Can you say eminent domain?

We lawyers like to joke about eminent domain and the high unlikelihood that this will occur, especially with retail malls. Of course, thanks to the horrible Keto decision, you can take someone's house to build a hotel.That's because we are not in Venezuela. According to Peter Maclennan, Hugo Chavez apparently decided he didn't want a shopping mall to be finished and opened, so he announced that the mall will be "expropriated," or condemned. Malls are not socialistic enough, but a hospital or school is all right.No, I do not see this happening in the US, even with an Obama administration. :)...

Read more »

Good Morning, Manila! (and Good Evening, Chicago)

Magandang Umaga! It is mid-morning Monday in the Philippines and Sunday evening in Chicago, and I just learned the Bears lost, blowing any chance they had of the playoffs. I never expected them to be even close, so I am not bummed out. Now I pin my hopes on a Rose Bowl victory by USC against Penn State.I am still astounded by the amount of dirt being pushed here in the Philippines. We had a terrific visit yesterday to Tagaytay Highlands, an upscale, private real estate development about 60 minutes from Manila. The facilities, security and dirt were all nothing short of magnificent. The...

Read more »

Philippine Perspectives

Shopping here appears to be the national pastime. Forget basketball. Hit the mall. You can even got to Sunday Mass there if you are so inclined, with services in English and Tagalog. (Remember, English is an official language here.)We are about to celebrate my mother-in-law's 80th birthday in an hour. There should be 200+ people in our yard here, and hopefully we'll have enough food. You never know how many people will show. The problem with estimating a crowd is that it is acceptable for the invitees to bring family and friends. And since my wife and I are the official hosts of the party...well,...

Read more »

RIP Al Meyerhoff

I was sorry to see Al Meyerhoff's obituary in the New York Times while trying to catch up on news from half a world away.Al was a tenacious, courageous but affable litigator who spent his life fighting for the little guy. When I was a junior lawyer I was involved in a Proposition 65 lawsuit opposite Al and the NRDC. I remember Al on conference calls as the scrappy guy who wanted to fight, fight and fight until he won, but never in a mean spirited way. Even though we were opponents I could not help but respect him. Call him a true believer, if you will. Requiscat in Pac...

Read more »

A whole lot going on at year's end

I know there is a lot going on at home. Real estate developers want a bailout because so much debt is coming due. Thacher Proffitt, a firm I worked with a few times on CMBS deals, is dissolving, and that's sad. And there's so much more going on, even at Christmas -- to much to write about. But I am 14 time zones away, safely ensconced in Manila, where you walk outside and you feel like you are in a steam bath. If you have never been to Manila, I recommend it for many reasons. First, if you are a dirt junkie, you will be amazed at the amount of real estate development going on, small, large...

Read more »

Happy Holidays!

I am swamped with year-end work right now, and I'm trying to cram it all into this week since I am leaving for Manila on Saturday night for the holidays, which means I also have family obligations here to which I must attend. That does not lead to much time to write here. I'll perhaps post something about dirt issues in the Philippines once I get there, and I'll be back if something compelling arises. But if I don't have the opportunity to do so -- which is what I think might happen these next few days -- please accept my best wishes for a happy and healthy holiday season. We often forget what...

Read more »

GGP update: will Citibank lead, follow, or get out of the way?

GGP moved an updated press release stating, "[i]t has not reached unanimous agreement with its syndicate of lenders to further extend the maturity date on the $900 million Fashion Show and Palazzo mortgage loans. The Company is continuing its discussions with lenders regarding its loans."According to the press, the word is that Citibank, the lead lender, is the lone holdout. Globest.com says that Citi is "heap[ing] requirement upon requirement for the REIT to meet." Now, we don't know exactly what those requirements are, but of course the cynic in me immediately says, "How much money has the...

Read more »

Whither Sears?

I have such fond memories of Sears. Just about any my age or older does. The huge catalog, the Christmas Wish Book, the retail stores, the candy counter. I think I just gained two pounds thinking about chocolate covered candy.After watching the local segment of the Today show this morning, I read perhaps the most succinct story ever, the entire text of which I repeat below: There's a dire warning from the chairman of Sears Holding Corp. Edward Lampert said this may be the final holiday season for the Chicago-based retailer, as the company continues wrestling with falling cash reserves and...

Read more »

GGP- day of reckoning?

Hard to say at this point. The stock's up 31% as I type. The company announced that it was able to refinance $900 million in debt, but that is not the $900 million that comes due today for the Vegas malls. There's no assurance of further extensions on those loans; I'd have to speculate that this is because Citibank has been playing hardball by wanting a retrade on another deal. And I guess the other banks cannot, have not or will not buy Citi out of its share of the loans, which is one way to skin that cat.For those of you interested in the CMBS part of the deal in the event of a filing, this...

Read more »

Hotel 71...it's baaack (on the market)

I promised to follow up here when there is more news about Hotel 71, and some moved this morning at Crain's.The word is that Wachovia, the special servicer for the CMBS pool that took title to the property after winning a bankruptcy auction, has hired an Atlanta-based broker to seek buyers. Tough market, but, as the story notes, this will be an interesting test of the waters.Also according to the story: Complicating the transaction further, a buyer would need to spend about $20 million to finish a renovation..... One person familiar with the hotel expected it to sell for no more than $60 million,...

Read more »

The Decline of GGP

After being interviewed today for a story on GGP, I noticed this piece in the Journal on the mall owner's decline (and hopefully not its demise -- the two week loan extension's up Friday). I'll let you digest it just as I still am doing as I type.Maybe the last paragraph says it all:The Bucksbaums, meanwhile, have seen their personal fortunes fall with the company's. According to friends, Matthew [Bucksbaum, the retired co-founder of GGP] and [his wife] Kay have decided to cancel their annual holiday party in Aspe...

Read more »

State for Sale

Or so say the Feds. Here's a link to the criminal complaint against the governor. Enough sai...

Read more »

Sorry Sam - still no subscription for you

Yep. Yesterday, advisers, today, a Chapter 11 filing for Tribune Corporation. Even the Grave Dancer, much as I admire him, can't win them all."Over the last year, we have made significant progress internally on transitioning Tribune into an entrepreneurial company that pursues innovation and stronger ways of serving our customers," [Sam] Zell said in the [press] release. "Unfortunately, at the same time, factors beyond our control have created a perfect storm -- a precipitous decline in revenue and a tough economy coupled with a credit crisis that makes it extremely difficult to support our...

Read more »

Gee, could you paint a bleaker picture? And is that a good thing?

When I read this story, captioned "It can't get much worse," I wanted to jump out the window. Luckily I was in the basement.Seriously, here's what some are saying in institutional investor land:Properties with purchase offers are not closing; transactions are down; and managers are going hat in hand to their investors for cash to prop up properties they do own. “There's no light, no tunnel, no liquidity, no equity,” said Jeff Barclay, managing director and head of acquisitions and development at real estate investment firm ING Clarion Partners, New York. “Some people are being wiped out,”...

Read more »

Thursday Tidbits - December 4, 2008

CoStar reports the ubiquitous Younan Properties is taking the plunge on 180 N. LaSalle, with a closing date of no later than December 17.There's light at the end of the tunnel? That's what panelists were saying in Irvine yesterday.If you own a title policy through LandAmerica or are closing a deal with them, don't panic. Fidelity has you covered. If you have a 1031 account with them, then, you may have a problem. That company and the holding company went bankrupt. Lawyers Title and Commonwealth Land Title did not and are being sold to Fidelity and are doing business as usual.Bailout money...

Read more »

A tale of two bankruptcies

Bally Home Fitness is belly up again. After a prepackaged 11 last year they filed another one today, with the goal of conserving cash in a sale scenario or a reorganization.The gym business is utterly cutthroat competition. You have the higher-end places that can charge (a little) more but have fewer members, and you have the others (such as Bally) that rely on large numbers and low fees. In either event the gyms rely heavily on additional services to make more money and in this economy...you get the picture. With those numbers, it is hard to make things work. But Bally's been around a...

Read more »

Can you say operating covenant?

In an office lease, a landlord often does not care if a tenant actually uses its space so long it pays the rent.Retail? That is a while different ballgame. Nothing looks worse than a shopping center where the tenants have "gone dark," or closed the store while still paying rent. You have a myriad of issues related to this that go far beyond the scope of a blog. I'm sure there are some articles about this phenomenon out there.I got a kick out of a Journal story yesterday about this. Some retailers are trying to get out of deals without having to pay hefty termination fees. In the case of...

Read more »

Chicago's coolest offices - The Powerhouse Building

Or so says Crain's. Even though I'm not in the story (big deal), it is very cool to see your friends, your clients and your office building in the news.And I am inclined to agree. Even my little space that I hardly use, while not as dramatic as Structured Development or Wight & Company, has a great big window, exposed brick, and all the modern trappings. Yes, it is the building on this page on the left. And I like i...

Read more »

Jamie's back in town

The New York Times and Legal Week both report that bankruptcy and restructuring guru Jamie Sprayregen is returning to Kirkland & Ellis, where he was before going to Goldman Sachs for a stint as a managing director.According to the Times:“I missed the practice of law,” Mr. Sprayregen, 48, said. “What I’ve learned from Goldman, the financial expertise I’ve gained, will hold me in good stead and will be extremely helpful on the lawyer side of restructuring.”I don't know Jamie personally, but I was just talking about him with a colleague a week or two ago, and my colleague saw this coming because...

Read more »

Want a weekend roundup?

Can't do better than Deal Junkie, so just go there, okay? The highlights for me were the story on commercial loan delinquencies, and the WSJ piece from last week on construction expected to start up again with an Obama stimulus package emphasizing public works spending.By the way, I hope you all had a good Thanksgivin...

Read more »

Two more weeks for GGP, says the Tribune

I look at this story as a little good news in a whole pile of bad for GGP, and a testament to Metz, Nolan & Co. Although I guess you could argue that the holiday caused this, if there weren't legitimate discussions going on I don't think the short term extension on some $900 million in debt would have been granted.There's a lot more to this than just signing a short term extension. Loan covenants have to be looked at carefully, technical or material defaults examined and plenty of paperwork needs to be prepared by lawyers. But the lenders also have to think: do I really want these assets...

Read more »

Deutsche Bank to Trump: pay up, Donald

DB is not laying down in the face of Donald Trump's force majeure lawsuit. It has filed an action in Manhattan against The Donald, saying since the SPE formed to do the Trump Tower deal has failed to pay the lenders back, Trump personally owes the bank $40 million. (H/T to the HuffPo.)Apparently, then, the loan had some partial recourse to Trump, who IIRC said he would not do recourse (or perhaps it was full recourse) deals anymore. The $40 MM, at least for him, seems to be a reasonable amount for recourse to me. The other question, which a NY lawyer would have to answer, is whether Trump's...

Read more »

Thanksgiving counterpoint: clemency for George Ryan

I know I am going against the grain here, at least those in the Tribune and Sun-Times who think former governor George Ryan should rot in jail for another 5 years.While I see their points, I respectfully disagree.Senator Dick Durbin and I agree on virtually nothing. But I'm glad to see he is at least considering sending a letter to President Bush asking for executive clemency."Let's look at the price he's paid," Durbin told reporters at the Statehouse. "His family name has been damaged. He is at an advanced moment in his life and been removed from his family. He has lost the economic security,...

Read more »

Fidelity and LandAmerica do a deal after all

But now it's on much better terms for Fidelity. The skinny? LandAm apparently had a toxic exchange subsidiary that invested about $290 million in auction rate securities that may take forever to get rid of. And you need to access that money to faciliate the exchanges. In short? Liquidity crisis.So the solution? File Chapter 11 and sell the money making parts of the company, Lawyers Title and Commonwealth, to Fidelity. This of course assumes the deal gets past regulatory approvals, and I think it will. So FNF gets the cake without having to eat the poisonous part of the business.As an...

Read more »

GGP - we're not dead yet!

[Cue Spamalot music.]No news as of now on refinancing or a loan extension (Friday deadline's looming) or a BK filing for GGP. What we do know is this:Alby Gallun reports that Fidelity Investments and affiliates own 13.% of the company, which means mutual funds and investors are gonna take a huge hit. The expectation on the street is an extension of some sort that will just delay the inevitable given the amount of loans coming due in 2009.But, but, but...today we get news that Bill Ackman's Pershing Square Capital has bought 7.5% of the company on the cheap, paying prices ranging from $0.35-$0.51...

Read more »

Ooh, ooh! A proxy fight at Grubb & Ellis!

I guess Tony Thompson wants back in at Grubb & Ellis (the name of the consolidated company after the Triple Net Properties deal -- as you know Tony started that company):Thompson, who has criticized Grubb & Ellis management for some time after leaving the company early this year, has mailed a letter to Grubb & Ellis stockholders that says, “We have watched in dismay over the past nine months as Grubb & Ellis has, in our view, lost its way.”Thompson is just not happy that G&E has lost 82% of its value since he left. Join the club, bucko. The market's tough out there. Grubb...

Read more »

So much for that merger

Fidelity decided to terminate its acquisition of LandAmerica, as was its right at the end of the due diligence period.This came to me in an email from LandAm today:Why did Fidelity decide to terminate the merger agreement? We were informed that the principal reason for their refusal to go forward was the pessimism over the current and foreseeable real estate economy and not because of any negative finds concerning our company.What is the financial viability of the LandAmerica underwriters? The LandAmerica underwriters, Lawyers Title and Commonwealth, have over $300 million in combined statutory...

Read more »

Thank goodness for dumb doctor deals

Actually, that's a misnomer here. "Dumb doctor deals" are real estate transactions that make no sense but for the fact that there are doctors with plenty of money backing them. Reading this NREI story was a welcome relief from all the gloom and doom in the news lately. The sector, while perhaps not recession-proof, is still alive:According to the latest data from Real Capital Analytics, sales of medical office properties totaled $3.3 billion in the first nine months of 2008, a 13% drop compared with the same period a year earlier. But that dip pales in comparison to the 62% dive in property...

Read more »

Thursday Tidbits - 11/20/08 Edition

GGP has hired Sidley Austin as BK counsel. Now, this does not mean they will file. But, they've got over a billion in debt coming due by month's end, and the company's worth about $100 MM right now (not that there's any correlation; I just like to say that, and hey, lenders are worried too). I'm actually surprised this hadn't come out sooner.Why else this is a problem? Because spreads are insane, apparently driven by two deals possibly defaulting early in the loan cycle. Take a look at the underwriting and you'll see why. Maybe this is the sell signal we need to get people buying something,...

Read more »

Trmup's Lawsuit: Developer See, Developer Do

Tom Corfman's Crain's piece today predicts: Donald Trump’s lawsuit against the menagerie of construction lenders for his riverfront tower is likely to be followed by more pre-emptive strikes by other developers. Amid the prolonged credit crisis, such lawsuits could become common.We've heard all the stories, so I won't bore you with lenders turning the screws on their borrowers. (Hey, the borrowers did it to them a few years ago, let's not forget.)There were two opinions given about the lawsuit:“We’re in an economic crisis, yes, but does that constitute force majeure?” said real estate attorney...

Read more »

Never mind - just liquidate

Are changes in the bankruptcy laws causing this? Instead of reorganizing, companies these days are just liquidating. Let's see...Linens and Things, Value City, Bennigan's...now apparently Steve & Barry's (H/T Traffic Court) only three months after a private equity rescue, and some think Circuit City's conversion to a Chapter 7 is only a matter of time. Or is it that PE players are just scared of the economy right now and figure they better cut their losses? Maybe not here, since the hedge fund that bought the company is going to lose its investment. So, the best answer may be lenders....

Read more »

OT: Tackling teacher tenure

The hard-charging chancellor of the Washington, DC schools, Michelle Rhee (all of 38!), has proposed what teachers unions must believe is unthinkable. But the plan is nothing short of sheer genius.What is it?Ms. Rhee has proposed spectacular raises of as much as $40,000, financed by private foundations, for teachers willing to give up tenure.I considered being a teacher, but the salary structure just didn't work for me. It used to be that some or many of the best and brightest went into the profession. These days, fewer do, to the point that it is almost laughable.This idea will not end tenure,...

Read more »

Too little, too late

In today's Tribune:As Macy's heads into its third Christmas in Chicago facing a brutal shopping environment, it is starting to bring back a small part of the old Marshall Field's.Nice try. But I haven't shopped at Macy's since the name change and I never will. Sorry. Sav-On learned when it tried to change its name to Osco on the west coast back in the 80s IIRC; even though I was an Osco shopper in Chicago, that change failed miserably with the average shopper in LA. Macy's should have learned the same lesson, but it didn't.I might change my mind for the bankruptcy/store closing sale if that...

Read more »

CEO of Prologis resigns

Jeffery Schwartz is calling it quits at Prologis after just under four years on the job.If you want the full scoop and stories about this event and the company, let me recommend Stripnomics to you. Richard Woon's been covering this company in detail and probably has forgotten more about it than I know.UPDATE: on top of everything else, such as dividend cutting, overhead slashing, etc., Prologis is halting all new developmen...

Read more »

Can you say one mall?

Yep. GGP's worth the equity in one mall, and not a big one at that, as I write. Never thought I'd see the day with a company I've always respected.Traffic Court has a good summary of the goings-on, including the dropping from the S&P 500 and a vague statement from Westfield that it might be interested in some of the properties. Nothing against Westfield -- they have some good people there -- but Westfield Shoppingtown Water Tower Place is a mouthfu...

Read more »

Institutional investors - overinvested in CRE?

This is something I've read about before, but it bears repeating.The "denominator effect" looms as the next force that could pressure the slumping real-estate market. Falling stock prices are leaving institutional investors overexposed to real estate, which could trigger further declines in property values as some of the market's most-active players move to the sidelines to recalibrate their portfolios. Big pension funds, college endowments and insurance companies typically allocate most of their investment dollars to stocks and bonds and sometimes a smaller amount -- about 6% to 10% for pension...

Read more »

You know things are bad when

you read this. I know the Blixseth divorce started cordial, went sour, and now this? Whew.BILLINGS, Mont. (AP) — The Yellowstone Club, an exclusive mountain retreat for the ultra-rich, said it filed for bankruptcy Monday after failing to secure new financing — underscoring that even the elite can't escape the country's current economic trouble...

Read more »

And now, the dreaded going concern statement for GGP

Yup. GGP has released its 10-Q with the following statement: In the event that we are unable to extend or refinance our debt or obtain additional capital on a timely basis and on acceptable terms, we will be required to take further steps to acquire the funds necessary to satisfy our short term cash needs, including seeking legal protection from our creditors. Our potential inability to address our 2008 or 2009 debt maturities in a satisfactory fashion raises substantial doubts as to our ability to continue as a going concern.What does that mean? Bankruptcy if some big loans are not extended...

Read more »

And the bailout is supposed to do what?

Loosen credit? Utterly no evidence of that, or of interest rates going down either. This post from ULI's Ground Floor blog shows no signs of anything letting up.Hopefully this wasn't a complete waste of tax dollars to just line some pockets of the right people at Main Street's expense. Although I said it had to be done, I think you have to question how, why and when.Even if you want to do a deal, you may not be able to afford it. Which reminds me -- take a look at the spread...

Read more »

Circuit City turns to Chapter 11

First they announce store closings. Now bankruptcy, albeit Chapter 11 for the time being. Is that the whole story?The interrelationship is more than meets the eye from the wire stories. There is definitely a real estate component to this filing.When they announced the store closings, the question you had to ask was: how? Do the leases for the closing stores have termination rights? Landlords aren't just going to walk away smiling. A retailer with the clout of CC usually negotiates a "go dark" provision that allows the store to close but you still have to pay rent.But under Chapter 11, the...

Read more »

Legal term of the day: force majeure

Well, The Donald apparently can't get another loan extension for Trump Tower Chicago, at least not without taking a haircut, and we all know how Trump likes his hair. So he's suing his lenders and demanding more time, claiming that the global financial crisis is an event of force majeure that excuses his timely performance.I obviously haven't seen Trump's loan, so I don't know the exact wording. But I deal with these clauses all the time. Literally meaning "greater force", a force majeure clause excuses performance under contracts because of acts of God, strikes, wars, riots, natural disasters,...

Read more »

Fidelity National to acquire LandAmerica

As an agent for LandAmerica, thanks to my ownership interest in River West National Title, I was wondering about the company's future. The stock was down about 90% this year and 3Q financials were delayed. I figured the company was looking for a buyer (no easy feat in this market) or a Chapter 11.We got the former. Subject to the usual contingencies -- and presumably antitrust approval -- Fidelity National's buying the company. Here's the press release. You'll know Fidelity better in Chicago through brands such as Chicago Title and Ticor, just as LandAmerica is better known through Lawyers...

Read more »

One winner in the game - Wal-Mart

Seems like you can always count on Wal-Mart to do well when things are bad. Times are tough, you buy the least expensive you can. And Wal-Mart has those always low prices....and yes, a year ago people were talking about the end of the end of the Wal-Mart era? Show me the money, baby.Nonetheless, they are still being cautious about future expansion, which is just another reason why WMT stock is up almost 15% YT...

Read more »

Oh what the heck

Let's throw a little more money at a problem: namely, Block 37. Now we're looking at another $12 million to help pay for a Loews hotel there. The money will also apparently help pay for CTA cost overruns, which is apparently going to cost some $320 million.But let me say this: my gut reaction is that this is a good use of TIF money. Block 37, face it, is a showcase. We took this long to figure it out, and kudos to Freed for coming up with a good use. I like the idea of a hotel ther...

Read more »

And just to brighten your day a little more

We have another prediction in that the next tsunami in the market will be commercial real estate. This one comes from Thomas Barrack, the founder of Colony Capital via the WSJ's Deal Blog. (H/T Traffic Court.)Believe it or not, if Mr. Barrack is right I think this would be as bad or worse than the residential crisis. Why? The blog post says most of it well. If the loans mature and there are no buyers and no viable refinancing options, what next: RTC II? The Obama administration better be ready for the second half of its term when this all starts hitting the fan if not sooner.The best case...

Read more »

GGP, Kimco tank on lower earnings expectations

When your earnings aren't going to make the target, you know it's gonna happen. Could this come at a worse time for GGP? They claim to be making inroads on financing. I missed the call, unfortunately, but maybe I will listen to it later. Adam's a smart guy, so if anyone can bail this one out he can, presumably with Bucksbaum in the background. But GGP trading at $2.53 as I type and with a market cap of $677 million? Maybe Roeder was right. Problem is in this market selling isn't easy and lenders may be willing to negotiate just to not have distressed assets on the book...

Read more »

More on an Obama presidency and CRE

Eddie Baeb and the ubiquitous Bruce Kaplan have it right on: but for the credit crunch, we'd be in a sell sell sell mode.Enough sai...

Read more »

Waterview Tower: the naysayers were right for now

I'll toot my horn when I am right and admit when I am not. (I should make sure I am a lawyer, huh?) And this time the naysayers on Waterview Tower were right. First it was the trade credit insurance, then the liens, and now this. Alby Gallun moved a story this morning that Waterview Tower's construction loan with the Export-Import Bank of China is on hold. Anyone who said timing isn't important didn't develop real estate.Yes, this means you have 26 stories of a building shell sitting across from my old office just sitting there. And this also means B of A could foreclose on its A&D...

Read more »

And, just to top things off

Institutional investors are backing off private equity investments:Large institutional investors that provided much of the capital that put some of America's best-known companies into private hands are starting to cool on the investment strategy, suggesting that the lifeline for private equity is eroding.PE can bring big returns, but there's a concern about liquidity. I can understand that. But this can also mean, for dirt folks, less capital for investing and lower prices.But what it can also mean is a HUGE opportunity for the real estate investors who stay the course. If you have the cash...

Read more »

Simon: We're Not Buying GGP

And why should it? Yeah, that's the big rumor. But, just like law firms these days, there's little need to take the whole kit and kaboodle. If GGP cannot get out of its current hole, then Simon can make a much better play: cherry-pick the best assets one way or another. And, at least as far as I know, there is no other player to step in.Or is there? I have one other thought in mind, one I am going to put into an envelope, and I promise to tell you whether I am right or wrong about it.Oh, and in the big shock department: GGP's been hit with a class action over the whole loan business. Yes,...

Read more »

Preparing for an Obama presidency in CRE

As exemplified by this Retail Traffic piece last week comparing GOP and Democratic policies, dirt folks need to start preparing for an Obama presidency, assuming we don't end up in a Dewey Defeats Truman scenario.What will be good? Well, the Democrats will likely spend a lot of money on various programs in an attempt to stimulate the economy. This could lead to more projects and spending in the middle class, but it could also lead to higher prices and construction and labor costs.On the other hand, you have some real negatives, intentional or not. Capital gains taxes will increase, meaning...

Read more »

Bad news (for now) on the retail front

Nationally: as expected, Circuit City decided to close 155 stores by the holidays, including 13 in Chicagoland. It's been the talk for a long time now, as they are getting clobbered by Best Buy. FWIW, my local Best Buy does not look too busy either. But I really like the store. I dont; have a Circuit City near me so I do not keep on their doings much.Locally: Crain's reports that two of the three anchor tenant's at the old Carson Pirie Scott store, Fox & Obel and Billabong, are pulling out of the deal. I don't have any details or inside information. I'm guessing there were letters of...

Read more »

Roeder: GGP "almost literally worth nothing"

David Roeder of the Sun-Times has a scathing story today chronicling GGP's decline thanks to debt and too much optimism. I didn't see anything, however, about the hanky-panky loans previously disclosed by the company that led to the downfall of Bernie Freibaum, Robert Michaels and John Bucksbaum.All I can say is that I wish Adam Metz and company good luck. People who come from the old JMB dispora pretty much all have a lot of brainpower, and it looks like you'll need it her...

Read more »

RIP Studs Terkel

I was sad to read today that Studs Terkel "checked out" at the ripe old age of 96. He was a brilliant, amazingly inquisitive writer and an engaging personality.I was fortunate to have about half an hour alone with this legend in the 1980s. I didn't know at the time how lucky I was. He was in town narrating Lincoln Portrait and I was a member of the Knox-Galesburg Symphony at the time. We (and maybe one other person, as I recall) were the only people in the green room while the rest of the band was playing. I do recall being a little awed, and speaking about history and music -- jazz in particular....

Read more »

Halloween Spooktacular Edition

Boy, there's enough bad news this week that I am catching up on to make you want to crawl in a hole. But I won't. It is a spectacular day and as soon as I can get done with work and before trick-or-treating begins, I am going out for a nice walk or maybe even nine holes.Michael Mandel, citing a Morningstar report, tells us there's a 20% chance that CB Richard Ellis could go bankrupt. For dirt folks, that's would be as impossible as, say, Lehman going under. Oops....I did not go to ULI, but David Bodamer did, and the mood there was pessimistic. Doug Cornelius has a link to the trends report...

Read more »

Boom time?

That is what the LA Times says it is for lawyers. And it is for some - mortgage fraud, bankruptcy and all that. And perhaps the bailout will create opportunities that lawyers will have to helo their clients wade through.Of course, this is being written as two major California law firms (Thelen and Heller) have dissolved in the last few weeks. Don't tell all the laid off lawyers we're in a boom time. They and support staff are in many cases having a tough go of it.Larry Bodine, citing a Hildebrand International report, agrees. The word is that 2009 will be a tough year for lawyers, not a...

Read more »

Bozoids betting against Buffett while Laffer laughs about "solutions" to the economy

Well, today we have Arthur Laffer telling us that the present administration is, in a nutshell, Herbert Hoover all over again. And is Obama FDR, and, if he is, is that necessarily a good thing?You'd think the one constant in this would be the Oracle of Omaha, Warren Buffett. He's investing in certain equities as he thinks they are sound. And the Heard on the Street column at the WSJ is taking him to task a little for not timing things right.And others are jumping on that bandwagon.Hey, Buffett's not perfect. He'll be the first to tell you. But he has a darn good track record. And if you...

Read more »

GGP: Now John Bucksbaum and Robert Michaels "step down"

That's news. Here is the press release, and here is a WSJ story. Bucksbaum remains chairman but is no longer CEO, and Michaels is out as president but staying as COO.The Journal is calling it an "ousting." Their replacements are Adam Metz (the lead independent director, so that makes sense) and Thomas Nolan, respectively. I don't know Nolan but I do know a little about Adam, as I used to do legal work for some of the companies at which he worked. These guys have some big tasks in front of them. Job #1 has to be to get some loan extensions on properties, especially Fashion Show and Shoppes...

Read more »

Prices flat as a pancake, and heading to 1990s Japan?

Moody's is reporting that CRE sales prices were essentially flat in August, with transaction levels at their lowest in four years. Why?Neal Elkin, president of REAL, said that the flattening of prices in August may seem surprising, but that is because they are being looked at through the prism of the tremendous market turmoil of September and October. Transaction levels are still being hindered by a large bid-ask spread between buyers and sellers, he said, but many owners of commercial properties who purchased their properties with high leverage may have to sell, or refinance, although he said...

Read more »

Stimulating the economy -- through bank mergers?

Maybe I'm just a dumb dirt lawyer. But I really, really don't get this.A big criticism I had of the government "stimulus package" was that banks would have no obligation whatsoever to actually go out and lend money again. So what are banks planning to do with their government investments? If you said "lend money," guess again. No, they plan to use the taxpayer-financed infusion as cheap money to buy up banks that are weaker. As the story says:If the banks use the government funds to pay for acquisitions, it could prove controversial. Taxpayers essentially would be footing the bill as strong...

Read more »

Add Jenner to the list -- again

The NLJ reports that Jenner is once again asking (read: telling) about 10 partners to leave the firm. Why? Staffing changes to meet expertise. I hope no one I know is affected. Once again, here's that reminder that, for better or worse, partnership isn't what it once was. Nothing on associate layoffs though. Indeed, there was apparently an all-hands meeting the other week where employees were told everything is fine. ATL and the WSJ both have their own stories on this event. I guess you call call it the annual event, sort of like GE performance reviews. But GE's a corporation, of course....

Read more »