Columbus Dispatch: Ibiza’s developers face state allegations

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By  Jim Weiker

The Columbus Dispatch Wednesday February 8, 2012 6:44 AM

The Ohio Division of Securities has accused the developers of a major Short North condominium project of lying to investors and improperly distributing funds to themselves.

An attorney for the developers denied the allegations and said he plans to dispute them.

The allegations are the latest twist in the six-year saga of Ibiza, a proposed 11-story, 135-unit condominium at Hubbard and High streets.

The securities division accuses developer Apex Realty Enterprises of lying to potential investors in 2006 by stating that 120 of the 135 condominium units had been sold for a total of $68 million.

In fact, says the division, none of the units had been sold at that time.

Apex’s attorney, Timothy Miller, said the figures came from an estimate of the project’s future earnings that was distributed to potential investors and was not a statement of actual sales.

The division also alleges that Apex’s four principals each took about $80,000 in investor money without disclosing it to outside investors. The principals are Raymond Brown, Michael Council, Wilbur Ischie and Rajesh Lahoti, all of Columbus.

In addition, Council improperly received an $80,000 loan from the investment fund, according to the securities charges.

Miller said the principals were entitled to all the money they withdrew and much more that they didn’t.

“They put in more money than that — hundreds of thousands of dollars that they lost on this deal,” said Miller, a lawyer with Isaac, Brant, Ledman & Teeter of Columbus. “They were also entitled to a million-dollar development fee they never took.”

Miller said he will seek a hearing with the securities commission by the end of the week to fight the allegations. “I feel very confident that we will prevail on the claim simply because our clients haven’t done anything wrong,” he said.

The commission said it will issue a cease-and-desist order against the developers if they do not appeal or if a hearing fails to change the allegations. The order is essentially a ruling that the developers violated Ohio securities law but is not a criminal charge.

Brian Laliberte, a Columbus lawyer who represents buyers who lost deposits on Ibiza condominiums, said the state’s allegations reinforce his belief that developers mishandled money.

“The division’s findings confirm everything we believe to be true about the project,” he said.

The allegations provide a further glimpse into the financial collapse of what was to be the biggest condominium development in the Short North, a luxury complex with prices ranging from $159,999 to $1.5 million for a penthouse unit.

Starting in 2008, Apex and its sister company, ARMS Properties, collected 5 percent deposits on 75 of the units for a total of $1.16 million, an average of about $15,000 each.

The project never broke ground, however, and Apex filed for Chapter 11 bankruptcy protection in April. In a reorganization filing, Apex has proposed reimbursing condominium depositors an average of $2,600.

Other developers are eyeing the property for an apartment complex.

Business First: Sutherlands Lumber closing east Columbus store; promises to reopen in new location

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Business First by Dan Eaton, Staff reporter 

Date: Tuesday, February 7, 2012, 12:06pm EST - Last Modified: Tuesday, February 7, 2012, 2:21pm EST

 

An east Columbus lumberyard and hardware store is closing.

 

Kansas City-based Sutherlands Lumber Co. is winding down business at its store at 575 N. Nelson Road, near Bexley. A spokeswoman would not confirm the last day of operation, but said the company plans to reopen at a new location in Central Ohio, though no location has been found yet.

Family-run Sutherlands has 57 stores in 13 states, primarily in Texas and surrounding states. Central Ohio is home to two additional stores at 2590 Clime Road in southwest Columbus and in Circleville, but otherwise the market is a geographic outlier for the chain, whose next closest store is in Hannibal, Mo.

The spokeswoman said there are no plans to close the other stores and leave Ohio.

Forbes: COSI is 5th Best Children's Museum

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COSI: Center of Science and Industry, Columbus, OH

This huge children’s museum is one of the nation’s largest – and one of the few that can also keep adults fully engaged. It features more than 320,000 square feet of exhibit space, including “little kidspace®”, a 10,000 square foot area for kids not yet in first grade, designed by early education experts. The main part of the museum consists of 10 permanent exhibits exploring space, the oceans, our bodies, minds and spirits, gadgets and much more, all geared towards helping children learn while having fun. One unique highlight is the daily live shows, including rat basketball - real rats playing basketball! - and the hair-raising Electrostatic Generator show.

Reuters: Obama presses Congress to step up aid for homeowners

 

President Obama holds up a piece of paper he demonstrated as what he would like to see used for future mortgage loans while he talks about the economy at the James Lee Community Center in Falls Church, Virginia, February 1, 2012. Credit: Reuters/Larry Downing

The story is here

By Margaret Chadbourn

WASHINGTON | Wed Feb 1, 2012 6:48pm EST
 

WASHINGTON (Reuters) - President Barack Obama on Wednesday proposed a multi-billion-dollar package to help U.S. homeowners refinance and stave off foreclosure, part of an election-year push that is likely to face an uphill battle by the Republican opposition in Congress.

Obama moved to counter Republican criticism that the proposal would use taxpayer money to bail out irresponsible borrowers by stressing that only homeowners current on their payments could benefit. The president had sketched out the plan in his State of the Union address last week.

Home values have dropped 33 percent from their 2006 peak and nearly 11 million Americans now owe more than their homes are worth. Millions more have lost their homes in states that are up for grab in November's presidential election.

The White House is seeking to contrast Obama's stance with that of Republican presidential front-runner Mitt Romney, who has said foreclosures should be allowed to run their course.

"The truth is, it will take more time than any of us would like for the housing market to recover from this crisis," Obama said at a community center in Falls Church, Virginia. "But there are actions we can take, right now, to provide some relief to folks who've been making their payments on time."

The $5 billion to $10 billion program, that would be funded by a tax on the nation's largest banks, would allow homeowners to refinance at record low borrowing costs through government-backed loans. A senior administration official said it could reach 3.5 million Americans whose loans are not government-guaranteed. An additional 11 million homeowners whose loans are backed by Fannie Mae and Freddie Mac could also be eligible, the official said.

The Federal Housing Administration would run the program -- another sticking point for Republicans, who are worried about the agency's solvency. The FHA has been hard hit by mortgage defaults, and Republican lawmakers have warned it could eventually need a taxpayer bailout.

Republicans also have rejected Obama's call to pay for the program with a bank tax that Congress has turned down twice before.

"Rather than increase the government's stranglehold on our nation's housing finance system, we need to dial it back," said Republican Representative Scott Garrett of New Jersey.

RAMPING UP HOUSING RELIEF EFFORTS

Obama's plan would allow borrowers to refinance even if they owe far more than their homes are worth. Many homeowners have not been able take advantage of current record-low mortgage rates because the value of their homes has fallen and lending standards have tightened.

The White House said the program could save borrowers an average of $3,000 a year. It would be open to homeowners who have been current on their payments for the last six months and who have not missed more than one payment in the prior six months.

Applicants would need to occupy their home and have a credit score of 580 or higher to be eligible for the program. Only loans that fall beneath the FHA lending cap, which reaches as high as $729,750 in some high-cost markets, would be eligible.

"Government certainly can't fix the entire problem on its own. But it is wrong for anyone to suggest that the only option for struggling, responsible homeowners is to sit and wait for the housing market to hit bottom," Obama said.

The administration also said it intends to ask Congress to broaden a separate refinance program that seeks to help underwater borrowers with loans backed by Fannie Mae and Freddie Mac win new loan terms. It said the regulator that oversees the two government-controlled mortgage firms - the Federal Housing Finance Agency - had not done enough to make the program accessible.

Together, Fannie Mae, Freddie Mac and the FHA own or guarantee nine out of 10 new U.S. home loans.

In addition, the administration called for a single set of federal standards for the mortgage servicing industry that would include simpler loan forms and greater efforts to assist borrowers facing foreclosure. An effort by the Consumer Financial Protection Bureau is already underway to streamline mortgage paperwork.

Obama also highlighted an effort the administration has undertaken with FHFA to convert foreclosed properties held by the two firms into rental units.

FHFA said on Wednesday that investors could now sign up to prequalify to bid on properties under the program, and said it would kick off a pilot phase soon.

Last week the administration called on FHFA to allow Fannie Mae and Freddie Mac to reduce loan principal for struggling homeowners, an effort to widen the reach of its main foreclosure prevention program -- the Home Affordable Modification Program

When it launched the program in 2009, the administration said it would help as many as 4 million Americans. So far, only about 900,000 households have won permanent mortgage relief under the program.
"I'll be honest - it didn't work at the scale we'd hoped," said Obama.

(Additional reporting by Laura MacInnis and Alister Bull; Editing by Tim Ahmann; Andrea Evans; Diane Craft)

Columbus Dispatch: For buyers and sellers, a few good bets

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On the House: For buyers and sellers, a few good bets 

 Jim Weiker

A colleague becomes irritated every time I write a story based on new real-estate statistics.

Perhaps he’s jealous. After all, the figures give me plenty of material for stories.

But, of course, it’s precisely the abundance of material that annoys him.

Real estate is the baseball of industries: awash in numbers that can be manipulated to demonstrate just about anything.

Want to show that home sales are up? Mention that year-over-year sales rose for five of the past six months in central Ohio.

Want to show they’re down? Note that annual home sales dropped in 2011 for the sixth straight year to the slowest year in more than a decade.

Want to show that foreclosures are up? Point out that central Ohio filings have risen for two straight months.

Want to show that they’re down? Point out that foreclosures have dropped now for two consecutive years in Ohio.

For those weary of keeping daily score, here is the big picture:

Let’s start with foreclosures. The rise in foreclosures is often linked with the housing crisis but predates it by a decade. Foreclosures started rising in Ohio in 1996 and rose steadily until 2010, when they began to taper off slightly.

As for home construction, a key measure of the housing industry, it peaked in central Ohio in 2003 before starting a precipitous five-year decline that has yet to show any signs of improvement.

If you’re a homebuilder or a worker who relies on that industry, you’re still in the dark without a flicker of light.

By two other indicators — home sales and average sale prices — the housing industry started its slide in central Ohio in early 2006 and plummeted sharply during the next three years.

But the past two years show a more complex picture: Since the end of 2009, housing sales and prices have largely leveled out; they haven’t improved but neither have they worsened significantly.

What does this mean if you’re a buyer or seller?

If you’re a buyer . . .

 

The chance that your dream home is going to drop a lot in price is slim.

Prices are still a moving target in some areas, such as certain inner-city neighborhoods that are full of foreclosures. But in most neighborhoods, prices have stabilized and aren’t likely to drop significantly.

Indeed, in some places, prices show signs of rising. The median sales prices of homes in Gahanna, Grandview Heights and Downtown Columbus were up substantially in December compared with a year earlier. (But those are one-month figures only and are based on relatively few sales.)

If you qualify for financing, are ready to buy and have found the right home, you should bite the bullet. Even if the price drops $10,000 on the home you’re eyeing, you’re gambling on three things: that someone else won’t buy the home, that interest rates will stay low and that borrowing won’t get more difficult.

The odds are in your favor on interest rates, which experts think will remain low at least through the year. But Washington is considering several changes that could make borrowing more difficult and perhaps more costly.

In addition, the number of homes for sale in central Ohio is sharply down from a year ago, meaning that there’s going to be more competition for that home you’re considering.

If you’re a seller . . .

 

Forget 2005. Your home probably isn’t worth that now. In fact, I happen to know exactly what it’s worth: No matter what you paid for it, no matter what you owe on it, no matter what it once appraised for, it’s worth precisely what someone will pay for it.

If your home has sat on the market for six months with only a handful of queries and no offers, you need to drop the price if you want to sell it.

If you can’t afford to drop the price, you had better have some cash to bring to the closing or plan to rent it, or start pleading with your bank.

So what does the future hold? Anyone who tells you they know for sure doesn’t know for sure.

But, in housing, there are many more reasons to think the worst is behind us than ahead of us.

Jim Weiker is the home and garden writer. Reach him at 614-461-5513 or by email.
jweiker@dispatch.com

Columbus Underground: New Bakery Cookie Cravings Open in Italian Village

The Cookie Cravings Team: Joan, Lindsey and Matt Tewanger

  

The story is here 

A new cookie shop has opened in Italian Village. Nestled at the southeast corner of Fourth Street and Third Ave, Cookie Cravings Bakery opened last month. Lindsey Tewanger and a close friend had been baking and decorating cookies for about a year for friends. When the orders kept coming, they became difficult to manage as they were both working full time.  More here

Columbus Dispatch: King Ave. Methodist Church Growing With Gays

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Tracy Hahn and Virginia Sheffield pick and choose where they hold hands.

The Upper Arlington couple has been to plenty of churches where they don’t dare show affection toward each other because they are lesbians. At their church, however, they interlace fingers without thinking.

The two joined King Avenue United Methodist about a year and a half ago. They’ve rarely missed a Sunday. Chloe, the foster child they are adopting, is in the children’s choir. The family joins other members for brunch after Sunday service.

Today, gay Christians have choices of where to worship because several Columbus churches bill themselves as welcoming. There were far fewer in the late 1990s, when King Avenue was deciding to be open.

The years since have revealed an unexpected effect of that decision: The once-struggling church is thriving.

The process wasn’t easy. The former pastor, the Rev. Grayson Atha, was threatened with removal, and about 50 members left.

Many more came.

“It really wasn’t done to grow, but that was the outcome of it,” said Atha, 75, who retired in 2006.

Before the church openly welcomed gays, attendance on Sundays had dipped below 250 people. Now, average Sunday attendance is 560 worshippers. The church has been financially strong enough to pay for nearly $2 million in renovations and repairs to its kitchen and organ and the altar area.

And the congregation has raised $200,000 in donations and pledges to start a ministry in the Short North.

New families join regularly. The congregation is about 35 percent gay, said the Rev. John Keeny, pastor.

Keeny credits Atha with leading the charge. Atha said gay parishioners were tired of hiding, and something had to be done.

“That group did us a huge favor by bringing that issue to the forefront. A church does best when they respond to the people of the neighborhood,” said Atha, who now serves as a pastor of Summit on 16th United Methodist Church in the University District.

King Avenue fits the profile of the type of church that often struggles today: It’s old, mainline-Protestant and in an urban area.

When Atha started working there in 1994, a small group of gay members told him they wanted to be able to talk about their relationships and families freely at church. The effort started with a Bible study for gays.

Then, Atha preached about how families could include two men or two women. At the time, a member told the pastor that he had committed “ministerial suicide.”

Atha and his wife hosted members on both sides of the issue at their home — more than 1,000 people over six years — to eat dinner and get to know one another better. A church committee studying the issue in 1998 recommended that the church be inclusive to all.

Even before the study, the church’s personnel committee asked then-Bishop Judy Craig to remove Atha. She declined.

The issue of sexuality is far from settled in the Methodist church, and in many other denominations. The Episcopal Church, the Evangelical Lutheran Church in America and the Presbyterian Church (USA) all have experienced turmoil after adopting more-inclusive positions.

The Methodist church’s Book of Discipline still maintains that “the practice of homosexuality is incompatible with Christian teaching” and that people in same-sex relationships can’t be clergy members. Clergy members are prohibited from celebrating same-sex unions.

That language has been debated repeatedly in recent years and will be again when the denomination meets for its General Conference in late April and early May.

It upsets Keeny that he isn’t allowed to preside over same-sex unions for members of his church. Methodist pastors are circulating a statement that they intend to perform the ceremonies anyway. Keeny said he will sign it.

Last Sunday, he asked his members to pray for delegates, particularly those who probably would vote against inclusion. Don’t see them as “others,” he said, but as fellow Christians.

“We cannot afford to avoid God’s call. For it is the call to be fully human and to treat others as fully human.”

mheagney@dispatch.com