Blog > Blog > 2008 > March

March 31, 2008 at 4:52 pm

security ironNothing hurts a landlord’s pocketbook or pride like being the victim of theft or vandalism. The main security issue facing landlords in St. Louis and around the country is copper theft, but there are many other temping targets at any property. One particularly expensive and “easy to steal” component are AC condensers. Read more

March 26, 2008 at 12:18 am

Save a short break to get a bit to eat, I have been working on this blog nonstop since my previous post. I’m finally done with phase one. I have transferred everything from Blogger to Wordpress and things should move quickly from here on. I have more tedious cleanup to work on tomorrow, but I should be able to start implementing the full design very soon. In the meantime, don’t think badly of me for the current uninspired layout.

March 25, 2008 at 5:19 pm

It looks like my ability to post came back sooner than expected. I’ve got a good start on the new design and everything close to being setup for the final transfer. This blog has been all substance and no style since its inception, but that is about to change. This new look is not only exceptionally user friendly, it simply looks awesome. I’m hoping to have everything off the ground by the end of the week. Keep your eyes peeled.

March 24, 2008 at 9:00 pm

I’m finally getting my new design together for the blog. Unfortunately I have to switch servers and blog software and I won’t be able to post for a few days because of the change. The new design will probably take a week or two to come together after the transfer. Check back later this week for the usual updates.

March 20, 2008 at 3:41 pm

benton parkAlthough the Neighborhood of Benton Park has continually improved in recent years, the park of the same name has long sat idle. Its ugly, its not user friendly, and its just not nice. Read more

March 20, 2008 at 12:06 am

raise rentAccording to forecasts.org, as of today, the rate of inflation in the United States is 4.12%. That’s really high! Whether you live in St. Louis, the East Coast or Juneau Alaska this affects everything from the cost of a gallon of gas to your taxes. Money is worth less so it takes more of it to buy any product. Read more

March 18, 2008 at 5:12 pm

In the hot real estate market of the early to mid 2000’s, duplexes were virtually ignored by investors looking for rental properties. And with good reason. Why would anyone buy a property if they couldn’t make it cash flow. With the upward spiral prices took in that market, 2-families were generally abandoned by rental investors and embraced only by owner-occupants.

Flash forward to 2008 and you have a much different situation. As foreclosures continue to pile onto the market and values continue to fall, these long unnoticed investment opportunities are beginning to look a little more appealing. Duplexes located in all areas and in all conditions are beginning to pop onto the market at an rapid rate. The prices have gotten so reasonable that cash flowing these buildings has become the rule rather than the exception.

I’ve been surprised at the number of duplexes I have been finding in the St. Louis market that already have a ton of work done to them, yet are for sale at a very reasonable price. Central heating and cooling, new stacks, updated kitchens and bathrooms, clean drywall finishes: these are common finds among the foreclosures flooding the market.

One of my clients closed on a 2-family in the Shaw Neighborhood last week that is a prime example of the great buys that are out there. This duplex has central HVAC, a newer stack, circuit breakers, intact copper, spacious two and three bedroom units and is really in great shape. He’s going to have to put some work into it, but it won’t exceed $15,000. Once he’s done he’ll be able to rent each unit for about $750 for a gross income of $1500 a month. The real kicker is that we negotiated the purchase price down to only $79,000. That’s only a $94,000 total investment after repairs. Not a bad cash flow. Especially for Shaw.

Another point to consider when looking a 2-families is that in the existing financing market of 20% down deals, finding 20% of $79,000 for one of these duplexes is a lot easier than finding money for a down payment on a high dollar 4-family. These deals are often more affordable and quicker to get turned around.

Of course, I am not saying that all duplexes are good deals or that you aren’t better off investing in some other style of multi-family. The real point I am trying to drive home is that you should pay these opportunities some attention. Keep you options open and you just might find one of these “diamonds in the rough.”

March 17, 2008 at 11:48 pm

colored kitchen cabinetsThe most versatile, and probably most important, room in any property is the kitchen. A good kitchen can really make a lasting impression. So can a bad one. Thats why I constantly find myself disappointed by all the uninspired kitchen layouts and styles I see in buildings around town. Read more

March 14, 2008 at 9:40 pm

Just a quick follow up on yesterday’s post about Centene potentially bailing out on the Ballpark Village deal. The St. Louis Post Dispatch posted a similar article in today’s paper. Looks like the situation is serious. Click here to check out the full article.

March 14, 2008 at 7:57 pm

In the heyday of the 100% financing investment real estate market, fraud was really running rampant. One of the more common tricks was getting owner-occupant financing on a building, which the buyer had no intention of ever occupying. Nobody was getting called out on it, so more and more people started doing it.

Today is a different story. With all the checks and balances in the system, you’d be hard pressed to get away with that now. Some of these cash-strapped lenders are even getting so picky that they are looking back at old loans to figure out if any fraud was taking place.

I actually got a heads up on this issue from one of the tenants in a building I have ownership-interest in. The owner of the neighboring property did a rehab a couple of years ago and somehow got away with a non-historical porch and windows in the front of the project. We’ve been none too happy with his work and even less happy with the tenants he put in the building. I must confess that I wasn’t all that upset when I heard from our tenant that this guy was in trouble.

Apparently he financed his substandard rehab project with an owner-occupied loan despite the fact that this was a pure investment. I’m sketchy on the exact implications of this, but he now has this property for sale on the MLS. It’s way overpriced, so I’ll be curious to track what happens when he can’t sell this thing. Will they go so far as to foreclose on him or will they just renegotiate his loan?

The main question this situation raises is whether this is an isolated incident or if this is a sign of things to come? I suppose only time will tell. If you’re among those who financed this way, I would suggest you don’t wait to find out which way the wind is blowing.

Refinancing rates and terms are starting to open up again so it might be a good time to start thinking about making your loan legit. Under situations such as these, a lender has a right to call in a loan in full at any time. If that happens, the lendee (hopefully not you) might find themselves among the ranks of the recently foreclosed. Be careful out there.

March 13, 2008 at 11:13 pm

In the realm of über development projects in St. Louis, the Ballpark Village project next to Busch Stadium is probably the most prominent. The St. Louis Cardinals are required to develop the land and have been working with developer, Cordish, for what’s seemingly been an eternity. Last September, Clayton-based health care company Centene Corporation announced that they would be relocating their headquarters to the Village site. The pic to the right is the rumored design proposal. Development nerds, like myself, city-wide rejoiced.

Six months later, the picture isn’t looking as rosie. What was once a “sure thing” could be in danger. Most of this is only rumor at this point, but KMOX reported on the situation this morning and it doesn’t sound that great. Apparently Centene is bumping heads with Cordish on various aspects of the project. KMOX is claiming that the fate of the project might be determine in the next few weeks. You can listen to the report yourself here.

This report along with Mayor Slay’s blog entry on the matter in January, lends some credence to the belief that Cordish is rubbing everyone the wrong way. Lets just hope they can work something out. Not only are the residential and commercial components of this project a big deal, but we could really use an influx of new jobs Downtown. I was really hoping Centene’s move Downtown was a sign of things to come. Here’s to hoping.

To keep up on all the rumors and gossip, check out this thread on Urban St. Louis.

March 12, 2008 at 9:55 pm

If things keep going well, Benton Park could have a prominent new business in the near future. This project at 2200 Gravois has been under development for over two years, but it appears to finally be coming along. Two former members of the hard rock band Gravity Kills (you remember them don’t you?) among others, have been working on bringing this project to life since early 2006.

Plans for the $9.8 million project call for 16 apartments as well a significant amount of commercial space over 40,000 sq ft. The commercial anchor will be Shock City Music Works, which will focus on musical artist development and have a recording studio. This project, designed by the Lawrence Group, is being partially funded through $4.4 million in federal and state tax credits, brownfield credits and tax increment financing (TIF) from St. Louis.

The pictures above are mock ups of the interior and exterior of what the music studio will look like. For more pictures and info, check out the excellent Urban St. Louis web forum. I’ll try to post some pictures of the project when the weather warms up a bit more.

March 11, 2008 at 7:10 pm

The sheer number and variety of distinctive neighborhoods in the City of St. Louis can be tough to keep track of. With 79 unique neighborhoods, each with their own characteristics and investment opportunities, they all tend to run into one another. If you have ever wanted to know more about these neighborhoods, but didn’t know how, here are a few resources you might want to check out:

  • The City’s neighborhood website has a clickable map of the entire city with specifics on each neighborhood. Great if you are looking for detail.
  • If you’d like a printable neighborhood key to keep track of things offline, check out this neighborhood map (PDF) I put together.
  • Another good resource for keeping tabs of neighborhood boundaries and names is Yahoo Maps. They added a color coded system to their maps a couple of weeks ago that shows the boundaries and names of neighborhoods. Using Yahoo to lookup property locations is a great way to figure out what neighborhood a particular property is located in.

March 11, 2008 at 6:28 pm

Keeping your tenants and properties secure is an important part of running a successful investment. If your tenants feel unsafe, they will be less likely to remain at the property after their initial lease. If your property isn’t secured, you just might find your copper plumbing or AC condenser miss one day. Its a major concern.

Security systems are often used as a method to address this problem, but there is a more affordable, and in some ways more affective method: motion-sensor security lights. With a few strategically placed lights, you can really improve the security of your properties.

Your tenants will be happy because the building will be well lit when they enter and exit their unit. The property, as well as the tenants will be more secure because the motion sensors will activate when somebody enters the premises. A potnential burglar or robber is going to think twice before camping out behind a property that is well lit.

The next time you have a warm weekend free and are looking for something to do, head down to your local hardware store and pick a few of these up. They are well worth the investment.

March 7, 2008 at 6:43 pm

You are correct, man-with-sign, but not for long. At least in some situations. It looks like action is about to be taken to curb aggressive panhandling in the City of St. Louis. All I can say is that its about time. According to the St. Louis Post Dispatch, City Alderman just passed the bill addressing this issue, which has been kicked around the past few months. As the Post puts it:

“Under the proposal, panhandling would be allowed only during daylight hours. It would be banned at all hours at bus or MetroLink stops, around ATMs or an entrance to a bank, within 30 feet of a public doorway or at any sidewalk cafe, school or crosswalk.” Sounds like a good start.

The only thing left to do is get Mayor Slay’s signature on the bill. Seeing as he has already said that he would sign it on his blog, I think its safe to say that its a done deal.

You can read the whole article hear: article

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