Thursday, March 18, 2010

Condo Vultures Are Heading To Los Angeles

So there is this company in South Florida that specializes in buying distressed properties of the high density kind and then flipping them. But it is not like they buy any old upside down property. They wait until the poor bank holding the paper gets so incredibly desperate that they practically give them away. They call themselves Condo Vultures, and apparently they are very successful in making money off the misfortune and boneheaded business moves of others.

Now I heard about them on NPR last evening as I was wending my way up the 134 after a lighthearted day in the salt mines. And it really is quite a business they have going on there. Apparently so many unnecessary condominiums were built in Florida during the "Banks Gone Wild" subprime era that the landscape there is literally awash in the damn things. You just couldn't find a happier hunting ground for Condo Vultures.

Here's a bit of the Miami Herald story from Tuesday that was the source of all the excitement:

Buyer makes $200,000 profit in 20 minutes by flipping 19 Miami condos - It could be one of the quickest profits made in Miami's condo market. All it took was 20 minutes for a bulk buyer to make $200,000 by purchasing 19 units in the new Mi Primera Ilusion Villas Miami condominium and then immediately selling the same condos to another investor, according to a report from CondoVultures.com ... "Call this condo arbitrage, Miami style," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures LLC.

NPR, which broke the story to a national audience yesterday, has also published an interesting article on the Condo Vultures group, and I thought it would be nice to share it with you here. The piece starts with the Herald piece I quoted above, and then has this to say:

Bottom Feeders, Flippers & Condo Vultures: ... That's how crazy things are in the condo market in Florida, where a weak economy and over-built market have combined to drive foreclosures up and prices down to the point where bottom-feeders are now seeing if they can swoop in and make some fast money by quickly flipping properties ... The company collects data on the condominium markets in South Florida and four other cities-- and sells condos too. "Where you want to be in this market place when the market does start to turn is on the buy side," Zalewski says. And his company aims to provide clients with the information they need about that market.

So what, you may ask, does this really have to do with anything going on around here? Just because people went crazy in South Florida and built themselves into a state of near economic collapse can't have any actual relevance to us, right?

Mmm, apparently the correct answer is yes, it does. Because according to the Condo Vultures website, they are looking to set up an operation right here in sunny Los Angeles County. As a matter of fact, they now list 5 markets as being their happy hunting grounds. In addition to the aforementioned South Florida, other real estate disaster cities such as Las Vegas, San Diego, and Phoenix are also listed. And do you know where else? You got it, Los Angeles is now included as well. Here is what you'll see when you click on the LA tab:

Condo Vultures Realty LLC is working to open a location in the Los Angeles market to capitalize on the condo crash.

Did you see that? We really are a land of opportunity after all. Just another over-built and poorly planned region where soon to be arriving immigrant condo vultures can fly in and feed off the broken dreams of a thousand foolish developers.

So do you think that maybe SCAG should be getting a couple of points on all this upcoming action? After all, they were the ones insisting that all our local cities plan for the building of these brick and mortar equivalents of roadkill not so very long ago. Your federal and state tax dollars hard at work. Maybe their forecasts about millions of God's creatures moving here weren't so inaccurate after all. Except instead of people, the immigrants are turning out to be avian real estate scavengers.

Now I don't know where Condo Vultures LLC is planning on setting up their shop, but if they were to ask me I'd suggest Pasadena. Because not only would you have immediate walkable access to all those unsold 6 story condo wickiups located there, but you'd also have Glendale, Burbank, Arcadia and Monrovia right there at your fingertips as well. There must be hundreds of distressed condo properties located in just those burghs alone. The site of hungry condo vultures lazily circling above the half-empty skylines of our San Gabriel Valley brethren might be kind of interesting in an apocalyptic sort of way. A philosophical testimony to the nature of man's folly.

Of course, since we were the only city in the region with the foresight and chutzpah to stop such condo-crazy construction within our borders, there would be no reason for any Condo Vultures to circle on over Sierra Madre's way. As a matter of fact, they might even view this to be hostile territory and try to stay away altogether. Which would be fine with me.

Then again, there is a kind of 2005 condo cargo cult in this town that still believes it would be a good business investment to build that kind of stuff here. When all they would really be doing is feeding the vultures.

Bonus Coverage: I received a kick in the pants from a reader who asked what it is I have against condos. They live in a very nice one here and felt I was being something of a knucklehead about it. I called him up and I had the pleasure of talking with a very highly informed person who is keenly interested in what is going on. Short answer: What this article is about are the 6 story heavy development kind of stuff you find in some of our neighboring cities. The well-planned and unobtrusive condos you find here in Sierra Madre are how things should be done. Sierra Madre is planned for small town ambience, and that includes condominiums. Stuff that Condo Vultures LLC will have no interest in. That is the big difference.

64 comments:

  1. Oh dear, oh dear, oh dear. I heard Ms. Walsh wants to build a bird sanctuary; Saint Josh is once again looking to a career move; and little Joey Mosca is planning on representing all of the condo vultures as their SGV SCAG and SGVCOG lobbyist.

    John Crawford, you are on the cutting edge of breaking news!

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  2. I think Joe would be offended by the term "condo vultures." He
    would see it as another attempt to divide us.

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  3. Please see Pat Alcorn's campaign website: alcornpat.com if you want to know why you absolutely want to vote for this highly qualifiedcandidate. Also: E-mail Pat at: alcorn_pat@yahoo.com to contribute to this fine candidate. You will be delivered a yard sign so that your niebhbors will know that you are supporting this fine candidate. Forward this information on in an e-mail to all your friends in Sierra Madre. This is an important election. We must move forward to protect our fine town with strong candidates that will vote in our interests against the overdevelopment as described in today's blog. The research skills of John Crawford show that he is also a candidate deserving of your vote. Don Watts, Mayor Pro-tem has worked wtih Mayor MacGillivray to stave off the overreaching of state mandates that would change our town forever. Alcorn, Crawford and Watts. Tell everyone--do not sit home during this election!

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  4. Crawford,
    the sad thing is these massive multi-storied condos will very likely turn into slums in the next decade. The greedy don't care. They take their ill gotten profits and split to pillage another town.

    Just another case of bad governing by cities which allow this dangerous gamble of over-development.

    Thanks God we have had a council majority this past two years who has protected us.

    Sierra Madre!
    You need to vote for Crawford, Watts and Alcorn.
    If you want to gamble, go down to Santa Anita and bet horses. Don't gamble with the future of Sierra Madre! Don't gamble with our property values.

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  5. It would have helped Moran and Walsh if they had started to attend the council meetings prior to the last two, they obviously no nothing about the the city's business, COG, SCAG, Regionalism, and the effects on Sierra Madre.
    Moran got his job at the city many years ago with the help of his mother, and Webb Martin, and turned his back on our town years ago, moving to Monrovia to hawk real estate deals.
    To appear in town, after many years, claiming residency two days before running for council
    is obviously cheesy.
    I think it is a slap in the face to all residents of this town to believe he is genuinely an honest person, without special interests. He is here to continue the agenda of large scale development, and all those investors and realtors who were stopped by Measure V.

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  6. Anybody up for starting a Frank Girardot fan club this morning?

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  7. Hey, the Star News gets it. See today's editorial by Frank Girardot. Puts it front and center--it is about overdevelopment! You do not want to vote for an ex-realtor now account executive; nor an incumbent who has padded his council accomplishments and cozys up to Sacramento; nor a Senior Community Commissioner who does not pay much attention to governmental issues except what is fed her by another councilmember tied to energy and downtown development during the Measure V election. The choice is clear: Alcorn, Crawford and Watts.

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  8. After Mosca and Moran rolled into town to run for office, it should be obvious to all there should be a minimum residency requirement to run for office.Perhaps 3 years. That would give people a minimum of time to learn enough about our town to be able make halfway reasonable decisions as a council person.
    Our leadership should represent the best of our people, who do not have hidden agendas.
    A good example of this kind of resident is Pat Alcorn, who was asked to run by many people in town for her volunteer spirit and years of service. She has no hidden agendas and is running a genuinely honest campaign, and has followed all the commissions' business, including Regional Government meetings. She does not need to win by smearing people, or calling names, but is up to speed on the city's business, and threats to our town. She will bring her experience, knowledge and maturity to the City Council.

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  9. Anonymous at 8:25 am, I think your residency requirement may be illegal and it certainly would have eliminated Kurt Zimmerman who has been without question one of the most effective councilmembers in at least the last 10 years and arguably ever. And residency certainly hasn't made a difference in Walsh's grasp of the issues.

    A better solution would be for voters to take responsiblity for their own vote -- and make it a point to vote in local elections!

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  10. off topic. why hasn't the blog or the city council mentioned this: Does it apply to Sierra Madre. We are part of the San Gabriel Valley Municipal Water District.
    "Just received my water bill and read that on May 1, 2010, the San Gabriel County Water District will adopt a 75 percent increase in water rates unless consumers take action to protest the increase.

    The county will accept written protests received prior to the April 13 public hearing. Please have your vote be counted by writing to the

    Secretary of the Board, P.O. Box 2227, San Gabriel, CA 91778.

    Your protest must include the signature of the person on the bill, your address and state that you are protesting the increase to the "water consumption charge" and "water meter charges."

    Do not delay. We cannot afford to let the San Gabriel County Water District think that the majority of the people are OK with this increase." Letter to the Editor PSN 3/16/10

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  11. You know, the more I learn about Sierra Madre the more I envy the folks living there....

    I must admit that to many I would be considered a mini-version of the "condo vultures". I own a bit of real estate....mostly multi-family properties located throughout the San Gabriel Valley, located in residential areas. I try to purchase property which is in need of repair which the current owner won't, or can't, pay to complete. Or property where the owner has over extended themselves or has management problems.
    I then try to re-hab the property, put good tenants (and neighbors) into the property and maintain a "pride of ownership" approach to maintaining the units. I like to think I take an approach which is a win-win for the tenants, the neighborhood, the city and myself.

    With all of that said, I have been disgusted by the development over the last 20 years. It has been driven by developers and greedy Council Members with little regard for the very citizens who reside in the community. The residents are usually portrayed as "kooks", "NIMBY'S", or other such labels just because they want to have some say on how their community is run. Redevelopment Agencies (the City Council) have in effect excluded local residents from acquiring properties and acted in consort with big developers simply for their campaign contributions or worse.

    Really nice to see a town take a stand and say enough. We want our "bedroom" community and we are willing to fight for that quality of life.
    My hats off to those in Sierra Madre who are willing to fight for what they believe in!

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  12. link to Frank Girardot article today
    http://www.pasadenastarnews.com/ci_14697419

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  13. Sierra Madre FirstMarch 18, 2010 at 9:46 AM

    Frank G's point was made by both Watts and Crawford during the Kiwanis debate. That being part of Sierra Madre's unique charm is the independently owned shops in its downtown area. And it appears that after the debate ended Nancy Walsh was overheard telling seveal people, "See? They're against bringing in outside businesses." It is really telling that the Mosca/Moran/Walsh slate has nothing much to offer themsleves, and can only react to what our candidates are communicating.

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  14. As usual, Frank Girardot is on point (note to larry wilson - frank didn't have to drop a single name!). still, i have three comments:

    1. sir eric is an entertainment executive

    2. what the hell is josh moran an "account executive" of? can anyone tell me what he does for a living, where he lives, and how long he has lived there?

    3. dumping the SMPD - expecially that sociopath crank officer berry will go a long way toward keeping us from becoming temple city. how? by saving us at least $1.5 million annually, which can be applied to other great city uses.

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  15. I hear the Condo Vultures are planning on building a nest on top of The Stuart.

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  16. This comment has been removed by a blog administrator.

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  17. SM dodged a bullet - so farMarch 18, 2010 at 1:25 PM

    Just imagine an incomplete Downtown Specific Plan....Howies torn up and half built, parking lot next to it torn up, the Skilled Nursing Facility torn up and half built, and the Congregational Mega Church? Fully up and in operation with their auditorium and amphitheater or whatever else they wanted, because those people know how to accomplish their plans, with or without anyone minding the store. The condo vultures would be buying up half finished projects & waiting 'til the whole town would give in - just like on Stonehouse & Carter - might as well go through with it cuz it's already gone so far....

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  18. What's happened in the hillsides is terrible, and will be very clear to all the town once those mansions start rising up, but if the center of town was torn up?
    Not sure Sierra Madre could recover.

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  19. They will gaze down from One Carter like the Lords of Sierra Madre. Maybe that's the point. Also why those lots sold for as much as they have.

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  20. Yeah, but I wonder if the Lords of the Manors will really want to come into Sierra Madre. I bet there will be whole new fleets of luxury automobiles driving east or west on Grandview, skipping the simple folks parts of town all together.
    But hey, the council of 2004 wanted that property tax increase, even tho their city manager Gillison explained that it would only be a drop in the bucket.
    We lost the irreplaceable hillsides for a drop in the bucket.

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  21. Maybe they'll make 1 Carter a gated community. With the very good chance that hiring minimum wage gatekeepers would be hailed by John Buchanan as "bold new job creation."

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  22. Florida, Nevada and California have a lot more than just condos for the pickings. Some towns in Florida have up to 50% of their houses in foreclosure and sitting empty.
    And what was that place out towards Azusa that appeared on this blog? Rose something, with all those empty homes?
    The vultures are probably figuring that it will be the smaller living quarters, the condos, that will come back first.
    What a mess.

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  23. good memory skillsMarch 18, 2010 at 1:53 PM

    1:47, they won't be allowed to make Crater a gated community. Unless they ignore the conditions of approval. They'd never do that, right?
    They wouldn't sue the city or anything, to ensure their own protection from the dog walking riffraff you see all over town.

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  24. Yikes 1:53, that happened in Altadena! The La Vina housing development wanted to block access to hiking trails that ran behind their properties, even though it was part of the development agreement to keep the trails open...Think the argument was something about "That was the other guy who agreed to that."

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  25. Maybe that's where the bold new job creation comes in. Would we allow something as important as hiring gatekeepers to be held up by such inconsequentials as Hillside Zoning?

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  26. Four years ago, some of the the Pasadena Star News editors interviewed the City Council candidates to determine who the paper should endorse.

    Councilman Zimmerman told me that when he was interviewed, one of the editors called his plan's to preserve Sierra madre's downtown "stupid." The same editor then told Zimmerman that Sierra Madre would do well by imitating Temple City's downtown mixed-use development.

    Now that the economy has tanked, has the PSN changed its pro-development tune?

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  27. If Giradot was intellectual honest, he would have pointed out that candidates Mosca and Moran were two of the most vocal supporters of the downtown specific plan or DSP. And, it was the DSP, which would have transformed Sierra Madre into that Temple City he decries.

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  28. I don't understand Nancy Walsh. She is running on a "bring-in-new-business" platform. Doesn't she realize that bringing in new businesses requires displacing old businesses?

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  29. It would be nice if the PSN clarified that candidates Mosca and Moran were supporters of the condo-development plan.

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  30. Damn good point, 2:25. But you now how it goes with columnists for daily papers, they must remain safely above the fray. Otherwise who knows? They might actually say something. And we wouldn't want that to happen now, would we?

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  31. While the PSN is "clarifying," it should also mention that Ms. Walsh has serious quams about Measure V -- the initiative which stopped those condo development projects.

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  32. Poster 2:30, I agree. It's pretty chicken s__t for Giradot to write that story and not state how Mosca and Moran came down on the side of big condo-development in 06.

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  33. Nancy wants businesses in town that she can enjoy, 2:27. Bed, Bath & Beyond perhaps. Or Crate and Barrel. How about a Cracker Barrel? And then if we could somehow get a Nordstrom Rack? Pure ecstacy!Throw in a Red Lobster and a Red Robin, and the picture would be complete.

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  34. Here's the irony... If Measure V had failed, we'd have empty condo complexes and stores in our downtown.

    Mosca would be the most unpopular man in town and not stand a chance of getting re-elected.

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  35. I saw Mosca's campaign flyer. He's running on Kurt Zimmerman's record. Mosca has no shame whatsoever

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  36. It was Molly Okeon that made Sierra Madre her beat and relentlessly reported on the side of the DIRTS. I don't think she's with the PSN anymore. And if that's so, I'm delighted.

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  37. Well then it would have been the fault of the economy, 2:35. As opposed to what happened to the Skilled Nursing Facility, which is of course the fault of Measure V. It's logic of the moving target variety.

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  38. Oh! I want a Cracker Barrel! It's my favorite. There isn't one in California. It's almost as good as the Biscuit Worlds in West Virginia. Nancy should be running for Chamber of Commerce, not City Council -- maybe she is and just forgot which was which... Do you think the Buchanan's tricked her?

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  39. Maybe they promised her Karma Bell's old desk.

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  40. You think we'd be able to get a Sit 'N Sleep?

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  41. Hello. My name is Archer Daniels Middrift, and I belong to an organization called Downtown Needs Donuts. Did you know that within the confines of Sierra Madre there is not one dependable outlet for dunkers, jellies, or bear claws? That's right, not a single one. I would like to know where the candidates stand on this issue. I personally feel that this is a travesty and a direct affront to those of us who enjoy the great American food types. That no candidate seems to want to discuss so important an issue is, to my organization, a strong indication of what is really wrong with our town.

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  42. Ohhh Archer, you have to walk just a bit more, Brother. Wildflour Bakery on the corner of Lima and the Boulevard has bear claws that make a grown man weep.And sometimes you can get them in the day old basket for half price.

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  43. Nancy Walsh made it to neuroblast Films
    http://www.youtube.com/watch?v=Wq0BxwlpIp0

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  44. Joe Mosca lied to all of us and got hundreds of votes he didn't deserve, had we known the truth.
    He betrayed us on his very first development vote.

    He will not get all our votes this time around.

    I want to see his complete voting record put up for all to see. Then his "poor me" "I'm a victim" "MaryAnn is mean" will be seen by all for what it is, bs.
    We are responding to his voting record. Pure and simple.
    Had he kept his promises, I'd be out putting up his campaign signs and passing out his literature.
    It's really simple. Joe lied, and he won't get away with it.

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  45. As far as the condo issue goes, we have benefited greatly because none of the plans for development have come to fruition. The delay that has been imposed has benefited us greatly.

    Remember the old riddle: What's worse--Syphilis or a condominium?

    Answer: A condominium--you can get rid of syphilis.

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  46. channel 3 watcherMarch 18, 2010 at 3:25 PM

    Great clip Neuroblast.
    What the hell is Ms. Walsh talking about, a letter that was sent saying "No change" or "against change"?
    I heard the council's discussion of that letter. That is not what it was about.
    Somebody on her campaign staff needs to bring her up to speed.

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  47. Thanks Neuroblast for the Nancy video. Nancy must loose this election. I could not stand four yers of watching her wave her hands uncontrolably. If someone gave her a flag, she could perform a flag girl routine. With John's ramblings and her gestures, I will go nuts.

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  48. 3:36, John doesn't ramble; he instructs.Each little word leads to another and another and another, and in the interests of educating you, he wants you to follow every single possible idea that is tangental to other ideas that eventually will come down to a vote.He does it as a service.
    Nancy's hands are nice - it's her lack of understanding of the topic at hand that is dangerous.

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  49. Her hands are fine but she look like an
    out-of- control windmill.

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  50. Thank you, local. I have never shopped the establishment myself. Too far from my beloved Kersting Court. However, I will westhard ho to the Wildflour and sample the claws. I will get back to you with my verdict.

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  51. Nancy Walsh viewerMarch 18, 2010 at 4:16 PM

    *wince*

    shudder....

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  52. Nancy is confused because she is learning from John and Joe who are out of touch except with their own reflections in the mirror. It is no secret she is a no nothing because she knows nothing ..... the more she talks the more she drowns ...

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  53. The 3 Stooges are running scared because they know that they are running against 3 very intelligent candidates. They thought just because Zimmerman was not running was a great in road to take Sierra Madre back to the developers. Sorry, wrong plan. None of you understand any of the issues,nor do you understand WORKING FOR THE PEOPLE.......funny about that voting thing, huh?

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  54. Vultures in Los Angeles, who ever heard of such a thing? Now vultures, according to Wikipedia, are scavenging birds, feeding most on the carcasses of dead animals, yuck! Condo Vultures (a ghoulish name if I ever heard one) has appropriated the name of this unseemly bird, to engage in the unseemly activity, of feeding off of the "dead carcasses" of over-built condos.

    Thank goodness Sierra Madre has no such carcasses sitting around, windows plastered with "For Lease" signs.

    And why is Sierra Madre the "only city with the foresight and chuzpah to stop such condo-crazy construction"?

    This blog, thats why. Great foresight, Tattler!

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  55. We may not have empty condos--but we do have more For Rent signs than I have ever seen before. Lots of people moving from our fine town because . . .? If these appartment owners are facing big mortgages from recent purchases of these income properties well they are going to be in trouble. If they are long time owners without that hellacious overhead, then they will survive. Wish them luck.

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  56. Everything is FOR RENT now. Property values have evaporated, the real ability to pay rents have done that also, because of the outsourcing of jobs and the implosion of small businesses due to the credit crisis. Thankyou Goldman Sachs. This is where the bill comes due and unfortunately the taxpayers get to hold the bag. Local government and schools are going under as well, have to slash payrolls. So who's going to pay the tab? All those folks moving out of state?

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  57. Nothing like a little market adjustment, eh? Once the rents come down the apartments will rent. Besides, if someone can afford to make high rent payments, then they can afford to pay a mortgage. And with the price of houses having fallen as much as they have, why wouldn't a renter get out from under paying the landlord and get themselves into a house?

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  58. Soon California could end up like Mexico. Entire towns half emptied out as the best and brightest vamoosed for jobs that can only be found elsewhere.

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  59. Already like Mexico, we're seeing the killings starting in southern California now.

    http://projects.latimes.com/mexico-drug-war/#/its-a-war

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  60. I am not sure if you have addressed this in the past, but what is your opinion of the CA state AB-32?

    Since you have shed some light on SB-375 I have done some research and realized that AB-32 is the real monster along with the powerful (unelected) Air Resources Board. From what I can see SB-375 extends them more power.
    I have attempted to contact Sierra Madre’s and Pasadena’s CA state senators and assemblymen (to which I have yet to receive a response) asking for clarification on the extent of the control that SB-375 has over local planning. I also urged them to work to repeal or suspend both the AB-32 and SB-375.


    Do you support the "Suspend AB-32" movement?

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  61. Disregard my post above. u have already answered the question for me. I just scrolled further down the page and read your post from earlier in the week regarding this exact issue. thanks.

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  62. I'm a fan of Frank Girardot, too!

    Deirdre G

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