Tacoma's first large-scale condominium auction Saturday yielded substantial bargains for the buyers of 17 units at downtown Tacoma's Marcato condominiums.

For instance, a two-bedroom, two-bath, 1,210-square-foot unit with two inside parking places sold at auction for $180,000, just 46.3 percent of its original offering price of $388,900. That's a $208,900 discount.

A third-floor unit with two bedrooms and two baths brought $195,000 in the auction, a drop of $210,900 from the asking price of $405,900.

The units, which ranged from a single bedroom, 620-square-foot unit to a 1,228-square-foot unit with two bedrooms and an den, sold for an average of 55.2 percent of the units' original offering price.

The 70-minute auction at downtown's Hotel Murano, yielded $3,365,000 in sales for Marcato developer Vision One LLC. The original asking prices for those units was a total of $6,096,862.

"We had almost 700 groups through in the month leading up to the auction," said Koket Fowler, project manager for TeamBuilder Auction Group. "We knew all the units would sell because of the large amount of interest, the quality of the community and the great values," she said.

Sixty-eight pre-registered and pre-qualified buyers attended the auction.

In general, one-bedroom units sold for a higher percentage of their original asking price then did the larger, two-bedroom units.

The smallest unit in the auction, 620-square-foot unit with one bedroom and one bath on the building's second floor sold for $160,000. That's 69.6 percent of the $229,900 offering price before the auction.

Developer Robert Hebert said he was pleased that buyers realized some bargains. Though the prices were substantially less than the original asking prices, he said, the auction brought a quick finish to what had been the glacial pace of sales since the recession struck.

While each building is different, the Marcato auction may give other developers who are holding onto large unsold inventories of condo units in Tacoma an idea of what the market will bear in the future.

Several major buildings are seeing condo sales moving so slowly that they'll be years filling. A large waterfront building on the Thea Foss Waterway, the Esplanade has nearly 150 vacant units.

The bank that foreclosed on that property has yet to disclose how it intends to sell the remaining units.

Russell Investments is leasing about 215,000 square feet in its new Seattle home, according to a Seattle Times report today.

That's about 10,000 square feet less than the space the firm currently uses at its headquarters at 909 A St. in Tacoma. A report from Colliers International for the third quarter of 2009 put the available office space at 909 A St. at 224,000 square feet.

The Times' Eric Pryne reported this morning on leasing at the WaMu Center -- the building Russell's parent company Northwestern Mutual bought last month for $115 million.

Pryne's report focused on how rents in the WaMu Center compare to historic prices for downtown Seattle office space. But TNT readers might be more interested to learn what the recent listings for space in the building at 1301 Second Ave. reveal about Russell's future.

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We’ve already hit the bottom and we are no longer there.

So say real estate professionals who have reviewed the latest numbers, out Monday, from the Northwest Multiple Listing Service.

“It appears that we’ve seen the bottom, and we’re starting to climb out,” said Bill Riley, an owner of GMAC Real Estate in Puyallup and president-elect of Washington Realtors.

“People now know they can buy a house and it will be worth more down the road, he said Monday. “I wasn’t sure last month, but we are definitely in an upswing. There’s a possibility we can see the price of homes increase in 2009.”

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Seattle-based online real estate broker Redfin launched an app for the iPhone today that lets users view homes for sale on the Multiple Listing Service.

With the Redfin app, iPhone and iPod touch users can look at homes for sale and upload photos and notes from home tours to Redfin's real estate search site.

Users can find nearby listings and open houses or search neighborhoods by name or zip code and then filter the search by property type, square footage or the number of bedrooms and bathrooms.

"Redfin's app is a home-buying app not a search app," said Redfin CEO Glenn Kelman. "What that means is that we want to make every step of the home-buying process easier, not just a consumer's initial search but when she tours the house, when she gets back to her computer to pick up the search again, when she's ready to make an offer or after her offer is in escrow."

The Redfin App is available for free from the App Store, according to the company's news release.

Currently the app only includes listings in areas of the U.S. already supported by Redfin's website:

-- Seattle area
-- San Francisco Bay Area
-- Sacramento area
-- Southern California
-- Boston area
-- Washington, DC area
-- Chicago area
-- New York's Westchester County and Long Island, excluding the Hamptons

Ground-breaking for the first of two new hotels on downtown Tacoma's Foss Waterway could come this fall.

That's the latest word from Bellingham's Hollander Investments which plans to buy the potential hotel site near South 15th and Dock streets early this fall from Seattle hotelier Bob Thurston.

If construction begins, it will be a long-delayed victory for the Thea Foss Waterway Authority, which has waited five years for a hotel to be built. The authority, which is overseeing redevelopment of the formerly industrial waterway, has worked unsuccessfully with two prior developers to see a hotel constructed.

Hollander told the Tacoma City Council's Economic Development Committee this week that its preliminary plans call for construction of a 96-room Mariott Residence Inn on the south side of the site beginning this fall.

The second hotel, likely a Hilton with 128 rooms, would be built on the site's north side near the Esplanade condominium project. Construction of that second hotel would begin sometime between 2013 and 2015 depending on market conditions.

An office structure would be built at the same time as the second hotel. The office structure would visually link the two hotels to form a u-shaped configuration with the open end facing the waterway.

The development would include partially underground parking to serve all three buildings and retail and commercial space facing the water totally some 5,700 square feet in the final development.

Each of the hotel structures would be 9 stories tall.
Total investment in the project would be $35 to $40 million according to Hollander.

Holland owns the Marriott Courtyard Tacoma Hotel among other hotel properties.

Don Meyer, the waterway authority's director, said Hollander must begin construction by March of next year under the shoreline development permits obtained by Thurston.

If construction doesn't begin, the lengthy process of applying for those permits will start anew.

The waterway authority will meet Wednesday at 4 p.m. at its offices in the Dock office building to consider approving a new development agreement for the hotel.

The City Council must also approve new agreements with Hollander that would protect Hollander from claims related to past pollution on the site. Most of that pollution has been cleaned up.

The authority worked with two prior developers to build a hotel on the site, but neither was able to make the financing work.

Thurston, the site's present owner, hoped to build a boutique hotel. He added condominiums to the building design during the condo boom, but failed to find financing after the housing market crashed.

The Association of Community Organizations for Reform Now is hosting a Faces of Foreclosure walk at noon Wednesday.

The event is aimed at highlighting Pierce County's foreclosure situation. The county's foreclosure rate is often among the highest in the state.

Wednesday's event will features some speakers and "information sharing" about the problem, according to an ACORN press release and then a walk to the home of Kim Thagh.

Thagh is facing foreclosure on his South Tacoma home and ACORN is helping him to try and modify his mortgage. Thagh owns a home construction business and ACORN said his income has dropped during this recession.

The Faces of Foreclosure will begin the corner of 78th and South Wilkeson Street.

A foreclosure auction for a major downtown Tacoma waterfront condominium building attracted more spectators than bidders this morning outside the County-City Building.

And when the short bidding was done, the lender for the 8-story Esplanade condominium, IStar Financial Inc. of New York, emerged the auction's winner with a price of $7 million.

Some two dozen spectators watched as attorney Greg Fox read the lengthy auction documents in a light rain outside the second-floor entrance to the government building and then began the auction process about 10:15 a.m.

The sole outside bidder, Northwest businessman Chuck Tomas, halted his bidding at $6.1 million as the bank successively topped each of his bids.

Tomas is an investor whose 140-yacht was tied up for weeks this summer on the Foss Waterway near the condo building. That yacht, a former Canadian fisheries patrol boat, was undergoing an interior renovation.

The bank offered its bids to defend the $46 million already lent to help build the 162-unit condo building on the Thea Foss Waterway.

Had the trustee for the auction accepted another bidder's low offer for the building, the bank's interest in the structure would have been erased at price far less than that which it had invested as lender.

By winning the bidding, Istar gains title to the building except for the 11 condo units sold to private owners.

It is now free to pursue deals with potential acquirers interested in buying the entire structure or with individual condo buyers.

The News Tribune asked the bank about its plans for the building, but it had not responded by early Friday afternoon.

IStar Financial is a lender specializing in loaning money to developers and builders of commercial office buildings, retail buildings and other larger structures.

Hit by reversals in the commercial development market, IStar Financial recorded losses of $2.93 a share in this year's second quarter

The condo building was constructed after the Thea Foss Development Authority five years ago held a contest to pick a developer for the tract on the west side of the formerly industrial waterway.

California developer Mark Ossola won the right to build on the parcel and an adjacent property.

The adjacent property was to be an hotel site, but an hotel was never built. The waterway authority is now negotiating with a new hotel developer, Hollander Hotel Group Inc. of Bellingham, to build on that land.

The condo project took longer to plan and construct than anticipated. The building hit the market two years ago just as the housing market turned downward.
The market for retail spaces on Dock Street also failed to develop as hoped, and none of the retail storefronts in the building ever leased.

More than 13 percent of American homeowners with a mortgage have fallen behind on their payments or are in foreclosure, according to an Associated Press story today.

The record-high numbers were released this morning by the Mortgage Bankers Association, and are being driven by borrowers with traditional fixed-rate mortgages rather than the shady subprime loans with adjustable rates that kicked off the mortgage crisis.

As of June, more than 4 percent of all borrowers were in foreclosure, while about 9 percent had missed at least one payment.

The worst of the trouble is still concentrated in California, Nevada, Arizona and Florida, which accounted for 44 percent of new foreclosures in the country. Nearly 12 percent of all loans in Florida were in foreclosure, the highest in the country, followed by Nevada at 9 percent.

Loan delinquencies among borrowers with prime, fixed-rate mortgages grew from the first quarter to the second in all 50 states, with the biggest jumps in Wisconsin, Illinois, Utah and West Virginia.

In Washington in the second quarter, 5.82 percent of all home loans were at least 30 days overdue, according to the survey, and 2.47 percent of loans were in foreclosure.

Credit Suisse downgraded Federal Way-based Weyerhaeuser Co.'s stock today from "neutral" to "underperform," but the company's stock rose more than $2.00 a share.

The company Monday reported losses of 59 cents a share, but that was better than Wall Street had expected. Analysts on average had predicted a loss of 71 cents a share.

At midday, the company's stock was selling for $37.43 a share, up $2.24. During last year's second quarter, the company reported a lost of $1.25.

Closed sales of homes in Pierce County rose in July compared both to June and July last year.

According to the Northwest Multiple Listing Service, 903 home sales were closed in July in the county, compared to 747 deals closed in June and 796 a year ago.

The median price of a home sold in Pierce County this month fell to $228,500, down 10.4 percent from $255,000 a year before.

Statewide, sellers closed 5,527 home sales, up from 5,271 in July 2008. the median price of a home statewide was $279,000, down 10 percent from $310,000 a year ago.

The number of pending sales in Pierce County, 1,251, was up in July by 20.75 percent from 1,036 home sales pending a year before.

Forbes magazine in a new study ranks Seattle and Portland among the top dozen cities nationwide where housing vacancies are rising the quickest.

The magazine ranked Seattle eleventh among the nation's 75 largest metro areas in vacancy changes. Portland was 10th on Forbes' list.

At the top (or at the bottom, if you prefer) was Kansas City, Mo.

The the two cities are seeing their housing vacancies rise at a relatively high rate, the magazine said, total vacancies are less than in many other cities across the nation.

Home prices in the Puget Sound area continue to decline, according to a national home price tracking index.

The S&P/Case-Shiller U.S. National Home Price Index released Tuesday said prices were down 16.6 percent in May from year-earlier prices and down 0.3 percent from April.

Meanwhile much of the rest of the country showed signs of stabilization. Home prices in May increased for the first time since the summer of 2006, according to the index. Prices rose from April in 13 of the cities that make up the index.

The 20-city home price index rose 0.5 percent from April to a reading of 139.8, but was still 17.1 percent below the reading of 168.6 in May a year ago. It was the fourth consecutive month the index indicated prices have turned the corner and are heading back toward positive territory, according to The Associated Press.

In the Puget Sound area, prices fell for 12 of the last 13 months. In April, the index showed a slight uptick. This area tends to lag the rest of the country. We entered the recession after most other states and likely will exit it after them as well.

More from AP: The news follows upbeat reports showing sales of newly built and existing homes rose in June for the third straight month. And new home construction, while still weak, is the best it’s been since the fall.

The 20-city index has lost more than 32 percent since its peak reading of 206.52 three years ago. That means home prices are back to mid-2003 levels.

The Case-Shiller index measures home price increases and decreases relative to prices in January 2000. The base reading is 100; so a reading of 150 would mean that home prices increased 50 percent since the beginning of the index.