Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!tamsun.tamu.edu!mtecv2!americast.com!americast.com!usa-post From: usa-post@AmeriCast.Com Newsgroups: usa-today.real,americast.usa-today.real Subject: real Tue, Sep 1 1992 Message-ID: Date: 1 Sep 92 08:40:11 GMT Organization: American Cybercasting Lines: 129 Approved: usa-post@AmeriCast.com 09-01 0000 DECISIONLINE: Real Estate USA TODAY Update Sept. 1, 1992 Source: USA TODAY:Gannett National Information Network JOINT VENTURE FINALIZED: After a month-long delay caused by sagging finances, Grubb & Ellis Co. Tuesday will move ahead in a joint venture with IBM to manage 80 million square feet of office, retail and industrial space nationwide. The venture, named Axiom Real Estate Management Inc., begins operations with 1,200 former Grubb & Ellis employees and 500 former IBM employees, both companies said. (For more, see special Axiom package below). NEW HOME SALES DECLINE: The U.S. Commerce Department said Monday that new single-family home sales declined 2.6% during July. Despite the lowest mortgage rates in two decades and the lowest average price in about 3 1:2 years, sales declined after increases in May and June. Financial markets had predicted a modest gain, but consumer confidence, an important ingredient for a real estate recovery, remains low. HOME SALES DROP CALLED BAD NEWS: The National Association of Home Builders said Monday the drop in sales of new homes in July was bad news for the sluggish real estate industry. Sales dropped to an a seasonally adjusted annual rate of 563,000, down from 578,000 in June, the Commerce Department said. The problem: Consumers are too worried about the economy to purchase big ticket items like new homes. MANY DON'T HAVE INSURANCE: Only about one out of every three home owners has sufficient insurance coverage, according to an estimate released Monday by Marshall & Swift, a leading source of building data for the insurance industry. Home owners need enough insurance to rebuild a home from the foundation up. Separate policies are required along hurricane coasts, as well as for earthquake and flood damage. PHOENIX GIVES MORTGAGE ADVICE: Home mortgage customers can greatly reduce their chances of being taken for a ride if they follow three simple rules, Phoenix Mortgage & Investment Inc. president John Fairchild said Monday. Consumers should: Question the deal being offered; avoid working with a company if no information can be found about it; inquire about mortgage lenders or brokers with a realtor and previous customers. BECHTEL ANNOUNCES CONTRACT: Bechtel announced Monday it is part of a consortium of companies that has been awarded a contract to build a $245 million office building in Tokyo for Nippon Telegraph and Telephone Corp. The San Francisco-based company will be part of a team led by Taisei Corp. that will build NTT's main telecommunications building. Bechtel will provide construction management services for the building. INTEC EXPECTS ROOFING INCREASE: U.S. Intec Inc. said Monday it expects to see an increase in the sales of its roofing materials products following the destruction caused by Hurricane Andrew. Officials report seeing signs of increased business in affected areas. U.S. Intec, which makes rolled roofing materials for commercial markets, says its plants are capable of meeting any potential increase in demands. SIEMENS RECEIVES CONTRACT: Siemens AG said Monday it, along with its Portuguese partner Soares da Costa, received a $248 million contract for construction of Macau International Airport. The German company said the contract was awarded by CAM Sociedade do Aeroport International de Macau SARL. Its share covers various installations while Soares da Costa will handle the majority of construction work. FIXED-RATE MORTGAGES INCREASE: The rates for 30-year fixed-rate mortgages from the Federal Home Loan Mortgage Corp. were listed at 8.01% Monday, up from Thursday and up from 7.87% the week before. They were at 9.15% a year ago. For 30-year adjustable-rate mortgages, the rates were 5.26%, up from Thursday and up from 5.20% the week before. A year ago they were at 6.96%. ARM INDEXES CLIMB: The one-year Treasury ARM index rates were listed at 3.52% Monday, up from Thursday and up from 3.40% the week before. A year ago they were at 5.71%. For the 11th District ARM index, rates were at 5.258%, unchanged from Thursday and unchanged from the week before. A year ago they were at 6.998%. T-BONDS INCREASE: Treasury security rates for the 30-year bonds showed a decrease Thursday, listing at 7.41%. That's up 0.02 from rates of 7.39% Thursday but down 0.03 from 7.44% the week before. A year ago T-bonds were at 8.04%. SPECIAL PACKAGE ON AXIOM: AXIOM GETS THE GO-AHEAD: Final go-ahead on a joint real estate management venture between IBM and Grubb & Ellis Co. was granted Friday. The venture was first announced May 8. The formation of Axiom Real Estate comes four days after Grubb & Ellis announced a debt restructuring deal in which Warburg Pincus L.P. agreed to invest $13.5 million in cash in exchange for a 40 percent stake in Grubb & Ellis. G&E ANNOUNCES DEBT CONVERSION: Grubb & Ellis, based in San Francisco, also announced that its primary lender, Prudential Insurance Company of America, agreed to convert $15 million of its debt securities into convertible preferred stock amounting to a 27 percent stake. Prudential continues to hold $25 million in Grubb & Ellis debt. Grubb & Ellis is one of the nation's largest managers of commercial real estate. AXIOM WILL BE INDEPENDENT: Although the new joint venture will operate independently of IBM and Grubb & Ellis, Axiom will be 75 percent owned by Grubb & Ellis. IBM, which is based in Armonk, N.Y., will own 20 percent and the new management team will own the other 5 percent. Axiom will be headquartered in Stamford, Conn., and will be headed by former IBM executive Thomas E. Wynn. Real Estate Editor: Martin Baucom. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. 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