Debt Ceiling Debate

Perhaps I shouldn't wade into political waters, but the state of the economy affects real estate and especially commercial real estate.   Accordingly, these issues are very important for my profession. 

Listening to the coverage of the US Debt Ceiling Debate, it seems to me that the media coverage as well as the President of the US want to assign the blame for the impasse at the feet of the Republicans for not caving to the President's demands.   The President has repeatedly stated how desperately important it is to raise this Debt Ceiling and indicated that it is irresponsible not to do so.   He even threatened not to pay Social Security and our troops if the Debt Ceiling is not raised and then tried to assign the blame for this on the Republicans. 

Media coverage aside, logic tells me that if there is no agreement, it must also mean that the President has also not been willing to agree to the terms of the opposing side.   We are told that the issues at hand are the level of the Debt Ceiling, the reduction of spending, and tax increases.    The President tells us that he thinks raising the Debt Ceiling is imperative, so they are in agreement there.   The President also tells us that he believes that getting spending under control is imperative, so they seem to be in agreement there.   The one remaining issue then is tax increases.

Taking this all together, it sounds to me like the President is saying that he is willing to let the US government default and allow social security recipients and soldiers to not be paid in order to demand tax increases.    If that is the case, I feel like I must be missing something.   The President indicated that the consequences were so dire that it would be completely irresponsible not to simply agree to something to allow the Debt Ceiling to be raised and yet he is not agreeing.  

The President seems to be saying that the state of the budget is so bad that only the tax increases will allow it to be under control.  And yet, all of the information available indicates that the increases desired cannot possibly balance the budget.

I cannot claim to know the President's mind and perhaps he is getting different information from the rest of us, but given that the tax increase is the issue preventing a deal and given that the tax increases could not begin to balance the budget, the President's motives for this demand become suspect.  This leads me to wonder if the President is holding the country hostage to try to make political gains at the opposing party's expense.   Hopefully, I am wrong, but in my humble opinion, the promotion of class conflict to attain political advantage is not a courageous or helpful policy.

(stepping off my soap box)

Have a great day!

David

David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY  40299

PS - I am sure that my principal broker would appreciate me noting that these are my opinions only and do not necessarily reflect the opinions of this firm or its other agents and employees.

8116 Blue Lick Road Sold

My C-Store listing on 8116 Blue Lick Road, which earlier in the year was my busiest listing has sold and closed on Tuesday.     That one was a challenging listing but the more challenging they are, the more satisfying when they sell.    I believe the new owner intends to update it a little and lease it out.   

With that one sold, I have more time available for other listings.   Let me know if you need any help. 

Have a great day and stay cool!

David

David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY  40299

Site Selection and Building projects

About a week ago, a gentleman from a local church called to ask about land I have listed.   His church was facing a possible eminent domain issue where a government project might have to take their land.   The church had decided that if they had to move, they would build a new facility.   Accordingly, they were looking for raw land.   Their primary concern in their search was finding an appropriate location.

If only life were so easy.   Finding land is actually much more complicated than that.   Location is certainly an important factor but it is only one of several factors you need to consider.   You also have to consider zoning.   If a parcel of land is not zoned properly, you cannot build on it unless you get the property rezoned.    Right now a rezoning in Jefferson County, KY usually takes a minimum of 9 months and may take up to 18 months.     Luckily, a church may be in any zoning.

You also have to consider infrastructure.   Does the land have water, sewer, electrical service, and gas service?    Sewer service is especially critical in Jefferson County today.    Much of the land in Jeffersontown can not presently be developed because of a lack of sewer capacity in that area.  This is also true in Prospect and several other areas of Jefferson County.

Another consideration is the size of the land.    One thing people forget to consider is the amount of space necessary for parking or the required set backs on a piece of land.   This may make the amount of land you need much larger than you might expect.    This gentleman told me that they estimated that they needed parking for 400 to 500 cars.   That is a lot of parking.   Depending on how the parking is configured, you can expect to get somewhere between 130 and 200 parking spaces per acre.  (probably closer to 130)   So this church would need 3 to 4 acres just for the parking.  

Other important questions to consider:

• Is this in the flood plain?
• What is the topography of the site?
• Is it in a historical district or other restricted use area?
• Are there any environmental issues for this site?

Working through this example - Presently on KCREA there are 239 listings for raw land in Jefferson County.   Of these only 49 are between 4 and 7 acres.    The church would like to be in a residential area, and about half of these are in Industrial Parks.   That leaves us with about 25 properties.    Of these properties, approximately half will not have the required infrastructure (usually the big issue is sewage capacity).   So now we are down to about 12 sites.   By the time we draw a radius around the church, we may only have 2 or 3 sites that could even work for their criteria.

Many people are surprised when they realize how few options will actually exist when everything is taken into account.  

Have a great day.   Be sure to let me know if I can be of help in your real estate needs.

David

David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY  40299

DMcCoy@ccre.biz
(502) 379-6005