Riverpark Bust

Wow, who could have predicted?

At the beginning of this decade, the developers of RiverPark in Oxnard looked at the vacant land, the asphalt plant and the run-down neighborhoods along the Santa Clara River and bet the area could almost be its own little new-suburban city. RiverPark would be a place where the people of 2010 would walk their kids to school, stroll through the neighborhood park, stop to buy organic produce from Whole Foods Market, and head home to chop it on their new granite countertops.
...

Today, RiverPark has about 800 occupied homes, rather than the 2,800 the plans call for at build-out. The shopping center sits vacant and fenced-off, construction equipment the only thing parked in its vast lots. The planned opening keeps getting pushed back, with “late 2010” the latest word from the developer, Shea Properties.

Be sure to read the comments for the different perspectives. Outsiders doing the Nelson Muntz "Hah hah!" The stuccos who lament their trusting the city. The denialists who can't even see reality. Past Riverpork posts here.

The thing that will kill the project will ultimately all come down to a failure of government. Yes, built in a flood plain. Yes, too dense. Yes, taxes too high regardless of home prices. All direct consequences of incompetent leadership at the municipal level. It's too late for Riverpark. Will the city wake up in time to save themselves from Wagon Wheel?

And the hits will keep coming. 800 occupied residences are not enough to service the HOA or Mello-Roos debts encumbered on their behalf. I wonder how many understand they are joint and several liable for the entire amount and not just the pro rata share currently being assessed? If you think the current 2.6% plus municipal burden is excessive, just wait. Riverpark will be a text book study for generations to come.

Riverpark Update I (reposted)

I don’t “hate” Riverpark. Riverpark is a travesty, Riverpark is an example of excess in the bubble. Riverpark is a sad commentary on dysfunctional municipal processes. Lots more. I go on on my pathetic blog tomorrow. Oh and the newspaper reports the Riverpark disaster in progress today in order to get out in front of my reportage.

Visited the welcome center and registered. This will be interesting to watch it play out.

The friendly sales associate had me all to herself as i was the only visitor at this 2600 unit megaproject. The literature was silent but the salesperson vollunteered that the Mello-Roos is 30yrs, 0.8%. Thus $800/yr per $100k added to costs. Additionally, HOAs run from $200/mo for townhomes to $100/mo for SFRs. Thus $2400-$1200/yr TCO.

I'd guess the median sales price is $600k given the sales sheet provided with $1800 HOA and 1.9% tax bills. $100k down, $500k @ 6.2% and PITI will be about $3100 + $1000 + $200 = $4400/mo.

The entire site is supposedly 700 acres with 1/3rd open space, 3 schools, fire station, roads, 2600 DU. Hyperdensity. Hyperscary. I say supposedly because I've never seen so much public space dedication. Not just wide, winding streets but rotaries (traffic circles) and huge cul-de-sac bulbs. The developers read like a rouges gallery; SP, Centex and Shea. The construction looked adequate but the short driveways told me parking was going to be an issue in places. Previous posts already addressed ingress/egress. I didn't have the heart to ask about sales rates. It is too early anyway. Any sales were surely to contractors or other interested parties.

Riverpark Update

Back to Riverpark. The implosion is really picking up steam and this one is typical. The usual story; bought new Dec 2006 for $580,500. Back to the bank Aug 2008 for a $378,020 outstanding balance. Looks very much like a first reset default eh? An 18 month old house with a $200,000 loss. $11,000 per month. And why didn't somebody want it for $378,020 on thte courthouse steps? That's the kicker and why Riverpark is doomed. 2008 Property Tax: $10,784. $900/month. Every month, month in and month out.
----
3093 Orleans Dr
Oxnard, CA 93036
Price: $399,900
BEDS: 3
BATHS: 4
SQ. FT.: 2,302
$/SQ. FT.: $174
LOT SIZE: -
YEAR BUILT: 2006
STORIES: 3
NEIGHBORHOOD: El Rio / Nyeland Acres
----

Riverpark Update II

Riverpark is my candidate poster child for the Great SoCal housing bust. It has everything going wrong. In coming posts I'll show the stupid traffic circles, outrageous Mello-Roos, excessive HOA dues, covenants, density mitigation and more. But to start the old cliche: A picture is worth a thousand words. Graphitti from one of the gangs attempting to claim Riverpark as their territory.

Riverpark? RiverPORK!

Unfreakin' believable. I swear they need to test the Oxnard City Council chamber's water for psychotropics. Talk about drinking the Kool-Aid. This from our local fidshwrap The Star:The Oxnard City Council tonight will consider giving RiverPark developers $12 million for a parking structure and other improvements for an upscale shopping center.
Nevermind the project is obviously deep in financial trouble. Nevermind the economy is on the brink of a recession. Nevermind the transportation infrastructure cannot handle the predicted increase in VPD. Whatinthehell is the Council thinking?

Here is their lame rationale:
As part of the deal, RiverPark will pay the city $9 million for a downtown business assistance program, but it's unclear how that money would be spent.

If that is a little unclear let me put it in plain language: Money laundering with a 25% handling fee.

Riverpark FSBO

The home builders are full tilt to construct all the new neighborhodds in Riverpark our favorite California Central Coast canary in the coalmine. The recently annouced "Whole Foods" sign is up. Everything seems just fine at Riverpark. Time to collect the profits and move on. And here it is. ForSaleByOwner. This is too new to be zillowed and does not appear to be in the MLS. There is a nice hand lettered sign with a San Fernando phone number if you are interested at only $789,000. I guess the $137k in improvements justifies the $200k premium over builder models who are offering equal or better upgrades. Hurry, it has already been on the market for a month, no telling how long it will last.

SMUGGIE - Oxnard's Riverpark

A great big slap on the back and palm grease under the table to Oxnard for one of the most egergious abuses of public trust in the Riverpark developement fiasco. A $750 million planned developemnt community, Riverpark has gotten subsidies, emminent domain assistance and exemptions from the Constutionally required public vote and CEQA compliance.

A Little Off The Top

Why rent when you can buy? Then again why not buy and rent it out? Here's a tri-level town home in the new Riverpark complex. Let's run the numbers. Actually that's old hat. Let's run just one number; carrying cost ex-mortgage.

614 Green River St, Oxnard, CA 93036
3/ 2.5/1,519/$188
YEAR BUILT: 2008 MLS#: 90013806

Great tri level condo available in the gorgeous RiverPark development. The home features granite counter tops with Stainless Steel Appliances. The home will include the washer, dryer, softwater system, alarm and refrigerator. The home includes a third level with a huge room and walk in closet. Walking distance to parks and schools.

Now the important numbers:
Homeowners Association Dues: $211
Tax (2008) $5,384

Got that? $660/mo for the privilege of ownership.
You might get $1300/mo renting this out. That leaves $640 for debt service. That sets the value at $143,000. Asking price? $285,900. It's almost as if they were working the numbers backwards except multiplying by 2.

Riverpark Update IV Cart Before the Horse

Remember Riverpark is supposed to built on new urbanist smart growth principles. Unfortunately the housing bubble popping has left Oxnard with ll the residents and none of the mixed use. That means these ultra high density homes will be generating twice the VMT the planners predicted. Dumb growth, dumb Oxnard, evil planners.

Riverpark? No, River PORK!

I know we are talking Oxnard and I swear they put soemting in the water up on the dias but come on how stupid can you get? One exit across the bridge in Ventura there is a multiplex with a dozen sceens. Straight down the main drag in the heart of downtown there is a city subsidized urban multiscreen theatre. And now Riverpark is scrapping the master plan for their New Urbanist Utopia a dozen years in the failing forward in favor of another freakin' multiplex cinema. And such a deal it is. They are offering nine million d-o-l-l-a-r-s (pinkie to corner of mouth). And all it will cost Oxnard is $12m in improvements and abatements and also whatever they owe to the downtown cinema if this ruins that business. Deal or No Deal? Deal! By a "vote" of 4-1 the City Council has pursed the shiny object and thrown past partners under the bus.
Newspaper coverage.
Star 20th
Star 19th
Star 18th

I'm going to see if I can get the 1 part of that 4-1 vote to comment.

Riverpark Parked

HT to "w" but face it, we all saw this one coming years ago.
Economy delays RiverPark retail center in Oxnard

Ventura County Star reports:

Work on The Collection — which will include a 50,000-square-foot Whole Foods Market, a 16-screen Century Theatres cineplex and an REI store — has slowed, reflecting the pace of the economy as a whole, said Colm Makem, president of Shea Properties, the developer.

“We’ve moved the opening to the fall of 2010,” Makem said Monday. “Basically to reflect the slowdown in the economy and that’s why you’re seeing a slowdown in the construction.”

The company, which has other commercial and residential developments in California, Arizona and Colorado, has had to adjust work on those projects as well. The hope is the opening of The Collection will correspond with the upturn in the economy.

“We own a lot of real estate and we’re trying to pace the development with the economy,” Makem said. “Most economic forecasts are showing a turnaround in 2010.”

----
Another Oxnard Albatross. Backgrounder from 2003 ArchNewsNow.

Riverpark Unrest

One of the problems with massive ill considered development projects is the details. you know the little stuff the sales agent neglects to mention to the early buyers of $800,000 houses on postage stamp lots and $15,000 tax bills.

turns out last week ground was broken on one of those details.

Workers have already laid the foundations for 140 apartments and town homes in Oxnard's RiverPark development that will be home to more than 140 very-low and extremely-low-income families.

Now I knew this all along but apparently not the neighbors. Thay are a tad upset as seen in their comments:

I know what's in store... everything within a 2 mile radius being shot at, tagged, stolen or vandalized. Just wait until they, the new Paseo Del Rio's (PDRs), start fighting with the El Rio gangsters.

My tax dollars already provide these folks with free health care. They force many of the area schools to provide services for ESL instead of services that will prepare our most talented students for the next step in their education.

The [market] rent for a 1 bedroom is $1655.00/mo with garage. .... I would have been very angry if I leased then found out this news.
I understand and have no problem with people who need some temporary help. The ones I worry about are the people who are using the system and cheat the system. I wouldn't like it if I am paying 4 times the rent these people are and have them ruin the place.

And to think I was gonna buy in that area, 550k for a beautiful townhome. What's the deal with this city? Allthese brand new communities are turning into low income social housing units. ...I would be absolutely fired up if I paid half a million dollars for my place, knowing my nieghbor is paying about $1000 for rent. And $270 for a one bedroom? My homeowners premium isnt even that cheap. Thanks Oxnard for once again ruining what could of been a clean, crime free community.

Even people not caught up in the mess are victims:

Because of the 'sweetheart deal' City Council made with the developers, I will watch Downtown Oxnard dry up and blow away.

Read the Rest here.

Holes in the Ground

This is "Riverpark" one of my local "holes." Holes are development projects that have been started but stand little chance of being completed as promised. Sacramento has a hole so large it swallowed CalPERs. Bakersfield appears to have dodged the big bullet as Crisp & Cole got caught before they got to the hole stage with their high rise condo scam. Got any holes in your area?

Suggestion Box

Back to more abnormal posts and a new year.

New features being added:

Blogs O'Shame
Blogs O'Note
Unmoderated Casey Posts
Transit Myths by the Numbers
Why Macs? Tracking the OSes
The Riverpark Fiasco

Suggestions?

Riverpunk'd

Just a quick post while I get the ever growing MAXfest organized.

California Municipal bonds are getting slammed. Here's a new one:
Rio Elementary
So what? A poorly performing school district needs money. Well look at the details.
Maturity 9/1/2028
RIO CALIF ELEM SCH DIST CMNTY
Coupon 5.120%
Yield 11.000%
Price $53.07
Call date 9/1/2012
Call Price $102.00

The reason they need the money? They built a shiny new poly-million dollar school and administrative complex to support Riverpark. Gee, ya think this is gonna end well? And as a side note; 11% double tax free is a more than 19% taxable equivalent.

Riverpark Update III

This post was supposed to be about traffic, VMT and vehicle accomodation. This first picture is one of several "roundabouts" or "traffic circles" or more properly "rotaries" the FHWA be damned. I grew up in a town with real rotaries. They've served generations with speedier traffic. Oxnard unfortunately drank the MUHD SmUGLER kool-aid. This picture speaks a thousand words. How comfortable are you with what's happening? The place is freakin' empty and you already brace for getting T-boned should you dare enter the circle of destruction.

Not scary enough? Version 2:



Two lanes of entering disaster. People in CA don't know how to work these things. Oxnard is also, how shall I say? Ummm, more beset by unvetted drivers than average.

But like I said, this isn't about traffic. Look past the rotary. What do you see? The Mixed use development that will be there? In this market? If it ain't broken ground it won't for a very long time. That next what's being built.

Ninety-Eight Percent Leased

According to an anonymous poster in a previous Riverpark thread this empty area is 98% leased and scheduled to start construction in 7 months. I guess I was wrong to doubt the power of the Oxnard name.

Auger In at Riverpark

Here's a knife just waiting for someone to reach out and grab it from the air.

Sold new;
11/22/2006: $584,454

Now on Redfin for $417,000.

$167,454 and 16 months later. Imagine waking up every morning $300 poorer and making a daily house payments of $150. And that's if they get the price.

Skittles in NorthEast Riverpark

Fellow blogger (and Venturan) Effective Demand took the same neighborhood from yesterday and ran it through a NOD/NTS/REO filter.
P = NOD filed
A = NTS filed
B = Back to the Bank / REO / Foreclosure

119 properties currently in the foreclosure process at some point for just 1 development.

At this point an earthquake would be a kindness.

Here is the view from RealtyTrac:

Neo-Tragedy

Zip 93036.

20 years ago; strawberry fields and a toxic waste dump.
Today; bubblezone, money losing golf course on a toxic waste dump and poster child for why New Urbanism is a crock.

Here's a rough map:


Dot 1 is Riverpark. I've written extensively on this abortion that lives. Check out this gem:

Sales History:
Jan 31, 2007 $641,000
Listing Price History:
Apr 02, 2008 $459,900
Jun 15, 2008 $395,000
Sep 13, 2008 $359,000

Still no buyer! Ten thousand dollars per month doesn't cover the losses since initial purchase. Thing is $359k isn't so bad. The property includes a seperate apartment that could rent for $1000 so what's the problem? The problem is HOA and Mello-Roos. Taking those into consideration the present value equivalent price is more like $550k. Ouch.

Dot 2 is the River Ridge Golf Course. How hard is it to lose money on a freakin' golf course? The City of Oxnard manages exactly that. Classic example of public meddling in the private market.

Dot 3 is the 1990s development zone. Starting "small" with 2800 f on 6000 sf lots the developer and city hubris inflated until we saw 4500 sf on 6000 sf lots and 6000 sf behemoths on whopping 10,000 sf lots. How are those doing?
3428 Glen Abbey Ln.
Sales History
Aug 12, 2003 $599,000
Sep 06, 2005 $919,000
Aug 18, 2008 $782,781
I love the "random number" last sales price. A dead giveaway that the bank owns it. 20% plus arrears and penalties. The "tell" is in the description: "BANK OWNED in Victoria Estates near River Ridge golf. Upscale community amenities including pool, spa and clubhouse. Last sold for over $900k. Custom wood floors downstairs. Oops, did I mention that the last occupants took the carpet and appliances with them. Well, they did, shame on them. Hence the bargain price for over 3600 sq ft in Victoria Estates."

Occupants, not owners. They need you to be the next occupant. So it goes.