Where readers ask and we try to answer:
There must be many of you brokers out there who are familiar with the Lembi juggernaut. Well, word is that they are adjusting to a changing financing landscape and even, gasp! selling some units. Maybe that will allow some of us little guys to get a shot at buying some of the multi-unit buildings around town? Any thoughts?
Well, Paco, whatever word on the street you are hearing must have some truth to it, as we’re hearing the same thing. We are not reporters, don’t pretend to be, and frankly don’t feel like “glamming” this post up, so we’ll give some bullets:
* Trophy Properties has currently listed multiple properties
for sale. As a result of a slipping market the buildings are arguably
priced above current market values.
* With shifting values and adjustable loans there are rumors that
the company is having trouble keeping up.
* Most of Trophy’s purchases in recent memory were done with short
term, highly leveraged adjustable loans, which are believed to be
* Trophy has purchased approx. 85% of the buildings, with 10 or more
units, in the last two years. This aggressive buying has “frustrated” a
lot of SF investors. Many competing Buyers are licking their
chops waiting for more properties to come back to the market. However,
because of high prices, most of the properties are not
attracting serious investors.
* This uncertainty is creating a “standoff” in the 10+ unit market,
as Sellers are waiting to see how listed properties sell before listing
their own, and investors are not moving on recently “listed” properties
because they are so expensive.
* Many local Agents are all wondering, “how will the market react to
disparity between Sellers and Buyers.”
That from a highly connected source in the multi-unit world.