THIS is the best breakdown of the Public-Private Partnership announced today.
The two key elements of the plan are:
• Legacy Loans Program: a program to combine an FDIC guarantee of debt financing with equity capital from the private sector and the Treasury to support the purchase of troubled loans from insured depository institutions.
• Legacy Securities Program: a program to combine financing from the Federal Reserve and Treasury through the Term Asset-Backed Securities Loan Facility (“TALF”) with equity capital from the private sector and the Treasury to address the problem of troubled securities.
Here is the key to what this program is trying to do:
The equity co-investment component of these programs has been designed to well align public and private investor interests in order to maximize the long-run value for U.S. taxpayers. Specifically, while the plan is designed to help reduce the liquidity discounts contained in legacy asset prices in the near-term, the most important way to protect taxpayers is to ensure that the government is not paying more for assets than their long-run value as determined by private investors. Since TARP funds will be invested alongside private capital on similar terms, this reduces the likelihood that taxpayers will be overpaying. At the same time, taxpayers will have the opportunity to participate in the asset’s upside along with private investors.
The market’s initial response was clearly positive. But a big question is exactly how the private funds pay a price they like without causing further damage to the banking system. We will see
The site of
Kai Ani Village sits at the corner of Lipoa Street and South Kihei Road in central Kihei. One of the great benefits of this site is only hinted at by the aerial photo above. Most other complexes in South Maui border other significant buildings and can create a cramped environment. Kai Ani Village on the other hand has spacious and open surroundings. To the east side of the property, the bottom of the photograph, are wetlands and a small residential neighborhood. This provides open unobstructed views to one of Maui's treasures, Haleakala. Across Lipoa Street to the north of the complex, the right side of the photograph, is a two story commercial building and a single story shopping area. Neither of these throw any sun shadow onto Kai Ani Village. Finally on the west side of the property, the top of the photograph, the roomy feel continues with the single story St. Theresa's Church and parking lot and then more wetlands.
These kinds of surroundings mean that Maui's famous sun will always shine on Kai Ani Village and Maui's cooling breezes will not be blocked.
Kai Ani Village is well worth a tour. The showroom is open every day. Come by for a private tour.
One question people ask regarding Maui real estate is "Why should I buy now?" There are actually several; good reasons but first let us address the facts of the matter. The facts are that in the short term it is impossible to know what will happen and how events will affect prices. But over time, single events typically have their impact muted and demographics and long running economic and technological trends tend to take over. So with that in mind, here are a few reasons to consider buying Maui real estate now:
- Selection has never been better-The Maui real estate options available to a buyer are broader than they have been in a generation.
- Lack of New Product-Local regulation has effectively placed an economic moratorium on new development. So waiting will not create opportunity.
- Interest Rates are also at generational lows
- Sellers are more open to creative approaches than ever before.
- Prices are significantly off their all-time highs
- If one waits until everyone recognizes the turn, you will lose the advantages of acting early
- Over any reasonable time horizon, can you imagine Maui not being a highly desired location?
Perhaps most importantly, Maui is still Maui, and time is something we don't get any more of in our lives. Those days you spend elsewhere you will never get back.
In the midst of all the economic issues facing the nation and the world, it is very good news that consumer spending, which represents 70% of the economy, has begun to rebound from December's dismal numbers. On average January and February were up almost 2%. What does this mean for Maui real estate? Nothing directly, but it does give a glimmer of hope we are closer to the end that the beginning.
For sale inventory indicates how long it would take for all homes for sale to sell at the current sales pace if no new homes were brought to market. Currently national for sale inventory stands at 9.6 months. That number is significantly improved compared to the 11 months the inventory had been for much of 2008. The further this ratio declines, the better the news is for sellers of Maui real estate.
The dust fence dividing Building 3 has come down. The style of the live-work units in Kai Ani Village is now clear from South Kihei Road. The wonderful visibility into the commercial space and easy public access makes these commercial spaces prized locations. Come and take a tour of Kai Ani Village!
