Scientists are now learning that life is wiped out on earth about every 20 million years. Great…we will finally get the deficit paid off and we’ll all be wiped out! I heard one of the proposed budget cuts was for our representative to now play miniature golf! Speaking of golf and living forever, I will be turning 50 years old on the 9th and to celebrate I am going to play 50 holes of golf. It should make for a long frustrating day celebrated with family and good friends.
Last month I reported that we have seen an upturn. I still hold to this but as in other previous bumps we have to get and maintain momentum. This month we have seen a little flattening again. The USD index was down two-tenths of a percentage point. Down for the first time in 27 months – but essentially flat. Unemployment in San Diego the single most significant number rose nearly 1 full percentage point in June to 10.4%, the highest mark for 2011. However, tech employment was up slightly. Merger and acquisitions activity in San Diego nearly tripled in the first quarter of 2011 over the same quarter last year. The number of patents granted rose sharply in San Diego. The growth of patents serves as a good indicator of the level and pace of innovation in the region (and future jobs and space requirements).
Just as a reminder, as things slowly pick up, we want to make it as easy as possible to make a deal. On our end, let me assure you we are hustling on deals “like our hair is on fire” . From the property perspective, we ask that the vacant spaces are light (lights all work, windows are not cracked and are clean), bright (space is unobstructed, electricity is on, lenses are clear – not yellow ) and white (walls clean and preferably fresh white paint – no holes or damage, ceiling tiles white and unstained). On owners end, turn documents (LOI’s and leases) around quickly. “Time kills all deals” . We are seeing deals fall out because owners take to long to respond or sign.
Maybe it is turning 50 or maybe it is the dog days of summer but this month I am going to keep the letter short and share some graphics with you rather than commentary.
First, follow this link to Google Trends for Real Estate-Rentals. Granted this chart reflects residential rentals but search activity closely parallels that for commercial.
Second, below you will see my own proprietary chart which charts market activity. To be healthy we want to be over 250 and prefer to be over 300. As you will note breaking through that magical “250.” line is the start and stop that I have been reporting all year.
Outgoing FDIC Chair, Sheila Bair summed up the situation best when she said; “The fact that so many residential and commercial properties currently underwater go a long way to explaining the continuing weakness of the small business sector, which is so important to the creation of new jobs.” “Almost half of the liabilities of nonfarm noncorporate businesses are secured by real estate, both residential and commercial.”
“The large and persistent declines in real estate values in many areas of the country have hurt both the demand for small business products on the part of their Main Street customers as well as the ability of small businesses to borrow against the real estate collateral they own.”
Years ago I remember banks giving away toaster ovens when you opened an account. The problem seems to have occurred when they started loaning out money like it was an ATM machine. Soon Wal-Mart will be giving away banks as your free gifts when you buy a toaster oven!
Lest you think I am crazy to play 50 holes of golf in one day, I still have my eye on the Guinness Book of World Records for the most golf in a year…enjoy this month’s story.
Richard Lewis set out to play 600 rounds of golf last year to get his name in the Guinness Book of World Records. The Guinness Book of World Records required Lewis to sign in and out with golf pros to prove he has completed each round.
The 64-year old Lewis walked every hold for an estimated 3500 miles of golf in 2010. “I’m addicted; what can I say?” said Lewis. Lewis is a member of the Four Seasons Resort and Club Dallas at Las Colinas Four Seasons Club Manager Rob Cowan said, “Nobody in the 27-year history of the Four Seasons has gotten more out of his membership than Richard.”
Lewis not only wanted to play 600 rounds, but he also wanted to play them well. His average score during 2010 was 78.5. Now the question…did he make his goal of 600 rounds?…yes, he hit that mark on December 26th but played on a bit more…he closed out 2010 with a record of 611 rounds played. How many holes in one did he make?…none. Be he did close out 2010 with a birdie on the final hole.