Club, Spa, Resort, and Healthcare Marketing

Banks await outcome of Dubai World talks

“The entire scene now depends on the outcome of the restructuring negotiations between Dubai World and the banks,” said Dheeraj Lakhwani, banking analyst at Prime Emirates. “Only then will confidence return and banks can decide how to pursue their lending strategy in UAE.”

Moody’s estimated Dubai World owes UAE banks $15 billion (Dh55 billion) based on its receipt of “sufficient information from most rated banks.” Provisions will also have to be made for heavy losses likely to be taken against exposure to the troubled Saudi groups Saad and Algosaibi.

And yet another big question mark remains over the recovery, or possible continued slide of the real estate sector in Dubai, to which local banks are heavily exposed. Emirates NBD, the Gulf’s largest lender by assets, said earlier this month its real estate exposure accounted for 27 per cent of its loan book.

Soft growth

It all adds up to another year of soft loan growth, said Janany Vamadeva banking analyst at HC Sec-urities in Dubai, which ultimately means low econ-omic growth.

“It’s a cycle,” Vamadeva said. “Without one you cannot have the other.”

via gulfnews : Banks await outcome of Dubai World talks.

Dubai World Loses Trophy Manhattan Knickerbocker Building to Lender

Financially hard-hit Dubai World has lost another trophy property to a lender. This time around it was the legendary, 94-year-old, 300,000-square-foot, 10-story Knickerbocker Building in Manhattan’s Times Square district.Danske Bank A/S of Copenhagen took back the former 300-room hotel property this week after Istithmar World Capital, the private-equity arm of the Dubai government’s investment fund, defaulted on a $300 million loan.

Ben Singer, a broker with Jones Lang LaSalle retained to sell the property, tells The Wall Street Journal a column of buyers is already lined up to bid on the asset located at 1466 Broadway in Manhattan’s busiest and most glamorous commercial and entertainment district.  Another address for the building is 142 West 42nd Street.

The 50-percent vacant building has been operated as a retail and office site for the last 30 years and became known locally as the 1466 Building.  It was also know in previous decades as Six Times Square, the Newsweek Building and the Knickerbocker Building.

Istithmar World Capital had planned to re-convert it to a 300-room hotel after paying $300 million for the property and an additional $76 million for an adjoining vacant lot, according to the WSJ.

via DUBAI UPDATE: Dubai World Loses Trophy Manhattan Knickerbocker Building to Lender – Real Estate Channel Global News Center.

Business bankruptcies rise again in February

U.S. business bankruptcies rose again in last month, marking the fifth-straight February that such filings have increased, according to a bankruptcy data provider on Tuesday.Companies from a range of industries, including video rental chain Movie Gallery Inc MVGRQ.PK, radio network Air America and luxury ski resort developer East West Resort Development V LP LLLP, were among the 6,557 businesses that filed for relief from creditors in February, according to Automated Access to Court Electronic Records AACER, a database of U.S. bankruptcy statistics.”Even if the economy gets better, bankruptcy filings continue at a healthy clip for six to 18 months,” said Mike Bickford, president of AACER. “And it’s not at all clear as to whether we’re really in a recovery.”On average, 345 businesses filed for bankruptcy each day, up from 336 last year, according to AACER.Combined, business and personal bankruptcy filings jumped 13 percent from the same period last year.Companies and individuals filed 6,171 bankruptcies daily, on average. That is the second-highest rate since the 2005 bankruptcy reform act took effect. Only October 2009 had a higher count with some 6,352 bankruptcies filed per day.

via Business bankruptcies rise again in February | Reuters.

“Builder” Magazine says Wilmington housing market “Best Bet” to recover this year

Builder Magazine recently presented their annual list of the top 20 real estate markets expected to see recovery and prospectively, a healthy year. Economist’s for Builder Magazine stated that the markets that benefit first will be the ones with the strongest core dynamics; places where house prices never got out of hand, cities where a diverse and progressive employment base drives job creation, and towns that draw population despite the economic recession. The Carolinas pulled in a total of seven cities on the list – Wilmington, being one of them. Many of the seven made the list because of the Carolina’s continuing reputation for a high quality of life, affordable housing, and growing employment prospects.

via “Builder” Magazine says Wilmington housing market “Best Bet” to recover this year | WWAY NewsChannel 3 | Wilmington NC News.

Scrub Island Resort opens in the BVI

Scrub Island Resort in the British Virgin Islands opened on schedule today, becoming the first new resort to be built from the ground up in the BVI in more than 15 years.Scrub Island is one mile offshore from Beef Island on Tortola, site of the main airport in the BVI.Facilities include 26 oceanview guestrooms and 26 suites; a lagoon pool with a waterfall; 55 deep-water berths at the marina; a spa and health club; two restaurants and bars; four beaches; and the Dive BVI shop.Resort yachts transfer guests to and from the island; golf carts are used at the resort and around the island.Scuba, dive and fishing trips as well as excursions to nearby islands can be booked through the resort.Introductory nightly rates through March 31 start at $399 per room, double occupancy, with breakfast. A family rate for two adults and two kids in a two-bedroom suite starts at $959 per night, valid to Dec. 18.

via Travel Weekly.

East West Resort Development files for Ch 11 bankruptcy

East West Resort Development V LP LLLP, a U.S. luxury residential community developer, filed for bankruptcy protection early on Tuesday, saying it was unable to secure additional capital from its current lenders to fund development and other expenses.In court filings, the company said it was formed to develop residential and commercial real estate projects on and around the North-at-Tahoe Resort, a residential development and year-round resort community located in North Lake Tahoe, California.East West Resort Development, whose affiliate owns the five-star Ritz-Carlton Highlands at Lake Tahoe, said its properties had lost significant value over the past year and in some cases, assets were being valued below their loan balances.The company said that as on Dec. 31, 2009, it had $256 million in assets. Excluding $189.4 million in contingent guarantee liabilities and bond obligations, it had $61 million in debt.It also sought court approval for a $10 million debtor-in-possession DIP financing to continue operations while in Chapter 11 bankruptcy.East West Resort Development also owns Old Greenwood, home to the 18-hole Jack Nicklaus Signature Golf Course in Truckee, California.

via UPDATE 1-East West Resort Development files for Ch 11 bankruptcy | Reuters.

UPDATE: Got $40 Million? A Florida Development Needs You

The Forkosh Development Group wants millions of dollars worth of help in suburban Miami.

The developer seeks an equity partner – with $30 million to $40 million – to help jumpstart the stalled 52-story Solis Resort Spa & Residences project in Sunny Isles Beach, reports trade pub Commercial Mortgage Alert.

Forkosh has already poured some $53 million into the project that includes 135 condos, a 140-room luxury hotel and an 11-story garage. When it broke ground in February 2007, prices started at $1.2 million. (These days, projects are commanding steep discounts.)

According to the Alert, the Solis was to be finished last summer. Lehman Brothers was set to fund the bulk of the work, but that fizzled with the firm’s bankruptcy.

Finding a partner won’t be easy: The Miami condo market’s overbuilding and subsequent implosion is legendary. Between 2003 and 2010 In Sunny Isles alone, developers built nearly 30 condo projects with more than 6,300 units boosting inventory by 53% according to real estate consultancy Condo Vultures. Too much inventory fueled a housing crash that continues plaguing lenders: They repossessed an average 83 properties per day in South Florida last year.

“In order to secure an equity investor, the developer will have to give away the store,” said Peter Zalewski’s Condo Vultures’ founder. “I can’t imagine a scenario where an investor will come in and support a project that’s under construction, given the fact that there are three towers with 1,000 units next door.”

Just 40% of those units are sold, he adds. Any future deal will probably be made “on the courthouse steps.”

Developments tried contacting Forkosh’s New York and South Florida offices, but was told “no one is here today.” Good thing we weren’t ready to write a check.

via UPDATE: Got $40 Million? A Florida Development Needs You – Developments – WSJ.

Home Builders’ Latest Strategy: Building Houses

Given the state of housing, it seems like builders wouldn’t start a home without a signed buyer. But that is exactly what they’re doing: They’re ramping up speculative construction to attract last-minute home buyers who want to tap the soon-to-expire tax credit.

As I write in today’s Journal, it is filled with risk, a move that comes as builders appear to be healing from their worst downturn in generations. If these buyers don’t materialize, builders could be saddled with unsold homes that will require heavy discounting to sell, hurting profits and slowing the housing recovery.

These new homes may also continue to lose market share to lower-priced foreclosed addresses that continue tempting consumers. Indeed, some economists expect an avalanche of foreclosures in the months ahead as lenders release homes they have been keeping off the market.

“Too much construction now would leave excess inventory and price pressure once the tax credit expires,” said Credit Suisse analyst Dan Oppenheim.

Builders also know buyers want to touch and feel what will likely be their biggest investment. But the industry is watching the calendar. The extended – and expanded – tax credit applies to contracts inked by April 30 and closed in June. After that, sales could weaken significantly, given unemployment remains a stubborn problem. Read: They’ll take the deals now and worry about the consequences later.

“We know that we’re going to have more people out now,” says Lance Wright, co-owner of CastleRock Communities in Houston. “Buying is an emotional decision. Seeing the actual product that you’re moving into will certainly make it easier.”

via Home Builders’ Latest Strategy: Building Houses – Developments – WSJ.

Home Prices Recover in Some Metro Areas

Home prices recovered in more than a third of U.S. metropolitan areas in the fourth quarter, the National Association of Realtors said Thursday.The median price for single-family home resales was up from a year earlier in 67 of the 151 U.S. metropolitan areas included in the trade group’s quarterly survey. The Realtors pointed to “a broad stabilization in home prices.” But other housing analysts say the home-price trend depends heavily on any recovery in the job market and on the pace of foreclosures.

The national median price for single-family homes was $172,900 in the fourth quarter, down 4.1% from a year earlier. That was the smallest decline in more than two years.

Among metro areas showing the biggest gains from a year earlier were Cleveland (25%), Akron, Ohio, (23%) and San Francisco (13%). Those increases don’t denote a general surge in home values but rather show that sales of foreclosed homes at fire-sale prices made up a smaller percentage of overall sales than they did a year earlier.

Foreclosures dominated some markets a year ago. Nationwide, “distressed property,” including foreclosures and homes at risk of foreclosure, accounted for 32% of fourth quarter transactions, down from 37% a year earlier, the Realtors estimated.

Metro areas showing big price declines included Las Vegas and Ocala, Fla., (both down 23%) and Orlando (down 20%).

For condominiums, the median resale price in the quarter for 54 metro areas surveyed was $177,300, down 4.8% from a year earlier. Eleven of the metro areas showed higher condo prices, and the rest showed declines.

One major worry is that price drops have left many households without any equity in their homes. Homeowners who are “under water”—owing far more than the value of their homes—are more likely to abandon their houses if their incomes fall or they lose their jobs. That would create more foreclosures, weighing on jobs. At the end of 2009, 21% of households with mortgages on single-family homes owed more than the current value of their homes, according to a new estimate from Zillow.com, a real-estate data provider.

via Home Prices Recover in Some Metro Areas – WSJ.com.

Ritz Carlton Lake Las Vegas to Shutter

(Personally, I think this would have happened regardless of the economy. $18 hamburgers and poor service… It’s tough to recruit help 30 miles off the strip, when there are so many opportunities for labor closer to town – bc)

The Ritz-Carlton Lake Las Vegas, a five-diamond hotel at the troubled resort community in Henderson, told its 340 employees Monday that it will close on May 2.

Transcontinental Corp. opened the 349-room hotel in 2003, but Deutsche Bank took over ownership of the property last year through an affiliated company called Village Hospitality and decided to stop funding the resort.

“The unprecedented economic downturn has had a significant impact on the hotel’s operations. As a result, Village Hospitality LLC concluded that continuing to fund operations was no longer economically viable and consequently decided to close the hotel effective May 2, 2010,” Assistant Vice President Scott Helfman said in a statement.

“The entire Las Vegas region has been financially impacted, probably more than any other region in the United States,” said Vivian Deuschl, corporate vice president of Ritz-Carlton, which operates the hotel.

She pointed to a decline in individual visitors and an even bigger drop in group business.

“It’s not a reflection on the hotel,” Deuschl said.

via Shutting down the Ritz – February 9, 2010 Tuesday – Las Vegas Review-Journal (Nevada).