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Arlen, you should have been more worried about the the people you are serving then your seat in congress. You were not sent to Congress to try to win term after term and change parties so you can be assured of winning. You were sent to Congress to serve the people of your district. You turned your back on them. so, how is that working out for you? Bye Bye!

May 17, 2010 11:35 AM, By Denise Kalette, NREI managing editor

The percentage of information technology (IT) employees at apartment companies has declined significantly over the past two years, according to a new benchmarking report by the National Multi-Housing Council, an apartment trade group based in Washington, D.C.
The workload of individual IT staff has increased by 47% since 2008 because of the cutbacks, the new report shows. Two years ago, each IT staff person supported the tech needs of 110 employees in an apartment firm. Today, each IT worker supports 162 employees, according to the survey.
The amount spent on outsourcing technology tasks nearly doubled, from 12.6% of apartment firms� IT budgets in 2008, to 23.6% in 2009. Smaller companies, with fewer than 200 employees, were far more likely to outsource IT projects.
The smaller firms spent an average of 42.4% of their technology budgets on outsourcing to outside companies. That compared with less than 1% spent by bigger apartment companies with more than 1,000 employees.
�While there is no right answer as to how much apartment companies should be investing in technology, this NMHC survey offers firms an updated benchmark that will let them compare their IT spending and staffing levels with their peers,� says David Cardwell, vice president of technology and capital markets at NMHC.
The new survey, conducted in late 2009 and early 2010, supplements a survey conducted by NMHC in 2008, and gives companies a sense of how IT spending has evolved, according to Cardwell.
Overall, respondents spent 0.95% of their gross revenue on IT in 2009, up from 0.7% in 2008, and not including telecommunications services.
Spending on discretionary projects such as document management systems, fell from 19% of apartment companies� IT budgets in 2008 to 14.3% in 2009. The percentage spent on consultants fell even further, from 20% of IT budgets in 2008 to 6.8% in 2009.
Results of the survey also show a significant decrease in the number of help desk staff at apartment companies. In 2008, on average, companies provided one IT help desk staff person for every 172 employees, according to NMHC. By 2009, there was one help desk staff person for every 282 employees.
Besides examining outsourcing, and comparing the amount of IT budgets spent on consultants or outside professionals rather than on apartment firm employees, the survey examined discretionary spending on revenue-increasing IT investments. Besides document management, the discretionary projects included such as lead-tracking and lead-management systems.

www.CommercialPropertyDirectory.com

From National Real Estate Investor

May 17, 2010 11:33 AM, By NREI staff

CB Richard Ellis Group, the Fortune 500 real estate services firm based in Los Angeles, has launched a real estate auction service to help lenders, investors and owners dispose of commercial real estate assets. Doug Johnson and Paul Galanis, veterans of the real estate auction business, joined CBRE to head the program.
They will collaborate with CBRE�s capital markets, brokerage, and global corporate services staff to offer services from traditional auctions to sealed bids and online auctions.
"Auctions are an increasingly popular means of disposing of commercial property," said Gregory Vorwaller, president of CBRE's Investment Properties Group. "They can often help an owner to sell property efficiently and at maximum value. While this is especially true in a soft market, auctions are a proven sales method across market cycles."
Johnson, a 16-year veteran of the auction industry, will be managing director of the auction initiative. He was previously senior vice president at Sheldon Good & Co. Galanis, also a former senior vice president at Sheldon Good, has joined as managing director, as well, according to CBRE. Johnson and Galanis are based in Chicago.

www.CommercialPropertyDirectory.com

The US Natural Resources Committee has moved to bring a bill concerning Puerto Rico Statehood, HR 2499, to the house floor. HR 2499 isn’t really a vote for Puerto Rico statehood but does require a vote to be taken. Statehood is a possible outcome of the vote. So why is the statehood of Puerto Rico is a contentious issue? Tax debt is something it has to do with, autonomy also, and questions of representation.

The history of Puerto Rico statehood

The Puerto Rico statehood history goes back many years. Even though Puerto Rico was first colonized by the Spanish, it became a United States colony in 1898 during the Spanish-American war. The Foraker Act created a civilian government, separate judicial system and nonvoting member of the United States congress in 1900. All Puerto Ricans became US citizens in 1917. Puerto Rico was officially made a commonwealth – not quite Puerto Rico statehood, but not an independent nation in 1947. Residents of Puerto Rico instead are U.S. Citizens without voting representation in Congress or the necessity of giving instant money to the IRS.

HR 2499: A vote on Puerto Rico statehood

Puerto Rico statehood has to be voted on by a national vote because of the HR bill within the House of Representatives as a fourth plebiscite. The other three plebiscites held have not come out strongly for or against Puerto Rico statehood. The pro-statehood and pro-commonwealth parties in Puerto Rico have about equal support, and the pro-independence party has about 5 percent support. HR 2499 would create the first congressionally-sanctioned plebiscite about Puerto Rico statehood.

Statehood of Puerto Rico votes

Two votes would occur if HR 2499 passed, which is the bill raising questions about Puerto Rico statehood. A vote could be held on the question first "Should Puerto Rico maintain its present political status.". If most votes are no on the question, then a second vote would be held. The second vote would offer 3 different options:

• Independence which means that a separate nation can be made by breaking ties between US and Puerto Rico
• Associated Sovereignty – ties are maintained with the US while eliminating US citizenship and Territorial Clause controls of Puerto Rico
• Puerto Rico Statehood which would make Puerto Rico a 51st state of the US, with two US senators, eight presidential electoral votes, and six congressmen.

There are numerous good arguments both for and against Puerto Rico statehood. Some say Puerto Rico statehood would offer equal representation to a group of individuals who are subject to federal laws. Other individuals argue that Puerto Rico statehood would break up the unique and balanced system that has developed over the last 50 years. What is your opinion?

Article Resources

HR2499.org

By M.P. MCQUEEN
WALL STREET JOURNAL

Are you overlooking a commercial real-estate boom?

If your definition of the category is limited to splashy office parks and shopping malls, both of which took a pounding during the financial crisis and haven't fully recovered, then you probably are.

But think a little smaller—like fast food-restaurants, convenience stores and gas stations—and the returns get bigger. Such ventures, known as triple-net-lease properties, are "the best-performing sector of the commercial real estate marketplace," says David Bailin, head of global managed investments for Citi Private Bank, which serves ultra-high-net-worth clients. "It is the sector that lost the least value [during the recession] and rallied the quickest."

View Full Image

Brian Shumway for The Wall Street Journal
Michael Federman at his property in Lower Manhattan, which houses a new Chipotle Mexican Grill restaurant.

Triple-net-lease properties are usually freestanding buildings in which a tenant agrees to take responsibility for maintenance, taxes and insurance during a long lease—leaving the investor with little to do but collect checks. Investors typically buy individual properties through commercial real-estate brokers like Marcus & Millichap, CB Richard Ellis Group or others, either alone or in limited partnerships with a few other investors, and then lease them out to occupants such as drug store chains, quick-serve restaurants, convenience and dollar stores, medical outfits, and in some cases big-box retailers like Costco.

Triple-net-lease properties are generating annual returns of as much as 12% these days, estimates Bernard J. Haddigan, managing director of Marcus & Millichap Real Estate Investment Services' National Retail Group. Individual investors and small groups of partners generally invest $300,000 to $5 million per building.

Some publicly traded real-estate investment trusts concentrate on triple-net-lease properties, too. They returned 16.9% during the first quarter—compared with 11.1% for Dow Jones Equity All REIT Index, which includes all types of commercial and residential property.

Triple-net properties suffered during the recession, but less than other types of real estate. Whereas overall commercial prices fell by about 40% during 2007-09, prices for triple-net properties fell by about 15%, according to Mr. Haddigan.

Like all kinds of investing, triple-net-lease plays are based on risk: the more you're willing to take, the greater the potential returns. There are several important factors that determine a triple net deal's riskiness: the creditworthiness of the tenant, the location, physical condition and functionality of the property, and the remaining term on a lease (shorter is riskier). Also important: the "occupancy cost" or "health ratio," defined as the percentage that the tenant pays in rent relative to store sales. (The lower the ratio, the better.)

Besides overall economic risk, there's the risk of picking a tenant whose product or service might fall out of favor. Changing consumer trends can wipe out cash cows, as happened with some video-rental stores during the last decade.

"You need a good tenant," says Jeffrey Rogers, president and chief operating officer of Integra Realty Resources, a commercial real-estate appraisal and consulting firm that doesn't own or broker real estate. "Then you need an optimal location and to know what the market rent is. That is absolutely key."

Investors who lack the time or inclination to invest in triple-net-lease properties directly can get into the category via REITs such as the publicly traded Realty Income Corp. and Lexington Realty Trust in New York, as well as American Realty Capital Trust in Jenkintown, Pa., which is not traded on a stock exchange. These REITs invest mainly in triple-net properties, and they're generally sold through broker-dealers. They sometimes have minimum-net-worth and other requirements.

As with most income properties, investors can come out ahead—or behind—on triple-net properties in two ways: through price appreciation and income. The best measure of income potential is the so-called capitalization rate, or the net operating income divided by the purchase price of a property.

In recent months, cap rates have been falling because property prices nationally are rebounding. More investors are going after fewer high-quality properties, driving prices up. This is considered a positive sign for the broader commercial real estate market—but it means the easy money in triple-net-lease properties might be coming to an end.

But there is still opportunity for savvy investors. Michael K. Federman, 38 years old, is an attorney in New York who began investing in triple-net properties in 2004, during the previous recession. His first acquisitions were fried-chicken restaurants in upstate New York, followed by a Circle K convenience store in Arizona. He later sold the Circle K and purchased more buildings, and currently owns a portfolio of 15 properties.

A self-professed "conservative" investor, Mr. Federman now concentrates primarily on single-tenant properties, he says. Most recently, he and a business partner in March purchased a long-term lease property for about $4 million housing a Chipotle Mexican Grill in Lower Manhattan with a cap rate of 8.5%. That return was in line with the national average for casual dining restaurants in 2009, according to Marcus & Millichap.

"For me it was a perfect deal," he says, "because it combined prime real estate, stellar credit and minimal management responsibilities."

www.CommercialPropertyDirectory.com

No pictures this week.  I have been working on sample boards for a new construction home creating the texture on the walls.  Its a good challenge to be the one who applies the texture.  I am using a series of photographs the client has provided.  I will post some pictures when I work it out.

Nonfarm payroll employment rose by 290,000 in April, the unemployment rate edged up to 9.9 per-
cent, and the labor force increased sharply, the U.S. Bureau of Labor Statistics reported today. Job gains
occurred in manufacturing, professional and business services, health care, and leisure and hospitality.
Federal government employment also rose, reflecting continued hiring of temporary workers for Census
2010.

Read the whole report!
http://www.bls.gov/news.release/pdf/empsit.pdf

Some Fridays have more good news to share than others. Today – one day after a record intra-day point drop in the Dow – fits into the latter category. Was it caused by a “fat finger” (a technical glitch) or fears that contagion from Greece’s debt will spread to other countries, threatening the euro? The drama playing out in Europe eclipsed this morning’s blowout report from the Bureau of Labor Statistics that employers added 290,000 net new payroll jobs last month including 231,000 in the private sector. It was the best performance since February 2006 and well above the consensus for 175,000. On any other day, this might fuel a big stock market rally, but today, traders are focused on events overseas.

I was struck by editorials in today’s New York Times and Wall Street Journal that were in basic agreement, which is news in itself.

• In the Times, Nobel prizewinning economist Paul Krugman asks, “So, is Greece the next Lehman? No. It isn’t either big enough or interconnected enough to cause global financial markets to freeze up the way they did in 2008. Whatever caused that brief 1,000-point swoon in the Dow, it wasn’t justified by actual events in Europe.” Click here to read the full article.

• The Wall Street Journal states, “… there is no good reason that sovereign debt problems in a country that represents only 2% of the EU economy should send the world into another financial crisis and recession… The world banking system is far stronger than it was two years ago, and… the world economy is also stronger than it was in 2008.”

It’s not unusual for financial markets to disconnect from economic fundamentals for periods of time. Consider the 23 percent plunge in the Dow on October 19, 1987 (Black Monday). The economy continued to expand, and employers continued to add jobs at a rapid pace for another 2 ½ years by which time the stock market had recovered its losses.

The 290,000 jobs added to payrolls last month is good news for commercial real estate because it shows that occupier demand for space is heading in the right direction. Financial markets remain fragile as the problems in Greece and the euro zone illustrate, but they don’t preclude a continuing recovery. It serves as a cautionary tale on two fronts:

• Investors should not abandon their analytical rigor as they compete for bargains in commercial real estate and other assets.
• Eventually the U.S. must get its own fiscal house in order.

Have a great weekend.

Best regards,
Bob

Robert Bach
SVP, Chief Economist
Grubb & Ellis
312.698.6754

www.CommercialPropertyDirectory.com
www.CommercialBrokerBlog.com

Big business and our government. The compromise between the free market and government regulation, and (my opinion) in the worse case, government run, entities.

How does the gap between the rich, the middle class, and the poor, influence our decisions? How do we feel about the influence of money in politics?

Why do we allow health, banking and oil companies to give so much money to our representatives? How are they so big and need our tax money to stay in business?

The big trusses for the great room came yesterday and were set. These big fir beams will be painted to match the other beams I have done for the home.
I spent the day painting the tongue part of the tongue and grove 2 by 6 ceiling planks for this room, approximately 220 sixteen footers. A little forward thinking here is that if the ceiling planks shrink any you might be able to see the raw wood if a seam opens up. So painting that area eliminates that from happening.