An online auction netted a $625,000 winning bid for the partially built McQueen Professional Plaza near the Islands community in Gilbert, where the blighted complex has gathered weeds, litter and graffiti while sitting vacant for years.
The sale late last month could mean a happier ending for a development that was supposed to open in late 2008 but which has since fallen into neighborhood-eyesore status.
The two-day auction, which ended April 26, may not result in a sale, since the terms and conditions allow the seller to accept or reject any bid for the property. But the initial information provided by Auction.com suggested the $625,000 bid met the seller's undisclosed reserve price.
The winning bidder is required to execute a purchase agreement within two hours of the auction's close or risk being declared in default. The bidder then must deliver earnest money within 24 hours, and the sale should close within 30 days, according to the terms and conditions.
Auction.com accepted bids only from cash buyers, who paid a $5,000 deposit to participate in the auction.
Bidding started at $250,000 and climbed to $400,000 by the morning of April 26. A flurry of last-minute bids elevated the price to $625,000. According to Auction.com, the property's most recent real-estate value was set at $620,000 in August 2010. The developer's initial loan on the project was worth about $7.4 million, according to Maricopa County records.
Phoenix contractor Parker Ganem, who was building the complex, said now-defunct Silver State Bank was financing the project but stopped paying and was seized by the federal government. "That one bank took my entire construction company down," Ganem said. "I had to file for bankruptcy because of that one project."
Construction screeched to a halt, leaving partially framed buildings with exposed foundations and open storm-drain culverts. Weeds shot up, and the lot drew litter and graffiti.
by Parker Leavitt - May. 11, 2012 02:39 PM The Republic | azcentral.com
Unfinished plaza bought
Tuesday, May 15, 2012
Builder rolls out Line K at Pinnacle Peak Place
Piet Boon has a new look for north Scottsdale homes.
The Dutch designer and K. Hovnanian Homes are unveiling a line of contemporary semi-custom homes this weekend at Pinnacle Peak Place, a mile from of the city's iconic peak.
A four-bedroom model home opens Saturday in this gated community northeast of Pima and Happy Valley roads. Prices range from $700,000 to $820,000.
The interior of the 3,874-square-foot model home stands out with its stark white walls, modern lines and an abundance of disappearing glass walls and outdoor living space. That includes a reflecting pond in a breezeway, infinity-edge pool and a shower and soaking tub outside the master bathroom.
"The desert view is so incredible," Boon said in explaining the openness of his Arizona designs.
"It's so different with the boulders and cactus."
Boon is an interior and furniture designer based in Amsterdam, the Netherlands, with an international list of clients.
Boon joined with K. Hovnanian Homes, based in Red Bank, N.J., a year ago to create the builder's Line K of contemporary homes with its rollout in Scottsdale.
The result is a design that runs counter to the sameness of the Tuscan, Mediterranean and Spanish architecture so common in the gated communities across Scottsdale.
"We think there are people who are tired of Tuscan, tired of the traditional styles here," said Jack McSweeney, K. Hovnanian Homes Phoenix Group director of architecture.
It is a design that will appeal to younger buyers who are used to a more modern aesthetic as well as to Baby Boomers, he said.
The stonework and the exterior color schemes at Pinnacle Peak Place are similar to the surrounding homes but the sleeker lines and optional metal roof are less common for the area.
Pinnacle Peak Place was first developed in 2006 by the Pivotal Group Inc. and Geoffrey H. Edmunds & Associates Inc.
It was to include 80 homes on 124 acres.
In those boom times, the homesites were priced from $395,000 to $975,000, and homes of 4,000 to 6,000 square feet were offered at $1.5 million to $3 million.
Twenty-one homes were built, including a $3.3 million property in October 2007, but much of the community remains undeveloped.
K. Hovnanian Homes has 26 lots that it acquired earlier this year, McSweeney said.
It is offering three models with variations in floor plans.
All of them include four bedrooms, three-car garages and 31/2 or 41/2 bathrooms.
Prices start at $700,000 for a home of 3,305 square feet up to $820,000 for 3,874 square feet. Each lot is close to an acre in size.
Send real-estate news to peter.corbett@arizonarepublic.com. Follow him on Twitter @petercorbett1.
Line K debuts
What: K. Hovnanian Homes at Pinnacle Peak Place.
Where: 25851 N. 89th St.
Contact: 480-656-2789, khov.com or pietboon.com.
by Peter Corbett - May. 11, 2012 01:15 PM The Republic | azcentral.com
Builder rolls out Line K at Pinnacle Peak Place
The Dutch designer and K. Hovnanian Homes are unveiling a line of contemporary semi-custom homes this weekend at Pinnacle Peak Place, a mile from of the city's iconic peak.
A four-bedroom model home opens Saturday in this gated community northeast of Pima and Happy Valley roads. Prices range from $700,000 to $820,000.
The interior of the 3,874-square-foot model home stands out with its stark white walls, modern lines and an abundance of disappearing glass walls and outdoor living space. That includes a reflecting pond in a breezeway, infinity-edge pool and a shower and soaking tub outside the master bathroom.
"The desert view is so incredible," Boon said in explaining the openness of his Arizona designs.
"It's so different with the boulders and cactus."
Boon is an interior and furniture designer based in Amsterdam, the Netherlands, with an international list of clients.
Boon joined with K. Hovnanian Homes, based in Red Bank, N.J., a year ago to create the builder's Line K of contemporary homes with its rollout in Scottsdale.
The result is a design that runs counter to the sameness of the Tuscan, Mediterranean and Spanish architecture so common in the gated communities across Scottsdale.
"We think there are people who are tired of Tuscan, tired of the traditional styles here," said Jack McSweeney, K. Hovnanian Homes Phoenix Group director of architecture.
It is a design that will appeal to younger buyers who are used to a more modern aesthetic as well as to Baby Boomers, he said.
The stonework and the exterior color schemes at Pinnacle Peak Place are similar to the surrounding homes but the sleeker lines and optional metal roof are less common for the area.
Pinnacle Peak Place was first developed in 2006 by the Pivotal Group Inc. and Geoffrey H. Edmunds & Associates Inc.
It was to include 80 homes on 124 acres.
In those boom times, the homesites were priced from $395,000 to $975,000, and homes of 4,000 to 6,000 square feet were offered at $1.5 million to $3 million.
Twenty-one homes were built, including a $3.3 million property in October 2007, but much of the community remains undeveloped.
K. Hovnanian Homes has 26 lots that it acquired earlier this year, McSweeney said.
It is offering three models with variations in floor plans.
All of them include four bedrooms, three-car garages and 31/2 or 41/2 bathrooms.
Prices start at $700,000 for a home of 3,305 square feet up to $820,000 for 3,874 square feet. Each lot is close to an acre in size.
Send real-estate news to peter.corbett@arizonarepublic.com. Follow him on Twitter @petercorbett1.
Line K debuts
What: K. Hovnanian Homes at Pinnacle Peak Place.
Where: 25851 N. 89th St.
Contact: 480-656-2789, khov.com or pietboon.com.
by Peter Corbett - May. 11, 2012 01:15 PM The Republic | azcentral.com
Builder rolls out Line K at Pinnacle Peak Place
Scottsdale builders seeing surge in new homes
Apartment development is the focus of Scottsdale's housing market, but builders based in the city say they are seeing a surge in new-home sales elsewhere in the Valley.
Builders acquired permits for nearly 2,500 single-family homes in the first quarter, up 74 percent from a year ago, said Greg Burger, publisher with RL Brown of the "Phoenix Housing Market Letter."
Maracay Homes reports that it sold 190 homes through April, more than double its activity a year ago. Plus, this year's $50 million in sales far exceeds last year's pace when Maracay sold $60.5 million for all of 2011.It's a big change for a new-home market that went from dormant to sluggish before the recent uptick.
"It hasn't been wine and roses the past few years," said Andy Warren,Maracay president since April 2009.
The number of building permits issued continued to grow in April and homebuilders are responding with new communities and floor plans.
Maracay Homes, with its offices at the Scottsdale Quarter, has four communities in Tucson and seven in the Valley in Buckeye, Chandler, Goodyear, Peoria and Queen Creek.
Maracay, the Arizona subsidiary of the Weyerhauser Real Estate Co., plans to open five more communities with a total of 414 home sites by the second quarter of 2013. Those developments are in Litchfield Park, Queen Creek, Gilbert, Chandler and in east Mesa at Eastmark on the former General Motors Desert Proving Ground site.
The builder has two more communities under contract with 135 home sites in Queen Creek and an additional 22 at Verrado in Buckeye.
"We've repositioned Maracay in the last two years to take advantage of the challenges in the economy," said Warren, who previously worked for Weyerhauser's Winchester Homes subsidiary in Bethesda, Md.
Maracay expects to sell 300 homes in the Valley this year and an additional 100 in Tucson, he said. The company's average home price this year is $260,000.
Home inventory declines
A shrinking inventory of resale homes has buyers turning to new homes, and builders are responding to the demand.
The current pace of 11,000 homes this year could slow because of a tighter supply of suitable home sites and as builders limit their sales because of shortages of subcontractors, said Burger.
Buyers are getting frustrated with failed bids for a shrinking inventory of resale homes and are turning to new homes, he said, adding that the price difference of new homes costing more than resale properties is narrowing in some neighborhoods.
"We're moving in a direction that new homes are coming into focus," Burger said. "Some builders have opened the flood gates and are selling as many homes as they can."
Shea Homes Arizona has seen its sales jump 40 percent so far this year over 2011.
The California-based company, with its Arizona division in Scottsdale, is averaging about eight home sales per week, up from five over the past two years.
"It's pretty refreshing," said Ken Peterson, Shea Homes Arizona vice president of sales and marketing.
Sales are on the upswing because consumers who lost homes to foreclosure or short sales are becoming eligible for loans, he said.
Few new homes locally
Nearly all of the new-home subdivisions are outside of Scottsdale, which has a limited amount of large land tracts for new communities.
Scottsdale issued 63 building permits for single-family homes in the first quarter, up from 33 a year ago but far below Gilbert with 697 permits and Phoenix with 347.
Pulte Homes and Lennar each are building about 200 homes at the gated Lone Mountain community just west of Scottsdale at 60th Street and Lone Mountain Road.
Pulte spokeswoman Jacque Petroulakis said the builder has seen its traffic and sales more than double in the past few months.
Retirees, move-up families and second-home buyers are part of the sales surge, she said.
Pulte, which launched sales at Lone Mountain in April 2010, has homes of 1,933 to 3,026 square feet for $298,990 to $369,990.
Utility-cost savings are a big selling point for the new-home market, with builders touting better insulation, construction techniques, and more efficient appliances and heating and cooling systems..
Builders are also offering garages large enough for recreational vehicles and stand-alone buildings for shops, studios or guest casitas.
New communities planned
Scottsdale-based Maracay Homes has seven Valley communities and four in Tucson. It plans to open these five communities with 414 home sites in the next two years:
Savannah in Litchfield Park, 70 homes with lots of 85 by 130 feet. Opening May 19.
Montelena in Queen Creek, 59 homes with lots of 90 by 140 feet. Opening fall 2012.
Lyons Gate in Gilbert, 46 homes with lots of 60 by 118 feet. Opening late 2012.
Vaquero Ranch in Chandler, 74 homes with lots of 60 by 120 feet. Opening second quarter 2013.
Eastmark in east Mesa, 165 homes with about half the lots at 55 by 115 feet and half the lots at 70 by 120 feet. Opening second quarter 2013.
by Peter Corbett - May. 10, 2012 03:22 PM The Republic | azcentral.com
Scottsdale builders seeing surge in new homes
Builders acquired permits for nearly 2,500 single-family homes in the first quarter, up 74 percent from a year ago, said Greg Burger, publisher with RL Brown of the "Phoenix Housing Market Letter."
Maracay Homes reports that it sold 190 homes through April, more than double its activity a year ago. Plus, this year's $50 million in sales far exceeds last year's pace when Maracay sold $60.5 million for all of 2011.It's a big change for a new-home market that went from dormant to sluggish before the recent uptick.
"It hasn't been wine and roses the past few years," said Andy Warren,Maracay president since April 2009.
The number of building permits issued continued to grow in April and homebuilders are responding with new communities and floor plans.
Maracay Homes, with its offices at the Scottsdale Quarter, has four communities in Tucson and seven in the Valley in Buckeye, Chandler, Goodyear, Peoria and Queen Creek.
Maracay, the Arizona subsidiary of the Weyerhauser Real Estate Co., plans to open five more communities with a total of 414 home sites by the second quarter of 2013. Those developments are in Litchfield Park, Queen Creek, Gilbert, Chandler and in east Mesa at Eastmark on the former General Motors Desert Proving Ground site.
The builder has two more communities under contract with 135 home sites in Queen Creek and an additional 22 at Verrado in Buckeye.
"We've repositioned Maracay in the last two years to take advantage of the challenges in the economy," said Warren, who previously worked for Weyerhauser's Winchester Homes subsidiary in Bethesda, Md.
Maracay expects to sell 300 homes in the Valley this year and an additional 100 in Tucson, he said. The company's average home price this year is $260,000.
Home inventory declines
A shrinking inventory of resale homes has buyers turning to new homes, and builders are responding to the demand.
The current pace of 11,000 homes this year could slow because of a tighter supply of suitable home sites and as builders limit their sales because of shortages of subcontractors, said Burger.
Buyers are getting frustrated with failed bids for a shrinking inventory of resale homes and are turning to new homes, he said, adding that the price difference of new homes costing more than resale properties is narrowing in some neighborhoods.
"We're moving in a direction that new homes are coming into focus," Burger said. "Some builders have opened the flood gates and are selling as many homes as they can."
Shea Homes Arizona has seen its sales jump 40 percent so far this year over 2011.
The California-based company, with its Arizona division in Scottsdale, is averaging about eight home sales per week, up from five over the past two years.
"It's pretty refreshing," said Ken Peterson, Shea Homes Arizona vice president of sales and marketing.
Sales are on the upswing because consumers who lost homes to foreclosure or short sales are becoming eligible for loans, he said.
Few new homes locally
Nearly all of the new-home subdivisions are outside of Scottsdale, which has a limited amount of large land tracts for new communities.
Scottsdale issued 63 building permits for single-family homes in the first quarter, up from 33 a year ago but far below Gilbert with 697 permits and Phoenix with 347.
Pulte Homes and Lennar each are building about 200 homes at the gated Lone Mountain community just west of Scottsdale at 60th Street and Lone Mountain Road.
Pulte spokeswoman Jacque Petroulakis said the builder has seen its traffic and sales more than double in the past few months.
Retirees, move-up families and second-home buyers are part of the sales surge, she said.
Pulte, which launched sales at Lone Mountain in April 2010, has homes of 1,933 to 3,026 square feet for $298,990 to $369,990.
Utility-cost savings are a big selling point for the new-home market, with builders touting better insulation, construction techniques, and more efficient appliances and heating and cooling systems..
Builders are also offering garages large enough for recreational vehicles and stand-alone buildings for shops, studios or guest casitas.
New communities planned
Scottsdale-based Maracay Homes has seven Valley communities and four in Tucson. It plans to open these five communities with 414 home sites in the next two years:
Savannah in Litchfield Park, 70 homes with lots of 85 by 130 feet. Opening May 19.
Montelena in Queen Creek, 59 homes with lots of 90 by 140 feet. Opening fall 2012.
Lyons Gate in Gilbert, 46 homes with lots of 60 by 118 feet. Opening late 2012.
Vaquero Ranch in Chandler, 74 homes with lots of 60 by 120 feet. Opening second quarter 2013.
Eastmark in east Mesa, 165 homes with about half the lots at 55 by 115 feet and half the lots at 70 by 120 feet. Opening second quarter 2013.
by Peter Corbett - May. 10, 2012 03:22 PM The Republic | azcentral.com
Scottsdale builders seeing surge in new homes
Improving Home Builder Morale Tops Warm Winter Rally Amid New Selling Season PHM LEN - Investors.com
Home builder morale rose to a five-year high in May and is better than it was during the mild winter months, suggesting the recent rally isn't just a weather-related anomaly.
The National Association of Home Builders sentiment index climbed to 29 from 24 in April. Readings for current conditions, the six-month outlook and traffic also rose, nearing or besting winter highs.
In intraday trading, Lennar (LEN), D.R. Horton (DHI) and KB Home (KBH) were each up more than 4%. PulteGroup (PHM) and Toll Brothers (TOL) advanced more than 2%.
The Building-Residential/Commercial group, No. 1 out of IBD's 197 industries this week, climbed to its highest level since Aug. '07.
Do-it-yourself retail giant Home Depot (HD), which reported in-line earnings and sales below estimates Tuesday morning, was off 1.6%.
Homebuilders reported higher orders and backlogs in their latest quarterly earnings, in line with separate data pointing to stabilization in the housing market.
Readings had been strong in February and March but retreated in April. But the latest rebound could point to some underlying strength. The NAHB's traffic subindex jumped to 23 in May from 18, also hitting a five-year high.
The overall index is still historically low and still far from the break-even level of 50. Readings above that mean more builders see good conditions than bad.
NAHB also noted obstacles to housing persist, such as access to credit, "inaccurate" appraisals, and rising materials prices. Data on housing starts come out Wednesday, offering another opportunity for a stock lift.
by Jason Ma Investor's Business Daily May 15, 2012
Improving Home Builder Morale Tops Warm Winter Rally Amid New Selling Season PHM LEN - Investors.com
The National Association of Home Builders sentiment index climbed to 29 from 24 in April. Readings for current conditions, the six-month outlook and traffic also rose, nearing or besting winter highs.
In intraday trading, Lennar (LEN), D.R. Horton (DHI) and KB Home (KBH) were each up more than 4%. PulteGroup (PHM) and Toll Brothers (TOL) advanced more than 2%.
The Building-Residential/Commercial group, No. 1 out of IBD's 197 industries this week, climbed to its highest level since Aug. '07.
Do-it-yourself retail giant Home Depot (HD), which reported in-line earnings and sales below estimates Tuesday morning, was off 1.6%.
Homebuilders reported higher orders and backlogs in their latest quarterly earnings, in line with separate data pointing to stabilization in the housing market.
Readings had been strong in February and March but retreated in April. But the latest rebound could point to some underlying strength. The NAHB's traffic subindex jumped to 23 in May from 18, also hitting a five-year high.
The overall index is still historically low and still far from the break-even level of 50. Readings above that mean more builders see good conditions than bad.
NAHB also noted obstacles to housing persist, such as access to credit, "inaccurate" appraisals, and rising materials prices. Data on housing starts come out Wednesday, offering another opportunity for a stock lift.
by Jason Ma Investor's Business Daily May 15, 2012
Improving Home Builder Morale Tops Warm Winter Rally Amid New Selling Season PHM LEN - Investors.com
Sunday, May 13, 2012
FDIC to spare healthy units of failing banks
WASHINGTON - Regulators plan to employ a strategy for handling big failing banks that would help stabilize the financial system by preserving the banks' healthy operations, the head of the Federal Deposit Insurance Corp. says.
FDIC acting Chairman Martin Gruenberg outlined the agency's strategy in a speech Thursday. Under the 2010 financial-overhaul law, the agency has the authority to seize and dismantle big financial firms that could collapse and threaten the broader system. The aim is to avoid another taxpayer bailout of Wall Street banks in another financial crisis.
Gruenberg said that under the strategy, the FDIC would take over a failing bank's parent company but allow its healthy subsidiaries to continue operating. He said that would reduce disruption and permit normal financial transactions.
Because the subsidiaries would keep operating, their trading and other relationships with other big financial institutions also would continue normally and "mitigate systemic consequences," Gruenberg said in the speech at a Federal Reserve conference in Chicago. That would reduce the chance that closely connected big financial firms would fall like dominoes.
In shutting down a bank's parent company, the FDIC would transfer its assets, especially holdings in its subsidiaries, to a new "bridge" company. Shareholders would lose their investment. Its creditors would receive equity stakes in the "bridge" company.
Eventually, the bridge company would become a healthy company in private hands, Gruenberg said.
FDIC officials cite Lehman Brothers' collapse in 2008 that precipitated the financial meltdown and Great Recession. Despite Lehman's extensive losses, there were valuable assets in some subsidiaries, especially its European operation, based in London, they say. When Lehman failed, that operation had to be dissolved under British law. The FDIC strategy would permit such an operation to continue.
by Marcy Gordon - May. 10, 2012 06:21 PM Associated Press
FDIC to spare healthy units of failing banks
FDIC acting Chairman Martin Gruenberg outlined the agency's strategy in a speech Thursday. Under the 2010 financial-overhaul law, the agency has the authority to seize and dismantle big financial firms that could collapse and threaten the broader system. The aim is to avoid another taxpayer bailout of Wall Street banks in another financial crisis.
Gruenberg said that under the strategy, the FDIC would take over a failing bank's parent company but allow its healthy subsidiaries to continue operating. He said that would reduce disruption and permit normal financial transactions.
Because the subsidiaries would keep operating, their trading and other relationships with other big financial institutions also would continue normally and "mitigate systemic consequences," Gruenberg said in the speech at a Federal Reserve conference in Chicago. That would reduce the chance that closely connected big financial firms would fall like dominoes.
In shutting down a bank's parent company, the FDIC would transfer its assets, especially holdings in its subsidiaries, to a new "bridge" company. Shareholders would lose their investment. Its creditors would receive equity stakes in the "bridge" company.
Eventually, the bridge company would become a healthy company in private hands, Gruenberg said.
FDIC officials cite Lehman Brothers' collapse in 2008 that precipitated the financial meltdown and Great Recession. Despite Lehman's extensive losses, there were valuable assets in some subsidiaries, especially its European operation, based in London, they say. When Lehman failed, that operation had to be dissolved under British law. The FDIC strategy would permit such an operation to continue.
by Marcy Gordon - May. 10, 2012 06:21 PM Associated Press
FDIC to spare healthy units of failing banks
Property near mall finally has owner
The Arizona Supreme Court has decided that investors in a California-based company own the high-profile, 10.5-acre parcel Elevation Chandler near Loops 101 and 202.
For three years, Point Center Financial of California and Phoenix foreclosure speculator Tom Peltier have been fighting in court over ownership.
The court's opinion, issued Friday, ends that legal battle and clears the way for investors to sell the parcel, which has drawn considerable interest from potential buyers.
"Even prior to the decision, there have been a few groups following up with us to see if the decision was out yet," said Rene Esparza, Point Center's loan servicing manager and asset manager.
Esparza declined to identify prospective buyers or the possible price.
A majority of the site's 270 investors, weighted by how much money they have in the project, will vote on whether to sell and, if so, which offer to accept.
"Even though we're negotiating the deal, we want to present to our investors what we believe is the best deal for them," Esparza said.
There have been distressed sales in the commercial market, but Elevation Chandler is a premium location. Its value was muddied because of the litigation, which Esparza described as "the big black cloud over the site."
The property is eligible for a variety of uses, such as apartments, offices or mixed use, but single-family homes won't be considered, Chandler planning administrator Jack Kurtz said.
Because the property is on the southern edge of the upscale Chandler Fashion Center, he expects a project there to complement the mall.
"At one time, the plans were for mixed use, which makes sense," Kurtz said. "The last people who came in, Archstone, were proposing high-density multifamily, which also made sense. Offices complementary to the mall would also make sense."
Colorado-based Archstone Apartments, which was in escrow when it broke the contract last fall, is expressing interest now that the title is clear.
Mayor Jay Tibshraeny is glad the legal case is resolved.
"The single-most question I get asked is what is happening with that partially completed structure near the mall," he said. "It's of keen interest."
City Councilman Rick Heumann said a Class A hotel would work well there because Chandler lacks a large meeting space. Condos are out because financing has dried up.
"The quality and standards of Chandler have to be met," Heumann said. "Elevation Chandler is going to be the entrance to the Price Corridor and the mall, and that's important."
At issue was who really owned the site. The legal battle began June 15, 2009, the day of a botched trustee's sale.
The Supreme Court said deeds of trust are governed by state statute, not case law, as Peltier had argued, said Roger Cohen, attorney for TD Service, the company that held not one but three trustee's sales on the property.
Joseph Cotterman, attorney for Point Center, said of the court's opinion, "I was very glad to see a well-reasoned decision that reached the right result for all the right reasons. It is very clear that the Supreme Court decided this strictly under the statutes that relate to deeds of trust."
The first trustee's sale was at noon on June 15, 2009, when an auctioneer for TD Service made a $1 million credit bid on behalf of Point Center. The auctioneer had been authorized to make bids for Point Center up to $25 million if competitors placed bids. Point Center was deemed the buyer.
Peltier arrived later and told the auctioneer the sale had been scheduled at 2 p.m., and he insisted the auction be repeated, so a second sale occurred about 3:30 p.m.
The auctioneer bid $1 million for Point Center, and Peltier bid a dollar more: $1,000,001. The auctioneer called his office and was erroneously told to declare Peltier the winner, even though Point Center had authorized the auctioneer to bid up to $25 million on the lender's behalf.
The next day, a standoff developed between Peltier and TD Service. The company said the sale was void because of errors, and it refused to accept the balance from Peltier, who in turn refused to accept from TD his $10,000 down payment from the day before.
The errors in the sale included inaccuracy in the property's legal description and in sale notices being placed at the wrong address.
Peltier, doing business as BT Capital, filed a lawsuit, which was dismissed by Maricopa County Superior Court Judge Bethany Hicks.
She ruled that the second trustee's sale was void because of procedural irregularities.
Peltier appealed, and the Arizona Court of Appeals kept his case alive.
However, the state Supreme Court said Friday that one of the keys was a third trustee's sale, held on July 1, 2010.
"We hold that this case was rendered moot when the property was purchased by the beneficiary (Point Center) at a third trustee's sale in 2010," the opinion said.
Peltier attended the July 2010 sale but didn't bid, saying he already owned the property.
The Supreme Court also ordered Peltier to pay attorney's fees incurred by Point Center.
Peltier's attorney, Bill Doyle, declined to comment.
Construction on Elevation Chandler stopped April 2006, leaving an eyesore, a partly built hotel jutting into the sky. Jeff Cline, Elevation Chandler's original developer, filed for bankruptcy protection in April 2008.
by Luci Scott - May. 10, 2012 03:33 PM The Republic | azcentral.com
Property near mall finally has owner
For three years, Point Center Financial of California and Phoenix foreclosure speculator Tom Peltier have been fighting in court over ownership.
The court's opinion, issued Friday, ends that legal battle and clears the way for investors to sell the parcel, which has drawn considerable interest from potential buyers.
"Even prior to the decision, there have been a few groups following up with us to see if the decision was out yet," said Rene Esparza, Point Center's loan servicing manager and asset manager.
Esparza declined to identify prospective buyers or the possible price.
A majority of the site's 270 investors, weighted by how much money they have in the project, will vote on whether to sell and, if so, which offer to accept.
"Even though we're negotiating the deal, we want to present to our investors what we believe is the best deal for them," Esparza said.
There have been distressed sales in the commercial market, but Elevation Chandler is a premium location. Its value was muddied because of the litigation, which Esparza described as "the big black cloud over the site."
The property is eligible for a variety of uses, such as apartments, offices or mixed use, but single-family homes won't be considered, Chandler planning administrator Jack Kurtz said.
Because the property is on the southern edge of the upscale Chandler Fashion Center, he expects a project there to complement the mall.
"At one time, the plans were for mixed use, which makes sense," Kurtz said. "The last people who came in, Archstone, were proposing high-density multifamily, which also made sense. Offices complementary to the mall would also make sense."
Colorado-based Archstone Apartments, which was in escrow when it broke the contract last fall, is expressing interest now that the title is clear.
Mayor Jay Tibshraeny is glad the legal case is resolved.
"The single-most question I get asked is what is happening with that partially completed structure near the mall," he said. "It's of keen interest."
City Councilman Rick Heumann said a Class A hotel would work well there because Chandler lacks a large meeting space. Condos are out because financing has dried up.
"The quality and standards of Chandler have to be met," Heumann said. "Elevation Chandler is going to be the entrance to the Price Corridor and the mall, and that's important."
At issue was who really owned the site. The legal battle began June 15, 2009, the day of a botched trustee's sale.
The Supreme Court said deeds of trust are governed by state statute, not case law, as Peltier had argued, said Roger Cohen, attorney for TD Service, the company that held not one but three trustee's sales on the property.
Joseph Cotterman, attorney for Point Center, said of the court's opinion, "I was very glad to see a well-reasoned decision that reached the right result for all the right reasons. It is very clear that the Supreme Court decided this strictly under the statutes that relate to deeds of trust."
The first trustee's sale was at noon on June 15, 2009, when an auctioneer for TD Service made a $1 million credit bid on behalf of Point Center. The auctioneer had been authorized to make bids for Point Center up to $25 million if competitors placed bids. Point Center was deemed the buyer.
Peltier arrived later and told the auctioneer the sale had been scheduled at 2 p.m., and he insisted the auction be repeated, so a second sale occurred about 3:30 p.m.
The auctioneer bid $1 million for Point Center, and Peltier bid a dollar more: $1,000,001. The auctioneer called his office and was erroneously told to declare Peltier the winner, even though Point Center had authorized the auctioneer to bid up to $25 million on the lender's behalf.
The next day, a standoff developed between Peltier and TD Service. The company said the sale was void because of errors, and it refused to accept the balance from Peltier, who in turn refused to accept from TD his $10,000 down payment from the day before.
The errors in the sale included inaccuracy in the property's legal description and in sale notices being placed at the wrong address.
Peltier, doing business as BT Capital, filed a lawsuit, which was dismissed by Maricopa County Superior Court Judge Bethany Hicks.
She ruled that the second trustee's sale was void because of procedural irregularities.
Peltier appealed, and the Arizona Court of Appeals kept his case alive.
However, the state Supreme Court said Friday that one of the keys was a third trustee's sale, held on July 1, 2010.
"We hold that this case was rendered moot when the property was purchased by the beneficiary (Point Center) at a third trustee's sale in 2010," the opinion said.
Peltier attended the July 2010 sale but didn't bid, saying he already owned the property.
The Supreme Court also ordered Peltier to pay attorney's fees incurred by Point Center.
Peltier's attorney, Bill Doyle, declined to comment.
Construction on Elevation Chandler stopped April 2006, leaving an eyesore, a partly built hotel jutting into the sky. Jeff Cline, Elevation Chandler's original developer, filed for bankruptcy protection in April 2008.
by Luci Scott - May. 10, 2012 03:33 PM The Republic | azcentral.com
Property near mall finally has owner
$2 Trillion JP Morgan Trading Loss Renews Push To Curb Bank Risk; Dodd-Frank Found Wanting - Investors.com
JPMorgan Chase's (JPM) $2 billion trading loss has renewed concerns about how the nation's largest banks manage risk and raised doubt as to whether the 2010 financial overhaul adequately protects taxpayers.
Overnight, CEO Jamie Dimon seems to have gone from exhibit A in the case that too-big-to-fail banks can be safely run without tighter regulatory handcuffs to exhibit A that they can't.
In one respect, the shift may be unwarranted: The trading loss looks like a superficial wound — not even big enough to wipe out half ofJPMorgan's Q1 profit. At least when it comes to absorbing this particular loss, "too big" may not be so bad.
JPMorgan Chase CEO Jamie Dimon reassured the bank's employees on Friday that the company is "very strong." He is pictured in San Francisco on Jan. 13.
But banking experts understand that financial crises are a fact of life. As long as banks are playing with federally insured deposits — and an implicit broader bailout backstop — taxpayers have an interest in making sure they don't take on excessive risk.
That's where the Volcker Rule, passed as part of the Dodd-Frank reforms, is supposed to come in. But the rule remains unfinished as regulators struggle to translate Congress' mandate to keep banks from taking risky bets into clear, workable guidelines.
Rep. Barney Frank, D-Mass., sounded a note of vindication: "The argument that financial institutions do not need new rules .. . is at least $2 billion harder to make today."
Yet it's unclear if the Volcker Rule would even restrict the activity that burned JPMorgan. Dimon suggested on Thursday's conference call that the trade in question was done to hedge risk and, therefore, would be permissible under the Volcker Rule.
The rule targets proprietary trading — making trades not to provide customers with liquidity or hedge risk, but for pure profit.
"The Volcker Rule judges very much by the intent" behind a trade, said Brookings Institution scholar Douglas Elliott. "If a bank does its hedging incompetently," that's beyond the ability of regulators to police, he said.
And for good reason: "If we didn't have these exceptions, (the Volcker Rule) would effectively forbid a large majority of the things that banks do."
Elliott, for one, is no fan of the Volcker Rule, which aims to ban unnecessary risk, rather than preventing excessive risk-taking. In that sense, it seems designed to rid bank culture of a "trading mentality," he said.
Other analysts also see it as somewhat besides the point in heading off financial crises.
"Banks usually go broke from making bad loans," not proprietary trading, said American Enterprise Institute banking expert Alex Pollock.
by Jed Graham Investor's Business Daily May 11, 2012
$2 Trillion JP Morgan Trading Loss Renews Push To Curb Bank Risk; Dodd-Frank Found Wanting - Investors.com
Overnight, CEO Jamie Dimon seems to have gone from exhibit A in the case that too-big-to-fail banks can be safely run without tighter regulatory handcuffs to exhibit A that they can't.
In one respect, the shift may be unwarranted: The trading loss looks like a superficial wound — not even big enough to wipe out half ofJPMorgan's Q1 profit. At least when it comes to absorbing this particular loss, "too big" may not be so bad.
JPMorgan Chase CEO Jamie Dimon reassured the bank's employees on Friday that the company is "very strong." He is pictured in San Francisco on Jan. 13.
But banking experts understand that financial crises are a fact of life. As long as banks are playing with federally insured deposits — and an implicit broader bailout backstop — taxpayers have an interest in making sure they don't take on excessive risk.
That's where the Volcker Rule, passed as part of the Dodd-Frank reforms, is supposed to come in. But the rule remains unfinished as regulators struggle to translate Congress' mandate to keep banks from taking risky bets into clear, workable guidelines.
Rep. Barney Frank, D-Mass., sounded a note of vindication: "The argument that financial institutions do not need new rules .. . is at least $2 billion harder to make today."
Yet it's unclear if the Volcker Rule would even restrict the activity that burned JPMorgan. Dimon suggested on Thursday's conference call that the trade in question was done to hedge risk and, therefore, would be permissible under the Volcker Rule.
The rule targets proprietary trading — making trades not to provide customers with liquidity or hedge risk, but for pure profit.
"The Volcker Rule judges very much by the intent" behind a trade, said Brookings Institution scholar Douglas Elliott. "If a bank does its hedging incompetently," that's beyond the ability of regulators to police, he said.
And for good reason: "If we didn't have these exceptions, (the Volcker Rule) would effectively forbid a large majority of the things that banks do."
Elliott, for one, is no fan of the Volcker Rule, which aims to ban unnecessary risk, rather than preventing excessive risk-taking. In that sense, it seems designed to rid bank culture of a "trading mentality," he said.
Other analysts also see it as somewhat besides the point in heading off financial crises.
"Banks usually go broke from making bad loans," not proprietary trading, said American Enterprise Institute banking expert Alex Pollock.
by Jed Graham Investor's Business Daily May 11, 2012
$2 Trillion JP Morgan Trading Loss Renews Push To Curb Bank Risk; Dodd-Frank Found Wanting - Investors.com
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