Archives for April 2014

LAS CRUCES >> Nearly two years after buying a large parcel of land in Picacho Hills, the village of Hatch is searching for a buyer.
Hatch paid $2 million to Picacho Mountain Development LLC for the 125 acres of undeveloped land as well as 21 residential lots in 2012 as an investment. The municipality bought the land with the hope that Picacho Hills Mountain Development and its president, Bob Pofahl, would eventually buy it back at a higher price.
That deal, though, never came to fruition and Hatch is now on the lookout for another buyer.
“We’re looking to sell,” confirmed Hatch Trustee James Whitlock.
Hatch Mayor Andy Nuñez said he wishes his town wasn’t in the current situation with the land and is looking to dispose of the property north and west of Las Cruces.
“Things aren’t working out the way they were supposed to,” Nuñez said.
When Pofahl and former Hatch Mayor Judd Nordyke signed a real estate contract on May 30, 2012, it included the language: “Seller and purchaser acknowledge that is it their intent to negotiate in good faith a contract or contracts for the repurchase of the property by seller or seller’s affiliates.”
Hatch’s lawyer, Las Cruces-based Bill Lutz, said Pofahl made quarterly payments of a little more than $30,000 to keep the option open. He said Pofahl stopped making the payments, though, after nearly a year and a deal was never reached. Lutz said Hatch does not have to repay Pofahl the money because it was not an actual payment for the land.
“We tried to get him to pay, but things just didn’t work out. I have no idea why,” Nuñez said. “We did try to collect.”
Lutz said he has had contact with Pofahl’s lawyer.
“We agreed to go our separate ways,” Lutz said.
For his part, Pofahl said he decided not to buy the land back.
“I haven’t exercised the contract to repurchase the property,” the developer said.
Pofahl, though, said he has not ruled out the idea of buying the land back in the future. He said he guesses the land could be worth about $2.5 million or more.
Nuñez said he does not think the board of trustees will be interested in another deal with Picacho Mountain Development.
“I don’t think they would accept that right now,” he said.
Las Cruces developer John Moscato, who has no part in the deal, said he could not speak specifically to the land Hatch is trying to move, but said selling land has to do with variables.
“Location has a lot to do with it. Zoning has a lot to do with it,” Moscato said. “For a large parcel, there might have to be a volume discount.”
Hatch officials do not want to talk specifics of a potential sale yet, but said the wheels are in motion to list the property.
“We’re working on trying to get an organization to sell it for us,” Nuñez said.
Both Nuñez and Lutz said they have no hard feelings against Pofahl.
“He’s a super guy, ” Nuñez said. “He’s done a lot of good for the city of Las Cruces.”
Pofahl has formed a couple of investment groups and is currently involved in several high-profile projects in Las Cruces.
He’s part of Las Cruces Community Partners LLC, which hopes to develop a city plaza downtown and also turn the former Doña Ana County Courthouse into a five-star hotel. Las Cruces City Manager Robert Garza has told the Sun-News the city would move forward on plaza plans without Las Cruces Community Partners if a deal wasn’t put together by April 14.
Pofahl is also part of a group that plans to develop the 110 acres where the Las Cruces Country Club used to reside. That development could include a hospital as well as commercial and residential aspects.
By: Brook Stockberger (Las Cruces Sun-News)
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LAS CRUCES >> What does $400 million buy these days?
If you’re in Santa Teresa, the answer is a brand-new, 10-mile long railroad facility that could employ as many as 600 people.
Jerry Pacheco with the International Business Accelerator visited the Union Pacific rail facility intermodal yard on Tuesday.
“I’m looking at 1,000 (railroad) containers,” Pacheco said on his cell phone from the site. “They are four containers high. It looks like a building out here.”
Gilbert Mesa with Industrial Developments International announced that the facility was operating. The location serves three purposes. There is an intermodal facility where freight is transferred from train to truck; a diesel-fueling site; a crew-changing station.
“This is a huge game changer for the region,” Mesa said during a talk at the monthly Mesilla Valley Economic Development Alliance luncheon at Hotel Encanto de Las Cruces.
He said the project, which began in 2011, created 3,000 construction jobs and could lead to as many as 600 permanent jobs by 2020.
There is still work to be done, though. Aaron Hunt with Union Pacific said the “full facility is not complete.
“Much of the work is finished however and we are fueling locomotives there, performing crew changes and doing some intermodal container lifts,” Hunt said.
Commercial real estate
In addition to Mesa, Kary Bulsterbaum with Steinborn TCN and Jack Redfearn with NAI 1st Valley Realty were at the MVEDA luncheon to discuss the local commercial real estate scene.
Bulsterbaum said the job market is still soft enough in Las Cruces to affect commercial real estate.
“We’ve only recovered 38-percent of the jobs we’ve lost since 2008,” he said.
Not all commercial real estate reacts the same, though. Bulsterbaum said that Las Cruces has seen space for urgent care facilities, specialty dental services and pain management locations continue to be in demand.
“Medical demand is not going away,” he said.
He said office space is tied to the job sector and is “still slow.”
Still, Bulsterbaum said that there is action in retail.
“We’re seeing national names looking more and more at our area,” he said.
Redfearn said one of the best areas for commercial space is on East Lohman Avenue because of medical space.
He said that restaurants have their eyes on Las Cruces.
“Fast food and sit-down places are still going strong,” Redfearn said. “They’re still driving our market.”
Trader Joe’s?
Whenever the Sun-News conducts polls or asks readers on social media sites what they would like to see come to the area, Trader Joe’s is often one of the top answers.
Redfearn, though, was succinct when asked if there were any plans or even talk of the company locating a store here. Speakers stood to answer previous questions, but Redfearn said the answer was so simple, he could keep his seat.
“No,” he said.
By: Brook Stockberger (Las Cruces Sun-News)
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NAR Commercial Issues and Actions April 2014
Issue: Alternative Minimum Tax (AMT): On January 2, 2013, President Obama signed into law the American alternative minimum tax (AMT) starting wit hthe 2012 tax year. Specifially, the measure sets the exemption amounts (i.e., the income not subject to taxes under the AMT) at $50,600 for individuals and $78,750 for couples filing jointly, then adjusts these amounts yearly for inflation. It also allows various non-refundable personal credits to be claimed against the AMT. The AMT was created by the Tax Reform Act of 1986 to prevent higher-income taxpayers from using credits and deductions to completely offset their federal income tax liability.
NAR Action: NAR successfully worked with Congress to ensure a permeant patch to the AMT.
Issue: Basel III: The Federal Reserve, Federal Deposti Insurance Corporation (FDIC), and Office of the Comptroller of Currency (OCC) have finalized a new risk-based capital category – High Volatility Commercial Real Estate Exposures (HVCRE) for commercial acquisition, development, and construction (ADC) loans. Specifically, the new changes raise the risk-weight for an ADC loan from 100% to 150%. In response to the final changes, it is highly likely that banks would substantially change their current lending practices and reduce the amount of available credit in order to avoid the higher capital charges associated with ADC loans.
NAR Action: After seveal letters to bank regulators and lawmakers, including comments sent to the Federal Reserve, FDIC and OCC, NAR continues to meet with Congress and the Administration to modify the final rule in order to prevent a reduction in commercial real estate lending as well as an increase in borrowing costs.
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(NAR Issue Brief)