Dallas Area ranks 12th in Commercial Real Estate Forecast

Dallas Morning News

 

Dallas-Fort Worth gets middling marks in the latest commercial real estate market forecast.

The closely watched "Emerging Trends in Real Estate" report usually favors coastal and Northeastern markets, and this year is no exception.

Washington, D.C., New York, Boston , San Francisco and San Jose, Calif., were on the top 10 list of U.S. markets to watch for commercial property investment opportunities.

Some Texas cities also did well. Austin ranked fourth, and Houston was eighth in the annual list.

Although D-FW significantly outpaces other Texas cities and most U.S. markets in economic growth, the area was rated 12th out of more than 50 U.S. markets in the 2011 forecast

The D-FW area got an even lower rating for development prospects in the year ahead.

The survey showed that industry executives across the country are optimistic that 2011 with be a turnaround year.

"Investors with cash could have excellent opportunities to seize market bottom plays by recapitalizing cash-starved owners or buying foreclosed assets," said Stephen Blank, a senior fellow with the Urban Land Institute, which sponsored the study with accounting firm PricewaterhouseCoopers.

The report gives D-FW high marks for stable housing prices and low business costs.

But North Texas was slammed for its persistently high office vacancy rates and the ease of building new projects here.

The D-FW area was second only to Los Angeles as one of the best places to buy industrial properties.

Foreclosure Halt may only Delay the Inevitable

Houston Chronicle

A possible moratorium on foreclosures may help some distressed borrowers, but for the overall housing market, it will just delay the loss of homes for some Texans, real estate experts say.

Texas Attorney General Greg Abbott asked 30 lenders this week to put foreclosures and sales of foreclosured properties on hold and to review the way they document repossessed properties.

The request came after lenders halted some foreclosures in 23 other states amid allegations of "robosigning" — processing documents without proper review and notarization. The federal government is now looking into the allegations.

"The AG demand, especially if he sues in court, will only cause a substantial delay in getting this default backlog cleared out, therefore extending the high volume on into 2011," said Amanda LeCureux, managing partner of The Woodlands-based Foreclosure Information & Listing Service.

Government programs to help borrowers stay in their homes have already delayed large numbers of foreclosures, said Kevin Riles, a Houston-area real estate agent who specializes in foreclosures.

A moratorium may only prolong the pain.

"I'm starting to be of the opinion that we need to go ahead and release some of these properties to the market so we can move forward," Riles said.

In addition to suspending foreclosures, the attorney general asked lenders to halt the sales of properties previously foreclosed on and the evictions of people living in those properties.

Stopping sales and foreclosures will "throw a monkey wrench in the housing market" by creating a backlog of properties for sale, said Jim Gaines, an economist with the Texas A&M Real Estate Center.

"It will take the market a long time to work through and will play havoc on prices," he said.

On the other hand, some distressed borrowers might benefit from a moratorium by getting extra time to pay their mortgages or look for jobs if they're unemployed.

"I think it's going to be a great thing, because it's going to pull the tide of foreclosures from hitting the market," real estate agent Paul Silverman said.

While Houston hasn't been hit as hard by defaults as other parts of the country, foreclosures have affected home values because those houses typically sell for less than comparable properties that aren't in foreclosure.
 

Restraining orders

Consumer advocates were cautious in assessing Abbott's actions.

Attorney Natasha Gransberry has sought temporary restraining orders on behalf of clients who were being foreclosed on despite having modified loans.

She described cases in which loans were sold to new servicers that moved ahead with foreclosures because they didn't know the borrower had a modification in place.

She's urging clients not to rely on Abbott's actions to keep them in their homes.

Richard Tomlinson, director of litigation at Lone Star Legal Aid, said he was happy to see the attorney general take action but isn't sure how much it will help consumers since compliance with the moratorium is voluntary.

"The proof's in the pudding. Based on what he learns, it will be interesting to see what Abbott does," Tomlinson said.

He urged struggling borrowers to seek help from Lone Star or get other legal counsel to stave off foreclosure before their homes are set for sale at auction. Before a foreclosure is complete, an attorney can help qualified homeowners file for bankruptcy or look for legal violations in the foreclosure that could thwart it, Tomlinson said.
 

Business as usual

So far, just one lender, Ally Financial, has agreed to suspend foreclosures in Texas. Disclosures several weeks ago that an Ally employee rushed documents without reviewing them triggered the nationwide attention on robosigning.

Wells Fargo said it isn't planning a moratorium. JPMorgan Chase and Bank of America have declined to comment on the request.

On Tuesday, the day after Abbott's action, the monthly foreclosure auction in Harris County went off as usual.

There were 4,035 properties posted for auction and 1,268 that were actually foreclosed.

"That's about average," LeCureux said. "It looks like they foreclosed the same number they would have any other month."

Postings in September totaled 4,691 - the highest since October 1987, when 4,773 properties were posted.

September totals were up because of the sluggish economy as well as a five-week posting period that gave lenders an extra week to post properties for sale.

"Since the downturn started in late 2008, more and more Houston homeowners have been affected, and as more time passes and with the recovery so anemic, the numbers of late payers are starting to pile up, even in Houston apartments," LeCureux said.