Property Management Nation

Entries tagged as ‘in the news’

Is a Tweet Worth a $50,000 Lawsuit?

July 29, 2009 · Leave a Comment

I am pretty sure this is not what the SEOs have in mind when they encourage property management companies to “utilize social media.”

Within the last few days, a libel suit for the ages has broken out over nothing more than…a tweet. Yes folks, 140 characters of “what are you doing” goodness has turned into a $50,000 lawsuit between a Chicago resident and the property management company she used to rent from.

Horizon Group Management is going head to head with former tenant Amanda Bonnen over a tweet she posted regarding the state of her apartment. One of Horizon’s employees recently released a statement (whose tone is ambigous) saying, “The statements are obviously false, and it’s our intention to prove that. We’re a sue first, ask questions later kind of organization.”

So here’s what we know:

  1. Horizon Group Management is already the number one example on the “Streisand Effect” Wikipedia page.
  2. Jeffrey Michael did his company no favors with the above quoted statement.
  3. The masses on the internet have, for the most part, found this to be more trouble than it’s worth for the management company and assume the company now wishes they’d kept their mouths shut and lawyers under lock and key.
  4. Amanda Bonnen, whether telling the truth or not, will surely think twice about any tweet she posts ever again (though one source says she’s already shut down her account.)
  5. The decision of this case will undoubtedly permeate the foundations of social media and networking as it make an example either out of the management company, or Bonnen herself.

Great points have been made across a number of blogs and articles about the legal aspects of libel, freedom of speech and whatnot (many are linked to within this article), but I’d like to focus on the literal absurdity of the situation.

If you read the complaint filed by the management group, you are able to read a string of Bonnen’s tweets, not many of which are particularly positive. If every company she complained about from Spirit Air to O’Hare airport to the City of Chicago, took up a suit against her, she’d be a full time defendant in the courts. And I doubt Bonnen’s twitter stream is all that different from millions of other Twitter users.

I realize Horizon’s case is based on Bonnen’s wording, that she’s directly accusing them of something they say isn’t true, but still. While I’m not condoning the use of Twitter as a place to complain or criticize, I have to wonder if it is really worth it for Horizon to go through with the suit.

If Horizon Management Group is lucky, the story will die down in a few days…but at the rate it’s spreading, that’s probably too much to hope for.

What are your thoughts property managers? Where does “clearing your name on Twitter” rank in your marketing strategy?

Categories: food for thought · property management
Tagged: , ,

Where Have All The Good Appraisers Gone?

July 28, 2009 · Leave a Comment

There’s something rotten in the real estate industry and this time it doesn’t directly center around predatory lending.

It has to do with appraisals. An appraisal is a valuation of a home or property to determine its worth in the market. This valuation is required in order to qualify for a loan.

According to an expose´-type report by The Center for Public Integrity, crooked appraisers have had their licenses stripped for everything from having a conflict of interest (acting as both appraiser and loan coordinator) to preparing incomplete, inaccurate or downright bogus appraisals. Some of these appraisals contributed to pushing homes sales through at the exorbitant prices seen at the top of the housing boom.

In addition, some “good guy” appraisers say they are being pressured by realtors and lenders today to bloat prices in order to justify mortgages.

It sounds more like a mob movie than our current housing market, doesn’t it?

Still, these questionable appraisal practices were supposed to be staunched by the creation of the Home Valuation Code of Conduct in May 2009. The agreement stopped lenders from pressuring appraisers to ‘influence’ the results of their appraisals, but has created a separate, third party, largely unregulated appraisal management industry that has a CNN Money article calling such companies “appraisal mills, churning out values cheaply and quickly — and often, wrongly.”

So where does this leave the housing market?

What happened to the days when a house was worth what it cost to build it, give or take the value of the location and how well the building was maintained? Comps now consist mostly of bargain priced foreclosures and short sales, or previous “boom-era” sales that had prices inflated. The HVCC had the right idea, but does not seem to have gotten to the heart of the problem: the basic need for good, decent appraising.

Categories: food for thought
Tagged: ,

What will become of Neverland Ranch?

June 29, 2009 · Leave a Comment

Whatever your opinion of Michael Jackson, it is impossible to deny that the country has lost a celebrity personality. With much discussion still roiling in regard to his passing, many are still trying to come to grips with the fact that he is actually gone. But with armies of helpers, executive assistants, investment specialists, publicists and the like, some affected by Jackson’s death are merely left to the mundane realities of day to day business.

One question an investment management team somewhere is struggling with, is what happens to Neverland Valley Ranch?

Thankfully we don’t live in France where the laws regarding death and property are about as straightforward as a daytime soap plot arc, but a question that will soon need to be answered is, “what will be done with the mansion/zoo/ranch now?

According to multiple sources, an investment firm called Colony Capital, LLC owns most of Neverland Ranch, with Jackson’s estate owning a small portion. The property was almost auctioned off in mid 2008 as a result of non-payment of debts run up from fighting molestation charges against Jackson, but the loan was purchased by Colony Capital last May. Further research reveals that the sale or transfer was a joint venture between Jackson and Sycamore Valley Ranch LLC, an affiliate of Colony Capital, LLC.

So what does this mean for both Colony Capital as investor/managers and whomever is now potentially in charge of Jackson’s portion of the estate?

Colony Capital, LLC which owns, among other investments, Raffles International and the french professional soccer team Paris Saint-Germain, is a worldwide investment LLC. According to a Billboard article released yesterday, Colony is in talks with Tohme Tohme, Jackson’s former manager, to potentially have Jackson buried at Neverland Ranch and become an attraction akin to Graceland. However, the small town of Los Olivos isn’t gung ho about the prospect of their sleepy town being inundated with tourists year ’round.

This type of property management, where $120 million properties are sold and traded like plastic monopoly houses becomes its own phenomenon. Whatever happens, no one will ever be able to think of Neverland Ranch as anything other than the Michael Jackson’s one-time home. Will that make the property more or less valuable? Only time will tell.

Categories: food for thought · property management
Tagged: ,