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"As Manhattan Housing Prices Plummet, Fairfield County Commuters Wait and See"

"As Manhattan Housing Prices Plummet, Fairfield County Commuters Wait and See"

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Published by Laurie Wiegler
from the Commercial Record:
www.commercialrecord.com

The Commercial Record
Connecticut’s Weekly Business Newspaper Since 1882

Fairfield Co. commuters waited out the plummeting and gyrating real estate market in NY for a chance to pluck a choice flat or condo - perhaps.




from the Commercial Record:
www.commercialrecord.com

The Commercial Record
Connecticut’s Weekly Business Newspaper Since 1882

Fairfield Co. commuters waited out the plummeting and gyrating real estate market in NY for a chance to pluck a choice flat or condo - perhaps.




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Published by: Laurie Wiegler on Dec 06, 2010
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09/29/2012

 
Connecticut’s Weekly Business Newspaper Since 1882 
FRIDAY, FEBRUARY 13, 2009
BY DANIEL D’AMBROSIO
coMMerciaL recorD corresPonDent
T
he news last month from HKGroup Commercial Real Es-tate was a head scratcher.Thefounder, TedHampe, hadresignedafter two de-cades at thehelm, andthe star bro-ker he tookon as partnerin 2001, Matthew Keefe, was nowin charge. Keefe claims Hampe, 74,needed to “slow down.”Meanwhile, Hampe went out andgot a full-time job elsewhere – andquestioned Keefe’s honesty abouthis exit.Hampe started HK Group inWestport in 1988 after years incorporate marketing. But then itwas announced that as of Dec. 31,Hampe – who will turn 75 in April –would walk away from a companythat has racked up more than $1billion in sales in the past 20 years. According to Keefe, who is 56,it’s a natural progression.“He’s 75 years old. At some pointor another you got to slow downor the Good Lord makes you slowdown,” said Keefe. “He founded thefirm and left it to his partner, and isthrottling back. This is all natural,it’s not weird.”On the question of why he lefthis successful company, Hampewas guarded.“I can’t tell you everything, butthe official word is that I wantedto get out of management,” he said. Although Keefe was a very big pro-ducer, he “was not interested in part-time management of the com- pany,” Hampe said.“He was solely focused on sell-ing,” he added. “I was spendingas much as 75 percent of my timemanaging two offices and 13 bro-kers.”Hampe now has other plans inhis new position as a senior vice president in the Westport office of Prudential Commercial Real Estate,and was a little taken aback at hisformer partner’s assessment of his position in life.“It sort of belies the fact that I’mworking full time and looking for-ward to a new challenge,” Hampetold The Commercial Record.Hampe said he will be doing hisown deals at Prudential, and willbe recruiting brokers “who don’trequire that much attention” to joinhim. He admitted leaving the com- pany he founded was emotionallydraining, but said he was excited bythe challenge of getting back into property sales full time.
HK GroupFounderNot Done Yet
www.commercialrecord.com
Vol. CXXVI I No. 7 $6.00
The Commercial Record
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For more information visit
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2009
DECISION DOLDRUMS
BY LAURA SCHREIER
coMMerciaL recorD staFF Writer
L
ife insures were feeling confi-dent that a hoped-for proposalwould get the OK from regula-tors last month – but to their sur- prise, the proposal got shot down.Insurers were unhappy to lose asource of potential help in trou-bled times, but some insurers have paused to grumble that the pro- posal’s death had more to do with political maneuvering than pure policymaking.The proposal would have al-lowed insur-ers to lowercapital andsurplus re-serve require-ments byabout 6 per-cent, a moveindustry rep-resentativessay wouldhave freed up more money to makeinvestments and do business.The National Association of Insurance Commissioners wasconsidering the proposal until theNAIC’s executive committee shotit down, saying the industry hadn’tdemonstrated a strong enough needfor such changes now.“I was just baffled,” said BobSheridan, head of Savings Bank LifeInsurance of Massachusetts, whocouldn’t speculate as to the propos-al’s demise, but said it had seemedlike regulators had consensus andwere moving forward.Peter Tedone, president of Con-necticut’s VantisLife Insurance,said: “I do not believe it [the pro- posal] was rejected on its merits… I think there’s politics in everyenvironment, and this is just one of them.”Tedone had been watching theNAIC’s actions on the proposal,even though they wouldn’t havedirectly affected his company. Re-gardless, he said, it was frustratingto see the idea get derailed.
Not So Free And Easy
The plan of loosening capital andsurplus requirements had garneredits share of controversy. Consumergroups argued it was the height of irresponsibility to lower require-ments at a time when the nationwas learning the harsh conse-quences of free-and-easy finances.Insurers countered the capital re-quirements for the industry werelong considered overly conserva-tive, and freeing up more capitalwould have allowed them to dobusiness in a constricted financialenvironment.Now, individual state commis-sioners might allow those capitalchanges within their state borders.
Insurers DecryReserve Proposal’s Death
Continued on Page 2
Source: The Warren Group
Number of ConnecticutMultifamily Home Sales
STATE STATS
 
20,00015,00010,0005,0000
’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08
BY LAURIE WIEGLER
coMMerciaL recorD corresPonDent
I
n the past six months, prices for apart-ments and co-ops in Manhattan havefallen as much as 10-20 percent, de- pending on location. In addition, land-lords and co-op managers are beingforced to throw in freebies – such as oneor two months’ free rent, waiving brokerfees and slashing parking costs.Yet it is unclear whether or not Fair-field County residents who regularlycommute into Manhattan are taking ad- vantage. Brokers who spoke to The Com-mercial Record indicated that part of the problem is a lot of people are taking await-and-see attitude when it comes toany move.Barry Salottolo, listings director withCiti-Spaces in Manhattan, is one of thosebrokers.“Some people are waiting for the pricesto drop even more, [but] we don’t see thatas really viable because they’re not goingto bottom out to the degree that peoplemight be waiting for it. It’s a great timenow with the interest rates at 4½ to 5 per-cent but, like I said, it’s really driven bythe market and whether you’re working,whether you can afford it.”Great rates aside, Salottolo is confi-dent the lure of living in Manhattan willat least keep prices more stable than theyare in Brooklyn, which he says has justcratered. Some of the top brokers Salo-tollo works with in the city have seen prices plummet from $1,100 a square footfor a condo to about $600 or $700.“So people who bought a couple yearsago are reeling right now. They have toactually sit a lot longer, and they maynever recoup everything they paid.“In Park Slope and in Williamsburg Ihave seen a 30-percent to 40-percent dropin some properties for both sale and forrent. Brooklyn crashed well before Man-
OPPORTUNITY OPENS
As Manhattan Housing Prices PlummetFairfield County Commuters Wait And See
TOM SULLIVAN
Continued on Page 2
TED HAMPE
YOUR ONLINE LIFE JUST GOTMUCH MORE INTERESTING
 Visit the new www.CommercialRecord.comfor all of your:
• Breaking News• Comings & Goingsof your colleaguesand competitors• The most up-to-dateresearch tools
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EDITORIAL
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The Commercial Record
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©2008 The Warren Group Inc. All rights reserved.No part of this publication may be reproduced in anyform or by any means, electronic or mechanical, in-cluding photocopying, recording, or by any informationstorage and retrieval system, without written permis-sion from the publisher. Periodicals postage paid atBoston, MA, and additional locations. The CommercialRecord™ and The Warren Group™ are trademarks of The Warren Group Inc. POSTMASTER: Please send ad-dress changes to The Commercial Record, 280 SummerSt., Boston, MA 02210. Basic annual subscription rateis $278, six month subscription $160. Subscription, ad- vertising, editorial and production inquiries should bedirected to: The Commercial Record, 280 Summer St.,Boston, MA 02210, 800-356-8805.
The Commercial Record
Connecticut’s Weekly Business Newspaper Since 1882 
P
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BY
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 ARREN
G
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M. W
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Chairman
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IMOTHY
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 ARREN
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.,
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 AVID
B. L
OVINS
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INCENT
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F
ebruary 
13, 2009
THE COMMERCIAL RECORD
2
STORY IDEAS? E-mail your submissions to our Web team at editorial@thewarrengroup.com
ON THE WEB
 
A ROUNDUP OF OUR MOST POPULAR WEB-ONLY STORIES FROM THE PAST WEEK
THE WEEK
If you weren’t reading CommercialRecord.com last week, here’s a sampling of what you missed:
     ▲
NEWPORT FEDERAL LOSES $800K IN ‘08
Newport Bancorp, the holding company for Newport Federal Savings Bank, which has plans to open a branchin Stonington “soon,” has reported a net loss of $609,000 for the quarter ended Dec. 31. For the quarterended Dec. 31, 2007, the bank reported a net loss of $47,000. For the year ended Dec. 31, the companyreported a net loss of $848,000, compared to net income of $757,000 for the year ended Dec. 31, 2007,a decline of more than 200 percent. According to Newport Federal’s Web site, the bank has plans to open abranch in Stonington, but does not offer a timeline.
U.S. HOUSING MARKET BOTTOM WITHIN SIGHT?
U.S. housing markets from Florida to California have suffered price drops of 50 percent or more from theirpeak, but now, at long last, a bottom is within sight, likely in the fourth quarter nationally, according to a re-port from Moody’s Economy.com. By the end of the housing downturn, nearly 62 percent of the nation’s 381metropolitan areas will have experienced double-digit-percent declines in house prices, peak-to-trough, saysthe report by chief economist Mark Zandi and a team that includes Celia Chen, senior director of housingeconomics. The declines will exceed 20 percent in about 100 metro areas.
CBRE NET FALLS 95 PERCENT IN Q4
CB Richard Ellis, which has offices in Hartford, New Haven and Stamford, saw its 2008 fourth quarter netincome fall 95 percent year-over-year, from $122.4 million in 2007 to just $6.5 million last year. For theyear, net income stood at $83.9 million in 2008, down almost 79 percent from $390.5 million in 2007.
CBIA VP OFFERS BLEAK ‘09 JOBS OUTLOOK
Peter Gioia, vice president and economist for the Connecticut Business and Industry Association (CBIA),isn’t expecting any substantial improvement in the state’s employment outlook until at least 2010. Gioiacited reports from the New England Economic Partnership and Moody’s Economy.com, both of which expectConnecticut to lose 60,000 to 80,000 jobs in the next 18 months, with no recovery until mid-2010. Gioiasaid the state may lose up to 40,000 more jobs in 2009, though things may be less bleak in the second halfof this year.
SUBMIT A COMMENT
e-mail: editorial@thewarrengroup.com
MLS MERGER FERVOR
 
We asked readers last week to weigh in onwhether or not they felt the Greater FairfieldCounty CMLS ought to merge with the Connecti-cut Statewide MLS. An overwhelming majorityof respondents, more than 93 percent of totalvotes and more than550 total, were infavor of a merger,saying it mightserve agentsbetter thisway.
RESULTS:
YES 93%NO 7%
MOST READ:
Turf War: Towns’ MLS Independence Draws FirePerks Are Being Dropped – And Added – By BanksCBIA VP Offers Bleak ‘09 Jobs OutlookNewport Federal Loses $800K In ‘08CBRE Net Falls 95 Percent In Q4
MOST EMAILED:
U.S. Housing Market Bottom Within Sight?Turf War: Towns’ MLS Independence Draws FirePerks Are Being Dropped – And Added – By BanksUBS Top Job A Poisoned ChaliceAMA, Others Suing Aetna, Cigna Over Payments
here’s What YoUr Peers WereinteresteD in Last WeeK:
 
AL
L
     ▲
Here’s what one readerhad to say after voting:
“The real question should have been....whom does it better serve to go Statewide....The BIG Real Estate Compa- nies or....the clients/customers? Thesimple answer is “a statewide MLS system benefits the customers/clientsand THEREFORE the agents”.
Another reader had this to say afterreading the poll’s accompanying story“Turf War: Towns’ MLS IndependenceDraws Fire”:
“It certainly would make it easier for appraisers to get ac-curate informationwithout having to join every board in the state.” 
 
Fear Of Employment StatusFactoring Into City Move
F
ebruary 
13, 2009
THE COMMERCIAL RECORD
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hattan had its slowdown,” says Salotollo.
Where Have AllThe Commuters Gone?
Yet, all this prospective good news forbuyers means naught if everyone fearslosing his job. New York State Unemploy-ment figures reflect cause for worry, too,as the state has issued two extensions of emergency benefits, the most recent beingapproved by President Obama.Salottolo says it’s another reason why people are waiting.“Even the people who had ‘good jobs’ – you see them walking around the streetsand they’re unemployed – so it’s a scarything. [These are] people who think thatthey’re untouchable.”Further supporting the unemployment problem: bridge and tunnel traffic for themain nine arteries into New York wasdown 5 percent over last year. Aaron Don-ovan, MTA spokesperson, points out thatthis is subject to a slight variation afterfurther review.How it all will play out is, of course, un-clear. If consumersare not buying ste-reos and microwaves,chances are they arealso afraid to buy anew condo or flat aswell. Asked how muchthe prices will haveto drop, if there willbe a tipping point before the commuterswill move into the city where they work,Salotollo was skeptical.“That’s going to have a lot to do with thefact that people in Fairfield County whoare middle- or upper-middle class who areliving pretty nicely may not want to comeinto the city and be priced out,” Salottolosays.
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This, though, would only apply to insurers do-miciled at these states, and critics have said piecemeal regulatory changes would createan uneven playing field, not to mention pub-lic confusion when different companies start playing by different rules. Jack Dolan, spokesman for the AmericanCouncil of Life Insurers, said the industryhad hoped to avoid this mishmash of differ-ent rules by getting the NAIC to approve theregulations for the entire country.Dolan also expressed surprise at the pro- posal’s demise. It had solid support from thecommittee that initially reviewed it, he said,so it caught everyone off guard when theexecutive committee put the kibosh on theidea.He pointed to New York insurance super-intendent Eric Dinallo as being particularly vocal about dismissing the proposal duringthe executive discussion.“You could put a lot of the leadership forkilling this on the shoulders on Eric Dinallo,”he said. According to a statement from the NAIC,association president and New HampshireInsurance Commissioner Roger Sevignysaid, “Simply put, the industry has not madea credible case for why we need to makechanges on an emergency basis.” As for the New York superintendent, firstdeputy superintendent Kermitt Brooks saidthat yes, Dinallo had been vocal in his belief that the proposal was too broad.“Eric took the charge and framed the is-sues, that the broad industry relief at theNAIC level was not good.”Meanwhile, individual states met last weekto discuss allowing such changes within theirown borders.Connecticut Commissioner Thomas Sulli- van had been the only member of the execu-tive group to approve the industry’s proposal,but has since stayed mum on whether hewould allow individual companies to changetheir capital and surplus requirements in hisstate. A flurry of attention surrounded the issuein Connecticut last week when The HartfordFinancial, facing a $2.7 billion net loss in itslatest filings, asked the commissioner to beallowed such a change. Sullivan issued a pub-lic statement saying he was forbidden by lawfrom discussing the matter of an individualcompany.Regulators who rejected the proposal dis-agreed with the proposal’s particulars, anddisagreed the measure deserved the “emer-gency” status the industry had given it, ac-cording to an NAIC release.Ohio’s insurance director, Mary Jo Hudson,approved the capital requirements proposalon Jan. 22, even before the NAIC’s executivecommittee issued its decision. Ohio spokes-woman Carly Glick demurred from discussingthe politics of the NAIC’s decisions, and saidthe Ohio director’s decision was based onconcern for consumers. If other states low-ered capital requirements, she said, it wouldleave Ohio insurers lagging behind and forcedto raise prices on their products.
 Email: lschreier@thewarrengroup.com.
Angst Adds To Surplus Controversy
Continued from Page 1Continued from Page 1
BARRY SALOTTOLO

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