January/February 2011 - Gulf Coast News & Real Estate Articles

BP fund to settle more than 2,000 claims of damage from gulf oil spill

By Steven Mufson, Washington Post Staff Writer, Friday, February 11, 2011; 8:13 PM

The administrator of the BP escrow fund will settle more than 2,000 claims of damage from last year's oil spill from hotels, oystermen, condominium owners and others from Louisiana to Florida. Individual payments will range from $10,000 to $30 million, according to a lawyer for the claimants.  The claimants who will get payments include small-time oystermen, New Orleans Saints coach Sean Payton and the upscale Sandestin Golf and Beach Resort, said Daniel Becnel, a Louisiana lawyer who helped negotiate the deals. Payton has a summer home near the gulf coast, Becnel said. Payments will also go to 900 condominium owners and 50 commercial establishments such as hotels, motels and restaurants. The group of settled claims is one of the biggest so far, but there are many more. As of Thursday, the $20 billion Gulf Coast Claims Facility established by BP had paid 168,634 claims for a total of $3.4 billion. More than 400,000 individuals and 87,412 businesses have asked to be compensated for economic damages resulting from the spill, though a large number of them have been dismissed as having no merit.  Kenneth Feinberg, who is the fund administrator, has been trying to convince people that they would be better off taking payments from the $20 billion Gulf Coast Claims Facility, which was established by BP last year, than if they filed a lawsuit that could take years to resolve.  Feinberg has been paying not only for damages sustained last year but also for those that might be sustained in the future. For example, Becnel said, Feinberg has been paying oystermen for losses last year but is also providing identical sums through 2012 because an oyster crop takes three years to grow.  Becnel said he and other lawyers for the group had submitted extensive supporting materials from economists, environmental scientists and real estate experts.  Becnel said Feinberg was doing "a fabulous job," though Feinberg has been sharply criticized for the amount of money BP is paying him to manage the escrow fund. Feinberg has also been asking claimants to renounce their right to sue BP.

Alabama foreclosures dip in January

Published: Sunday, February 13, 2011, 5:57 AM

By Kathy Jumper, Press-Register

Foreclosure filings dipped by 1 percent nationwide from December to January, according to RealtyTrac's monthly market report.

There were 261,333 foreclosure filings in the United States, a 17 percent decrease from January 2010, according RealtyTrac, which monitors foreclosures online at realtytrac.com.   One in every 497 U.S. housing units got a foreclosure filing in January. But five states -- California, Florida, Michigan, Arizona and Texas -- account for more than 50 percent of national total.  Foreclosure filings include default notices, scheduled auctions and bank repossessions.  Alabama had 1,642 new foreclosure filings in January, a 16 percent decrease from December 2010.  There were 95 foreclosure sales statewide at an average price of $190,606.  Mobile County had 214 new foreclosure filings in January with the highest number, 139, in the city of Mobile.  Baldwin County had 258 new filings in January with Foley reporting the highest at 113, according to RealtyTrac.  Mississippi had 282 new foreclosure filings in January, with seven foreclosure sales at an average price of $169,881.  Harrison County had 26 new foreclosure filings in January, 11 of them in Gulfport.  Jackson County saw 31 new foreclosure filings last month with 14 in Ocean Springs.

Investor buys acreage in Gulf Shores | al.com

Published: Sunday, February 13, 2011, 4:51 AM

Charter Landing of Orange Beach paid $1.35 million total for 52.7 acres at Bartram Walk, formerly called Waterdance, on Baldwin County 4 in Gulf Shores, and then sold the property in five parcels for a total of $1.86 million, according to court records. Charter is owned by Ken Montgomery, who bought the bank note and resold 89 condominium units at The Wharf on the Intracoastal Waterway last fall.

via Investor buys acreage in Gulf Shores | al.com.

Condo Developers Hope to get BP Money Soon

Published: Sunday, February 06, 2011, 4:13 AM

By Kathy Jumper, Press-Register
 

 Developers say that all but a handful of the 188 owners in Phoenix West II have signed releases agreeing not to sue BP PLC in exchange for a $37.2 million payment from the oil giant that will aid completion of the 31-story condominium tower in Orange Beach.

"We're working on getting them all signed," said Tillis Brett of Brett/Robinson, the project developer. "We just lack a few. I think we will get it worked out."

But that doesn't mean all are happy about the deal.

Nick Catranis, a commercial Realtor in Mobile who owns a unit in the unfinished tower, said he signed the release.  "I had no choice," he said. "I bought my unit for $750,000, and now it's selling for $500,000. If they finish the project I might be able to get my money out of it. It's a sore spot with me."

The $245 million Phoenix West II was scheduled to open in July 2009, but Brett/Robinson said in March of that year that completion would lag into 2011. Units were priced from $650,000 to $850,000 in March 2009.

The oil spill hit last April and brought sales to a halt, just when a slow condo market was showing signs of improvement, Realtors said.  By June of last year, a three-bedroom unit in the unfinished complex was being offered at $510,000, developers have said.

In December, BP said it would provide the money to finish the stalled 358-unit building contingent on lawsuit waivers from Brett/Robinson and any owners that had already bought into the complex.

BP plans to meet with the developers in mid-February to discuss progress on securing the releases, BP officials said last week. They declined further comment.

Typically, Brett/Robinson demands that buyers pay for their units by the time that a complex opens, with the company using the money to help fund construction. The company has said that at least 69 buyers paid cash as early as 2005 when construction started.

The $37.2 million settlement, coupled with future sales, should be enough to finish the gulf-front project, most likely in 2012, said attorney Jim Thompson of

Birmingham, who represents Brett/Robinson's owners -- Tommy Robinson, Gene Brett and Tillis Brett.  BP has not set a deadline for signed releases, according to Thompson.

"There are less than half a dozen owners that have not signed," he said. "Sometimes it takes folks a little while for this to sink in and see that this is a great deal."

Orange Beach officials welcomed the BP and Brett/Robinson settlement, saying they don't want a huge, unfinished building on the beachfront. State officials touted the deal, pointing out that tax revenues generated from Brett/Robinson's 18 condo buildings account for 4 percent of all lodging taxes paid to the state.

Condo owners have been presented two releases, according to Thompson. One absolves BP and others involved in the summer's Gulf oil spill from future litigation. The second is a forbearance agreement that extends the developer's completion deadline for two additional years.  The forbearance documents are not required by BP, according to Thompson.  "We're making progress and hopefully it will be put to bed soon," Thompson said.  Gene Brett said that sales activity has picked up, with 30 units in Phoenix West II sold since Thanksgiving. Other units have been reserved with the purchase contingent of the BP settlement, he said.

Construction slowed, but never stopped at Phoenix West II, according to Tillis Brett. The number of workers could soar from 60 to 200 after developers are paid by BP, he said. "Our subcontractors are ready to go."

Mortgage Rates for the Day   2-4-11

Kim Naseman, Prime Lending, 251-379-2702, knaseman@primelending.com

Conventional 30 yr fixed            5%

Conventional 15 yr fixed            4.375%

Conventional 5 yr ARM               3.5%

FHA 30 yr fixed                         4.875%

USDA 30 yr fixed                       4.875%

VA 30 yr fixed                           4.875%

Jumbo 30 yr fixed                     5.5%

Jumbo 15 yr fixed                     5.125%

Jumbo 5 yr ARM                        4.375% 

Foreclosure Prevention Help for Ala. Homeowners

Oil spill claims payments would double what was lost in 2010 for most, document says

Published: Wednesday, February 02, 2011, 8:51 AM     Updated: Wednesday, February 02, 2011, 10:12 AM.  Mobile Press-Register

MOBILE, Ala. -- Full final payments in the oil spill claims process will be double what was lost in 2010 for most people and businesses, and quadruple 2010 losses for oyster harvesters, according to a document released by claims czar Ken Feinberg this morning.

Feinberg is giving the public two weeks to comment on the document before his Gulf Coast Claims Facility begins making final settlement offers based on its methodology.

Feinberg said a strong recovery is already underway from last year's spill in the Gulf of Mexico. He said he predicted that most people and businesses would incur losses equal to 70 percent of their 2010 loss in 2011, and 30 percent of their 2010 loss in 2012.

Feinberg said he would recalculate those figures every four months, as the economic realities along the Gulf Coast became clearer.

Claimants must fully document their losses from April 20 to Dec. 31, 2010, he said, with requirements of that documentation far more stringent than for last year's emergency claims process.

Daniel Craven, a Gulf Shores attorney who is representing businesses and property owners at the Gulf, said this morning that he doesn't think Feinberg's plan will be welcomed.

"If it’s two times what the losses were in 2010, but deduct what they were already paid, a lot of people over here are going to be very unhappy,’’ he said.

Feinberg has said that any previous claims payments would be deducted from the final settlement payment.

"I think most people over here were hoping (the offer) would be three times, and backing out what they were already paid they would get a total of two times for 2010,’’ Craven said.

Claimants who want to accept the full final settlement must promise not to seek future compensation or sue BP PLC or any other company involved in the spill. Claimants can ask for interim claims that cover three months worth of losses on a continuing basis without ceding their legal rights.

Post-Spill: Condo Sales Market Is Showing Signs Of Life

January 31, 2011.  Mobile Press-Register

By Marcia Bradford

While the oil spill from the BP/Deepwater Horizon well explosion had a very negative impact on real estate sales along the gulf coast this past summer, area real estate professionals are predicting that condo sales will strengthen this fall.

"We are seeing some real signs of life," said Patrick Daily, owner/broker of RE/MAX Orange Beach (Ala.). "Pending sales along the Alabama Gulf Coast are strong, and we have been writing contracts."

A similar scenario is unfolding in Northwest Florida, according to Carmela Bell, managing broker for ResortQuest in Destin, Florida.

"We are cautiously optimistic that the market is recovering from the oil spill crisis," she said. "The successful capping of the oil well has gradually restored public confidence, and buyers are slowly stepping back into an advantageous market. Although closed condominium sales have not yet shown an increase over last year, the number of pending condominium sales in August and September increased an average of 26 percent over the pending sales in 2009. Following May through July’s negative pending sales compared to the previous year, this is the first sign of positive change."

Oil Impact

Even as they look forward to sales of condos and other types of real estate increasing this fall and winter, real estate professionals did not downplay the challenges of the past few months.

Karen Smith, owner of Beachy Beach Real Estate in Panama City Beach, Fla., said she had been on track for a good year when "the oil delivered a punch" in late April. After the accident, however, her closings went way down in May and June. And in July, for the first time in three years, she had zero closings, she said.

"Even though we didn’t get any of the oil over here, the media coverage created a perception that our beaches were in bad shape, when, in fact, they were never impacted at all," she said. "But many of the condo buyers here are investors who intend to rent out their units, and they were scared off. Fortunately, I had done well up to that point and was able to withstand the setback. Now, things are looking up again."

Daily referred to June, July and August as "difficult," estimating that the oil spill had reduced anticipated sales levels by about 50 percent.

"The oil spill definitely had an impact, both personally and organizationally," Daily said. "Along with our ongoing issues of hurricane risk and high-priced insurance, the oil spill threw another unknown factor into buying property along the gulf coast. It caused a decline on an already depressed market. But we are now seeing that our beaches and the gulf are still absolutely beautiful, and people are coming back."

Throughout Destin, Sandestin, Okaloosa Island and along Highway 30A in Florida, the ­uncertainty the oil spill caused had a negative effect on the real estate market, both perceptually and economically, Bell said.

She pointed out that statistics taken from the Emerald Coast Board of Realtors’ Market Comparison Report reflect that condominium sales since June have been lower than the same month last year. The number of condo sales was down in June by 28 percent, in July by 46 percent, in August by 5 percent, and in September by 17 percent.

"If the positive trend shown by the first quarter in 2010, at an average increase of 78 percent higher than last year, had continued, this would have been the strongest market in years," she said. "The oil spill caused faltered demand for condominiums, and some buyers canceled. Some people who have been watching the market speculate that the impact of the oil more clearly re-set the floor of the market."

Buyers Seek Value

Daily said that today’s buyers are looking for "value-priced properties, typically seeking condos for $350,000 or less."

"Here on the Alabama Gulf Coast, I think that we have found the sweet spot," he said. "We have condos at the price people are willing to pay, with the amenities they are seeking," he said. "By contrast, very few condos priced at more than $500,000 are selling right now."

Bell said that while competitive pricing is the foremost factor affecting sales in the Destin area, she contended, "It is not simply price but an overall best value that attracts our next buyer. The same factors contributing to the attractive buyers’ market on the Emerald Coast over the past several months, including historically low interest rates, continue to hold true," she said.

While the statistics for the average number of units for sale continues to decline, this does not necessarily reflect a declining inventory in the Destin area, Bell said.

"I believe the decrease in inventory is largely due to sellers removing their property from the market instead of lowering their price to the current market demand," she explained.

Daily said that there are "absolutely fewer condos for sale" along the Alabama Gulf Coast, but said the numbers in his area are affected by people taking units off the market until demand increases and prices go up. "We are probably three to five years away from building more condominium projects," he said. "Even though condo construction has come to a halt in our area, there is still a lot of inventory. We will continue to see a lot of short sales and foreclosures into next year. And, there are still too many REALTOR® listing condos that are way over-priced for today’s market. Today’s informed buyer won’t pay $450,000 for a condo that appraises at $300,000."

Alabama hiking trail: Volunteers work to create 550-mile path from beaches to mountains

Published: Monday, January 31, 2011, 8:31 AM     Updated: Monday, January 31, 2011, 12:01 PM

By Dave Helms, Press-Register

Alabama Hiking Trail Society chapter president working to 550-mile hiking trail that traverses Alabama. The society's Gulf Coast chapter will hold a public meeting from 1-3 p.m. Feb. 12 at the 5 Rivers Delta Resource Center on the Causeway in Spanish Fort to discuss the project.  The vision is a wilderness walking trail that stretches from the white sands of Fort Morgan north to the mountains of north Alabama.  After a 550-mile traverse of the state, the hiker would be rewarded with amazing views at the Walls of Jericho, a strikingly beautiful bowl canyon and waterfall at the Alabama-Tennessee state line.  The Walls of Jericho are located in a popular Jackson County wilderness area owned by the state’s Forever Wild land preservation trust. Opened in 2004, it features a canyon bordered by 250-foot-high sheer cliffs surrounded by a hardwood forest filled with rare animal and plant species.

In between, foot travelers would witness the state’s distinctive range of habitats, home to unmatched numbers of wildlife and plant species.

The only catch: It doesn’t exist quite yet.

The Alabama Hiking Trail Society is working with state and federal agencies to bring the plan to fruition. Its Gulf Coast chapter will hold a public meeting from 1-3 p.m. Feb. 12 at the 5 Rivers Delta Resource Center on the Causeway in Spanish Fort to discuss the project.

A project the scope of the Alabama Trail would have impacts beyond getting people outside and walking, organizers have said. It might fuel eco-tourism that could bring new dollars and positive exposure to the state and towns along the trail.

While much of the trail is still “dots on the map,” its southernmost leg is actually not that far from reality, according to AHTS chapter President Joe Cuhaj.

“We have a huge corridor that can be completed in a relatively short period of time,” Cuhaj said recently. That corridor, a 60-mile stretch along the Perdido River, is already on 18,000 acres of state property and just needs to be marked out, he said.

The Feb. 12 meeting is an attempt to develop more volunteers to help accomplish the trailbuilding.

“We’re exploring right now, getting all our members out there to fan out and help plan the trail,” Cuhaj said. “We’re not only looking for the path of least resistance, but we want to make a unique and interesting trail to walk,” he said.   View full size

Trailbuilding involves balancing several factors, including tough decisions on what features to include and leave out, along with making sure water can be found along the way. Such water must typically be treated chemically or filtered before it’s safe to drink.   The trail must also make allowances for backpackers who might be carrying up to 50 pounds of equipment. Trail designers who have hikers going straight up or down a grade without switchbacks often have their ancestry questioned around the campfire.  Once the route is picked out and approved by the state, the real work begins, Cuhaj said.  “We do it all manually — the only motorized equipment we use is a mower to chop brush. The rest is done by hand, including trimming trees and building bridges,” he said.   The good news is the Alabama Trail’s southernmost trail is already in place.

The Bon Secour National Wildlife Refuge, which is the proposed southern terminus, already has six miles of trails in place, according to Jereme Phillips, manager of the refuge.  “We’ve been very supportive of efforts by the Alabama Hiking Trail Society to encourage people to engage in more outdoor activities,” Phillips said.

“This could be an Alabama version of the Appalachian Trail, as continuous as possible, which is a difficult thing to accomplish these days with urbanization and development,” Phillips said.

Trail developers see the Alabama Trail linking up with the upstate Pinhoti Trail and other trails that might eventually be added officially to the Appalachian Trail, stretching from Georgia to Maine in a 2,181-mile arc.

The Alabama Trail would also tie into the Eastern Continental Trail, which goes from south Florida to Quebec, Canada.

Meanwhile, the Gulf Coast chapter of the AHTS, with just 62 members currently, has its work cut out for it. "There are huge sections to be looked at, but we think we could have the corridor on the Gulf Coast done in five or six years," Cuhaj said.

Cuhaj, a resident of Daphne for 20 years and author of “Hiking Alabama,” said the project deserves the support of volunteers.

“This project will give something, especially to the Gulf Coast, that we currently do not have — a wilderness area where individuals and families can go out and explore nature, maybe camp out. It will also protect a greenway so wildlife can roam free as they should, something we are rapidly losing here on the coast, and provide additional income to local municipalities by bringing in eco-tourism dollars.

“The trail will be a national and worldwide hiking destination.”

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