How To Make $100 Million A Year In Bend, Oregon

Well Damn, that didn't take long. I hung out the Bend-to-Columbia Air post just a day after it was announced that Textron was "buying" Columbia. Didn't sound right to me. Sounded like an awful big rush. Sounded like Columbia needed the money yesterday.

They started to make it sound like a nice, big Strategic Acquisition... good for Columbia, good for Bend, good all the way around. Yup. Did Not Smell Right To Paul-doh. I wrote in the comments on Sunday:

Although it appears Columbia accepted some sort of bid on Friday, I still wonder if running 'er thru a BK won't still happen. Remember, the founder is still suing for $1MM+ back pay. If I was Cessna, I'd have them go BK, and wipe out the liabilities, lawsuits and all.

Next Day, The Big BK! I'm telling you folks, when something doesn't Smell Right, it probably isn't. Columbia hasn't smelled right for many moons. What kind of company shuts down when part suppliers are late? A company With No Money, that's what kind.

Now, we're starting to hear "All Is Well" at Columbia. They'll stay in Bend, everything will be just fine. Really? Because Chap 11 typically means carve up the carcass, and selling the bits at a garage sale. Textron/Cessna, if they have Any Sense At All, will simply bid on the bits it needs, and cart them off to Wichita. The bits it does not need, will go to others... hell, I might stop by and pick up some picture frames and a chair.

Point is, HOW will Columbia be run once it is sold off bit by bit? Cessna Will Not buy Columbia Outright, No Way. It'll be an auction. Anything you hear to the contrary is an attempt to deceive plane buyers to buy anyway, and to keep employees, who have been spanked by this company so many times their asses are raw, to stay on.

Believe NONE OF IT. Columbia is dead and gone, unfortunately.

Speaking of things going down the shitter, BEM recently left this comment (which is NOT the thing going down the shitter, by the way...):

I would never mess with perfection, Paul, but I think sometime you should do a "bust-o-meter" on Central Oregon grand schemes falling victim to the RE bust

I think it's safe to say that I was never really a Big Fan of the concept of The Shire. Hell, I love LOTR more than anyone, probably the best movies of all time. But a Good Movie Does Not A Subdivision Make. This is just a Bad Idea, and that's putting it mildly. It's a TERRIBLE IDEA.

And finally, the developers have thrown in the towel on this White Elephant. From the COR website:

Come home to The Shire, a serenely lovely community with streams, waterfalls, ponds, wildflowers, paths and amphitheater, all designed to convey a sense of peace and belonging. Lot includes plans for 3BR/3.5 BA 2374 sq ft energy efficient Pheasant Cottage with ground floor master suite & 2 junior suites, vaulted great room and terrace views. Or design your own home and have our builder or yours construct it.

"Design your own home"... folks that means The Hobbits attempting to enforce the CC&R's have succumbed to The One Ring. This means Hobbit Hole here, craftsman there, contemporary Brady Bunch homes everywhere! They have unfortunately already built 3-4 Hobbiton dwellings, and unless they are burned by ring wraiths, they will be intermingled with whatever home design lot buyers are willing to put there.

Paul-doh smells a bargain. Cuz nothing smacks down the resale of a hobbit hole more than being a standout among craftsmans. Woof, those spec Shire huts will be hell to unload now. The Shire has just gone from the frying pan into the fire. Those Shire shacks will be like geodesic domes.... death.

The Shire was conceptualized by a local "think-tank", The Hatchery. Here's a short summary by these smug bastards:

The Hatchery team is composed of extremely bright and talented professionals with senior executive level experience in Sales, Marketing, Business Development, Strategic Planning, Public Relations, Operations, Engineering leadership, Manufacturing and Finance.

Yeah, the people who brought us The Shire ARE extremely bright and talented. They're so bright, they Bought In, and located Their World Headquarters at The Shire! Now THAT'S smart!

Just so I'm clear: These guys and gals probably are pretty smart. But they succumbed to a delusion that blinded hundreds if not thousands around here:

1) Real Estate prices are going up
2) I own Real Estate
3) I am a genius
4) Every idea I will ever have is a great idea!
5) I have an idea for a Grandiose Real Estate development

OK folks, we're all sort of collectively average, with ideas no better or worse than a few years back. But the RE bubble has convinced many, MANY people to build some of the nuttiest stuff ever conceived. The Shire? Maybe in Ireland, or England, or somewhere like that.

CENTRAL OREGON IS HIGH DESERT

The Shire is a blatant example of a concept doomed to failure from Minute 1. There are other more subtle losers, but they are equally doomed to Total And Utter Failure. Here is a short list:

1) The Plaza, a "non-age restricted" condo: DOOMED. The Plaza is totally doomed.

2) Mercato: DOOMED. Mercato will almost certainly not get funded, and if it does, it'll not lease to near capacity in my lifetime.

3) Redmond Waterpark: DOOMED. Were we 5X as big, maybe. But no way will this work, even if it's domed. People DO NOT like to go swimming in the dead of Winter.

4) The Whole Tuscan Craze: DOOMED. The only possible survivor is Ranch at the Canyons. "Tuscan" is being slapped on every possible structure, including mobile homes, spider holes, and apartment buildings.

I went from being pretty sympathetic to Becky Breezes' plight with the hideous Plaza, but no more. First, she has actually RAISED prices on several of these units, without a single reduction. If The Plaza were not Becky's own development, she'd have whacked the sellers expectations & asking price to nothing.

Second, I posted this over on BendBB:

Just found this:

http://tinyurl.com/2w9vmy

Located at Upper Terrace
1,600 SQUARE FEET $1,095,000

Unit 408, The Plaza. 4th floor penthouse w/unobstructed Cascade Mtn views, 1,600 sq. ft.., Great Room floor plan for spaciousness, 2 Master Suites w/full bathrooms, tile showers/glass doors, vaulted ceilings in Great Room, kitchen island, slab granite counters, wood/tile/carpet flooring, private balcony, A/C, stainless steel GE Monogram appliances, fully wired for audio/video, 2 underground parking spaces w/storage unit.

For more information:
Terry Dietz
America At Home
P.O. Box 801
Office Phone: 541-433-2400
tdietz@worldstar.com

First, this listing AIN'T Becky Breeze, who I believe is listing new units EXCLUSIVELY. This is listed on Page 2 of BendBB's Sept New Listings & Price Changes entry. PLUS, THIS badboy is a top floor PENTHOUSE unit, that if I recall, Breeze stated she had sold in Christmas:

A few blocks away, The Plaza is expected to have models ready to show next month, Breeze said. So far, 14 of the building's 42 units are under contract. Prices average around $650,000 to $700,000 for units in the all-residential building, but the most expensive unit so far - a top-floor penthouse with views of the river, The Shops at The Old Mill District and the Cascades, went under contract for $1.999 million at Christmas.

http://tinyurl.com/35uq8p

You tell me, but this looks like a Plaza resale at a HUGE LOSS.

This is the first "resale" at The Plaza, and if Breeze's claim of near $2,000,000 sale prices for penthouse units are true, it'd be a Huge LOSS, over $900K. It actually looks like ONLY 4 UNITS HAVE SOLD so far in The Plaza (Breeze claims 25% have sold), at least that's all that's in the county clerks records. There may be more. But Unit 408, the only possible "penthouse" unit, sold for about $820K, not $2 million. And what's better, the freak who bought it is TRYING TO FLIP IT FOR A $280K profit in only 2 months! Classic!

There you have it: Breeze is a liar, she a stubborn obstinate seller trying to market a horribly flawed concept, and those she has actually sold to, are out of their minds!

POP QUIZ!

Which one of these guys apparently invested $200,000,000 in a Bend aircraft maker this week?

1) Peter Tork of "The Monkees"
2) Rip Taylor
3) Liberace
4) Indian Billionaire, Vijay "Jazzy Jeff And The Fresh Prince" Mallya

I know, it's hard to figure cuz each has One Sweet Ass Fuckin' Hair Doo! I mean, WTF?

Did anyone else see that pic in The Bulletin, and wonder what the hell is up with that dudes hair? I mean, DAMN.

ATTENTION INDIAN DUDE: That sweet-ass tight fro may have landed the ladies in 1973, but that thing is just weird!

Anyway, this is YET ANOTHER STORY THAT DOESN'T PASS THE SMELL TEST. I wrote in the comments:

This whole thing SMELLS BAD. $200MM (if true), values Epic at $400MM. WHAT! No way. With 140 employees, that is almost $2.9MM/employee. No freakin' way is that real.

Boeing market cap is $82.52BB
Employees: 153,000
Value/Employee: $540,000

Is this Indian Dude INSANE? He's valuing a po-dunk little maker of kit planes out in the desert at more than 5X the per employee value of BOEING?

Man, if this Rick Schrameck guy actually convinced this nut to pay $200MM for 50%, he is One Hell Of A Shyster. Valuing Epic at well over 5X the relative value of Boeing on an employee basis is straight up INSANE.

That Rick Schrameck dude has pulled off the Bend Enterprise Investment Marketing Boondoggle Of A Lifetime. He got rocks. Bangin' a friend of his for $200MM, for only HALF of Epic, a podunk nut'n out in the desert. That's one thing. But he did it while RIGHT NEXT DOOR, there is a much larger competitor GOING BANKRUPT! Holy Shit! That is just brutal!

Seriously, it is stuff like this that reaffirms my faith in The Impossible. If this is true, which I seriously doubt, this guy has pulled off a dot-com era boondoggle the likes of which this town will never see again. Good job Rick!

And the guy is INDIAN. If Glengarry Glen Ross (The Greatest Salesperson Movie AND Real Estate Movie EVER MADE) has taught us anything, it's that selling to Indians is gat damn impossible:

Williamson: [handing Roma lead cards] I'm giving you three leads...
Ricky Roma: Three? No, I count two.
Williamson: There's three leads there.
Ricky Roma: "Patel"? Fuck you. Fucking Shiva handed this guy a million dollars, told him "Sign the deal!" he wouldn't sign. And the god Vishnu too, into the bargain. Fuck you, John! You know your business, I know mine. Your business is being an asshole. I find out whose fucking cousin you are, I'm going to go to him and figure out a way to have your ass - fuck you!
[throws the cards at Williamson]
Ricky Roma: I'm waiting for the new leads.


I'm telling you RE types right now, watching Glengarry Glen Ross ought to be de rigeur in Monday morning RE meetings! It's awesome!

Blake: You see this watch? You see this watch?
Dave Moss: Yeah.
Blake: That watch costs more than you car. I made $970,000 last year. How much you make? You see pal, that's who I am, and you're nothing. Nice guy? I don't give a shit. Good father? Fuck you! Go home and play with your kids. You wanna work here - close! You think this is abuse? You think this is abuse, you cocksucker? You can't take this, how can you take the abuse you get on a sit? You don't like it, leave.

Blake: And to answer you question, pal, why am I here? I came here because Mitch and Murray asked me to. They asked me for a favor. I said the real favor, follow my advice and fire your fucking ass because a loser is a loser.

Blake: We're adding a little something to this month's sales contest. As you all know, first prize is a Cadillac Eldorado. Anybody want to see second prize?
[Holds up prize]
Blake: Second prize is a set of steak knives. Third prize is you're fired.

Ricky Roma: You ever take a dump made you feel like you'd just slept for twelve hours?

Oh God... every line in that movie is just a classic. I actually know an extremely successful salesperson who watches this movie 2-3/month.

Anyway, this should bring us full circle to How To Make $100 Million A Year In Bend, Oregon. Rick Schrameck has already done the legwork, and has proven the Concept.

1) Start UNPROFITABLE business
2) Fly to Bangkok for Freaky Sex Junket
3) Approach Indias Answer To Liberace
4) Ask for 10X what the company is worth
5) Fire up the Automatic Cash Spanker
6) Bail out with Golden "Shower" Parachute 2-3 years later

It is AMAZING how there are people who can ask, and somehow receive, HUGE sums of money around here for some of the lamest-ass projects EVER. Becky Breeze and Lafky come to mind. Granted, I went to Epic Airs website, and they got some Sweet Rides, and had I the means, I would possibly consider buying one. But is Epic really worth $400 million, or even close? My God, this is another Malaysian Mambo, where some Far East Elvis Impersonator/Government gets whacked for not just millions... BUT HUNDREDS OF MILLIONS!

Rick Schrameck, I salute you. If you have in fact secured $200 million from an Indian Dude wearing Liberaces prized toupee, then you my friend, are KING OF THE WORLD.