Silver linings seen in housing statistics
Prices of single-family homes across the United States are still falling, but the declines are slowing down, according to one of the leading housing market indictors. Numbers released by Standard & Poor’s showed a 15.4 percent decline in the second quarter of 2008, compared to the same quarter of 2007. The S&P/Case-Shiller Index, which covers all nine U.S. census divisions, also reported annual declines of 17 percent and 15.9 percent, respectively, for its 10-city and 20-city composite price index.
These declines were less than economists had forecast, however. Quarterly figures for nationwide home prices showed a 2.3 percent drop in the three months through June from the previous three months, compared with a 6.8 percent decline in the first quarter of 2008.
“While there is no national turnaround in residential real estate prices, it is possible that we are a seeing some regions struggling to come back, which has resulted in some moderation of price declines at the national level,” said David Blitzer, chairman of the index committee at Standard & Poor’s, in a prepared statement.
Las Vegas remains the weakest real estate market in the country, according to the report, closely followed by Miami and Phoenix. For the month of June, Denver and Boston were the best performing markets; each city had three consecutive months of sales gains. Charlotte and Dallas recorded four straight months of positive returns, according to the index.
NAHB: Multi-family construction looking ‘greener’
The National Association of Home Builders has released results from a survey of multi-family builders and developers, showing that professionals in the multi-family market are becoming more interested in building green.
Seventy-four percent of respondents said that buyers and renters are willing to pay more for green amenities, though the median additional amount they are willing to pay is only about 2 percent, according to the survey.
The survey also found the following:
• 89 percent of respondents reported they are installing energy-efficient appliances and lighting in their multi-family communities.
• 79 percent are using windows with low-emittance (Low-E) glass, which helps block the transfer of radiant heat by using a special coating.
• 64 percent are using recycled and recyclable products.
• 50 percent are using significantly more insulation than required by the building code, a number that rises to 70 percent of West Coast respondents.
“Apartments and condos are inherently green, because they offer more compact development to begin with,” said Steve Patterson, chairman of NAHB’s multi-family leadership board. “With today’s heightened consumer interest in green, multi-family builders are embracing more green and recyclable products and are more willing to invest in energy efficiency.”
Hines Horticulture seeks to sell assets to Black Diamond
Hines Horticulture, which filed for Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware on Aug. 20, will seek to sell its assets to hedge fund Black Diamond Capital Management, the Irvine, Calif.-based company announced.
Hines is one of the largest producers of ornamental shrubs, color plants and container-grown plants in the country.
Black Diamond, which is Hines’ largest unsecured creditor and the holder of a majority of its $175 million in senior subordinated notes, has agreed to serve as the “stalking-horse bidder” for Hines. A “stalking-horse” bid is the first bid on a bankrupt company’s assets, from a bidder chosen by the bankrupt company.
According to court papers, Black Diamond is in the midst of due diligence — which needs to be completed by Sept. 19 — and Hines has offered to pay the fund a $225,000 work fee as an incentive to finish it in short order.
Documents show that the stalking-horse bid is worth up to $58 million in cash, which would pay off Black Diamond’s debts, plus $500,000 in wind-down costs.
Hines pursued several possible restructuring alternatives in the months before its bankruptcy filing, including a sale of all or pieces of the business, a new debt or equity infusion or a balance sheet restructuring.
Hines sells its goods to more than 1,180 retail and commercial customers, including Home Depot, Wal-Mart and many small local garden centers, representing a total of more than 6,670 outlets throughout the country. Hines’ products are mostly sold under the “Hines Nurseries” trade name. The debtor operates seven commercial nurseries where plants are grown for sale to retailers and other businesses.