From the Bakersfield Californian:
Real estate firm investigated
State agency looking at transactions by company, say ex-employees who gave files
BY VANESSA GREGORY, Californian staff writer
The former Crisp & Cole Real Estate firm is being investigated by state regulators, two former employees say.
Both staffers say they have given investigators files related to their work at the Bakersfield company, which rose to prominence in 2005 and 2006 due in part to the public extravagance of its brash young owner, David Crisp.
Jack Doremus, a 34-year real estate veteran who managed Crisp & Cole Real Estate for two years before resigning in April, said he personally supplied investigators from the California
Department of Real Estate with requested files.
"We're not trying to hide anything from them," Doremus said.
He hopes people will withhold judgment until the investigation is complete.
The Department of Real Estate, which licenses and regulates the industry, will not confirm or discuss ongoing investigations, said spokesman Tom Pool.
Friday, June 29, 2007
From the Bakersfield Californian:
Posted by Bakersfield Bubble at 7:57 AM
Thursday, June 28, 2007
June 28 (Bloomberg) -- Shares of Beazer Homes USA Inc. fell as much as 8 percent after the company said it fired its chief accounting officer for attempting to destroy documents while it is under investigation for potential fraud by the FBI.
Beazer, based in Atlanta, fired Michael Rand after an internal probe of the company's mortgage unit, according to a filing yesterday after the close of regular stock market trading with the U.S. Securities and Exchange Commission. A message left at Rand's home was not immediately returned.
``This raises red flags regarding the content of the documents in question, in our view,'' Michael Rehaut, an analyst at J.P. Morgan Securities Inc. wrote in a report yesterday.
Posted by Bakersfield Bubble at 9:26 AM
Wednesday, June 27, 2007
As reported here a local title company is exiting the market.
Here is the story from Bakersfield Californian:
LandAmerica Financial Group to close all Kern offices
by VANESSA GREGORY, Californian staff writer
The latest sign of an ailing real estate market appeared Wednesday, when Richmond-based LandAmerica Financial Group Inc., announced the planned closure of its three Kern County title offices.
“To manage our company responsibly, particularly in a slowing real estate market, we must continually find ways to streamline and reduce costs,” the company said in a statement.
The local offices, which operate under the subsidiary name of LandAmerica Commonwealth, are “under-performing,” the statement said.
Twenty-six employees will be affected, company spokesman Peter Habenicht said in an e-mail.
As home sales have slowed, competition for business among local title companies has increased, according to Eric Klein, vice president and county manager of Chicago Title.
Unlike real estate agents and mortgage brokers, who earn commissions, switching jobs when business slows is tougher for salaried workers in the title industry, Klein said.
The LandAmerica Commonwealth offices have already ceased accepting new work, but will continue to employ a few employees through the summer to complete any unfinished transactions.
Posted by Bakersfield Bubble at 4:37 PM
From the Central Valley Business Times comes a story about Donald Trump bailing out some bankrupt Valley developers:
The bankrupt Running Horse high-end housing development near Fresno is being purchased by New York City real estate mogul Donald Trump, according to media reports. Purchase price is $40 million for the 420-acre project.
The 780-home housing development is planned around a golf course designed by golfing legend Jack Nicklaus and his son Jack II. Just two holes of the course have been put in so far and no homes have been built.
Repeated efforts to sell the development and golf course had failed and earlier this month it was reported that Mr. Trump had walked away from the deal, too.
But Mr. Trump’s offer Wednesday could be trumped: It needs approval of the federal bankruptcy court that oversees the project since bankruptcy was filed in April.
Posted by Bakersfield Bubble at 1:03 PM
News today on office closures and layoffs due to the local real estate slowdown. This blogger has received word that LandAmerica Commonwealth will be closing their three Kern County offices on Friday.
Also, from the Bakersfield Californian comes a story on layoffs at the newspaper due to a slowdown in real estate ad sales:
A steep but cyclical decline in real estate advertising has forced The Bakersfield Californian to eliminate 40 positions, 10 of them through layoffs, company President and CEO Richard Beene announced Tuesday.
Publisher Ginger Moorhouse lamented the loss of the 40 positions, or 12.5 percent of her staff, saying, "It is really hard to make decisions like these, but I am confident The Bakersfield Californian will have a great future in our market."
Between 2004 and 2006, The Californian enjoyed strong profits largely because of an "exploding real estate market," Beene said. But recently, real estate agents, home builders and others in the industry have scaled back their advertising, he said. The real estate market is not expected to rebound until 2009 at the earliest, he said.
Posted by Bakersfield Bubble at 12:51 PM
Monday, June 25, 2007
Final May 2007 Numbers are out. So much for all those clowns who said prices would never go down.
If you take out the incentives (which are not included in these numbers) the drop is even bigger. Added to this is the fact that inventory continues to grow, sales continue to drop and credit is tightening.
Bakersfield $275,000.00 $301,500.00 -8.8%
Clovis $359,000.00 $431,500.00 -16.8%
Fresno $271,000.00 $285,000.00 -4.9%
Posted by Bakersfield Bubble at 12:55 PM
Saturday, June 23, 2007
From Kiplinger. “Mike Franey, a mortgage loan officer in Bakersfield, Cal., saw trouble coming. For years, swarms of investors descended on his hometown, buying and flipping some of the cheapest housing in the state, driving up the area’s median home price from $99,000 in 2001 to $280,000 in 2006.”
“Franey feared that when the investors left for greener pastures, prices would decline and he and his wife, might lose the equity in their home just as they approached retirement.”
“‘I said, ‘We need to sell right now and rent until we can buy again cheaply,’ says Mike.”
“The Franeys sold in May 2006, just as prices peaked, for $577,000, nearly twice what they had paid in 2002…and they moved into a much smaller rental home.”
“But for Mira, owning a home meant security. She hated renting and wanted to buy again. So the Franeys purchased a four-bedroom, two-bath house in a nice neighborhood for $420,000. They used an ‘alt doc’ loan, one that lets borrowers state their income without proving it.”
“For six months, Mike didn’t make a single loan, and his six-figure income dropped by half in 2006. Struggling to make their mortgage payments of $3,200 a month and running out of savings, the couple tried to sell the home last fall but had no takers.”
“Mike approached their lender, Countrywide Financial, and offered the deed in lieu of foreclosure. Countrywide refused to do anything until the Franeys were delinquent, a common practice among lenders for legal and tax reasons.”
“The Franeys missed their first mortgage payment in January, and in February they listed the home for sale at $368,500. Countrywide agreed to accept a ’short sale,’ meaning it would cancel the couple’s debt in exchange for the proceeds of the sale. In early May, the couple lost a buyer who had offered $350,000 but then found a better deal while everyone waited for Countrywide to approve the sale.”
“The house is back on the market and now stands vacant. The Franeys moved into a rental with an option to buy in three years. By then, Mike’s loan underwriter tells him, he’ll be able to get a mortgage again, as his credit score and his income improve.”
Posted by Bakersfield Bubble at 1:54 PM
Friday, June 22, 2007
From Eyewitness News:
First it was Bakersfield realtor David Crisp and Family, and now another well-known realty company has a number of properties in trouble.
Eyewitness News has learned Bakersfield's Global Realty and owner Khamphou Sinpane has had as many as seven properties that have received Notices of Default this month.
However, five properties, including Global Realty's office on Chester Avenue are more than $20,000 behind in payments.
Posted by Bakersfield Bubble at 2:41 PM
Thursday, June 21, 2007
Viewing public records it now appears that another REIC member was drinking his own kool-aid. Khamphou Siripane and family have 8 recent notices of default:
1) 1324 California Ave
2) 1200 K Street
3) 1216 K Street
4) 825 Chester Ave
5) 616 Williams St
6) 604 Williams St
7) 126 N Chester Ave
8) 7916 Corte Nobleza
Posted by Bakersfield Bubble at 3:12 PM
Saturday, June 16, 2007
New and existing home numbers for May 2007 are out from Dataquick news.
Median home price this year (May 2007) is $265,000 vs $285,000 last year (May 2006).
Home sales were down 39% YOY.
More details will be posted when the CAR reports by city in a week.
Posted by Bakersfield Bubble at 7:41 AM
Thursday, June 14, 2007
We have an update on the tax liens and lawsuits from the Bakersfield Californian:
The Internal Revenue Service slapped him and his wife, Jennifer Crisp, with a $111,170 lien in back taxes and penalties, according to public records.
"When you have a big business, there's always things, sometimes,
that falls through the cracks," Crisp said Wednesday. "And when you notice it,
you take care of it. That's it."
The back taxes stem from 2005, when the local real estate market experienced a frenzy of home sales and price appreciation.
Why he owes so much money to the IRS is unclear, Crisp said.
In late May, Commercial Trade Bureau, a debt collection agency, filed a breach of contract lawsuit against David Crisp and Crisp Cole & Associates, the business Crisp started with real estate agent Carl Cole, according to court records.
The company is suing on behalf of KBAK-TV 29 for $15,800 in services rendered, records show.
Crisp said that he also owes money to The Californian, and that he assumes his debts may have motivated the newspaper to run stories about his finances.
Posted by Bakersfield Bubble at 8:00 AM
Wednesday, June 13, 2007
News from DQNews.com on the SLOWWWWWWWWWW market. Keep one thing in mind, this is before the recent adjustment in rates, up about 50 bps in the last few weeks, look for June to be much worse.
La Jolla,CA----Last month was the slowest May for Southern California home sales in 12 years, mainly because of sharp declines in lower-cost markets. The Southland's median sales price was unchanged, a real estate information service reported.
"Sales have been dropping now for the last 20 months. The first part of that was just coming off the frenzy of 2004 and 2005 and didn't put that much downward pressure on prices. The sales declines of the last half year, though, will have more of an effect on prices. It's remarkable they haven't come down more than they have," said Marshall Prentice, DataQuick president.
Posted by Bakersfield Bubble at 4:06 PM
I have been very busy and have not been able to post.
Here is a quick update from public records (click the "official documents" link):
Tax Lien - Federal
CRISP DAVID M (R)
DIRECTOR INTER REV (E)
Tax Lien - Federal
CRISP JENNIFER A (R)
DIRECTOR INTER REV (E)
CRISP DAVID M (R)
WT CAPITAL LENDER SERV (E)
Posted by Bakersfield Bubble at 9:06 AM
Sunday, June 03, 2007
Crisp & Cole Real Estate, close family members and staffers have received default notices on more than $11 million in loans
Who would have their home sold by a group who obviously can't handle their own home tranactions properly?
From Sunday's Bakersfield Californian:
Crisp hit hard by home defaults
BY VANESSA GREGORY AND GRETCHEN WENNER,
Californian staff writers
e-mail: firstname.lastname@example.org: email@example.com
A year ago, it was all about image: a Gulf Stream jet, bodyguards, a half million-dollar car, Armani suits.
Now, 27-year-old David Crisp is floating in default notices. So are family members and employees, current and former. No other local real estate agency has been hit by such a rash of defaults on large loans in recent months, a Californian survey has found.
"I will not put my head down," Crisp said Thursday. "I will not roll in the sand. There's not one day where you won't see me in the office working."
Even as Crisp celebrated his latest coup -- apparently securing tentative loan approval to build a pair of 24-story towers at CSUB -- he, his family, his business partner and his current and former employees appear to be in financial trouble.
In all, the former principals of Crisp & Cole Real Estate, close family members and staffers have received default notices on more than $11 million in loans.
Crisp, his wife, Jennifer Crisp, and his mother, Tu Crisp, have received nine default notices since mid-April. More than half of the properties in their names are in jeopardy, according to information provided by First American Real Estate Solutions.
Current and former employees of Crisp Real Estate Inc. -- formerly Crisp & Cole Real Estate -- and Tower Lending have racked up at least 10 default notices this year. One former staffer's home has been auctioned off by trustees, public records show.
Carl Cole, 59, the former chief executive of Crisp & Cole who is still involved with Crisp on the towers project, has also had problems. A default notice for a $1 million loan taken out in December 2005 appeared in county records Wednesday. Cole declined to comment Thursday.
A flurry of liens for delinquent homeowners association fees, meanwhile, cloud properties owned by Crisp and his family, Cole and some employees.
Crisp said none of his properties will be foreclosed upon. Instead, he says he'll pay off defaulted loans "one by one."
Crisp said his missed payments stem from a business decision to buy a 10,000 square-foot office building at 8800 Stockdale Highway that will eventually house the towers' sales offices.
Defaults have risen drastically in recent months -- both in Bakersfield and around the country -- but the Crisp and Cole companies are the only local real estate agencies with principals and employees hit by a rash of defaults on large loans, a Californian survey of public filings has found:
Crisp said some of his family's properties in default are home to relatives, while others are investment properties.
Still, multiple defaults aren't the norm for investors, who can make money in up and down markets, said Kevin Oliver, a local investor.
"A smart investor should be doing just fine," said Oliver who added that the market has obviously cooled.
Crisp appeared on the front page of The Sacramento Bee in 2005 by the open gull wing of a $560,000 Mercedes-Benz McClaren. He later splashed onto the front page of The Californian in front of a chartered jet. He bragged of a $50,000 watch, $10,000 suits, of building a home with an indoor basketball court.
Crisp encouraged agents to wear expensive clothes and fronted them money to drive fancy cars, he told a Californian reporter at the time.
But he never pressured employees to overextend themselves, Crisp says.
Chris Stovall, who worked at Tower Lending, a Crisp company, before leaving in 2006, said he wasn't forced to buy up.
"I can't really say if there was pressure or not," Stovall said. "I know he didn't come to me with a whip and say, 'I want you to trade in your truck and get a BMW.'"
For his part, Crisp remains confident he'll succeed.
"I've always been optimistic about what can happen," Crisp said. "The next day is a new day."
Posted by Bakersfield Bubble at 1:00 AM
Saturday, June 02, 2007
Crisp, who is having trouble making the payments on a few homes, "obtains" a letter of credit for $1.8 billion.
From the Bakersfield Californain:
Project developer David Crisp received a letter of intent for a $1.8 billion line of credit for the University Towers project at Cal State Bakersfield.
In a letter, investment firm Neuflithz Wisenthall & Schlumberger said it would extend the credit line for a 10-year term with a 5.8 percent interest per year.
Crisp shared the letter with The Californian Thursday.
Friday morning, Crisp said the loan terms are still being negotiated.
"Do I feel confident about this as a funding source? Yes, I do, 110 percent," Crisp said. "I'm confident with people that are working on it, I'm confident that it will get done."
Crisp hopes to finalize the financing within the next five to six weeks.
Tim Mahoney, an independent broker based in Oklahoma who's working with Crisp on financing the towers, said everything is going well with the deal. Financing terms are confidential, he said, adding they are dealing with "high-level financiers from Europe." Neuflithz Wisenthall & Schlumberger was incorporated in Delaware in 1989, according to the Delaware Secretary of State's Web site. On Neuflithz's site, clicking the "Contact us" button launches an e-mail window. It appears the e-mail will be sent to an address in the United Arab Emirates.
The company acts as a credit leasing agent and fiduciary trustee for "corporations and individuals who, for many and varied reasons, wish to do so on the private financial markets rather than through the traditional banking sources, undertaking to conduct 'due diligence' in such cases when an independent credit leasing agent or fiduciary trustee are called for, through its bankers in Luxembourg and Switzerland, from whom full banking references are available by previous arrangement."
Posted by Bakersfield Bubble at 7:45 AM
Friday, June 01, 2007
He now has the home listed for $219,950. Here is his online ad:
This is a 3 bed / 2 bath single story, single family home.
It was built in 2006, but has never been lived in. The home is absolutely gorgeous, with the finest finsihings throughout.
Other details Beds 3 Approx Square Feet 1213 Baths 2 Price/Sq Ft 181.33 Year
Built 2006 Lot Sq Ft(approx) 4356 ((Assessor's Data))
This home was purchased preconstruction 1 year ago for the same price being
offered. This is an excellent opportunity for a family or an investor to take
advantage of the current market conditions and purhcase this home well below
The price has been reduced from $259,000.00, and is being offered for the amount of the current mortgage balance.
Posted by Bakersfield Bubble at 9:43 PM