christmas but was only recently disclosed, follows talk of another residential development further north along the Brooklyn waterfront: the long-bruited redevelopment of the former Domino Sugar factory in Williamsburg by Community Preservation Corporation. In addition to converting the historic sugar refinery into housing, a $1.5 billion plan calls for new towers to be built for a total of 2,200 units of mixed-income housing.

It can be difficult to get ambitious new developments approved and built in the area. A public review of the Williamsburg plan is expected to drag on over the next several months.

While Community Preservation Corporation has a track record of building affordable housing and enhancing communities, Toll Brothers, one of the nation's largest homebuilders, is best known for flooding suburbia with wasteful McMansions, many of which now stand empty.

But the company still has capital, and has been buying up land. Real estate, like baseball and politics, evidently keeps giving second chances to players that stick around long enough.

And it's a very good deal for Toll Brothers. Beyond the wreckage of high-end condo prices and foreclosures in working-class neighborhoods, New York remains an inherently strong market. The population keeps growing. The murder rate keeps falling. Last year, it was the most popular tourist destination in the land. The schools, at least in upper-income areas, keep improving. And the mess of regulations and natural boundaries mean that large-scale new development is a rare, pricey undertaking. The truth is New Yorkers increase far more rapidly than the supply of places for them to live.

At the $8.6 million purchase price for vacant land at the corner of Water and Plymouth Streets, Toll Brothers has paid slightly more than a dollar per each current New Yorker.

But will Toll give good value for the good value it's getting? It talks about smart growth, but its prior stumbles in the area made it look fairly dim.

These days, Toll Brothers talks the talk about building plans that cluster work, home and shopping. The Dumbo development, in a landmarked area adjacent to a new waterfront park the city is creating and a gaggle of restaurants and kids' stores, will face a high burden of proof. (Just ask developer Forest City Ratner, whose Atlantic Yards mega-development has been held up for years by fierce community opposition.) Toll Brothers knows the regulatory labyrinth well, having taken its lumps on other projects in Brooklyn.

But in the wake of a housing crisis that has ravaged many lives and neighborhoods, don't expect Brooklynites to give this elephant a free ride.

 

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]]>brooklynCommunity PreservationspsnotreqdCorporationdevelopmentDomino SugarDumboForest CityspsnotreqdRatnermcmansiontoll brotherswilliamsburgAlec Appelbaum2010-01-07T14:14:00 00:00Could Fewer Cars Mean Higher Home Values?http://realestate.aol.com/blog/2010/01/07/could-fewer-cars-mean-higher-home-values/http://realestate.aol.com/blog/2010/01/07/could-fewer-cars-mean-higher-home-values/http://realestate.aol.com/blog/2010/01/07/could-fewer-cars-mean-higher-home-values/#commentsFiled under:


Here's a thought experiment: picture your nearest subdivision with for-sale signs dotting the yards. Now picture a high-rise downtown with easy access to theaters and restaurants, maybe a valet, and a transit stop a couple of blocks away.

If you give up your car, can you afford the high-rise? And will you miss your car?

Shakes things up, doesn't it? With news that the total number of American cars on the road shrank last year, a leading (albeit crunchy) think tank believes that Americans have lost their knee-jerk attachment to new cars. The Earth Policy Institute parsed federal data and concluded that the total stock of American cars dropped by two percent last year, from 250 million to 246 million. We can't declare whether this represents a long-term shift or a just a symptom of the recession, but let's consider for a moment about what it suggests about strength in housing markets.

The Institute's director, Lester Brown, argued that young people, who are more likely to live in cities with decent public transport, care less about cars than people in their 40s and 50s did when they were teenagers. That makes sense, since first-time home buyers generally avoided cities a generation ago.
Now that cities are safer and have improved parks, schools and newly revitalized downtowns, the urban market has more long-term credibility. And people buying starter homes in cities with decent mass transit have a much better shot at cobbling together a downpayment if they don't have to also make car payments.

Now, I'm a lot less certain than Brown that we've reached a tipping point. (Even at 246 million, that's still 5 cars for every 4 registered drivers). Maybe more people in cities are foregoing car purchases because there are fewer banks offering loans, or because more of them are immigrants leery of federal hassles, or because they're waiting for the car makers to come out of federal receivership. Maybe it's a moment that will fade like the new Knight Rider show. But it's certainly revealing about where to find resilient home values.

Let's take away this lesson from Earth Policy's report: in the aggregate, more Americans are open to living in high density areas. What does that mean for homebuyers?

If access to public transit becomes a factor in home purchases, that locks in a premium in markets that have just expanded subway or rail service -- good news for people who just bought in metro LA, Denver, Washington or other cities with robust transit budgets. (Heck, even Charlottesville has started sounding more serious about bus service.)

It also may mean higher taxes in the future for people in metro areas that have yet to expand or upgrade transit service -- if good rail lines become a lure, cities will compete to provide them. While New York City managed to issue bonds to pay for its only subway expansion in a generation (now crawling along toward a 2014 opening), most cities finance new transit with taxes.

If "smart growth" becomes a selling point -- and it arguably has -- places near shopping and offices will enjoy a premium over far-flung subdivisions. But in counties where smart growth has yet to take root, political battles over where to put high-density development will impact the tax and permitting picture in unpredictable ways.

The calculation quickly veers into emotional and long-range territory. Do the benefits of car-free living, in the short and long term, exceed the cost of future taxes to pay for mass transit? Do the advantages in air quality, stress avoidance, convenience and liberty from foreign oil justify a price premium for high-density homes?

It's just a blip. But the Earth Policy report suggests that more of our fellow citizens are ready to answer those questions with a yes -- and without honking their horns.

 

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]]>car-freeEarth PolicyspsnotreqdInstitutesmart growthtransit-oriented developmentAlec Appelbaum2010-01-07T11:00:00 00:00