It would be interesting to know what proportion of the national total has been Las Vegas development over the last 20 years. In terms of population LV has been growing far faster than the national avg during this time frame. I see this downturn as the end of a 20 year growth cycle for LV; I can see the LV area being stagnant for 5 years going forward.
This shows the huge over investment in offices in the '80s due to the S&L lending.
Don't mistake coincidence for causation CR. THe 80s was also the baby boom entering the workforce and their most consumptive years. It also isn't entirely fair to use %age of GDP as both deflationary and inflationary effects are in play. Americans spend a smaller portion of their entire budget on energy and until recently food than at the start of the 80s. Likewise some construction costs are much higher, others lower. And don't forget technology. I can tilt up, electrify and network a research space in half the time and half the real cost due to advances in modular construction, snap wiring and wireless networking respectively.
In short, the 80s are no longer relevant to this latest period. IMO which is considerable less weighty than yours of course.
I just got back from five days in Las Vegas. We stayed at the Bellagio. The place was capital E "Empty".
Yeah, it's the desert in summer, but I've been going there and staying at Bellagio for a week every August since 2002, and, man, are they hurting.
Saturday night, mid strip.... only three of eight craps games running, all with open spaces, all $10 minimum bets. Previous years, Saturday nights, all 8 games open, $25, $50, or even $100 minimum bets, no spots open.
How much time does anyone spend outside during daylight hrs when visiting Vegas in the summer anyway? Not much, I'll wager(heh heh). The casinos do everything they can to make sure you are on the casino floor with no idea what time it is. I expect people with summer vacation time have historically made their trip to Vegas in the summer.
I think this is an important point so I will continue to bring it up. Didn't we just experience a jobless recovery? Why do you need more office space on the heals of a building boom during a jobless recovery? In my opinion, the office building over the last 5 years was just adding to the overbuilding of the boom ending in 2001 in general. Office construction is dead for several years. (Retail won't recover for a decade).
I'm pissed of with you guys constantly bitching about Kalifornia and Las Vegas.
Here is a sample from near Princeton,NJ
Princeton South Corporate Center
A total of 280,000 square feet is currently being developed by OPUS at PrincetonSouth Corporate Center, a Class A corporate campus located at I-95 and Route 31 in Ewing, NJ. Ultimately the project will include 740,000 sf of Class A corporate office space.
Mercer Corporate Center
Mercer Corporate Center is a total of 300,000 square feet under development by OPUS near I-195 and Route 130 in Hamilton, NJ.
Princeton / I-95 Corporate Center
Located in the I-95 Corridor, this 178,831 square foot office building is available for lease immediately.
OT:
Any new bets on when Wachovia kicks the bucket?
I just received the strangest call. A financial manager from a local wachovia bank wanted to tell me thanks for our business. Umm, let's see considering, the only thing we have with wachovia is a checking account which averages < 500/month, I'm a little concerned. I don't have any loans, CDs, savings, etc. with Wachovia, and they want to tell me thanks for a checking account that is just used to pass small amounts of cash through??? Hmmmmmmmmmm.
There are simply almost too many securities affected by recent ratings cuts at Fitch Ratings to list, as the number of deals affected by deteriorating collateral performance particularly among Alt-A and prime jumbo securitizations are seeing ratings tumble at a record pace to start August.
On Monday alone, Fitch downgraded or put on negative watch 2,655 classes from 190 different deals, both prime and Alt-A, and all from 2005 to 2007 vintages. And that was after downgrading or putting on watch 4,441 classes from 256 separate deals on Friday last weeks cuts included a large chunk of pre-2005 prime and Alt-A securitizations, as well.
That means between Friday and Monday, Fitch took out the carving knife no, make that a machete to 7,061 securities from 446 deals. And nary a subprime loan in the bunch.
However, as of Q2 2008, only mall investment is declining - in fact, investment in lodging soared in Q2!
Makes perfect sense. The Foreclosed will need somewhere to live. It'll turn into a National Disaster. FEMA will take over the administration of the newly homeless.
Everyone moves into hotels. Billing goes to FEMA @ $350.00 a night.
This is going to be interesting for L.A. - Sorry ReBear - There's a bunch of new Hotels sprouting Downtown, 2 or 3 huge new ones in Beverly Hills, a couple coming on line in Hollywood, even Glendale just approve a new Hyatt. Who the hell is gonna stay in these things? Crazy....
Well, with that one big 5,000 room project offline that means there are only 35,000 new hotel rooms planned to come on line in Vegas in the next few years.
Princeton South Corporate Center
A total of 280,000 square feet is
Mercer Corporate Center
Mercer Corporate Center is a total of 300,000 square feet under
Princeton / I-95 Corporate Center
Located in the I-95 Corridor, this 178,831 square foot office
Yeah, and wait until Merrill Lynch throws two million square feet of vacant space on the market a few miles away. We'll see how fast these offices lease up and at what rate.
Princeton and Hopewell are gonna be San Diego East for office vacancy.
Well, today is the 5th day of the 8th month. 5+8=13, which is obviously a good sign for the markets. On top of that, this is 2008, and we have
(2+0+0+8)+(8-5)=13, again! I think that explains it.
How are those monorail bonds doing?
12th Percentile
Ha hahaha
Last time i was there the cabie was laughing at them as we drove underneath it.... Its cheaper for 2 people to take a cab... Who storms around Vegas solo anyway?
BTS sales have not arrived...retailers large and small are in a panic. I suspect spring 09 mall vacancy rates will stun even the most pessimistic individuals.
No $ amounts on that anywhere, but looking at the Fitch Prime RMBS note of July 29, 2008 on Prime Jumbos will have to leave a mark...with increasing roll rates, increasing loss severity and what looks to be a three months doubling rate for the 2007 vintage delenquencies, about a 4-5 month for the 2006 and a 5-6 for the 2005, this train is gathering speed (not to mention the May-June segment looks to be starting a steeper curve...).
The highlight of my commute (central Va) is passing by the site for a Hampton Inn. Out front is a weathered fallen down sign with "Open spring of 2008". They are STILL on the excavation phase of the project. Seems to be rock, no make that LOTS of rock. A dozen dozers have been busting rock for months.
Around here all the low hanging sites have been picked and marginal parcels are being built on. Not only do you need a blank check for the excavator but rock or other drawbacks to a site can delay a project for months while the meter is running.
Here in the foothills of the Blue Ridge the smart ones have a geologist go over the parcel so if there are problems they can either walk away or bargain down/factor in the price of the project.
Whole Foods also sharply cut its outlook for 2009, saying it now expects sales growth of 6 percent to 10 percent for the year -- rather than the previously stated 25 percent to 30 percent growth. And it said its comparable-store sales are expected to grow 1 percent to 5 percent, down from the previously anticipated growth of 7.5 percent to 9.5 percent.
I know of at least one place (Portland, ME) where Whole Foods opened a huge new store right next to Wild Oats. And then when the bought WO, they just shut location down and rolled it all into the new WF.
Mish points out that today "Detroit's three automakers are urging Congress to make as much as $35 billion to $40 billion in low-cost loans available during the next two to three years to assure that the companies survive long enough to retool and build a new generation of fuel-efficient vehicles.
"
What a steaming pile of horse manure...let them go bankrupt and have the bondholders carve up the carcasses. The equity holders in these companies deserve to be wiped out.
lama - I love to shop at Whole Foods and Wild Oats but those people invented inflation before it was cool. Its pretty easy to just go to the normal grocery store and save 25%.
I guess the unit of measurement for empty office space is millions, writeoffs is billions and bailouts is trillions.
It would not shock me to see the same thing happen to office buildings as happened to cars. The older, space-wasting, energy-inefficient buildings will become surplus. Companies will want newer types of cost-effective and energy-efficient buildings. There is so much wasted space in an average office building. In a lot of prime Manhattan office buildings, there might be 30-40 people working on a floor with 10,000 square feet.
I work in a space of about 70 square feet, and I'm pretty productive. We don't need all the filing cabinets and big copying machines and crap that office workers used to need, before PCs and the Internet. Think about how much money and energy companies could save if they put 100 workers into 5,000 square feet of space and made the ceilings 7 feet high. It would feel a little claustrophobic at first but so what? Shut up and work as hard as the Chinese or we'll never catch up.
Whenever I go to Whole Foods with my friend, she always tell me to pretend to be smug and indifferent, because that's how there crowds are. They're like "We're better than anyone else because of the food we eat". Well, they can keep their $7 loaf of bread, along with their $13 jam, and shove it up their ass for all I care!
I"m with Elvis. Smug for a lot of reasons. However, I shop at Whole Foods (when i can, they don't have them where i live) because the food is so tasty.
I'd shop at Walmart and eat at McDonald's if the food wasn't such crap.
And I bake my own bread which makes me smug as hell.
rich,
I believe newer/cost effective space is called REOs. Employers will soon ask employees to find REOs to work from to save rental expenses. Just open windows for light and use PDAs for communication. Lean and mean. Lean and mean.
Any idea why the lodging investment spiked higher in CR's graph? Lag between project start/construction and completion? Anyways, good news for folks looking for a cheap hotel room.
I think 2005/2006 was the peak of the demand for land to build new hotels. It takes a while to get the land entitled then to build. They should be completed soon. The herd leads itself off a cliff once again. The Indians will eat well tonight.
If managers would get over their obsession with seeing folks at their desks rather than evaluating their actual work, most office space would be seen as an unnecessary expense and abandoned. The majority of 'office' work can be done anywhere there is a computer and a network.
Just booked a hotel in Nashvegas that's $10/night more expensive then when I was there 2 years ago, still a POS. Walk up rate is $20 more.
Vegas is like Phoenix except with less industry outside of casinos. The Phoenix RE bust 20 years ago had price suppression for 10 years, took 15 years for prices to recover to 89 levels.
Aug. 5 (Bloomberg) -- Morgan Stanley, the second-biggest U.S. securities firm, told several thousand clients this week that they won't be allowed to withdraw money on their home- equity credit lines, said a person familiar with the situation.
The action mostly affected clients with properties that have lost value, according to the person, who declined to be identified because the information isn't public. The New York- based investment bank will review home equity lines of credit, or HELOCS, monthly from now on, the person said.
Whole Foods gives me the willies. I live in a university town, and the people behind the counters at the natural food markets are basically the same as the people standing in front of them: students, early grads, locals, hippie kids, etc.
But when I go to a Whole Foods in Silicon Valley, especially in Palo Alto, the customers are highly privileged Anglo high-income eco-druids in expensive clothing, and the staff is working class and minority-heavy and couldn't afford to shop there in a million years. And the customers seem oblivious to their excessive privilege. Like I say, gives me willies.
"Movie theater operator Regal Entertainment Group said Thursday that second-quarter profit fell 74% on costs related to its purchase of Consolidated Theatres and debt payments.
Net income dropped to $13.8 million, or 9 cents a share, from $52.7 million, or 33 cents, a year earlier, Knoxville, Tenn.-based Regal said. Sales declined 1.1% to $675.8 million, missing the $681.3-million average of analysts' estimates compiled by Bloomberg....."
Some of this is due to bookkeeping, and a one-time gain Regal had in the same quarter a year ago. Still...
"We haven't talked about theater chains lately, the anchors of so many retail centers"
The desperate developers here are paying huge development/land improvement costs based on commitments from theaters to build huge movie theaters. This was to jump start the developments. Unfortunately, but foreseeably, no tenants have followed these theaters and the developers are stuck with huge land improvement cost debts. Now that the retail gravy train has left, these guys are in deep sh%$.
Some idiot/genious came up with a cookie cutter approach for building identical 4 story hotels. The damn things are like mushrooms.
Its the 'Merican Way - copy someone else's pretty average idea and multiply like crazy to get better economies of scale as opposed to studying the idea and REALLY innovating a better solution offering.
Oh well what could possibly go wrong with a 'proven success model'?
:::
All I have to say as somebody who stays in alotta McHotels... this sector is really REALLY gonna get killed.
Anonymous Bosch:
I fear you may be very prescient. I still remember N.Y. metropolitan area in the 80's. Owners of welfare hotels made a killing at the taxpayer's expense.
"The future is but past forgotten, and we're on the road to madness"
I'm the CFO of a group that both owns and manages hotels. I can assure you that given todays construction costs there is no way you can make money at 50% Occupancy!!
It would be interesting to know what proportion of the national total has been Las Vegas development over the last 20 years. In terms of population LV has been growing far faster than the national avg during this time frame. I see this downturn as the end of a 20 year growth cycle for LV; I can see the LV area being stagnant for 5 years going forward.
Pretty dead here these days? Too much cannabis maybe?
This shows the huge over investment in offices in the '80s due to the S&L lending.
Don't mistake coincidence for causation CR. THe 80s was also the baby boom entering the workforce and their most consumptive years. It also isn't entirely fair to use %age of GDP as both deflationary and inflationary effects are in play. Americans spend a smaller portion of their entire budget on energy and until recently food than at the start of the 80s. Likewise some construction costs are much higher, others lower. And don't forget technology. I can tilt up, electrify and network a research space in half the time and half the real cost due to advances in modular construction, snap wiring and wireless networking respectively.
In short, the 80s are no longer relevant to this latest period. IMO which is considerable less weighty than yours of course.
Lodging is going to get killed!
Some idiot/genious came up with a cookie cutter approach for building identical 4 story hotels. The damn things are like mushrooms.
The break even on these 'proxy' real estate investments is supposed to be around 50% occupancy.
I guess if you have a long term fixed rate takeout, you might survive but the competitive rate cutting will be cuy throat.
They're not just building hotels -- they're building big multi-story hotels entirely out of wood.
WTH?
ac,
I've noticed that also. Four story wood with a little lick and stick or cheap stucco.
Some architect has his blue print machine working 24-7.
I just got back from five days in Las Vegas. We stayed at the Bellagio. The place was capital E "Empty".
Yeah, it's the desert in summer, but I've been going there and staying at Bellagio for a week every August since 2002, and, man, are they hurting.
Saturday night, mid strip.... only three of eight craps games running, all with open spaces, all $10 minimum bets. Previous years, Saturday nights, all 8 games open, $25, $50, or even $100 minimum bets, no spots open.
Vegas is really in the shitter.
Eric has it right. Cheap in Vegas is chic now. The big money casinos are empty and the table limits are down.
Some architect has his blue print machine working 24-7.
Ross | 08.05.08 - 4:13 pm | #
Nope same old print a little ragged around the edges and lots of adds/cross outs. They are like mushrooms.
jo6pac
ac,
I've noticed that also. Four story wood with a little lick and stick or cheap stucco.
Some architect has his blue print machine working 24-7.
A coworker said she stayed in one recently and the building literally shook when people walked around in it.
How much time does anyone spend outside during daylight hrs when visiting Vegas in the summer anyway? Not much, I'll wager(heh heh). The casinos do everything they can to make sure you are on the casino floor with no idea what time it is. I expect people with summer vacation time have historically made their trip to Vegas in the summer.
I think this is an important point so I will continue to bring it up. Didn't we just experience a jobless recovery? Why do you need more office space on the heals of a building boom during a jobless recovery? In my opinion, the office building over the last 5 years was just adding to the overbuilding of the boom ending in 2001 in general. Office construction is dead for several years. (Retail won't recover for a decade).
I'm pissed of with you guys constantly bitching about Kalifornia and Las Vegas.
Here is a sample from near Princeton,NJ
Princeton South Corporate Center
A total of 280,000 square feet is currently being developed by OPUS at PrincetonSouth Corporate Center, a Class A corporate campus located at I-95 and Route 31 in Ewing, NJ. Ultimately the project will include 740,000 sf of Class A corporate office space.
Mercer Corporate Center
Mercer Corporate Center is a total of 300,000 square feet under development by OPUS near I-195 and Route 130 in Hamilton, NJ.
Princeton / I-95 Corporate Center
Located in the I-95 Corridor, this 178,831 square foot office building is available for lease immediately.
OT:
Any new bets on when Wachovia kicks the bucket?
I just received the strangest call. A financial manager from a local wachovia bank wanted to tell me thanks for our business. Umm, let's see considering, the only thing we have with wachovia is a checking account which averages < 500/month, I'm a little concerned. I don't have any loans, CDs, savings, etc. with Wachovia, and they want to tell me thanks for a checking account that is just used to pass small amounts of cash through??? Hmmmmmmmmmm.
OT:
Fitch Takes Hatchet to Alt-A, Prime RMBS Ratings : HousingWire || financial news for the mortgage market
There are simply almost too many securities affected by recent ratings cuts at Fitch Ratings to list, as the number of deals affected by deteriorating collateral performance particularly among Alt-A and prime jumbo securitizations are seeing ratings tumble at a record pace to start August.
On Monday alone, Fitch downgraded or put on negative watch 2,655 classes from 190 different deals, both prime and Alt-A, and all from 2005 to 2007 vintages. And that was after downgrading or putting on watch 4,441 classes from 256 separate deals on Friday last weeks cuts included a large chunk of pre-2005 prime and Alt-A securitizations, as well.
That means between Friday and Monday, Fitch took out the carving knife no, make that a machete to 7,061 securities from 446 deals. And nary a subprime loan in the bunch.
Just subscribed to your blog feed. This blog has some great articles and analysis of current news. I look forward to reading more!
MiningOilGasGuru, tell us where the bottom in oil is.
God i wish i had kept my shorts on LVS, WYNN, PCR....
jo no tengo huevos!
...............
MGM Mirage Gets $1.65 Billion Vegas CityCenter Loans
MGM Mirage Gets $1.65 Billion Vegas CityCenter Loans (Update2) - Bloomberg.com
MGM Mirage, the world's second- largest casino company, said banks agreed to lend half the money it is seeking for the CityCenter complex it's developing on the Las Vegas Strip, and expects the rest before October.
Sort of related foreclosure news for Los Angeles.
LA foreclosures spread to Malibu, Santa Monica
| Reuters
However, as of Q2 2008, only mall investment is declining - in fact, investment in lodging soared in Q2!
Makes perfect sense. The Foreclosed will need somewhere to live. It'll turn into a National Disaster. FEMA will take over the administration of the newly homeless.
Everyone moves into hotels. Billing goes to FEMA @ $350.00 a night.
This is going to be interesting for L.A. - Sorry ReBear
- There's a bunch of new Hotels sprouting Downtown, 2 or 3 huge new ones in Beverly Hills, a couple coming on line in Hollywood, even Glendale just approve a new Hyatt. Who the hell is gonna stay in these things? Crazy....
Well, with that one big 5,000 room project offline that means there are only 35,000 new hotel rooms planned to come on line in Vegas in the next few years.
Oops.
How are those monorail bonds doing?
So I might as well say it. Knowing what we know, SRS sure looks cheap these days.
Mercer Corporate Center
Mercer Corporate Center is a total of 300,000 square feet under
Princeton / I-95 Corporate Center
Located in the I-95 Corridor, this 178,831 square foot office
Yeah, and wait until Merrill Lynch throws two million square feet of vacant space on the market a few miles away. We'll see how fast these offices lease up and at what rate.
Princeton and Hopewell are gonna be San Diego East for office vacancy.
Well, today is the 5th day of the 8th month. 5+8=13, which is obviously a good sign for the markets. On top of that, this is 2008, and we have
(2+0+0+8)+(8-5)=13, again! I think that explains it.
How are those monorail bonds doing?
12th Percentile
Ha hahaha
Last time i was there the cabie was laughing at them as we drove underneath it.... Its cheaper for 2 people to take a cab... Who storms around Vegas solo anyway?
..............
Not sure if this has been mentioned here today but many here are sure to find these photos of protesters at the Fed agreeable.
Mall investment is the inevitable outcome of easy credit.
BTS sales have not arrived...retailers large and small are in a panic. I suspect spring 09 mall vacancy rates will stun even the most pessimistic individuals.
He is about to get fired and is "networking" to line up his next job.
friardaddy,
No $ amounts on that anywhere, but looking at the Fitch Prime RMBS note of July 29, 2008 on Prime Jumbos will have to leave a mark...with increasing roll rates, increasing loss severity and what looks to be a three months doubling rate for the 2007 vintage delenquencies, about a 4-5 month for the 2006 and a 5-6 for the 2005, this train is gathering speed (not to mention the May-June segment looks to be starting a steeper curve...).
Speaking of lodging.
The highlight of my commute (central Va) is passing by the site for a Hampton Inn. Out front is a weathered fallen down sign with "Open spring of 2008". They are STILL on the excavation phase of the project. Seems to be rock, no make that LOTS of rock. A dozen dozers have been busting rock for months.
Around here all the low hanging sites have been picked and marginal parcels are being built on. Not only do you need a blank check for the excavator but rock or other drawbacks to a site can delay a project for months while the meter is running.
Here in the foothills of the Blue Ridge the smart ones have a geologist go over the parcel so if there are problems they can either walk away or bargain down/factor in the price of the project.
Cisco is "seeing progress in the U.S. Enterprise market"
whole foods warns of trouble ahead
Whole Foods also sharply cut its outlook for 2009, saying it now expects sales growth of 6 percent to 10 percent for the year -- rather than the previously stated 25 percent to 30 percent growth. And it said its comparable-store sales are expected to grow 1 percent to 5 percent, down from the previously anticipated growth of 7.5 percent to 9.5 percent.
I know of at least one place (Portland, ME) where Whole Foods opened a huge new store right next to Wild Oats. And then when the bought WO, they just shut location down and rolled it all into the new WF.
Whole Foods down? That's not the gasoline price effect. All their customers drive Priuses.
(sarcasm off)
rich,
I guess the unit of measurement for empty office space is millions, writeoffs is billions and bailouts is trillions.
Mish points out that today "Detroit's three automakers are urging Congress to make as much as $35 billion to $40 billion in low-cost loans available during the next two to three years to assure that the companies survive long enough to retool and build a new generation of fuel-efficient vehicles.
"
What a steaming pile of horse manure...let them go bankrupt and have the bondholders carve up the carcasses. The equity holders in these companies deserve to be wiped out.
lama - I love to shop at Whole Foods and Wild Oats but those people invented inflation before it was cool. Its pretty easy to just go to the normal grocery store and save 25%.
I'd rather go to Alfalfa's.
RE,
It would not shock me to see the same thing happen to office buildings as happened to cars. The older, space-wasting, energy-inefficient buildings will become surplus. Companies will want newer types of cost-effective and energy-efficient buildings. There is so much wasted space in an average office building. In a lot of prime Manhattan office buildings, there might be 30-40 people working on a floor with 10,000 square feet.
I work in a space of about 70 square feet, and I'm pretty productive. We don't need all the filing cabinets and big copying machines and crap that office workers used to need, before PCs and the Internet. Think about how much money and energy companies could save if they put 100 workers into 5,000 square feet of space and made the ceilings 7 feet high. It would feel a little claustrophobic at first but so what? Shut up and work as hard as the Chinese or we'll never catch up.
Whenever I go to Whole Foods with my friend, she always tell me to pretend to be smug and indifferent, because that's how there crowds are. They're like "We're better than anyone else because of the food we eat". Well, they can keep their $7 loaf of bread, along with their $13 jam, and shove it up their ass for all I care!
"We're better than anyone else because of the food we eat".
I prefer the smugness here. And the implied motto "We're better than Sebastian because we are."
I"m with Elvis. Smug for a lot of reasons. However, I shop at Whole Foods (when i can, they don't have them where i live) because the food is so tasty.
I'd shop at Walmart and eat at McDonald's if the food wasn't such crap.
And I bake my own bread which makes me smug as hell.
Ok, before we go to far OT, I'm out of here.
rich,
I believe newer/cost effective space is called REOs. Employers will soon ask employees to find REOs to work from to save rental expenses. Just open windows for light and use PDAs for communication. Lean and mean. Lean and mean.
Any idea why the lodging investment spiked higher in CR's graph? Lag between project start/construction and completion? Anyways, good news for folks looking for a cheap hotel room.
I think 2005/2006 was the peak of the demand for land to build new hotels. It takes a while to get the land entitled then to build. They should be completed soon. The herd leads itself off a cliff once again. The Indians will eat well tonight.
If managers would get over their obsession with seeing folks at their desks rather than evaluating their actual work, most office space would be seen as an unnecessary expense and abandoned. The majority of 'office' work can be done anywhere there is a computer and a network.
Just booked a hotel in Nashvegas that's $10/night more expensive then when I was there 2 years ago, still a POS. Walk up rate is $20 more.
Vegas is like Phoenix except with less industry outside of casinos. The Phoenix RE bust 20 years ago had price suppression for 10 years, took 15 years for prices to recover to 89 levels.
More nothingburger for dinner!
Morgan Stanley Said to Freeze Client Home-Equity Credit Lines
By Christine Harper
Aug. 5 (Bloomberg) -- Morgan Stanley, the second-biggest U.S. securities firm, told several thousand clients this week that they won't be allowed to withdraw money on their home- equity credit lines, said a person familiar with the situation.
The action mostly affected clients with properties that have lost value, according to the person, who declined to be identified because the information isn't public. The New York- based investment bank will review home equity lines of credit, or HELOCS, monthly from now on, the person said.
{snip}
Whole Foods gives me the willies. I live in a university town, and the people behind the counters at the natural food markets are basically the same as the people standing in front of them: students, early grads, locals, hippie kids, etc.
But when I go to a Whole Foods in Silicon Valley, especially in Palo Alto, the customers are highly privileged Anglo high-income eco-druids in expensive clothing, and the staff is working class and minority-heavy and couldn't afford to shop there in a million years. And the customers seem oblivious to their excessive privilege. Like I say, gives me willies.
We haven't talked about theater chains lately, the anchors of so many retail centers:
Theater owner's earnings plunge - Los Angeles Times
"Movie theater operator Regal Entertainment Group said Thursday that second-quarter profit fell 74% on costs related to its purchase of Consolidated Theatres and debt payments.
Net income dropped to $13.8 million, or 9 cents a share, from $52.7 million, or 33 cents, a year earlier, Knoxville, Tenn.-based Regal said. Sales declined 1.1% to $675.8 million, missing the $681.3-million average of analysts' estimates compiled by Bloomberg....."
Some of this is due to bookkeeping, and a one-time gain Regal had in the same quarter a year ago. Still...
This is just terrible. Now how am I going to put the flatscreen and the bowling alley in the stretch Hummer?
"We haven't talked about theater chains lately, the anchors of so many retail centers"
The desperate developers here are paying huge development/land improvement costs based on commitments from theaters to build huge movie theaters. This was to jump start the developments. Unfortunately, but foreseeably, no tenants have followed these theaters and the developers are stuck with huge land improvement cost debts. Now that the retail gravy train has left, these guys are in deep sh%$.
A coworker said she stayed in one recently and the building literally shook when people walked around in it.
ac | 08.05.08 - 4:22 pm | #
Was she sure they were just walking?
Ross writes:
Lodging is going to get killed!
Some idiot/genious came up with a cookie cutter approach for building identical 4 story hotels. The damn things are like mushrooms.
Its the 'Merican Way - copy someone else's pretty average idea and multiply like crazy to get better economies of scale as opposed to studying the idea and REALLY innovating a better solution offering.
Oh well what could possibly go wrong with a 'proven success model'?
:::
All I have to say as somebody who stays in alotta McHotels... this sector is really REALLY gonna get killed.
Anonymous Bosch:
I fear you may be very prescient. I still remember N.Y. metropolitan area in the 80's. Owners of welfare hotels made a killing at the taxpayer's expense.
"The future is but past forgotten, and we're on the road to madness"
hasnt the cost of raw materials been going way up over the past few years?
curious how thats affecting the graphs results in the past 4 years
I'm the CFO of a group that both owns and manages hotels. I can assure you that given todays construction costs there is no way you can make money at 50% Occupancy!!