Readers have wondered about the story of the billion-dollar property being bought for $100,000. It was the lender (who was the previous owner) who got the property back, and who is now in position to make a tidy profit on their original $45 million mortgage:
On Tuesday, it sold for a mere $100,000 at a foreclosure auction, a fraction of the $200-million loan outstanding on the property.
A markdown of 99.99%, of course, comes with some fine print. Any other buyer would have been on the hook to repay that loan — and this buyer has to eat that loss.
That’s because the buyer is the estate of late Herbalife founder Mark Hughes, which previously owned the property. The estate set this current saga into motion by selling it to Atlanta investor Chip Dickens in 2004.
Dickens borrowed around $45 million from the Hughes estate to buy the property, and that debt has since ballooned to roughly $200 million with interest and fees. Three years ago, Dickens transferred ownership to a limited liability company controlled by his partner on the project, Victor Franco Noval.
Noval is the son of convicted felon Victorino Noval, who pleaded guilty to mail fraud and tax evasion in 1997 and was sentenced to federal prison in 2003.
Unable to pay the debts, their limited liability company, Secured Capital Partners, tried — and failed — to declare Chapter 11 bankruptcy last month, which led the Hughes estate to force a foreclosure auction to either sell the property in hopes of recouping its losses or buy it back, likely losing the $200 million they were owed in the process.
Rob Dawg mentioned the rent-control initiative that will be on the ballot in 2020.
It will be a scaled-down version of the one that got voted down last time:
Amid mounting pressure for lawmakers to protect renters from the steepest of increases in a hot rental market, this initiative is a scaled-back version of Prop. 10. The proposed ballot measure would not give cities carte blanche to impose sweeping rent control rules. New construction would not be impacted.
“We tried to address the concerns we heard during the last campaign,” says Weinstein, “A lot of politicians wanted to see reform instead of repeal of the Costa Hawkins rules.”
The measure would also allow cities to impose rent control on single-family homes if the landlord owns three or more homes, which exempts mom-and-pop landlords. Plus, the measure would allow for limited vacancy control, which is currently prohibited. When a tenant moves out of a rent-controlled apartment, cities and counties could limit rent increases for the next tenant, as long as they allow the landlord to raise the rent at least 15 percent over three years.
The new measure faces many hurdles on its road to the ballot box. Rent control opponents, including real estate interest groups, who describe the legislation as a retread of the old initiative, raised a whopping $76 million to defeat Prop. 10.
“Prop 10 2.0 would drive down property values and prompt an exodus from the rental housing market,” Tom Bannon, chief executive officer of the California Apartment Association said in a release. “California needs sensible housing policies that protect tenants and encourage the building of affordable homes for working families. This measure makes the crisis worse.”
Supporters of Prop. 10 raised only $26 million, the bulk of which came from the AIDS Healthcare Foundation. But Weinstein remains resolute.
The California Association of Realtors will also put forth the change to Prop 60/90 that would allow seniors to take their old tax basis with them to their new home, regardless of whether they paid more or less for it, or which county it’s in. The removing of commercial properties from Prop 13 protection will be on the ballot too, and maybe all bundled up together?
I doubt any of them will change home values in the short-term, but what an Election Day!
Two weeks ago, David Berman died at age 52. Here’s what wiki says:
David Cloud Berman (born David Craig Berman; January 4, 1967 – August 7, 2019) was an American musician, singer, poet and cartoonist best known for his work with indie-rock band the Silver Jews. Although the band primarily existed as a recording project for most of its existence, the Silver Jews toured regularly from 2005 until 2009. In January 2009, Berman announced his retirement from music in hopes of finding a meaningful way of undoing the damage that his estranged father Richard Berman (a lobbyist and public relations executive for the alcohol and tobacco industries, among others) had brought upon society.
In addition to the six full-length albums that Berman wrote and recorded with the Silver Jews, he released two books: Actual Air (1999) and The Portable February (2009). In early 2019, Berman returned to music under the new band name Purple Mountains, releasing a self-titled debut albumin July 2019. On August 7, 2019, Berman was found dead in an apartment in Brooklyn, New York. His death was ruled a suicide.
I had never heard of the guy, but Giorgio and others raved about his contributions:
One of the main reasons to set up shop at the La Costa Resort is to help support our efforts in the area.
When my current listing on Segovia came on the market, we were the only house for sale in the area.
But since then, TEN other similar – older one-story – homes have hit the market nearby:
We had listed for $888,000, and with a uniquely large backyard, we thought we had a shot at attracting a buyer who had a vision.
But now that we’re vying with eight others for the next buyer, we had to adjust on price. The house on Cima came on at $899,000, but lowered quickly and found a buyer on Monday – so we did the same thing, and lowered to $859,000.
The number of views has been incredible – there is no shortage of lookers:
Note that there are twice as many views on Zillow as there are on the MLS!
The auto-valuations are close too, so it shouldn’t be long now:
When a flood happens, adjust early and often, because you don’t want to get left behind.
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