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Aug 25

This legislation creates a financial tool to allow new growth to more expediently pay for itself through the creation of Comunity Infrastructure Districts (CIDs). A CID allows the formation of a taxing district comprised of the boundries of a new development.


Aug 18

This piece of legislation changes the size of real property that is eligible to be financed with a deed of trust in Idaho from forty acres to eighty acres, and clarifies the 80 acre limit. House Bill 491 should increase lending options for certain properties between 40 and 80 acres in Idaho.


Aug 12

There was a second piece of legislation (House Bill 465) that was passed by the Idaho Legislature that went into law on July 1, 2008.  This legislation amends provisions of the Local Land Use Planning Act which includes certain group homes for the handicapped within the definition of “single family dwelling.”  Under the Act such homes may be established without any permits, variances or other restrictions that would not otherwise be imposed on a single family dwelling.  The state provisions are an offshoot of the federal Fair Housing Act.  In 1988, the Fair Housing Act was amended to include those suffering from drug and alcohol addiction within the definition of handicapped.  In reliance on the Fair Housing Act group homes for drug and alcohol addicts have appeared in increasing numbers in family neighborhoods.  Residents in these homes are often convicted felons still under the supervision of the Department of Corrections, or registered sex offenders.


The Fair Housing Act does contain some exclusions.  One exclusion specifically exempts from protection those “whose tenancy would otherwise constitute a direct threat to the health or safety of other individuals or whose tenancy would result in substantial physical damage to the property of others.”  According to the United States Department of Justice that includes “persons convicted for illegal manufacture or distribution of a controlled substance, sex offenders, and juvenile offenders,” by virtue of their status.  It would also include those who are still under the supervision of the department of corrections on probation or parole.


The current state law, however, does not contain the federal exemption, and therefore imposes a greater restriction on local government zoning authority than does the Fair Housing Act.  The present legislation adds the federal exemption to state law to permit local government greater latitude in applying zoning procedures and conditions to group homes housing those falling within the exemption.  The legislation also clarifies terms of reference for group residence homes so that they are consistent in the applicable sections.  The term “supervision” is also clarified to specify the nature of the qualifying supervision connected with the handicapped residents as distinguished from unrelated types of supervision, such as parole or probation supervision.

 

 

Gail Heist is the Managing Broker at NAI Kowallis & Mackey, a full service Idaho commercial real estate brokerage and part of the world's largest network of commercial real estate offices consisting of 5,000 professionals in 350 offices in 55 countries around the world.  Gail can be reached by phone at 208.385.9876 or by clicking the contact Gail link to the left of this post.

 


 


Aug 08

There is another piece of legislation that was passed by the Idaho Legislature that went into law on July 1, 2008.  Transitional housing is a relatively new and expanding market in Idaho.  Transitional housing is primarily a commercial for profit venture.  Transitional houses have been moving into residential neighborhoods across the state because of any regulations. 


Aug 02

The Idaho Legislature passed some interesting piece of legislation this last session that went into law on July 1, 2008. The legislation I am going to discuss should help the consumers that are having a problem with foreclosure. There is a group of persons and businesses that are engaging in business practices that defraud innocent homeowners.


Aug 01

One of the most useful economic decision-making tools for commercial real estate users and investors is discounted cash flow analysis. The first step in the DCF process is to reduce each alternative being analyzed to the amounts and timing of all the cash flows. Once each of the alternatives has been reduced, the net present value can be calculated. The analysis can be done on a before- or after-tax basis. This article focuses only on the applications of the NPV function, which is a key consideration for determining users occupancy costs.

Jul 25

GlobeSt.com and its parent, Real Estate Media Network, hosted  “The U.S. Economy Crisis and Cures,” an economic briefing today with top economists from Ernst & Young, Moody’s, the Federal Reserve Bank of San Francisco, CB Richard Ellis and Marcus & Millichap to discuss the current economy and its impact on the commercial real estate industry.  Following are highlights of the presentation:
 

  • The general consensus is that we are experiencing a crisis in confidence, not a crisis in market fundamentals.  The numbers indicate a mild downturn, not a recession.
    • The economy has been steadily contracting since December 2007, with housing and the financial sector the leading indicators.
    • Though we haven’t yet met the definition for a recession (two consecutive quarters of negative GDP), the overall impression is that of a slowdown, impacting nearly all sectors
    • The downturn is in line with expectations and less severe than previous recessions

 

  • To date, job losses have been smaller than in previous recessions (notably the 1991 and 2001 recessions), leading to a less severe employment situation
    • The slower economy is typically attributed to six straight months of job losses, the continual plunge of home prices, and the impact of the credit crunch (particularly the rise in the risk spread)

 

  • Economists agree that the last two quarters of 2008 will see a slowdown or drop in economic productivity, and that recovery will pick up steam in 2009
    • A poll taken during the webcast found the majority agree that the economy will improve by the third quarter of 2009
    • Headline inflation is likely to spike again in the short-term, and will slow in 2009
    • Inflation rates are expected to rise, as the Federal Reserve is challenged with issues on both the economic growth and inflation sides of the equation, and economists try to gauge how prices and wage pressures are going to hold up with increased inflation
    • The economy will reset to where we were in 2004, as opposed to the boom years of 2006 and 2007

 

  • In overall terms, the financial sector is demonstrating its strong fundamentals
    • Underwriting for loans and mortgages has normalized, returning to how it was before the real estate bubble, mostly due to the Fed stepping in
    • Financing is available, but if you can get credit it is more expensive
    • This change in underwriting has tremendous implications for economic growth and recovery, as access to new capital is a key factor in growth

 

  • The commercial real estate market will see an increase in vacancies of 1-1.5 percentage points, but that increase is on a fairly healthy supply base
    • The market is in for some erosion of its fundamentals, as the economists are keeping a close eye on sublease numbers
    • Most expect to see weakness, not a hit, in market fundamentals
    • The industrial market is strongest overall, followed by office.
    • Existing CMBS is in very little distress, though 25-30% of today’s commercial debt comes from the CMBS market
    • The psychological aspect of the downturn comes into play with leasing demand, as most investors are sitting on the sidelines waiting to see where the market will go, and job losses will be way below trend
    • Prices have adjusted downward by approximately 15%

 

  • Economic recovery will come from a stabilization in energy and food prices, and establishing a new balance for the economy
    • The ‘dull’ downturn will have a ‘dull’ recovery, and will take another year to play out

 Gail Heist
NAI Kowallis & Mackey
www.NAIBoise.com 


Jul 23

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