Archive for February, 2010
January was a strong month in property sales for some Whatcom County communities, but not Bellingham.
There were 105 properties sold in Ferndale, Lynden and Blaine last month, up 26.7 percent compared to January 2009. The most significant increase in those communities came in the sale of used single family homes, which rose from 41 in January 2009 to 64 last month.
Total property sales include residential, commercial, industrial and undeveloped land. The data was compiled by First American Title of Bellingham.
In Bellingham there were 72 property sales last month, down 19.1 percent year-over-year. The category that saw a significant drop was commercial and industrial property sales. Residential property sales were about the same as the previous January, during a period of significant slowdown in the local and national economy. Sales of new homes were particularly slow in Bellingham; there were only two sold for the entire month.
In the Deming and Sumas areas, there were 16 property sales last month, up from 12 in January 2009.
SW Group, LLP, which has been building The Marin (also known as Meritage Semiahmoo) condominiums on the Semiahmoo Spit in Blaine, has filed for Chapter 11 bankruptcy reorganization.
The bankruptcy was filed earlier this month at the U.S. Bankruptcy Court Western District in Seattle. According to documents, SW Group has between $10 million and $50 million in assets and between $10 million and $50 million in liabilities. There are less than 50 creditors impacted by this bankruptcy. Must of the largest creditors are outside the Whatcom County area.
According to an earlier article, The Marin on Semiahmoo was planned for 18 condo units at prices ranging from $650,000 to $1.7 million. Some units are complete, some are still under construction, but none appear to have sold, according to county records.
Records indicate that Seattle Bank loaned SW Developers $18 million on the project.
Below is an AP wire storie about Simon Property Group wanting to buy General Growth (which owns Bellis Fair). To me it’s a sign that credit is starting to free up for business transactions. A year ago it seemed like companies couldn’t get financing for much of anything, especially shopping malls.
LOS ANGELES (AP) — Simon Property Group Inc., the nation’s largest shopping mall owner, made a $10 billion hostile bid Tuesday to acquire ailing rival General Growth Properties.
The acquisition would allow General Growth, the No. 2 owner of shopping centers, to emerge from Chapter 11 bankruptcy protection. General Growth filed for bankruptcy last year after buckling under the weight of billions in debt it racked up during a massive expansion effort fueled by cheap credit.
The move is Simon’s second attempt at a major acquisition in three months. In December, Simon offered $700 million in cash and stock to buy more than 60 outlet shopping centers from another competitor, Prime Outlets Acquisition Co. That deal is pending.
Simon is using its comfortable cash cushion and credit lines to take advantage of falling commercial property values, which are off 40 percent from their peak in 2007. And General Growth has some prized centers, including the Glendale Galleria in Southern California and the South Street Seaport in Manhattan.
Simon has been able to weather the economic downturn despite rising retail vacancy rates in the double-digits in some cities. The Indianapolis-based company popularized the so-called lifestyle center mall design that turned malls into neighborhood-like communities. Simon owns more than 380 properties, including the Houston Galleria and the Fashion Valley Mall in San Diego.
Many national retail companies have stores in regional malls like those that Simon and General Growth own. If Simon or another large mall operator were to acquire General Growth’s centers, that could give it more muscle to negotiate for lower rental rates with retailers.
Under the terms of the offer, General Growth’s unsecured creditors would get $7 billion, which would pay them in full. Shareholders would receive $3 billion, or $6 a share in cash and $3 a share in other assets. The offer, however, might be amended so shareholders could receive Simon stock instead of cash.
“Simon’s offer provides the best possible outcome for all General Growth stakeholders,” said David Simon, chairman and CEO, in a statement.
Simon disclosed its offer after General Growth’s board failed to respond to a formal offer it made last week.
In a letter to General Growth’s board dated Feb. 8, Simon spelled out its offer and argued shareholders stand to gain more from a takeover than if General Growth emerged from bankruptcy as a standalone company, or accepted a rival bid.
“We are convinced that a transaction with Simon is superior to any proposal you may be considering,” Simon wrote in the letter, stressing the proposal was not open-ended.
In a letter to Simon disclosed by Chicago-based General Growth late Tuesday, the company essentially told Simon its offer wasn’t compelling enough to steer it off its plans to emerge from bankruptcy and explore a possible sale of the company or a bid to raise capital.
But General Growth wasn’t saying no, either.
The company said it plans to send out details on its financial projections next month to unnamed “participants” and invited Simon to remain part of the process.
Though the official committee for General Growth’s unsecured creditors has backed the deal, stockholders appeared to be looking for a sweeter offer from Simon or another competitor. Shares in General Growth shot up nearly 28 percent, or $2.62, to $12.02.
Simon shares rose $2.82 to close at $74.82.
Alexander Goldfarb, an analyst with Sandler O’Neill & Partners, said he expects other offers to drive the bidding higher.
“General Growth has a number of options,” Goldfarb said. “This is not the only one.”
Any offer, should it be accepted, would be a steal compared to what General Growth was worth in 2007. Back then, with shares trading above $60, General Growth had a market value of about $15 billion. At Tuesday’s closing price, the entire company was valued at about $3.8 billion.
But any new owner would have to deal with General Growth’s massive debts. The company racked up $27 billion in debt by the time it sought shelter from creditors last April, making it the largest real estate bankruptcy case in U.S. history.
In December, a bankruptcy court approved its plan to restructure $10.25 billion in debt. A plan for restructuring another $1.7 billion in debt is up for approval when some conditions are satisfied.
At the time, General Growth said it was considering “all indications of interest in the company.” That fueled speculation the mall operator was fielding offers.
Many real estate investment trusts are also flush with money, having raised $34.5 billion of new capital last year. Some traders are speculating Brookfield Asset Management could be among those interested in buying General Growth.
The company has been looking to expand its slate of retail properties and acquired a stake in General Growth last year. Brookfield hasn’t provided details but said the stake was “significant.” Published reports have suggested the Brookfield spent as much as $1 billion — something the company hasn’t confirmed or denied.
In 2006, Brookfield made a bid for shopping center owner Mills Corp. but was foiled by Simon.
Brookfield spokesman Denis Couture declined to comment Tuesday.
The Mexican restaurant El Tapatio is now open. It’s at 4459 Meridian St., just north of Wal-Mart in the building that used to be home to a sushi restaurant.
There’s also a “Coming Soon” sign up for Wonderful Buffett, which is also on Meridian Street near Taco Time.
Here’s an interesting press release showing what Washington industries will need more workers in a couple years:
OLYMPIA — Washington is going to need more bookkeepers, nurses, lab technicians, and aircraft mechanics in the coming years. And while the recession has slowed demand for all occupations, demand for mid-skill jobs could once again outstrip supply by 2013, according to a state analysis.
A new Skill Gap Analysis from the Workforce Training and Education Coordinating Board (Workforce Board) compares future demand for occupations with how many workers are currently being prepared in Washington through public and private colleges and apprenticeship programs. This information provides insight as to which occupational fields should be recruiting new students and increasing educational capacity.
The Workforce Board’s research focuses on jobs that require at least one year of post-high school education and training but do not require a bachelor’s degree-an essential but sometimes overlooked slice of the job market referred to as mid-level jobs. These jobs typically pay well and often come with benefits, offering Washington residents the chance to earn a living wage.
Topping the list of occupations facing shortages are categories such as accounting and bookkeeping, health care, and installation, maintenance and repair of equipment. These are the fields where demand (job openings) will most likely outpace the supply of newly prepared workers as the economy recovers. The largest potential undersupply will be in bookkeepers, accounting assistants and other accounting professionals with a projected average annual gap of 1,350 between 2012 and 2017.
In general, demand for mid-level workers is not expected to recover to pre-recession levels until 2013-when projected demand for new mid-level workers will be 8 percent above current output.
Some occupations, such as nursing, are in short supply of trained applicants even in this recession. Nurses will continue to be in high demand even though Washington currently produces over 3,000 new nurses per year. If Washington’s community colleges and private schools continue to produce the same number of nurses they do now, the Workforce Board projects an average supply/demand gap of over 1,000 per year between 2012 and 2017.
High unemployment resulting from the recession has put at least one category of skill shortage in question.
“We had a shortage of skilled construction workers before the recession hit and our projection shows we might have another shortage in upcoming years, but it does not account for the great number of currently unemployed workers in the trades who will be willing and able to return to work when the economy recovers, said Rick Bender, President of the Washington State Labor Council and a member of the Workforce Board.
Still, the skill gap analysis has been useful in helping recruit students and expand programs when needed. For instance, in the late 1990s, the Workforce Board identified that Washington suffered from an acute shortage of Information Technology professionals. In response, the State Board for Community and Technical Colleges directed funding from the Legislature to boost the number and capacity of IT programs. Today, Washingtons production and demand in that occupation is basically in balance.
“While no one has a perfect crystal ball, our analysis at least gives us some tools to anticipate where the shortages might occur before they represent a serious drag on our economy. Washingtons employers not only require a skilled workforce but a workforce with enough of the right skills, said Mike Hudson, a project manager with the Association of Washington Business and member of the Workforce Board.
Learn more about the Workforce Board’s Skill Gap Analysis at: http://www.wtb.wa.gov/skillgap.asp
Boondocks Boats & Motors at 2551 Roeder Ave. remains closed and is currently in default with the Port of Belling-ham for failing to pay rent.
The company, which sells and repairs boats and has been a tenant on the waterfront since 1984, owes rent on the land, said Carolyn Casey, spokeswoman for the Port of Bellingham. The port does not own the building.
Boondocks has not been regularly open at the Roeder Avenue building since the holidays. Jon Lindhout, president of Boondocks, would not comment on the company’s plans at this time.
Sea Sport Boats, a boat manufacturing company that was purchased in 2000 by the Lindhout family, continues to operate at 4654 Guide Meridian.
The Quarterback Pub & Eatery at the Sehome Shopping Center (near REI) has been closed the past couple of days, with no indication as to why. The phone to the business has also been disconnected. Messages left for Owner David Albaugh seeking comment have not been immediately returned. The pub currently has an active liquor license, according to the Washington State Liquor Control Board.
The eatery is a sports bar that opened in the 1990s.
There were 62 Whatcom County bankruptices in January, up slightly from the 60 tallied in December, according to data from the U.S. Bankruptcy Court Western District in Seattle.
After seeing monthly spikes in the middle of 2009, bankruptcy filings locally have been relatively stable. For each of the past four months, bankruptcy filings have been between 60 and 70.
In Skagit County there were 34 bankruptcy filings, nearly matching January 2009, when there were 32.
A new smoke shop opened this week in downtown Bellingham.
Sugar on Magnolia Smoke Shop is in the former home of The Newstand at 111 E. Magnolia St. Along with cigarettes, the 2,000-square-foot store has hookahs, tobacco and its own humidor room with a selection of cigars.
Manager Ahmad Fatah said he’s expecting a diverse crowd, from college students on up. The store is open seven days a week, from 9 a.m. to 9 p.m.
Western Washington University’s Center for Canadian-American Studies, in participation with multiple on-campus offices and departments, has kicked off Canada Week.
Events will run through Feb. 12, involving Canadian culture, politics, economics and history at Western’s campus. I’ll list more events when the information becomes available, but this is what is scheduled for Tuesday, Feb. 9:
Noon-1 p.m.: “Tracing the Acadian Borders,” public lecture, Christina Kepple, WWU assistant professor of Modern and Classical Languages; sponsored by the WWU Center for International Studies. College Hall 131.
7-8 p.m.: “The Legacy of the Olympic Games: Vancouver 2010,” public lecture, Ralph Vernacchia, WWU professor of Physical Education, Health and Recreation and director of the Center for Performance Excellence. Arntzen Hall 100.