Strategic Health Care, a Tennessee-based mental health care provider for geriatric patients, has subleased 8,000 square feet in the former Odyssey Hospice building.
The new 22-bed facility will be the company’s fifth location in the United States. According to Tammila Wright, a broker with Keller Williams Commercial, who represented the landlord and the tenant, the company has found a ready market for its specialized service.
“They expect to build their own facility in the next three years,” she said.
Hospice Properties IV LLC, the building’s owner, was home to Odyssey Hospice but closed its 12-bed inpatient hospice last year. It now provides strictly home health care.
Mortgage rates lower
The average interest on a 30-year fixed-rate mortgage dropped to 5.47 percent last week, the lowest for four years, according to a Freddie Mac survey.
Some lenders say the rates have dropped even more since Freddie Mac polled lenders on Monday, Tuesday and Wednesday of last week, as low as 5 percent or even less in some cases.
Barbara Pattee, owner of Springs Mortgage said she has been able to secure borrower financing for a 30-year fixed-rate loan with just 1 point at 4.875.
“The activity rate has picked up, but not as dramatically as it would have a couple of years ago,” she said. “Some people think it may drop even further and want to wait. Anything below 5.25 is a phenomenal rate — and it won’t last long. Waiting could mean missing a great opportunity, especially for those with adjustable rate mortgages.”
Most lenders admit rates remain volatile, bouncing up as high as 5.5 percent in some parts of the country.
Industry experts say the dip reflected in the surveys reflect reaction to the Federal Reserve’s announcement last month that it would buy a sizeable chunk of mortgage-backed securities. That news had an immediate impact on interest rates.
The survey addressed rates on loans that meet Fannie Mae and Freddie Mac guidelines. The agencies accounted for 57 percent of all mortgages closed during third quarter, according to industry trade publication Inside Mortgage Today.
Frank Nothaft, Freddie Mac’s chief economist, said the recession and high unemployment numbers also played a role in driving down rates.
Home price reports
Single-family home prices in Colorado Springs generally decreased during October and November, as reported by two industry sources.
The results vary slightly, based on the metrics used.
During early December, the First American CoreLogic LoanPerformance Home Price Index issued its October monthly report that tracks home sales price trends. The monthly survey indicated that home prices (single-family and condominium/townhomes) for the Colorado Springs area fell by 3.46 percent compared to October 2007, with a current median home price of $188,900.
Nationally, home prices fell by 10.44 percent, according to LoanPerformance, to a median price of $193,720. LoanPerformance HPI includes price, time between sales, property type and loan type (conforming vs. nonconforming).
ZIP code 80924 topped the list for the highest recorded home price in Colorado Springs, with a median price of $380,000; and ZIP code 80910 recorded the lowest median price at $120,000, the report said.
In contrast, the Pikes Peak Association of Realtors’ November report, written by PPAR Chairman Jay Gupta of Gloriod & Associates, separates the residential market into single-family home and condominium/townhome categories. It also breaks out existing median homes prices from all home prices in the market.
That report showed that median prices for a single family home in El Paso and Teller counties fell 1.1 percent, from $189,000 to $187,000, from October to November — with existing homes accounting for almost 90 percent of the total sold.
Condominium and townhome median prices, in contrast, were up 10.8 percent compared to October and 12.5 percent for the year.
Like national home value trends, however, from November 2007 to November 2008, the median single-family home price in the Pikes Peak region fell 9.9 percent.
T. Rowe Price goes global
As the stock market challenges even the most stalwart investor, some companies are taking another look at commercial real estate as a promising investment in the United States and beyond.
T. Rowe Price is offering investors the chance to participate in its Global Real Estate Strategy fund, open to individuals and institutional investors. In a statement, Director of Global Equities Bill Stromberg said “Global investments are becoming an increasingly important component of investors’ portfolios … We have been strategically expanding our global research capabilities and now have more than one-third of our equity research team based outside the United States.”
The global real estate strategy targets long-term growth through capital appreciation and income by investing at least 80 percent of its net assets in equity securities of real estate companies throughout the world. Such firms include real estate investment trusts and in related real estate operating companies.
Citing the protection offered by long-term commercial leases from income decreases in recessions, the company expects to profit “from pricing power when leases renew during strong economies,” the company said in its statement.
Becky Hurley covers real estate for the Colorado Springs Business Journal.