Editorial: Too Much News to Muse by Lesley Hensell
With so much news in the world of real estate this week, I simply could not choose a single item to write about. So hang on to your hat – we’re going to cover a lot of ground today. This column will include information on a cool new online venture, an update on one of the most prominent real estate scandals of late, and a rant about one of my least favorite public officials. First, the Internet venture. AmeriQuotes.com launched nationally this week. The Internet-based service is designed to improve the way commercial real estate transactions are conducted by providing both buyers and sellers with free online bids for many services. The site (www.ameriquotes.com) provides free access too competitive bids from a nationwide network of service providers for title insurance, phase I and phase II environmental reports, 1031 exchanges, brokerage, property and casualty insurance, land surveys, escrow and appraisals. To obtain bids for services, the real estate principal logs on to the site and fills out approximately five minutes worth of transaction-specific data. The information is converted into an electronic request for proposal and submitted via e-mail to service providers doing business in the area of the transaction. Within two business days, bidding service providers submit their quotes back to the AmeriQuotes.com web site, where they are prioritized and electronically packaged. Within three business days of the initial RFP, up to 48 quotes are submitted back to the investor, who then makes direct contact with the winning bidders. “A need exists within the commercial real estate community for a more efficient and cost-effective process for building high-quality transaction teams,” said Martin Gibeau, founder of the company and former president of Stewart Title of Denver. “Because we are a Web-based service, a portfolio manager in Denver can access services in Chicago, San Francisco or any other U.S. market without ever leaving the office or even picking up the phone.” Sounds cool, but who pays? Somebody always has to pay. Gibeau says that service providers pay a “nominal fee” to access RFPs. “This online service has the potential to profoundly alter the process by which real estate professionals assemble their transaction teams,” said Jeff Witt, senior vice president of MeriStar Hotels and Resorts, Inc. (NYSE: MMH), an affiliate of real estate investment trust MeriStar Hospitality. “Locating the best service providers in unfamiliar markets can be a sometimes time consuming and expensive proposition. It is clear that AmeriQuotes.com will help streamline the process and ensure a competitive price environment.” Sounds cool to me. Sounds cool to investors, too. AmeriQuotes.com recently secured venture capital funding from an investor group led by Cavalry Capital Management of Monument, Colorado. Moving on to the legal world, lawsuits continue to pour in against JDN Realty Corp. You may recall that the company has been accused of concealing more than $5 million in undisclosed executive compensation, engaging in at least 21 undisclosed related-party transactions and overstating net income by at lease $5 million. This little problem caused the company’s stock to nosedive more than 40 percent, resulting in several shareholder lawsuits. In the past week, JDN has announced quarterly dividends. According to JDN, its bank lenders have agreed to extend the company's credit agreement despite the fact that false financial reporting constituted an event of default. Because several officers resigned when JDN’s indiscretions became public, the company also appointed a new president. Fred Williams now is president of JDN Development Company, Inc. Earnings for 1999 now will not be released on schedule as the accounting department scurries to clean up the mess. Finally, in the spirit of ongoing primary elections, I feel compelled to take a dig at one of my least-favorite politicians. During his tenure as Housing and Urban Development secretary, Andrew Cuomo has become famous as a worthless newsmonger. Hardly a day goes by without HUD brandishing his name across the top of a new press release. Just so you’ll know where your tax dollars are going, I thought I would share a bit of the week’s news. First, HUD declared on Tuesday that Cuomo “awarded $5.2 million in grants to help more than 5,500 low-income elderly people and people with disabilities living in HUD-subsidized housing get health care, meals and other supportive services.” OK, to start with, Cuomo didn’t award anything. His department merely dispersed monies earmarked for this purpose by Congress. Secondly, big freakin’ deal. If you check out the state-by-state figures, you’ll see that the dollar amounts are insignificant. Why does this warrant a press release, as well as an additional $375 in taxpayer money paying for the release to go out over PR Newswire? Then, on Wednesday, HUD proudly announced that its “Teacher Next Door” initiative will enable thousands of teachers to buy HUD-owned homes for half-price in economically distressed neighborhoods in the school districts where they work. Does this annoy anyone else out there? I know that teachers generally are underpaid, but what’s up with me and my fellow taxpayers picking up half of the tab for them to buy houses? Once again, this release was a no-newser – the program is not even new. Cuomo just longs to see his name in print each and every day. | 
