Woof. Really had to WANT that title to work.
I, as have most Bendites, have developed an immunity to the Kool-Aid that our resident Jonestown media has made a living shoveling down our gullets. And sometimes it feels like I'm whistling in the wilderness, because I hear NOTHING but FAN-got-dang-tastic news coming from every corner.
Q: "How's Business?"
A:"YOU SHOULDN'T EVEN HAVE TO ASK! BUSINESS IN BEND WAS, IS AND ALWAYS WILL BE UNBELIEVABLY GREAT! BETTER THAN GREAT! IT'S INFINITELY GREAT! THE ONLY THING BETTER THAN BUSINESS IN BEND TODAY, IS BUSINESS IN BEND TOMORROW! INFINITE!"
OK, that's basically Bend media for you. You essentially can't hear anything else, UNLESS YOU REALY WANT TO, and if you can find a counter-culture to the Everybody Happy/Jonestown party line, you'll often see Kool-Aid vendors whaling on bloggers like me, and few others who actually dispute the idea that Bend is THE PARADISE. Not A PARADISE, THE PARADISE.
So imagine my surprise when I saw this on Utterly Boring:
http://utterlyboring.com/archives/2007/02/26/is_this_woman_n.php
Jake goes on to question the veracity about of one of the pillars of CO real estate on home affordability! Could it be true? Homes aren't affordable here? Are there further chinks in the armor?
Well, it seems so:
http://bend.craigslist.org/com/283576540.html
Here is a Poor Californian (I know, I freaked out too) who came to Bend and, ~wait for it~, didn't not immediately walk into riches, super models, Ferraris, and 6 mansions. I will paste this craigslist post in it's entirety here:
Hello:
I read your ad on craigs list and wanted to respond so that you don’t make the mistake that so many of us here have. I am originally from Los Angeles and regret ever moving here. In CA I had an almost full time practice that has dwindled down to almost nil here in Bend. Actually it is nil. Any clients I have had are from out of the country and I service them online. I did try to market my practice here and the papaers not only got my name wrong, my number wrong soo many times that if any potential clients did attempt to contact me I lost them due to the lack of people doing their jobs correctly here.
The housing market has quadrupled since we moved here in January 2003. It is literally as much as CA homes now. (The ones not along the ocean in CA though, but still, we’re talking $400k and up) The locals here try to claim that Bend is like Aspen, CO…and it is NOT, at all. There isn’t much to do here either. We do have one mall, if you can even call it a mall. It is a ONE story building that is literally half empty! There are a lot of camping and outdoor recreation available here though. The drinking water is the best I’ve ever had in my life. The air is crisp and fresh. (for now) The humidity level is low so when it is 17 degrees out it does not feel that cold, just as when it is 90 degrees out it does not feel that hot. The area is beautiful but to me, it is isolated. Any true city is a 2 hour drive, and over a pass, which is a bitch in the winter months. And as far as cuisine, in my opinion it SUCKS. Being from L.A. I’m used to far above average restaurants, (NY is better I’m sure!) and Bend is far more than below average. For example, try calling an Italian restaurant here and ask them if they have garlic bread, NONE of them do! (Wait one does and they charge $5 for a loaf) Though the employees here are English speaking they never cease to “F” up our orders! (Be it fast food or dine in places) Just crazy things like that.
They try to advertise and market Bend and Central Oregon as though it’s some prime city here and the food places are fabulous…how family oriented it is….lots to do…and so on..but I’m sorry, this is very untrue. Not to mention that the “true” locals despise and loathe anyone who was not born and raised here. (Yet they take your money quickly enough) They act as though you are foreign. You hear jokes and sarcastic remarks constantly about Californians primarily, but it’s just as bad for anyone else not from the area. I think that Bend and Central Oregon would be a great place to visit, but you wouldn’t want to stay more than 3 days because you’d die of boredom. (Unless skiing and or snowshoeing is your thing?)
We came to Bend in Jan of 2003 with $50 grand from a small real estate sale and we were forced to basically spend it ALL to get on our feet and to become stable. At that time the cost of living was definitely cheaper than CA and it seemed so new and exciting. Now that a few years have passed, I really, really regret it. If I had to do it over again I would have never come here. Sure if you’re from out of state (like NY or L.A.) you can certainly sell your home for $400k to 1 million and buy a home here outright…but then what? Property taxes are fairly high here. Sure, there is no sales tax BUT if you have to work, as most of us do, the state income tax is ridiculously high! (Up to 35% high) I’d rather pay sales tax any day then have so much of my wage taken! Then you have the dumb ass Californians,and I’m from there! Who are trying to vote in sales taxes! Their way of thinking is the state will lower the state income tax..we all know that isn’t true!
The job market here is horrid. (Unless you have a specific career path or degree such as a doctor or lawyer, vet, etc) I have been out of work since December. (So almost 3 months) My background consists of Property Management, Office Administration and Customer Service Representative type of work, so you’d think I could easily gain employment here, right? Well, I’m sorry but I generally cannot survive, even here, on $8 an hour!!!!! I’ve had a hell of a time here and am more than broke at this point. My husband has an accounting and computer IT background and has been forced to take a job as a Customer Service Representative for $11 an hour at T-Mobile. (And $11 an hour here is GREAT money!) T-Mobile is probably the biggest employer here and it is in the next town over. (Redmond…20 miles away) I apologize for sounding so negative, but honestly our dream has been shattered by moving to this place. We are in fact looking to move out ASAP! We plan to put our small little home on the market in the spring, I’m sure we’ll take a loss on it since the real estate market has simmered down so much, and then we’re moving to a city with at least 400 thousand people and NOT in Oregon! Please feel free to write back and ask me any specific questions that you may have.
This just floored me in a few ways. First, it's the first time I ever even conceived of Californians as humans. Second, I feel BAD for this woman! Finally, it is one of the first times I've seen it put into print so well, just what Bend REALLY is all about.
This place EXISTS to create a conveyor belt of inbound money from where ever it can to fleece every last nickel from any starry-eyed dreamers who even take a sip of Bend Media Kool-Aid. Employers here pay NOTHING! Unless you ALREADY have millions, you almost certainly will go BROKE trying to make it here!
The above craigslist post was put on another local blog:
http://ikeeneye.wordpress.com/2007/02/25/californian-who-regrets-moving-to-bend/
Read these comments:
Bend has, in my experience, a service-based economy. Most people my age that live there work as baristas or waitresses or snowboard instructors. Bend is only for rich californians, not necessarily the still-working ones that these people sound like.
But of all the places in Oregon there is too live Bend is top of the list for money greedy, scamming, rudeness, ect. there is to live. Sad that that town has become what it has, how in the world did it get so out of control that people have to leave there to find happiness? I seen enough hard working people suffer there moving from place to place never having any security of a nice warm place to call home because the cost of living just kept going up and up. Seems to me if you were working class you never had the money to enjoy the fun things there was to do there because you had to work every hour you could just to pay the rent and afford food. Rich is very much in control there, they own the apts, houses and trailer parks, working class is at their mercey. Sad that there is a part of Oregon that could be so wonderful, but instead for a native Oregonian it can be the pit of hell. Too bad for Oregon that Bend seems to be the place everyone knows about, when you think of Oregon you think of Bend. I hope everyone reading this understands not all of Oregon is like Bend. We are a great state, freindly, caring, and most of all love and take care of our elderly. Dont judge Oregon based on Bend. I am not sure what went wrong in Bend but the rest of the state can learn by Bends mistakes and hopefuly stay as beautiful as it is.
Bend was a wonderful, small town as recently as fifteen years ago, and has grown into a monster of a city crammed into a small space. For the last ten years, I watched Bend become a more difficult place to live — pretentious, traffic-ridden, and a little bit meaner than I had remembered it. My husband and I hated it, and began travelling to Baker to relax on the weekends and do… well… do nothing. We love the wide open spaces, the genuine friendliness of the people, and the simplicity of knowing your neighbors more than your business associates.
I found that post on the Bend Craigslist, and it just made me laugh. Then, I felt bad. Tens of thousands of people sold their expensive homes in California to “settle down” in Bend, only to turn it into a mini-Santa Monica. Now they’re unhappy, because it’s just not hoity-toity enough for their lifestyles. I can’t tell you how many times I’d hear newcomers to Bend complain about the shopping, the restaurants, the lack of nightlife. Why on earth did they move there, then?!??? I miss Bend; not Bend as it is now, though — Bend as it was.
Baker is our home now. I love it here, and I love the feeling of community.
Dang. This ain't me folks, this is regular people just "out there". There seems to be a real groundswell of disaffected folks who are tired of the Bend Experience. The main upshot being their financial clock is cleaned in this place. Have not seen anything like this EVER.
Tuesday, February 27, 2007
Sunday, February 25, 2007
SOLD OUT! Well... sort of. Not really. OK, none actually sold...
In a Bulletin article last April,
Buyers compete for Bend condos
Deadline for bids on Franklin Crossing condos today
We got the practically effusive predictions of never ending price appreciation for Bend in general, and downtown Bend condos in particular. Franklin Crossings condo units were embroiled in a bidding war:
Six of the seven drew offers at the asking price before the reservation period ended last Friday, Coldwell Banker Morris Real Estate broker Norma DuBois said. Five drew multiple bids, which prompted a follow-up bidding period. The competition may bump the prices up even further.
The reservation period was offered only to a "priority list" of potential clients who had expressed interest in the project, DuBois said.
The Franklin Crossing building, in particular, with its ground- and second-floor retail, third- and fourth-floor offices and upstairs condos "has a penthouse feel," DuBois said. "There is a real feeling of uniqueness to it."
Joe Bankofier, a partner in Franklin Crossing's development group, Keystone Partners LLC, said he didn't expect condominium sales to run as strong as they have in his building when he started planning the project three years ago. In fact, the ownership group raised the target prices on its condos around $200 a square foot since they started considering their pricing last year.
Then, from an August article: High-end retail eyes Franklin site - Restaurants, athletic club are among pending leases:
The eight condominiums sold from $481 per square foot to $636 per square foot, Oliver said.
So, we get the impression that Franklin Crossing practically had to fend off buyers with a stick, and resort to their "priority list" to keep the rabble at bay from sullying the waters with their almost sub-human bids. So these units are not just reported as "Sold", they are Sold Squared. There's virtually no chance in Hades mere humans will ever get their mits on a Franklin Crossing condo. OK, those units are SOLD, GONE, GOODBYE.
Fast forward to today:
Condo market key to penciling out projects
Developments line up, but sales strength a factor
In Franklin Crossing at the corner of Franklin and Bond — the downtown’s first new five-story mixed-use building — buyers lined up to snap up reservations on the buildings eight top-floor condominium units last spring, despite prices that ranged over $1 million, DuBois said.
But the market changed over the summer, and so did Franklin Crossing’s fate.
Reserved buyers melted away from five of the building’s eight units by the end of 2006, DuBois said, leaving only three sold so far. The remaining five units, priced between $450,000 and $1.1 million, account for about $3.25 million in inventory at current listing prices.
So Franklin Crossing units are available again, right? So the whole SOLD OUT thing was a load? Apparently so. And what's more, developers have pinned their hopes on the condo market to get downtown deals done:
All of the downtown projects include some mix of retail or office space on their lowest floors.
But, given the high prices for downtown land and the high price of construction, their economic viability may depend on a single factor — the health of the residential condominium market.
The reason: Selling parts of a building to condo dwellers is the only way, in most cases, to offset initial building costs to the point where ground-floor retail and midfloor office leases can generate a profitable income stream.
In other words, as Bend Realtor Norma DuBois puts it, “It’s the only way you can make it pencil.”
Seems downtown buildings don't make sense unless you can jam way overpriced condo units down the gullets of several buyers on Day 0. Day 0 is the day you're at the bank begging for money to start building, by the way.
This latest article goes on to detail the vomiting forth of a litany of condo projects all over Bend that promise to flood the market with hundreds of units. Then it details the terrible vagaries of the condo market, a beast much more volatile than single family home sales. And these projects are almost all mixed-use residential/commercial beasts that need the pre-selling of condos to even get out of the blocks. And... condo sales are dead.
But this entry isn't about that... it's about what "SOLD" and other representations from Realtors, and by extention, our local media really means. We were told last April, and on innumerable occasions since, that Franklin Crossing was SOLD OUT. That means to me, SOLD OUT, operative word being SOLD. We find out that more than half the buyers in Franklin Crossing have bailed out. They weren't SOLD, they were just PENDING. Or kind of PENDING. Maybe the buyers made verbal promises about going PENDING. MAYBE. SOMEDAY. If certain contingencies are met.
A promise to go pending someday, if certain contingencies are met, maybe.
Call me a pessimist who just doesn't get it, but THAT AIN'T SOLD.
Which brings me to THE REAL POINT: OUR LOCAL MEDIA HAS ZERO CREDIBILITY WHEN THEY REPORT CRAP LIKE THIS, AND THEY KNOW FULL WELL THEY ARE COMPLICIT WITH THE RE INDUSTRY IN LYING ABOUT THE MARKET WHEN THEY DO REPORTS LIKE THIS. FRANKLIN CROSSING WAS NEVER SOLD OUT. BUT THE BULLETIN REPORTED THEY WERE SOLD OUT LIKE THE TRAINED DOG THEY ARE. HEY BEND MEDIA, HERE'S AN IDEA: GROW AN EDITORIAL BACKBONE!
Buyers compete for Bend condos
Deadline for bids on Franklin Crossing condos today
We got the practically effusive predictions of never ending price appreciation for Bend in general, and downtown Bend condos in particular. Franklin Crossings condo units were embroiled in a bidding war:
Six of the seven drew offers at the asking price before the reservation period ended last Friday, Coldwell Banker Morris Real Estate broker Norma DuBois said. Five drew multiple bids, which prompted a follow-up bidding period. The competition may bump the prices up even further.
The reservation period was offered only to a "priority list" of potential clients who had expressed interest in the project, DuBois said.
The Franklin Crossing building, in particular, with its ground- and second-floor retail, third- and fourth-floor offices and upstairs condos "has a penthouse feel," DuBois said. "There is a real feeling of uniqueness to it."
Joe Bankofier, a partner in Franklin Crossing's development group, Keystone Partners LLC, said he didn't expect condominium sales to run as strong as they have in his building when he started planning the project three years ago. In fact, the ownership group raised the target prices on its condos around $200 a square foot since they started considering their pricing last year.
Then, from an August article: High-end retail eyes Franklin site - Restaurants, athletic club are among pending leases:
The eight condominiums sold from $481 per square foot to $636 per square foot, Oliver said.
So, we get the impression that Franklin Crossing practically had to fend off buyers with a stick, and resort to their "priority list" to keep the rabble at bay from sullying the waters with their almost sub-human bids. So these units are not just reported as "Sold", they are Sold Squared. There's virtually no chance in Hades mere humans will ever get their mits on a Franklin Crossing condo. OK, those units are SOLD, GONE, GOODBYE.
Fast forward to today:
Condo market key to penciling out projects
Developments line up, but sales strength a factor
In Franklin Crossing at the corner of Franklin and Bond — the downtown’s first new five-story mixed-use building — buyers lined up to snap up reservations on the buildings eight top-floor condominium units last spring, despite prices that ranged over $1 million, DuBois said.
But the market changed over the summer, and so did Franklin Crossing’s fate.
Reserved buyers melted away from five of the building’s eight units by the end of 2006, DuBois said, leaving only three sold so far. The remaining five units, priced between $450,000 and $1.1 million, account for about $3.25 million in inventory at current listing prices.
So Franklin Crossing units are available again, right? So the whole SOLD OUT thing was a load? Apparently so. And what's more, developers have pinned their hopes on the condo market to get downtown deals done:
All of the downtown projects include some mix of retail or office space on their lowest floors.
But, given the high prices for downtown land and the high price of construction, their economic viability may depend on a single factor — the health of the residential condominium market.
The reason: Selling parts of a building to condo dwellers is the only way, in most cases, to offset initial building costs to the point where ground-floor retail and midfloor office leases can generate a profitable income stream.
In other words, as Bend Realtor Norma DuBois puts it, “It’s the only way you can make it pencil.”
Seems downtown buildings don't make sense unless you can jam way overpriced condo units down the gullets of several buyers on Day 0. Day 0 is the day you're at the bank begging for money to start building, by the way.
This latest article goes on to detail the vomiting forth of a litany of condo projects all over Bend that promise to flood the market with hundreds of units. Then it details the terrible vagaries of the condo market, a beast much more volatile than single family home sales. And these projects are almost all mixed-use residential/commercial beasts that need the pre-selling of condos to even get out of the blocks. And... condo sales are dead.
But this entry isn't about that... it's about what "SOLD" and other representations from Realtors, and by extention, our local media really means. We were told last April, and on innumerable occasions since, that Franklin Crossing was SOLD OUT. That means to me, SOLD OUT, operative word being SOLD. We find out that more than half the buyers in Franklin Crossing have bailed out. They weren't SOLD, they were just PENDING. Or kind of PENDING. Maybe the buyers made verbal promises about going PENDING. MAYBE. SOMEDAY. If certain contingencies are met.
A promise to go pending someday, if certain contingencies are met, maybe.
Call me a pessimist who just doesn't get it, but THAT AIN'T SOLD.
Which brings me to THE REAL POINT: OUR LOCAL MEDIA HAS ZERO CREDIBILITY WHEN THEY REPORT CRAP LIKE THIS, AND THEY KNOW FULL WELL THEY ARE COMPLICIT WITH THE RE INDUSTRY IN LYING ABOUT THE MARKET WHEN THEY DO REPORTS LIKE THIS. FRANKLIN CROSSING WAS NEVER SOLD OUT. BUT THE BULLETIN REPORTED THEY WERE SOLD OUT LIKE THE TRAINED DOG THEY ARE. HEY BEND MEDIA, HERE'S AN IDEA: GROW AN EDITORIAL BACKBONE!
Friday, February 23, 2007
How To Cram Every Nook And Cranny With Homes
From an article in todays Bulletin:
Public hears plans for subdivision
Brooks' subdivision is only one of a handful of large subdivisions that are sitting on drawing boards in developers' offices, waiting for the city to expand its boundaries, but it would certainly be one of the largest.
To the west of the city, the Miller family wants to build a mixed residential and commercial subdivision on the 445 acres of land it owns west of NorthWest Crossing, complete with new schools.
Also to the west, landowner Matt Day and his Tumalo Creek Development company want to spread a subdivision across the 370 acres he owns to the south of Shevlin Park Road.
To the northeast, the city of Bend is still putting touches on plans to develop the 1,100 acres of land it owns for industry, housing, offices, commercial and higher education.
To the east, the Oregon Department of State Lands has plans to develop more than 600 acres it owns east of 27th Street north of the Knott Landfill, and a host of developers have plans to start building on various lands to the northeast.
It's obvious that Bend has grown enormously for the past few years. There's all sorts of reasons why put out there: Bend is beautiful. Retirees will never stop coming here. Californians love to run down the locals in Hummers. Bend is dirt cheap compared to downtown San Fran penthouses. And so on.
But let me put forth that Bend is not totally unique throughout the Universe. Granted, Bend is nice, but so are a lot of other places. And I guess the upshot of this ultimately is the weird idea that Bend Might Not Grow At Abnormally High Rates Forever Like Virtually Every Developer On The West Coast Thinks It Will.
I think Bend will do OK in the future, but there seem to be a large number of people who think they can convince an even larger group of extremely rich people to haul their life savings to this backwater and blow most of it in a high density, very expensive subdivision plot with a fairly average house. I'm not sure that can be done in quite the volumes they're dreaming of.
Besides the planned subdiv's stated above, there are city-doubling developments planned for Prineville and Madras. And every Prop 37 claimant thinks They will just plotz out a subdiv way out in the middle of nowhere, so they can easily and conveniently make they $5-6 million they'll need to retire.
It may not seem like it, but all that empty land is starting to mysteriously become available for development, despite the widespread idea that there is a land shortage in Central OR. Of course there's not. We might not have a lot of things, but land isn't one of them. It's everywhere.
There's probably going to come a time when Bend isn't as "hip" with the in-crowd as it once was. We are the It Town now, but the It Town has a way of not being the It Town after awhile. It becomes passe, not cutting edge, or the effects of being the It Town ruin the place. I would guess there will come a time soon when Bend doesn't grow, and in fact shrinks.
The Price:Income ratio here is completely skewed. 92% of the homes are beyond the financial reach of people making 120% of the cities median income. If I were to come to Bend today, look at homes and then look at jobs, the decision would be made for me: I'd love to live here, but I can't, it's financially infeasible. That sentiment is spreading, and has also been covered in the local paper. Working people can't make it in Bend.
We will reach some sort of crisis point soon: Either Bend will begin shrinking down and will reach a population point much smaller than it is now and become a resort town, or Price:Income ratios will begin to adjust. I wouldn't look to incomes to come up. There is every reason in the World for them to be going up now, and they aren't. This leaves prices to fall and fall dramatically. Home prices will need to shrink 40-50% in real terms to make Bend a viable place to live. But this could take 10, 15 or even 20 years.
I think we'll suffer a little of both: Bend will start shrinking soon, to the dismay and shock of those trying to build out every square inch of empty land. Plans will be revised down. Homes will go up for sale, but there'll be no one buying. Price will begin a slow but inexorable march down. They'll stall, and everyone will call a bottom, but it'll just be a pause before things go South again. It seems like Bend shrinking and falling real estate demand are two paradigms that no one even thinks is within the realm of possibility, but both seem like an economic certainty.
Public hears plans for subdivision
Brooks' subdivision is only one of a handful of large subdivisions that are sitting on drawing boards in developers' offices, waiting for the city to expand its boundaries, but it would certainly be one of the largest.
To the west of the city, the Miller family wants to build a mixed residential and commercial subdivision on the 445 acres of land it owns west of NorthWest Crossing, complete with new schools.
Also to the west, landowner Matt Day and his Tumalo Creek Development company want to spread a subdivision across the 370 acres he owns to the south of Shevlin Park Road.
To the northeast, the city of Bend is still putting touches on plans to develop the 1,100 acres of land it owns for industry, housing, offices, commercial and higher education.
To the east, the Oregon Department of State Lands has plans to develop more than 600 acres it owns east of 27th Street north of the Knott Landfill, and a host of developers have plans to start building on various lands to the northeast.
It's obvious that Bend has grown enormously for the past few years. There's all sorts of reasons why put out there: Bend is beautiful. Retirees will never stop coming here. Californians love to run down the locals in Hummers. Bend is dirt cheap compared to downtown San Fran penthouses. And so on.
But let me put forth that Bend is not totally unique throughout the Universe. Granted, Bend is nice, but so are a lot of other places. And I guess the upshot of this ultimately is the weird idea that Bend Might Not Grow At Abnormally High Rates Forever Like Virtually Every Developer On The West Coast Thinks It Will.
I think Bend will do OK in the future, but there seem to be a large number of people who think they can convince an even larger group of extremely rich people to haul their life savings to this backwater and blow most of it in a high density, very expensive subdivision plot with a fairly average house. I'm not sure that can be done in quite the volumes they're dreaming of.
Besides the planned subdiv's stated above, there are city-doubling developments planned for Prineville and Madras. And every Prop 37 claimant thinks They will just plotz out a subdiv way out in the middle of nowhere, so they can easily and conveniently make they $5-6 million they'll need to retire.
It may not seem like it, but all that empty land is starting to mysteriously become available for development, despite the widespread idea that there is a land shortage in Central OR. Of course there's not. We might not have a lot of things, but land isn't one of them. It's everywhere.
There's probably going to come a time when Bend isn't as "hip" with the in-crowd as it once was. We are the It Town now, but the It Town has a way of not being the It Town after awhile. It becomes passe, not cutting edge, or the effects of being the It Town ruin the place. I would guess there will come a time soon when Bend doesn't grow, and in fact shrinks.
The Price:Income ratio here is completely skewed. 92% of the homes are beyond the financial reach of people making 120% of the cities median income. If I were to come to Bend today, look at homes and then look at jobs, the decision would be made for me: I'd love to live here, but I can't, it's financially infeasible. That sentiment is spreading, and has also been covered in the local paper. Working people can't make it in Bend.
We will reach some sort of crisis point soon: Either Bend will begin shrinking down and will reach a population point much smaller than it is now and become a resort town, or Price:Income ratios will begin to adjust. I wouldn't look to incomes to come up. There is every reason in the World for them to be going up now, and they aren't. This leaves prices to fall and fall dramatically. Home prices will need to shrink 40-50% in real terms to make Bend a viable place to live. But this could take 10, 15 or even 20 years.
I think we'll suffer a little of both: Bend will start shrinking soon, to the dismay and shock of those trying to build out every square inch of empty land. Plans will be revised down. Homes will go up for sale, but there'll be no one buying. Price will begin a slow but inexorable march down. They'll stall, and everyone will call a bottom, but it'll just be a pause before things go South again. It seems like Bend shrinking and falling real estate demand are two paradigms that no one even thinks is within the realm of possibility, but both seem like an economic certainty.
Thursday, February 15, 2007
Broken Top Lawsuits: So Let It Be Written, So Let It Be Done.
Discontent Grows At Broken Top - Several Members Seek Legal Action
And so begins the lawsuit phase of the Broken Top Golf Course Shell Game fiasco intimated on the previous post. This Bend Bulletin article points out that the home owners are keeping their eye on the money:
"We're just trying to protect ourselves and keep everybody as calm as we can," said Ron Webber, president of the homeowners association. "The thing that's tragic about all of this are the fears and the uncertainties that it's creating in this otherwise calm and peaceful community. And that is sad."
Of course they want to douse the "fear and uncertainty" because those things are bad for home prices. Of course, once the Genie is out of the bottle (aphorism for "bloodsucking lawyers have got a taste for fresh meat and want to rip every living thing within 100 miles to shreds and devour it in a bloodthirsty frenzy"), its hard to stuff it back in.
Whoever the Seattle Ghost buyer is, they should realize they are shooting themselves in the foot by doing this. The richest people in the Seattle area are as follows:
I don't know why, but the Microsofties don't seem the type to do this sort of thing so far from home base, they all own a lot of RE near them. Besides, Bill Gates is under such a microscope, it'd be hard for him to do anything & make it stay a secret for long. The bottom 3 also don't seem the RE type. Not like I'm tight with any of them, but my money is on Bezos (he's bought some sagebrush out in TX), but mostly on McCaw. McCaw is the only one on the list with even remote ties to Bend. His new Clearwire venture is busting out all over Cent OR, and I actually had Clearwire door-to-door guys here a few weeks ago. Pretty thin, eh?
So there you have it, I predicted a lawsuit after essentially being told a lawsuit was coming & am now a predictive sage. My money is on Craig McCaw, his siblings, and their family trust as The dreaded Broken Top Busting Seattle Ghost. I will now go buy a lottery ticket which has about the same chance of being hitting the numbers. And all based on some door-to-door salesmen. You can take that to the bank.
And so begins the lawsuit phase of the Broken Top Golf Course Shell Game fiasco intimated on the previous post. This Bend Bulletin article points out that the home owners are keeping their eye on the money:
"We're just trying to protect ourselves and keep everybody as calm as we can," said Ron Webber, president of the homeowners association. "The thing that's tragic about all of this are the fears and the uncertainties that it's creating in this otherwise calm and peaceful community. And that is sad."
Of course they want to douse the "fear and uncertainty" because those things are bad for home prices. Of course, once the Genie is out of the bottle (aphorism for "bloodsucking lawyers have got a taste for fresh meat and want to rip every living thing within 100 miles to shreds and devour it in a bloodthirsty frenzy"), its hard to stuff it back in.
Whoever the Seattle Ghost buyer is, they should realize they are shooting themselves in the foot by doing this. The richest people in the Seattle area are as follows:
- Bill Gates, Paul Allen, Steve Ballmer, and Charles Simonyi (Microsoft)
- Jeff Bezos (Amazon.com)
- Craig McCaw (Cellular and wireless)
- James Jannard (Oakley sunglasses)
- John Orin Edson (Boats)
- Howard Schultze - (Starbucks)
I don't know why, but the Microsofties don't seem the type to do this sort of thing so far from home base, they all own a lot of RE near them. Besides, Bill Gates is under such a microscope, it'd be hard for him to do anything & make it stay a secret for long. The bottom 3 also don't seem the RE type. Not like I'm tight with any of them, but my money is on Bezos (he's bought some sagebrush out in TX), but mostly on McCaw. McCaw is the only one on the list with even remote ties to Bend. His new Clearwire venture is busting out all over Cent OR, and I actually had Clearwire door-to-door guys here a few weeks ago. Pretty thin, eh?
So there you have it, I predicted a lawsuit after essentially being told a lawsuit was coming & am now a predictive sage. My money is on Craig McCaw, his siblings, and their family trust as The dreaded Broken Top Busting Seattle Ghost. I will now go buy a lottery ticket which has about the same chance of being hitting the numbers. And all based on some door-to-door salesmen. You can take that to the bank.
Sunday, February 11, 2007
Seattle Ghost Spooks Broken Top Owners: "Now ya gettin nasty"
Here's the latest on the Broken Top fiasco, ostensibly taken from the now private Broken Top blog:
Cohen Financial
ATTENTION: Angus Cameron
111 Sutter Street (Suite 950)
San Francisco, CA 94104
E-mail to acameron@cohenfinancial.com
Re: Broken Top Club
Dear Mr. Cameron:
As a senior member (#65) of Broken Top Club, with a residence facing the 12th fairway, I'm hoping you can put an end to the concerns being generated by the Club's recent purchase by a nameless buyer.
My vantage point is that, since buying Broken Top property in 1993, my wife and I have looked forward to a day when the Club would belong to its members. Our Portland clubs (Portland Golf Club, Arlington Club, Town Club and Multnomah Athletic Club) were all equity clubs -- for people like us, the norm.
Even so, at Broken Top Club, short of acquisition of by its own members, our interests would be best served by the Club's passing into the hands of knowledgeable new owners with long-term staying power and genuine commitment to operating a premier property. If the Seattle Ghost qualifies, so be it.
Nonetheless, since word of the Club's sale leaked out, members and neighbors have been baffled, insulted, and infuriated by a series of slaps-in-the-face:
* Being told by you that the buyer's identity is being concealed by confidentiality agreement exacted by the seller, at the same time that the seller is telling us that the confidentiality proviso is demanded by the buyer .
* Being confronted by a cockamamie "re-development" scheme that would degrade the Broken Top neighborhood and shatter our way of life.
* Being sent, as the buyer's emissary, a grossly inept and uninformed "marketeer" whose only observable talent is the gift of alienating everyone who is exposed to him. ( * See footnote).
* Discovering a 6'2" blonde (an utter stranger among our members) parading around public gatherings to shell out business cards proclaiming her as Broken Top Club's Director of Sales/Marketing/Public Relations.
Having acquired, merged and sold several companies, I hardly need be reminded that, during many negotiations, confidentiality can be critical. But you don't need a Wharton MBA to figure out that, once the ink is dry, the parties had better start reading from the same page -- aloud -- to all their stakeholders and to the media.
The clumsiness and secrecy attending the Broken Top Club transaction have provoked resentment, suspicion and anger -- in my judgment, needlessly. Before this degenerates into a lawyers' feeding frenzy, the Seattle Ghost might think about shedding his shroud and laying his cards on the table, this time face-up.
Cordially,
John J. Mathews
61745 Broken Top Drive
Bend, OR 97702-1088
* To be perfectly blunt, within hours, the ESP "focus groups," had become widely known as the "f___-us groups."
And this:
This morning (2/8) I received a phone call from Angus Cameron of Cohen Financial. He stated that my name, as well as Ron Cole’s and ________ (a member who asked to not be identified), had come up in conversations and emails yesterday identifying us as members who are trying to organize an effort to buy the balances of the CEM memberships.
He stated that he wanted to open communications and “get ahead of this” as opposed to finding out about it later. He was very direct and forceful in his questioning regarding our intent. He also said he had heard we’ve hired an attorney.
My fundamental answer was, “we are considering all of our options including buying the balance of the CEM’s”. He pushed for more specifics, but I didn’t provide any more than to say we will be in touch when the time is right.
I turned the tables by asking him a series of questions. His answers are paraphrased here, not exact quotes.
How would the new owners react to an offer to buy the remaining CEM’s? “I’m not sure. Based on this new news of your efforts they instructed me to contact you and open a dialogue on the topic”.
You and the owner’s strategy to date have only created distrust and confusion about your intent. Why was it handled this way and why won’t the new owners identify themselves? “We sent Mike Parker in to present our ideas. We heard the feedback and are working on adjustments to those plans. The owners are a private family and they wish to remain that way. They don’t take an active role”.
You just said the owners asked you to contact us. “They are involved in decisions, but they want to remain private”.
How do the owners feel about the current CEM plan? What are their intentions? “We’ve hired Troon Golf to evaluate the membership plans. They should have some news in the next few weeks”.
Do the new owners plan to honor the CEM plan and turn over the Club and property when 300 CEM’s are secured as defined in the documents? “We have hired an attorney to review the documents and provide an opinion on the CEM plan. We should hear something within 30 days”.
It is inconceivable to me that the new owners wouldn’t have addressed that question during their due diligence, all of the upside potential of their acquisition hinges on that question. “I can’t discuss what happened in the due diligence”.
We’re both business people who have done major financial transactions. You’re saying the owner is waiting until 60 days after closing to find out if a membership structure will hinder their plans? Didn’t they answer that question in advance? “I can’t talk about the due diligence”.
With that we ended the call with me saying we would be in touch if we had more to discuss.
My general feeling is that he was on a fishing expedition.
Mark Powell
I hope they can resolve it peacefully, but this has LAWSUIT written all over it. If I were a BT owner, especially an equity holder in the golf course, I would be a little TO'd. But this is what happens in a "wink and a handshake" town like Bend. How many verbal deals will have to come back & bite people on the ass before they realize the Boss Hog style of running things won't work here anymore? There's a bridge in Sisters that a developer promised verbally to widen once he'd finished his little subdivision. Guess what? He sold most of the units, and when asked to complete the bridge, he told the City to screw off. Now there is a 1 lane choke point to exit that subdiv if there's ever a wildfire. And he probably WON'T be liable, since the City of Sisters is run on so many handshake deals. And of course, that's why the school system there is imploding and owes the state $1.2MM for a home schooling scam gone bad.
Cohen Financial
ATTENTION: Angus Cameron
111 Sutter Street (Suite 950)
San Francisco, CA 94104
E-mail to acameron@cohenfinancial.com
Re: Broken Top Club
Dear Mr. Cameron:
As a senior member (#65) of Broken Top Club, with a residence facing the 12th fairway, I'm hoping you can put an end to the concerns being generated by the Club's recent purchase by a nameless buyer.
My vantage point is that, since buying Broken Top property in 1993, my wife and I have looked forward to a day when the Club would belong to its members. Our Portland clubs (Portland Golf Club, Arlington Club, Town Club and Multnomah Athletic Club) were all equity clubs -- for people like us, the norm.
Even so, at Broken Top Club, short of acquisition of by its own members, our interests would be best served by the Club's passing into the hands of knowledgeable new owners with long-term staying power and genuine commitment to operating a premier property. If the Seattle Ghost qualifies, so be it.
Nonetheless, since word of the Club's sale leaked out, members and neighbors have been baffled, insulted, and infuriated by a series of slaps-in-the-face:
* Being told by you that the buyer's identity is being concealed by confidentiality agreement exacted by the seller, at the same time that the seller is telling us that the confidentiality proviso is demanded by the buyer .
* Being confronted by a cockamamie "re-development" scheme that would degrade the Broken Top neighborhood and shatter our way of life.
* Being sent, as the buyer's emissary, a grossly inept and uninformed "marketeer" whose only observable talent is the gift of alienating everyone who is exposed to him. ( * See footnote).
* Discovering a 6'2" blonde (an utter stranger among our members) parading around public gatherings to shell out business cards proclaiming her as Broken Top Club's Director of Sales/Marketing/Public Relations.
Having acquired, merged and sold several companies, I hardly need be reminded that, during many negotiations, confidentiality can be critical. But you don't need a Wharton MBA to figure out that, once the ink is dry, the parties had better start reading from the same page -- aloud -- to all their stakeholders and to the media.
The clumsiness and secrecy attending the Broken Top Club transaction have provoked resentment, suspicion and anger -- in my judgment, needlessly. Before this degenerates into a lawyers' feeding frenzy, the Seattle Ghost might think about shedding his shroud and laying his cards on the table, this time face-up.
Cordially,
John J. Mathews
61745 Broken Top Drive
Bend, OR 97702-1088
* To be perfectly blunt, within hours, the ESP "focus groups," had become widely known as the "f___-us groups."
And this:
This morning (2/8) I received a phone call from Angus Cameron of Cohen Financial. He stated that my name, as well as Ron Cole’s and ________ (a member who asked to not be identified), had come up in conversations and emails yesterday identifying us as members who are trying to organize an effort to buy the balances of the CEM memberships.
He stated that he wanted to open communications and “get ahead of this” as opposed to finding out about it later. He was very direct and forceful in his questioning regarding our intent. He also said he had heard we’ve hired an attorney.
My fundamental answer was, “we are considering all of our options including buying the balance of the CEM’s”. He pushed for more specifics, but I didn’t provide any more than to say we will be in touch when the time is right.
I turned the tables by asking him a series of questions. His answers are paraphrased here, not exact quotes.
How would the new owners react to an offer to buy the remaining CEM’s? “I’m not sure. Based on this new news of your efforts they instructed me to contact you and open a dialogue on the topic”.
You and the owner’s strategy to date have only created distrust and confusion about your intent. Why was it handled this way and why won’t the new owners identify themselves? “We sent Mike Parker in to present our ideas. We heard the feedback and are working on adjustments to those plans. The owners are a private family and they wish to remain that way. They don’t take an active role”.
You just said the owners asked you to contact us. “They are involved in decisions, but they want to remain private”.
How do the owners feel about the current CEM plan? What are their intentions? “We’ve hired Troon Golf to evaluate the membership plans. They should have some news in the next few weeks”.
Do the new owners plan to honor the CEM plan and turn over the Club and property when 300 CEM’s are secured as defined in the documents? “We have hired an attorney to review the documents and provide an opinion on the CEM plan. We should hear something within 30 days”.
It is inconceivable to me that the new owners wouldn’t have addressed that question during their due diligence, all of the upside potential of their acquisition hinges on that question. “I can’t discuss what happened in the due diligence”.
We’re both business people who have done major financial transactions. You’re saying the owner is waiting until 60 days after closing to find out if a membership structure will hinder their plans? Didn’t they answer that question in advance? “I can’t talk about the due diligence”.
With that we ended the call with me saying we would be in touch if we had more to discuss.
My general feeling is that he was on a fishing expedition.
Mark Powell
I hope they can resolve it peacefully, but this has LAWSUIT written all over it. If I were a BT owner, especially an equity holder in the golf course, I would be a little TO'd. But this is what happens in a "wink and a handshake" town like Bend. How many verbal deals will have to come back & bite people on the ass before they realize the Boss Hog style of running things won't work here anymore? There's a bridge in Sisters that a developer promised verbally to widen once he'd finished his little subdivision. Guess what? He sold most of the units, and when asked to complete the bridge, he told the City to screw off. Now there is a 1 lane choke point to exit that subdiv if there's ever a wildfire. And he probably WON'T be liable, since the City of Sisters is run on so many handshake deals. And of course, that's why the school system there is imploding and owes the state $1.2MM for a home schooling scam gone bad.
Friday, February 9, 2007
Bend Bulletin: We Suck.
In a strange twist, the Bulletin reports (Bend councilors say it's time to sue broker of BAT buses) that Bend city counselors are giving The Bulletin "the finger" over its reporting of the Bend City bus fiasco.
Listen up City of Bend counselors: Running this place isn't a tea party. A lot of you are in there for your own selfish interests, and not as responsible public servants. Politicians in this town are well known as grifters who use their positions as pure influence peddlers. Grow up or GET OUT! The Bulletin didn't shoot you in the foot, YOU DID!
I'll grant you this, that bus company is a bunch of thieving liars, but the city should have approached this AND ALL OTHER major expenditures with an exacting due diligence agenda. Of course they did not. These lemons ARE NOT the Bulletins fault AT ALL, it's all your fault. ALL OF IT. Getting pissed at them is indicative of complete incompetence.
Capell actually has it right:
“I think that it is time for the city to step in front of the bus,” Capell said.
Then we get a lawyers perspective:
Hummel at the meeting called the company lying crooks. He told the rest of the City Council that the city shouldn’t settle the case and should push for getting “every cent back.”
Surprise, surprise: City counselor Lawyer John Hummel wants to sue. He probably actually has an incentive to screw up deals. Then he can pawn off lawsuits to his buddies and take a kickback. Wonderful. Lawyers, dingos and other cannibals should be banned from city positions... as well as being out in public, or generally existing near humans.
Capells stock has gone up in my book. He didn't have much to start with since builder interests bought & paid for this guy to get elected. But just the same, he fessed up. But John Hummel should be thrown out of office. This litigious nutcase has shown zero remorse for pulling a huge financial boner, and his reflexive instinct is to sue. He should get the finger, and get thrown out of office.
During the same debate, some councilors criticized The Bulletin’s coverage of the issue and its editorials on the subject.
Hummel called the editorials “yellow journalism” and advocated giving the paper “the finger.” Friedman said The Bulletin hadn’t done its homework in seeing what other cities spend per mile to maintain buses and how Bend compared. Abernethy said the city hadn’t been treated fairly.
“They’re poisoning the rest of the citizens’ perception of the city,” Abernethy said.
I think this is a case of sour grapes by city counselors that their own incompetence, and old boy network "Boss Hog" style of handshakes & winks approach to running this city is starting to have negative consequences.Councilor Mark Capell, who was elected to the City Council after the city purchased the buses, said he thought the city should publicly acknowledge where it went wrong and what it is going to do about the problem.
“I think that it is time for the city to step in front of the bus,” Capell said.
Capell said he was tired of getting hammered by the public on the issue.
“It seems like the kind of thing everyone brings up,” Capell said Thursday. “It’s ‘what were they thinking?’ And it’s time to tell them what we were thinking.”
Tired of getting hammered on the issue? Hmmm... next time THINK! We can avoid fiascos like the City buses being lemons sold to us at a 1,000% markup & paying millions to have golf courses rebuilt after the city condemns them.Listen up City of Bend counselors: Running this place isn't a tea party. A lot of you are in there for your own selfish interests, and not as responsible public servants. Politicians in this town are well known as grifters who use their positions as pure influence peddlers. Grow up or GET OUT! The Bulletin didn't shoot you in the foot, YOU DID!
I'll grant you this, that bus company is a bunch of thieving liars, but the city should have approached this AND ALL OTHER major expenditures with an exacting due diligence agenda. Of course they did not. These lemons ARE NOT the Bulletins fault AT ALL, it's all your fault. ALL OF IT. Getting pissed at them is indicative of complete incompetence.
Capell actually has it right:
“I think that it is time for the city to step in front of the bus,” Capell said.
Then we get a lawyers perspective:
Hummel at the meeting called the company lying crooks. He told the rest of the City Council that the city shouldn’t settle the case and should push for getting “every cent back.”
Surprise, surprise: City counselor Lawyer John Hummel wants to sue. He probably actually has an incentive to screw up deals. Then he can pawn off lawsuits to his buddies and take a kickback. Wonderful. Lawyers, dingos and other cannibals should be banned from city positions... as well as being out in public, or generally existing near humans.
Capells stock has gone up in my book. He didn't have much to start with since builder interests bought & paid for this guy to get elected. But just the same, he fessed up. But John Hummel should be thrown out of office. This litigious nutcase has shown zero remorse for pulling a huge financial boner, and his reflexive instinct is to sue. He should get the finger, and get thrown out of office.
Monday, February 5, 2007
Deschutes County Median Income Lower Than State Average
From the Bulletin article today: Wage gap persists in Central Oregon - Earnings difference between men and women tops $10K, comes evidence that Deschutes County residents make LESS than the statewide median.
Median earnings for a full-time, year-round working male in the county were $39,716 in 2005, according to the American Community Survey, part of the U.S. Census Bureau. For full-time, year-round working females, median earnings were $29,422.
Women comprise 46 percent of the county's work force.
Data for Crook and Jefferson counties was not available.
Statewide, males earned $40,994 in 2005 versus $31,427 for females. Women account for about 38 percent of Oregon's full-time year-round workers, according Jessica Nelson, economist with the Oregon Employment Department.
From the state Report on Poverty (pdf), we find that monthly wages here reinforce the "poverty with a view" reality that persists in Deschutes County:
Deschutes County’s unemployment dropped from 7.6 percent in 2003 to
5.5 percent in 2005. The county also gained 10,522 employment positions
between 2001 and 2005—growing 20.0 percent. All three of the major industries
in Deschutes County gained positions, totaling 4,474 positions among them.
The 2005 average wage of $2,624, however, proved inadequate for single parents.
Deschutes County’s 2005 average wage could not fund the basic family budget
for a single adult and one child or more. The second largest industry in Deschutes
County, leisure and hospitality, paid an average wage nearly half of the county
average—$1,342 a month.
Families earning poverty level wages could afford no more than 40.2 percent of
basic family expenses in Deschutes County. In 1999, 2,046 families lived below
the poverty level, although 64.5 percent of those families had a household member
who worked
Unfortunately, our local government has worked feverishly to build the rock-bottom wage paying leisure sector of our economy, and ignore the far higher paying industrial or data-processing sectors. They also drag their feet on expanding the UGB which just happens to help a small number of RE asset rich scions of wealth.
This is why the bubble in Bend RE must inevitably bust. Almost everything possible is being done to promote low wage industries, while conversely everything possible is being done to induce artificial land shortages. So instead of building on the practically infinite land available within 30 miles of Bend, we end up with mega-density housing so builders can somehow bring prices within some semblance of attainability. Builders are basically incentive-ized to do this by the City.
I don't know how else this can play out: The City spends tremendous amounts to fill Bachelor ski lifts, (that are already at 100+% capacity) they leave these same low-paying employers begging for employees, leaving them to hire foreigners in some cases. We're feeding demand, yet starving supply.
We've got lower than average wages, and far higher than average prices. At some point the masses will rebel. Then the middle class will. Who is going to run the show? We're doing everything possible to ensure that 90+% of all Bendites CAN'T MAKE IT here.
Somethings gotta give. Our city is pursuing a antique paradigm of demand stimulation, when we are in fact supply starved. There aren't enough job seekers because prices are so insanely high compared to well below average wages. It seems this can only lead to economic contraction. Bend needs to concentrate on job creation, not DEMAND STIMULATION. Bachelor will SURVIVE. Our current policies are actually going to shrink this place economically. Wealth is being destroyed because the City is living in 1975. We are engineering our own Economic Bust... AGAIN. In attempts to entrench The Wealthy, we are ensuring the destruction of wealth at all levels.
Realize that when 92% of the locals can't make it, you are encouraging population flight. Who's going to live in all the homes we've built? They'll go up for sale, but no one can buy, no one makes enough. Until we start encouraging employers to move to Bend, we ensure our own economic destruction. There MUST be a tenable MIDDLE CLASS.
Thursday, February 1, 2007
City of Bend: LET IT BE
Todays Bulletin holds yet another nugget on how fastidiously the City looks after our tax dollars (if the City Bus fiasco just wasn't enough). Entitled, Bend golf course sees greener days ahead - Mountain High is being restored after several years without water, the story paints a tale of woe... or it it WHOA!
Seems Mountain High developer Jan Ward could no longer water the gold courses on the North side of his China Hat road development when the City condemned his water facilities. Welp, it only took a few years before courses went to pot and homeowners sued to have the course restored. Judge Titkin also has a little surprise for the City:
Tiktin ordered the city to pay Ward nearly $6.7 million last year for the water system, plus interest and attorneys' fees, ruling that it acted in bad faith when it condemned his water system in 2002 and offered too little to compensate him for it. The two sides are still wrestling over the amount of attorneys' fees, but the final bill is expected to total around $12 million, including the city's own legal expenses to fight the case.
So we, the lucky taxpayers, have the privledge of paying a developer almost $19 MILLION plus interest to rebuild a gold course that the developer states was losing "around $150,000 a year".
That's probably well North of $20,000,000 going to build a money losing golf course. It could have gone to building a homeless shelter. Nay, a homeless palace. Maybe gussied up a road or two. Or just about anything. Just about anything would be better than paying the legal fees to compensate some developer to rebuild a white elephant golf course so a few homeowners can bask in it's property raising munificence.
What a load of crap.
Seems Mountain High developer Jan Ward could no longer water the gold courses on the North side of his China Hat road development when the City condemned his water facilities. Welp, it only took a few years before courses went to pot and homeowners sued to have the course restored. Judge Titkin also has a little surprise for the City:
Tiktin ordered the city to pay Ward nearly $6.7 million last year for the water system, plus interest and attorneys' fees, ruling that it acted in bad faith when it condemned his water system in 2002 and offered too little to compensate him for it. The two sides are still wrestling over the amount of attorneys' fees, but the final bill is expected to total around $12 million, including the city's own legal expenses to fight the case.
So we, the lucky taxpayers, have the privledge of paying a developer almost $19 MILLION plus interest to rebuild a gold course that the developer states was losing "around $150,000 a year".
That's probably well North of $20,000,000 going to build a money losing golf course. It could have gone to building a homeless shelter. Nay, a homeless palace. Maybe gussied up a road or two. Or just about anything. Just about anything would be better than paying the legal fees to compensate some developer to rebuild a white elephant golf course so a few homeowners can bask in it's property raising munificence.
What a load of crap.
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