NY Times: Owners Bet on Raising the Rent, and Lost

[marmar]

Owners Bet on Raising the Rent, and Lost

By CHARLES V. BAGLI
Published: May 28, 2010


The first signs of financial turmoil came at Riverton Houses in Harlem.

Then came Stuyvesant Town and Peter Cooper Village on Manhattan’s East Side.

Now a third complex built by Metropolitan Life in the 1940s for veterans and middle-class families has run into financial distress after being purchased by speculators during the recent real estate boom. The owners of the sprawling Parkmerced apartment complex in San Francisco announced this week that they would default on their $550 million mortgage, which comes due in October.

A partnership of Laurence Gluck of Stellar Management and the Rockpoint Group, which had already lost Riverton Houses in Harlem in March to foreclosure, put out a statement on Wednesday that placed their problems at the 3,221-unit Parkmerced in the context of the current economic downturn.

“The landscape has changed dramatically,” P. J. Johnston, a spokesman for the owners, said in an interview. “The economy has taken a major hit. Many properties are facing default.” ..........(more)

The complete piece is at: http://www.nytimes.com/2010/05/29/business/29real.html?hp

[Catshrink]

1. I'm sure many others are also on the brink.

Sadly...

[Lyric]

2. Well that was a brilliant move.

They kicked out the veterans and middle-class working families who had stabilized rents, and tried to replace them with wealthier, higher-rent tenants. And then they failed utterly.

Forgive me if I'm not feeling much sympathy here. I'll save my sympathies for the lower-income people who lost their apartments to someone else's lust for profit.

[gratuitous]

6. Oh come on!

Don't you think they need a bailout? Where's your heart? Where's your compassion? These greedheads had a dream of fleecing folks who had more money than smarts, and the only people hurt were middle class families, who are (let's face it) pretty used to having their corn flakes crapped upon. And they lost! They ventured a whole bunch of capital and lost! It's, it's, just inhuman not to be moved by their plight! Think of all the below-minimum wage undocumented aliens who could have been cleaning those condos! What about the jobs lost?

You heartless libruls!

[high density]

3. Owners bet on greed, and lost

Everybody thought real estate was some infinite money machine a few years ago. It was ridiculous what people were doing.

[Captain Hilts]

4. There are 7 empty storefronts in the swanky Cleveland Park 'hood in DC. Empty. The McDonald's site

has been EMPTY for YEARS.

Landlord will do anything to avoid lowering the rent.

[marmar]

5. Wow. Cleveland Park? The 'hood near the zoo.....

I used to love a little Thai place up there. That's the neighborhood I would go walking or jogging in when I visited Washington.

[Captain Hilts]

7. Yes. Yenching Palace finally closed because the family didn't feel like

doing it any more.

But a whole lot of storefronts are empty there.

There is now a 7-11 directly across from the zoo - in the 'Freudian Hilton' building - that must be THE most lucrative in the chain.

The Zoo Bar, bless it, is still there and thriving. But further North in Sam's Park and Shop there are a couple empty places: McGruder's is gone, Brothers Coffee is Gone, City Gym is gone...and so forth.

[DiverDave]

8. An example:

The post office had 2 sites in Glenside PA.
Right across the street from each other.
The owner raised the rent to 10K per month and the post office moved out.
That was last year, it's still empty...
What a greedy idiot.