Do We Need TrophyFlip.com for Commercial Real Estate?

Cashing Out Quickly... Have you ever heard of Condo Flip™? This web site "lets buyers of preconstruction condos resell or assign those condos to new buyers. ... Whether you are flipping (selling) or buying, we are preconstruction experts and we've created this site for you!"

Well, maybe we need Trophy Flip for commercial real estate. (Yes, trophyflip.com is available.) Just consider the Bank of America Center in San Francisco.

Reflecting on his sale of the Bank of America Center last year for $825 million, Doug Shorenstein of the Shorenstein Company said, "Prices are staggeringly high relative to the returns and the underlying fundamentals." (New York Times, March 25, 2005)

But now the property is back on the market with its new owners "hoping that the price will reach as high as $1.25 billion." (NYT, July 13, 2005) That would be a gain of $425 million (about 50%) in a year. Hmm.

Maybe that's why Jim Titus of Realpoint believes "today's prices are reminiscent of the late 1980's, when Japanese investors overpaid for trophy buildings and went on to suffer huge losses." (Doing Deals While Wary of Bubbles, NYT, July 13, 2005)

So maybe you should subscribe to Real Estate Alert, "The Weekly Update on Institutional Buying Opportunities." Here's where you'll read stories about "Bidding tactics, clashes over broken agreements and other maneuvers you’re not supposed to hear about." Sounds juicy. Will it keep you out of trouble?

(Originally focused on the Resolution Trust Corporation's liquidation of savings-and-loan assts, Real Estate Alert was formally known as Liquidation Alert. A subscription costs $1,597 for 47 weekly issues and includes access to its "Deal Database" of property sales of $20 million or greater since Jan. 1, 2001.)

-- Peter Pike