Time flies. Do you remember back in 2007 when Arnold Schwarzenegger was governor and the state assembly passed AB 1103 Commercial Building Energy Use Disclosure Program? It was supposed to begin in 2010, but of course, it got changed and delayed and modified and finally, low and behold, the time to disclose energy data is upon us. The first phase of the Energy Use Disclosure Requirements begins July 1, 2013.
To refresh our memories, Assembly Bills 1103 and 531 require owners of nonresidential buildings located in California to disclose energy usage of such buildings in advance of any sale, lease, or financing of the entire building.
Here is the schedule for when commercial buildings need to keep and disclose energy usage records:
2. On and after January 1, 2014, for buildings with a total gross floor area between 10,000 square feet and 50,000 square feet; and
3. On and after July 1, 2014, for buildings with a total gross floor area between 5,000 square feet 10,000 square feet.
AB 1103 and 531
Assembly Bill 1103, signed into law on October 12, 2007, requires the tracking of the energy use of all nonresidential buildings and the disclosure of such energy use as part of the sale, lease, or financing of an entire nonresidential building. T
The disclosure requirement is intended to “motivate building operators to take actions to improve their buildings’ energy profiles” and “to allow building owners and operators to compare their buildings’ performance to that of similar buildings and to manage their buildings’ energy costs.”
Since we’re talking government, AB 1103 then added Section 25402.10 which contained a compliance deadline of January 1, 2010. Assembly Bill 531 removed that deadline, and replaced it with the disclosure of energy usage data on a schedule of compliance established by the State Energy Resources Conservation and Development Commission.
Compliance with Assembly Bills 1103 and 531 expects owners of nonresidential buildings to take certain actions at least 30 days before the sale, lease, or financing of the entire building.
1. Register for an account with “Portfolio Manager,” the U.S. Environmental Protection Agency’s ENERGY STAR program online tool for managing building energy use data.
2. Create a profile within Portfolio Manager for the nonresidential building.
3. Use Portfolio Manager to request that utilities serving the building release the last 12 months of energy use data for the building to Portfolio Manager. What you’ll get is:
- Disclosure Summary Sheet;
- Statement of Energy Performance;
- Data Checklist; and
- Facility Summary (collectively, the “Disclosure Data”).
4. After the utility data has been provided, download the Disclosure Data; and provide the Disclosure Data as part of the sale, lease, or financing.
(Regulations section 1683(a) + 1684(c).)
Here’s the curious caveat, there is no specific penalty for non-compliance, but a failure to disclose a building’s energy usage could be viewed as a material fact in the transaction.
Last installment, we told you that the ports were hopping…well here is a really great opportunity to have your own industrial complex by the port….
FINE INDUSTRIAL COMPLEX BY LONG BEACH HARBOR
1452 Harbor Ave., Long Beach, CA 90813
- Price: $615,000
- Building Size: 5,387 SF
- Price/SF: $114.16
- Property Type: Industrial
- No. Stories: 1
- Year Built: 1957
- Clear Ceiling Height: 12 ft.
- No. Drive In / Grade-Level Doors: 5
- Lot Size: 0.16 AC
- APN / Parcel ID: 7432-020-011
- Five 10′ loading doors total
- 3 bathrooms in shop
- 2 electric and 2 water meters, 1 gas meter
- Each building has a pedestrian door facing Harbor Ave.
- Overhead hoist inside northwest loading door
- Inventory and fixtures negotiable
Cut your fulfillment costs by relocating to the import/export hub of Long Beach. Take a tenant and expand as you need. For the very affordable price of $615,000, 1452 Harbor Ave. offers two side by side 2,240 SF buildings that have been connected, adding approximately 970 SF. Small fenced yard area in rear with gated access off Cowles St. AP#’s 7432-020-011 and 7432-020-012.
On the corner of Harbor Ave. and Cowles St., 2 blocks north of Anaheim St., and 2 blocks west of the 710 freeway. Close to Anaheim St. onramp to 710 Freeway.
Is this the kind of property you’re looking for?
Do let us know how we can move forward together in meeting your real estate goals 310.392.1211 or firstname.lastname@example.org.
The SoCal Investment Real Estate Group
Sotheby’s International Realty
LICENSE # – 01343854
Experience is how life catches up with us and teaches us to love and forgive each other.
p.s. a. This is not intended as a solicitation if your property is already listed with another agent.
b. We are not the listing agent on this property.
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FABULOUS INDUSTRIAL ADAPTIVE REAUSE OPPORTUNITY FOR LEASE > Port Seeks Tenant for Chicken of the Sea ComplexSeptember 9, 2012 on 8:11 pm | In Investment Opportunities, New Developments, Property Wish List, Uncategorized | 4 Comments
from Jodi Summers
Here is your fantasy industrial complex at the Los Angeles Ports. Located @ 337 Cannery Street, Terminal Island at the Port of Los Angeles! The Port has issued a Request for Proposals for the adaptive reuse of the historic Chicken of the Sea industrial complex at 337 Cannery Street. Let’s lease it together.
The Los Angeles Conservancy notes that Terminal Island’s longest-running cannery was instrumental in building Los Angeles’ highly successful tuna canning industry. The Port is looking for projects that will reactivate, reuse, and preserve the existing historic buildings on site. Proposals are due October 5, and the Port will host a tour of the site for bidders September 17.
Known as Van Camp Seafood Company from 1914 through 1997, the company helped transform the industry. Owner Frank Van Camp and his son Gilbert introduced innovations, such as refrigerated fishing boats, that remained industry standards for decades.
The company is credited with introducing canned tuna on a mass scale to the American consumer, particularly the housewife, as an affordable substitute for chicken. It was widely recognized for its Chicken of the Sea brand and the iconic Mermaid logo introduced in 1952. The company was officially renamed Chicken of the Sea in 1997.
This facility was the last operational cannery at the Port of Los Angeles and the last full-scale tuna canning plant in the United States.
We’re here to help you with your commercial and investment property needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – email@example.com or 310.392.1211, and let us move forward together.
Los Angeles Conservancy = firstname.lastname@example.org
While investing in domestic real estate is simple in theory, it is rarely easy in its execution. There is much involved – from banks’ stringent requirements and the glut of paperwork to overriding labor, market, and macroeconomic conditions.
Even beyond the predictable hardships associated with due process and protocols of purchasing domestic real estate, there are a myriad of “controllable risks” that, if ignored, can threaten, undermine, and even devastate an investment at large.
Here are 4 key risks every domestic real estate investor must know if they want to overcome the litany of hardships associated with today’s real estate investment landscape:
1.) Price perception. Simply put: do not assume that a low price is a good deal. Beyond price, investors should focus on other key facets that determine property value – namely location. When vetting a residential real estate purchase, focus on where it is located, including what subdivision and school district it is in as well as research the overall demographics of those that live there. Find out if the residence is in a rental or multi-owner neighborhood, which is a good indicator of how neighbors will treat your property and theirs relative to curb appeal and otherwise…all, of course, factors that affect the value. Another component is what the residence in question would rent for should you need to go that route as recourse or intention. With some time and effort applied to some simple research for information that is readily available, your price perception may be readjusted to understand whether that low price is actually the good deal that it appeared.
2.) Contracts and paperwork. It is imperative for you or a legal representative to actually read all of the language in any contract or piece of paper you sign, however copious that it may be. There can be terms that are not conducive to property investing, such as “deed restrictions,” which actually limit the allowable percentage markup on resale. In fact, some stipulate that you cannot sell a house for 120% above what you bought it for during the time period .Rules such as these can be too restrictive for professional home “flippers.” Deed restrictions ride with the property, so even if the ownership name changes, you can not get around it. Deed restrictions are also problematic due to a three-month waiting period to sell, which makes valuation difficult and creates a painful delay when faced with a rapidly declining market.
3.) Deal structure. How a deal is structured directly impacts the required cash flow. Many make the mistake of calculating equity and translating that into a monthly cash flow, which can make the deal seem better than what reality delivers. Deal structure decisions should also involve property estimating property taxes and related due dates. In this case, your only source of information should be county-driven facts and figures. Whether taxes seem high, low, or in-line, call the county and check to make sure because your scenario may differ from the prior owner’s situation. For example, if the property you are going to be buying is a foreclosure and the person living in it was a senior citizen they may have had a homestead exemption whereby the county allowed a tax reduction. However, as an investor, you are going to pay top-dollar for your property taxes. Other key deal structure considerations are insurance rates, management fees, vacancy rates and repair costs, which all have their own set of intricacies that you must investigate when considering the deal structure of your potential real estate investment.
4.) Exit strategy. In the realm of real estate investing, not having a clearly defined, pre-planned exit strategy even before purchasing a property can be a financial death knell. Knowing you will ultimately re-sell a property at the onset requires that you consider – and actually vet – all viable options and channels suited for the property at hand. While many investors choose to rehab and flip properties themselves, another highly profitable strategy to consider is simply wholesaling it to another investor on an “as is” basis. This can reduce your financial exposure and liquidity to facilitate future investments.
The bottom line? If you properly vet each and every domestic real estate investing opportunity that may seem like a “no brainer” at surface level, then you are more likely to increase the viability, profitability and sustainability of your domestic real estate investment portfolio.
Global real estate investing authority Terica Kindred is the Founder and CEO of OutEstate Investments, specializing in helping citizens in the U.S. and from around the world invest in the U.S. real estate market to help stimulate the American economy. Terica has started businesses on five different continents, and she is also an author, speaker, business consultant and investment strategist. Kindred will soon release her newest book, ‘The Next Global Millionaire,’ offering nine secrets to becoming a successful global investor or entrepreneur. She may be reached online at www.tericakindred.com.
By Jodi Summers
The BIG news of the last month is that the recession has ended, AND the government is giving us money to go back to business. The U.S.A. was a bit stunned and cautiously optimistic when the National Bureau of Economic Research announced that their research determined that the recession ended and economic recovery began 15 months ago, in June 2009. Good to know.
Join the ranks of the smart. Wise industrial buyers have been picking up all of the parcels they can find, as the L.A. industrial real estate market is beginning its rise off of a 10-year low. If you’re an owner/user, Small Business Loans are generous at this moment. Truly, there is no better time for a hungry industrial buyer to dive into the marketplace. Prime parcels are coming and going on a weekly basis.
“…Distribution and logistics users tend to be more focused on square footage and the respective economics,” observes Bradley D. Larson, vice president of Partners National Real Estate Group. “…It is more common for our industrial clients to consolidate or close a branch than to lay off staff. The emphasis from our industrial clients is on right sizing their branches as opposed to downsizings….
The Los Angeles industrial market has been positively impacted by the strong economy of our Custom District’s #1 trading partner – China. The strong Sino economy has driven down the Chinese trade surplus by $20.0 billion in August after imports rose by +35.2% on a year-to-year basis.
Shifting product around the world is the driving force of the Los Angeles industrial market. Now, those post-recovery statistics work in our favor. In August, the total number of containers handled at the ports of Los Angeles and Long Beach rose by +24.3 percent on a year-over-year basis to 1,374,839 TEUs (twenty-foot equivalent units). This was the ninth consecutive month of year-to-year increases and fifth consecutive month of TEU totals above one million.
The increase in port activity has helped our industrial market remain one of the strongest regions in the country. With the recent passing of the Small Business Aid Bill expect business to pop.
Yes, the big picture seems rosier, but through much of the year, cash flow has been an issue. Pundits expect the Small Business Aid Bill to make life easier. Small Business Administration loans are already in abundance, flowing freer than recent memory recalls. (Thank you Recoveries Act.)
The Small Business Aid Bill creates the $30-billion lending fund to help smaller banks make loans to businesses, and offers $12 billion in business tax breaks to encourage investment, entrepreneurship and hiring. The goal is to motivate bureaucracy-strapped community banks to encourage lending to small businesses, such as factories with 500 workers or less. Supporters hope to see the fund leverage up to $300 billion in loans.
With investors, cash is still king, as lending on non-owner occupied properties is still an issue. The latest monthly reports to the U.S. Treasury report that bank commercial real estate lending and balances continued to shrink.
The state of the Los Angeles industrial real estate market as we enter 4Q 2010, “On paper, everything appears to be coming back; let’s hope the Small Business Aid Bill will inspire businesses to actually take the economic risk and grow.”
Perhaps the Small Business Aid Bill will be the kick we need.
We’re here to help you with your property needs. Please contact Jodi Summers – Sotheby’s International Realty – email@example.com or 310.392.1211, and let us move forward together.
INDUSTRIALS PREDICTED TO REMAIN A STRONG REAL ESTATE INVESTMENT
Industrial properties continue to be one of the bright spots (along with multiunits) in the current real estate market. The long-term outlook is extremely positive, according to a new report from Torto Wheaton reasearch. While acknowledging that weak demand has temporarily damaged the market, the report observes that the benefits of globalization and a more open economy will bring sustained growth over time.
“The US economy is becoming more open and globally integrated,” observes report author Laura Stone Mortimer, a Torto Wheaton vice president and managing economist. “As a consequence, trade-measured by the sum of imports and exports of goods-will continue to account for an increasing share of GDP.”
The theory asserted is that over the next 10 years many emerging markets in Asia, Europe and Latin America will contribute to increases in global trade as their economies and currencies gain strength, much as China has done in the current decade. In addition, she says, the US is regaining ground as a major exporter.
“With the dollar’s recent weakening, our exports have become more attractive worldwide, creating greater demand for American-made goods,” the economist remarks. “Historically, the US consumer has demanded more foreign-made goods than foreign consumers have demanded American-made. This, however, is currently reversed, resulting in a more open economy. Over the long-term, export demand for US goods and services is anticipated to continue to grow.”
The report speculates that growth in warehouse demand may well outpace growth in domestic economic output due to increased globalization and a long-term trend in which trade will represent a growing share of the GDP.
“As such, our demand forecasts are slightly more optimistic over the longer term once the economy enters its recovery phase,” she says, noting that trade, which until 2004 represented less than 20% of the GDP, has grown to represent about 30% of GDP today. “…Trade as a share of GDP could continue to grow to as much as 40% over the next decade,” she ventures.
The change, she continues, will have a significant impact on the nation’s industrial markets, particularly those coastal cities that serve as transshipment centers and those hubs that are well-positioned, in terms of minimizing transportation costs and serving large areas of the population. “The role the US plays in world trade and the distribution of goods will be increasingly important,” she concludes.
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