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Do Historic-Home Tax Credits Create New Jobs?

Amy Biegelsen — 2010-05-10T18:00:00 00:00

Historic tax credits are the hot topic in Missouri where Gov. Jay Nixon is pushing to shrink the state's program in the waning days before the state legislature adjourns.

Missouri's program is the country's largest, but the state's offer to assist developers rehabbing historic properties cost the state $186 million last year, more than double the second largest program in Virginia. (Developers used historic tax credits to renovate Richmond's Carpenter Center.) The Missouri Business Journal reports that the latest figures "for the tax credit caps circulating Jefferson City include $75 million a year for historic tax credits, half of the current $140 million cap."

While the Show Me State works to cap the amount they dole out in credits, other states are rolling out new and revamped programs and touting them as the cause du jour: a job engine, of course.

Last month, Gov. Tom Pawlenty established his state's historic tax credit program as part of the Minnesota Jobs Stimulus Bill. By allowing the state government to forgive taxes worth up to 20 percent of the projects cost, supporters hope to see as many as 3,000 new jobs in the state.

Minnesota joins 33 other states that already have historic tax credit programs up and running, including Texas, New Jersey, Illinois and Pennsylvania. New York and Maryland have also tweaked existing programs this year to expand already existing ones. New York governor David Paterson recently told the Albany Business Review, "Historic preservation efforts have proven to create jobs, attract small business, increase property values and promote affordable housing."

John Leith-Tetrault, president of the National Trust Community Investment Corporation, just completed a study with Rutgers University that showed that from 1978 until 2008, the $16 billion that was invested nationally in historic tax credits yielded $21 billion in federal taxes. He says it makes sense that the credits have such a powerful impact on local economies because fixing old houses requires skilled, locally licensed labor.

"Any laborer could install a window that you import from China in a new building where everything is square," he says. "[A historic home] requires higher-paid workers because it needs a skilled laborer." It's a facet of the program his group has been touting for years, but has become a more appealing message in this down economy. "This is all that Congress cares about," he says, "so it's an opportune time to bring this up."

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Atlanta Developers Versus the Deceased

Amy Biegelsen — 2010-03-23T10:00:00 00:00

Filed under: News,Lifestyle

Atlanta City Councilman C.T. Martin caught some flack last month when he voted to approve a developer's plan to dig up bodies buried in a cemetery in Atlanta's tony Buckhead neighborhood. The developer claimed that when he bought the lot, he was unaware that it was a burial ground, but now the bones were in the way of his plans for the property. The other 11 council members voted against the measure, leaving the dead to rest in peace, but developers versus the deceased is a more persistent problem than one might think.
A planned expansion of the Texas Ranger Hall of Fame and Museum in Waco, Texas got put on hold last year when construction workers accidentally unearthed coffins and human bones from an unmarked cemetery. According to USA Today, an unmarked burial site holding more than 1,000 bodies from the 19th century were exhumed in 2006 to make way for the Pima County courthouse in Arizona. A 1991 project to build a Manhattan federal office building unearthed the remains of 400 slaves buried there.

While unmarked burial sites can haunt urban building sites, they present problems in the suburbs, too.

As planned communities crept further and further from city centers during the suburban building boom of the last decade, property owners that had held on to family farms found lucrative deals selling them off to developers. In centuries past, burying family members, friends and slaves in the backyard was more common.

Although grave markers may have deteriorated with time, Kay Simpson, vice president for Louis Berger and Associates, a firm that performs archaeological surveys, says some physical clues can tip off builders. When domestic wildflowers, like periwinkle or tulips, pop up in a field, it's unlikely that that spot was being used for agriculture, she says. Aerial photography or even ground-penetrating radar can help highlight unusual plowing patterns, too.

Developers have to get permission from the government to dig up and rebury bodies. This often involves making an attempt to contact any living relatives and securing their permission, which can sometimes be a tough sell.

Back in Atlanta, the city council members had heard emotional testimony from family members begging to let their dead remain unmoved, foiling the builders plans. At least the developer can guarantee the buyer will have quiet neighbors.

See Buckhead, Atlanta homes for sale at AOL Real Estate.

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Hometenders: Housesitters for Homes for Sale

Amy Biegelsen — 2010-03-18T10:00:00 00:00

Filed under: News

John Bezik and his wife Cyndee own a home, but for now they're living in a $2.8 million, 6,500-square-foot home outside Scottsdale, Ariz., that has been on the market for more than a year.

It's not their house, but they sleep there at night. By day, they keep the pool sparkling, the plants trimmed and the interior showroom-quality immaculate in case a real estate agent wants to bring a buyer through at a moment's notice.

They decided to rent out their home and act as interim caretakers of another until the market improves. But John Bezik is not, as the saying goes, just a member, he's also the president.
In 2008, John and Cyndee opened up HomeTenders of America and managed 250 homes that first year. Their daughter, Barbara, works as the office director. John is a licensed Realtor and his wife is an interior designer. (The home they are currently staying is is pictured below.) Both their businesses were hit hard when the market began to decline, but their skills complimented each other for the home tending business.

Bad times overall make for good times in the hometending market. Dan Ortega, one of the industry's godfathers, launched Showhomes of America in 1986 during the savings and loan crisis. He sold the business in 2004 and now just owns the Atlanta franchise, but says this most recent crisis has doubled their normal business.

"We absolutely blow up when the market goes in the tank," Ortega says.

The Beziks run criminal background and credit checks on all potential tenders. Many of his tenders have gone through bankruptcy, foreclosure or divorce so a compromised credit record isn't a deal breaker. Lousy furniture, however, can be. The residents are required to supply their own furnishings, although Cyndee and her team of decorators take care of the staging. The Beziks establish that a potential tender has appropriate furniture before even running a background check.

Once the tenders move in, they are responsible for utilities, landscape and pool maintenance. Technically they're contractors, not renters, which means the company can inspect the home unannounced. If anything in the home's appearance is out of place - even an unmade bed - the tender gets one written warning. The next infraction leads to a five-day notice to clear out.

John says that staged homes sell faster than vacant ones. Similarly, occupied houses are less likely to be vandalized; insurance premiums often spike on empty houses.

The service is free to Realtors and homeowners. Bezik makes his money off monthly fees from the tenders, who pay as little as $600 for smaller homes, up to as much as $3,000 for a 10,000 square-foot, $8 million home. It's a bargain for the amount of home the tender is getting, but not without inconvenience; the Beziks have moved twice already in 2010 as the homes are sold out from under them.

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New York City Doormen Threaten Strike

Amy Biegelsen — 2010-03-15T12:00:00 00:00

Filed under: Renting

New York city's 30,000 doormen and porters are in the midst of negotiating their new union contract this week. Talks resume March 17, and if no agreement is reached, residents in some 3,200 of New York's apartment buildings may find themselves hauling their own dry cleaning and Tibetan delivery up from the lobby.

Jerry Seinfeld once unkindly noted, "you would think if any group of people would not want to demonstrate what life would be like without them it would be doormen," asking "who's gonna walk out next? The guys who clean your windshield at the traffic light, with the dirty rag?"

Seinfeld may underestimate the threat of labor solidarity if the doormen strike and other workers refuse to cross their picket line.
Brickunderground warns that UPS may delivery packages to the nearest UPS office instead of crossing the line. Package closets and utility rooms may be locked, says Habitat magazine, and the New York City Department of Sanitation may refuse to pick up garbage until a state of health emergency is declared.

The doormen haven't gone on strike since a 12-day walkout in 1991, but in 2006, negotiations went right up to the very last day.

The x-factor in this year's debate is that the Real Advisory Board on Labor Relations, who represents building owners and operators, has a new president, Howard Rothschild. Crain's New York Business reports that Rothschild's predecessor, James Berg, was a well-regarded figure by both sides during his 30-year tenure. He died of cancer last November. Rothschild, appointed last Christmas, is talking tough.

"While other people in New York have been hit hard, [union] members' wages and benefits have gone up in each year of the agreement," he told Crain's. "When you have building owners who can't get the rents they were getting and co-op and condo owners who have been laid off or had their wages frozen or cut, this is not just business as usual."

It's true, the 2006 union contract, which expires April 20, does provide for wages to increase annually. The doorman union, 32BJ SEIU, say that while 2009 may have been a stinker for housing, New York real estate overall is doing well.

The union contends that in the four years since the last contract was negotiated, property values have increased for owners by 28 percent, while the cost of living has risen by 11 percent. The union wants a cost of living adjustment to their wages. Instead of salary freezes, the union is encouraging employers to lower their operating costs by taking advantage of a new "Green Buildings" training program that would teach building operators to save cash through making their buildings more energy efficient.

Stayed tuned. Negotiators have five days after taxes are due on April 15 to reach an agreement. If they can't iron out their differences, those in the doorman-building tax bracket could have a doubly unpleasant April 20.

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For Sale: San Fran's Best Known Victorian

Amy Biegelsen — 2010-03-05T16:00:00 00:00

Filed under: Design,Lifestyle

The owner of San Francisco's most famous "painted lady" Victorian has put it on the market for $4 million. Michael Shannon's four-story, corner property punctuates the end of one of the city's most photogenic blocks, known as Postcard Row. The sale has drummed up some attention, but he's used to that.

The pale green exterior of the 1892 structure has cameo-ed in movies, and an ad for Foster's beer, but it's most famous appearance comes in the opening credits of "Full House," the sit-com that introduced Mary Kate and Ashley Olsen to the world. It's the first time in 35 years that one of the houses on the iconic block has been up for sale.

Though the home's exterior has had its fair share of exposure, the interior has been hard at work, too. Shannon's furniture company, Michael Shannon and Associates, was born in the ballroom-cum-garage in the early 80s and has been inspired by the home ever since.

"When you own an old house everyone seems to be putting their hands out saying that'll be $10,000," Shannon recalls. He had a friend who could work with steal and the pair ground out their first creation, a table for the kitchen. A neighbor saw it and ordered four more. They ramped up production, and it wasn't long until the neighbors were coming around again, this time asking them to keep the noise down. Soon the business grew into it's own production and show spaces, custom fabricating work for the well-known Pierre Deux line. But the design sensibility never strayed far from home.

"For us the house really has served as our design laboratory," says Thomas Zickgraf, Shannon's spouse and the now CEO of the furniture company. Over the years, the lines have often included over-sized mirrors, a holdover from when Shannon first took possession of the home in the 80s. It had gone through periods of vacancy -- he had to evict an encampment of hippies on the floor with rumors of an FBI raid - and there were large holes in the walls. The historic home's lathe and plaster walls were difficult to patch, so the big mirrors were a solution that also brought more light into the rooms, a persistent problem for row homes.

Most of the furniture falls into the category of transitional decor. The pieces reference classic lines with a goal of making them distinct, but versatile enough to cooperate styles from ultra-modern to the Victorian's decorative brackets and stained-glass windows. The home's architectural detail could pose an immense design challenge to the next occupants, but Shannon and Zickgraf are happy to help.

"If someone wanted to buy the furniture," Zickgraf says, "we'd probably sell it to them."

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Glenn Beck v. Beck, Who's the Biggest Loser at Home?

Amy Biegelsen — 2010-02-25T16:00:00 00:00

Filed under: News

Left-coast Scientologist and musician Beck sold his Malibu rancher at a loss this month, but it's a race to the bottom as right-coast Fox News personality Glenn Beck also tries to offload his Connecticut mansion for six figures less than he bought it. Which Beck will win -- or, uh -- lose?
In January 2007, the avant-garde pop-star Beck and his wife, actress, Marissa Ribisi, bought what the Multiple Listing Service describes as "a very hip mid-century ranch" (middle) with three bedrooms, two bathrooms, pitched ceilings, hardwood floors and garden - not ocean - views. The property they bought for $2,050,000 also boasts a two-bedroom guesthouse with fireplace.

Beck put the 1,600-square-foot home back on the market in October 2008 at $2,399,000, but after cutting the price again and again, they finally sold it this month for $1,650,000 -- $400,000 less than they bought it for.

Meanwhile, gold bug and conservative commentator Glenn Beck has been trying to rid himself of his six bedroom, five bathroom colonial in New Canaan, CT. Local property records indicate that Glenn Lee Beck bought the house for $4,250,000 three days after Christmas 2005.

As of December 2009, it was listed at $3,999,000 -- a quarter-million less than he paid for it. Ouch.

Unlike his West Coast counterpart, this Beck abode (bottom left)) does have a view of the water. Sadly, the manse also offers a view from the street, which the Becks attempted to screen out. In May 2008, the family petitioned the local government for permission to build a six-foot privacy fence around the three-acre property at the advice of their security team. They accidentally got started on the fence-building project before obtaining official approval, but no news of whether or not they've finished it yet.

It's not clear where either couple with move next, though both families own other property. In July 2000, Glenn Beck's wife, Tania, bought a 1,845 square foot house in Fort Lauderdale, Fla., for the surprisingly low price of $156,800. In April 2007, the other Beck bought a home in Los Angeles' Hancock Park neighborhood for $6.75 million. (They put the six bedroom, nine bath on the market in July 2008 for $9 million, but by August 2009, it had already dropped to $6,595,000, and has since been pulled from the market.)

Who will be the biggest loser? We'll see. In the meantime, seems like both Becks are living on advice from the 1994 release "Loser" where the alt-crooner tells audiences he's "got a couple of couches," but sleeps "on the loveseat."

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