Thursday, June 14, 2012

International Economic Development Takings

In Taiwan a family protests the taking of their home to make way for high-rise apartments:

The block where the Wang Family House was located was chosen by Le Young, a construction company, to build a 15-story high-rise apartment building as an urban renewal project.

Although the family has refused to give up its land, the construction firm has already received the consent of more than 75 percent of the landowners on the block, and according to the Urban Renewal Act (都市更新條例), the firm can now ask the city government to help it evict the Wangs and demolish their home.

Steve Clowney

June 14, 2012 | Permalink | Comments (0) | TrackBack (0)

Wednesday, June 13, 2012

Backfilling Vacant Borders Stores

The Wall Street Journal has an interesting piece on the struggle of shopping center owners to backfill former Borders locations, a year after the book seller closed its doors.  In Winston-Salem's Thruway Shopping Center, the Borders space is being retooled for Trader Joe's to open in August.  While I miss having the book store, I welcome not having to drive to Charlotte for my favorite Trader Joe's items.  But as chains which occupy large boxes fail, backfilling those spaces becomes more problematic, particularly at the healthy rents the former tenants paid.  For example, the Circuit City location on Hanes Mall Boulevard remains empty, three years after it closed its doors.

Tanya Marsh

June 13, 2012 in Real Estate Finance, Real Estate Transactions | Permalink | Comments (0) | TrackBack (0)

The Great Commons in the Sky

Sad news: Elinor Ostrom, the first woman to win a Nobel Prize in Economics, died yesterday morning at Indiana University's Health Bloomington Hospital.  As the Nobel Committee stated:

Elinor Ostrom has challenged the conventional wisdom that common property is poorly managed and should be either regulated by central authorities or privatized. Based on numerous studies of user-managed fish stocks, pastures, woods, lakes, and groundwater basins, Ostrom concludes that the outcomes are, more often than not, better than predicted by standard theories. She observes that resource users frequently develop sophisticated mechanisms for decision-making and rule enforcement to handle conflicts of interest, and she characterizes the rules that promote successful outcomes.

Here's NPR's story:

NPR Ostrom Remembrance

 

And here's a link to a brief lecture by Ostrom were she explains her work.

Steve Clowney

June 13, 2012 | Permalink | Comments (0) | TrackBack (0)

Davidson on Property and Identity

NestorDavidsonNestor Davidson (Fordham) has posted Property and Identity: Vulnerability and Insecurity in the Housing Crisis (Harvard Civ. Rights & Civ Liberties L.J.) on the web. Here's the last paragraph of the intro:

The housing crisis, in short, holds lessons about the ineluctable distortions that the intimate landscape of property can generate.  This Article focuses on three facets of that landscape.  Part I examines the role that status anxiety played in the housing boom.  Part II turns to emotional aspects of how the pendulum has swung against homeownership after the downturn. Part III reflects on what these dynamics suggest for rethinking homeowner- ship as a touchstone, and for re-examining the centrality of consumption more broadly.  The Article concludes in Part IV by arguing that the legal system and housing policy must be more cognizant of these emotional vari-  ables, even if the institutional mechanisms available to do so are relatively limited.

Steve Clowney

(HT: Land Use Prof Blog)

June 13, 2012 | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 12, 2012

Inclusionary Zoning is Hard

A few years ago, Washington D.C. passed an ordinance that requires residential developers to price 10 percent of units in new buildings at below market rates.  You might think these units would sell out within days of hitting the market, but that isn't the case.  Many sit empty.  Lydia DePillis examines the dark underbelly of D.C.'s attempt to diversify its fancy neighborhoods:

The very first two condos created through inclusionary zoning are in a building at 2910 Georgia Ave. NW. While the rest of the units have sold out, these two have been on the market for almost a year now. [...] The problem is, you can't get a mortgage—or not very easily, at least. Most low- to moderate-income buyers want to get a Federal Housing Administration-backed loan. But the banks that FHA works with don't want to issue loans on properties that can't be resold at market rates in the event they go into foreclosure.

Steve Clowney

 

June 12, 2012 | Permalink | Comments (1) | TrackBack (0)

Hockett on Using Eminent Domain to Beat the Housing Crunch

HockettRobert Hockett (Cornell) has posted It Takes a Village: Municipal Condemnation Proceedings and Public/Private Partnerships for Mortgage Loan Modification, Value Preservation, and Local Economic Recovery on SSRN.  Here's the abstract:

Respected real estate analysts now forecast that the U.S. is poised to experience a renewed round of home mortgage foreclosures over the coming 6 years. Up to 11 million underwater mortgages will be affected. Neither our families, our neighborhoods, nor our state and national economies can bear a resumption of crisis on this order of magnitude.

I argue that ongoing and self-worsening slump in the primary and secondary mortgage markets is rooted in a host of recursive collective action challenges structurally akin to those that brought on the real estate bubble and bust themselves. Collective action problems of this sort require duly authorized collective agents for their solution. At present, the optimally situated such agents for purposes of mortgage market clearing are municipal governments exercising their traditional eminent domain authority.

I sketch a plan pursuant to which municipalities, in partnership with investors, can condemn underwater mortgage notes, pay mortgagees fair market value for the same, and systematically write down principal. Because in so doing they will be doing what parties themselves would do voluntarily were they not challenged by structural impediments to collective action, municipalities acting on this plan will be rendering all better off. They will also be leading the urgently necessary project of eliminating debt overhang nationwide and thereby at last ending our ongoing debt deflation.

Steve Clowney

June 12, 2012 | Permalink | Comments (2) | TrackBack (0)

Monday, June 11, 2012

Welcome Newbies

It looks like the ink is dry on this year's Entry Level Hiring Report put together by Prawfsblawg.  Special congratulations are in order for all the new profs who have expressed an interest in teaching property.  Welcome future property czars:

Amanda Reid (Florida Coastal)

Andrea Boyack  (Washburn)

Jessica Shoemaker  (Nebraska)

Kathleen Morris  (Golden Gate)

Kellen Zale  (Houston)

M. Alexander Pearl  (FIU)

Mark Templeton  (Chicago)

Nadav Shoked  (Northwestern)

Priya Gupta  (Southwestern)

Sally Richardson  (Tulane)

Yoon-ho Alex Lee  (USC)

Please let me know if I've missed anyone.

Steve Clowney

June 11, 2012 | Permalink | Comments (1) | TrackBack (0)

Kelly on Strategic Spillovers

KellyDan Kelly (Notre Dame) has posted Strategic Spillovers (Columbia) on SSRN.  Here's the abstract:

The conventional problem with externalities is well known: Parties often generate harm as an unintended byproduct of using their property. This Article examines situations in which parties may generate harm purposely, in order to extract payments in exchange for desisting. Such “strategic spillovers” have received relatively little attention, but the problem is a perennial one. From the “livery stable scam” in Chicago to “pollution entrepreneurs” in China, parties may engage in externality-generating activities they otherwise would not have undertaken, or increase the level of harm given that they are engaging in such activities, to profit through bargaining or subsidies. This Article investigates the costs of strategic spillovers, the circumstances in which threatening to engage in these spillovers may be credible, and potential solutions for eliminating, or at least mitigating, this form of opportunism through externalities.

Steve Clowney

June 11, 2012 | Permalink | Comments (0) | TrackBack (0)

Friday, June 8, 2012

1 World Trade Center and the History of Skyscrapers

World Trade May 2012 II

I visited New York City a few weeks ago and stayed in a hotel at 42nd and 10th.  My room looked south, so although the weather was hazy for most of my visit, I could observe the construction of 1 World Trade Center and (I think) 4 World Trade Center. 

Although I was more than three miles north of the World Trade Center site, the 1 World Trade Center building is obviously significantly taller than any structure south of Times Square.  (I know, duh.  When it is completed in 2013, with its nearly 400 foot spire, 1 WTC will be the tallest building in the Western Hempishere and the third tallest building in the world.)  Following up on Steve's post regarding cranes on the top of skyscrapers, this photo more clearly shows the cranes on top of 4 World Trade Center.  Unfortunately, the top of 1 World Trade Center is obscured by clouds.

World Trade May 2012

All of this is background to introducing a really interesting article in today's New York Times regarding the history of skyscrapers.  I love the Streetscapes column in the Times -- they do a wonderful job of blending the history of New York City real estate with present issues.  This article is no exception.  My favorite tidbit:

In 1897 The Record and Guide, alarmed by a proposal for a building 2,000 feet high, protested that New York was open “to attack from the audacious real estate owner” who cared nothing about robbing light from the neighbors, adding, “All that is needed is a barbarian with sufficient money and lunacy.”

The article discusses the historical animosity towards skyscrapers in New York, and the political battles regarding the land use restrictions that were put in place after the turn of the last century.  The article begins and ends with a description of the construction of 1 World Trade Center, concluding:

No one talks seriously about banning skyscrapers anymore; indeed congestion has been in recent decades praised, not derided. And so we have before us the prospect of a tower one-third of a mile high, that will be considered a monument of civic pride, a literal triumph out of tragedy. What people would have said in the 1880s and 1890s is barely a footnote.

But as a law professor, of course, I love footnotes.

Tanya Marsh

June 8, 2012 in Land Use, Travel | Permalink | Comments (0) | TrackBack (0)

Is There Anything Walmart Can't Do?

It's no secret that Walmart often faces fierce opposition when it announces plans to enter into a new community.  Well, two young economists have added another data point in the fight over the effects of the big blue stores.  Devin Pope, an assistant professor at the University of Chicago's business school, and his brother, Jaren, an assistant professor at BYU, tested how the presence of a Walmart store influences property values. 

According to their research, the value of homes within half-a-mile of a Walmart increase an average 2 to 3 percent more than homes that aren't close to the giant retailer.  Homeowners with property a half-mile to a mile from a Walmart see a 1 to 2 percent bump. 

The study concludes, "On average, the benefits to quick and easy access to the lower retail prices offered by Wal-Mart and shopping at these other stores appear to matter more to households than any increase in crime, traffic and congestion, noise and light pollution or other negative externalities that would be capitalized into housing prices."

Steve Clowney

June 8, 2012 | Permalink | Comments (0) | TrackBack (0)

Thursday, June 7, 2012

America's 11 Most Endangered Historic Places

Princeton

The National Trust for Historic Preservation just released it's annual list of endangered architectural, cultural, and natural sites.  This years list includes Theodore Roosevelt's Ranch, Princeton Battlefield, and Malcolm X's house.  See the full slideshow here.

Steve Clowney

(Image: Princeton Battlefield from Flickr user thisistami)

June 7, 2012 | Permalink | Comments (0) | TrackBack (0)

Mulvaney on Exactions

Tim-MulvaneyTim Mulvaney (Texas Wesleyan) has posted Exactions for the Future (Baylor Law Review) on SSRN.  Here's the abstract:

New development commonly contributes to projected infrastructural demands caused by multiple parties or amplifies the impacts of anticipated natural hazards. At times, these impacts only can be addressed through coordinated actions over a lengthy period. In theory, the ability of local governments to attach conditions, or “exactions,” to discretionary land use permits can serve as one tool to accomplish this end. Unlike traditional exactions that regularly respond to demonstrably measurable, immediate development harms, these “exactions for the future” — exactions responsive to cumulative anticipated future harms — admittedly can present land assembly concerns and involve inherently uncertain long-range government forecasting. Yet it is not clear these practical impediments are sufficient to warrant the near categorical prohibition on such exactions that is imposed by current Takings Clause jurisprudence. After analyzing the features of takings law that constrict the use of such an exactions scheme, this article offers an alternative approach to exaction imposition involving temporal segmentation of the government’s sought-after interest, which could provide a public tool to address anticipated future harms while offering at least some protection against takings claims.

Steve Clowney

June 7, 2012 | Permalink | Comments (0) | TrackBack (0)

Wednesday, June 6, 2012

June ABA RPTE Professor's Corner Conference Call

As I mentioned last month, the Real Property Trust and Estate Law Section of the ABA will host monthly "Professor's Corner" Conference Calls featuring three property professors who will discuss recent cases.  You do not need to be a member of the section or the ABA to participate in the call, but we certainly hope that you will consider joining.

The June call will be held on June 13th at 12:30 eastern/11:30 central and so on.  The call-in information is:

Dial in number: 866/646-6488

Participant Pass code: 9479109954

I will moderate the June call, which will feature:

Ray Brescia, Visiting Clinical Associate Professor of Law at Yale, currently on leave from Albany Law, will discuss recent developments in "Reverse Redlining" litigation in the wake of the financial crisis.  He will focus on recent settlements of actions against Wells Fargo and Countrywide Financial, and provide a brief overview of other ongoing litigation.

Shelby Green, Associate Professor at Pace Law School will discuss Italian Cowboy Partners, Ltd. v. The Prudential Ins., Co. Of Am., 341 S.W.3d 323 (Tex. 2011).  In this case, the court considered whether disclaimer-of-representations language in a lease contract precludes a fraud in the inducement claim.

John V. Orth, William Rand Kenan Jr. Professor of Law at University of North Carolina School of Law will discuss RBS Citizens, N.A. v. Ouhrabka, 30 A.3d 1266 (Vt. 2011) in which the court considered a creditor’s challenge to the doctrine of tenancy by the entireties.

If you are interested in participating in future calls, please let me know!

Tanya Marsh

June 6, 2012 in Recent Cases | Permalink | Comments (0) | TrackBack (0)

Mineral Leases Create New Prosperity

The New York Times details how hydrofracking dollars are starting to pour into the small, rural communities of Ohio and Pennsylvania:

Here in Noble County, . . . Eclipse Resources, a Pennsylvania company, mailed $16 million in oil- and gas-leasing checks last month to 70 households whose property has been found to sit atop oil and gas reserves. Working with a lawyer in nearby Marietta, the residents were able to band together to negotiate an unusually lucrative deal with the company that paid $4,000 an acre and 19 percent royalties on oil and gas production, and included safeguards to protect water and land. (The standard has been $20 to $30 an acre, one-sixth royalty rates, and no protections for water and land.)

Steve Clowney

June 6, 2012 | Permalink | Comments (1) | TrackBack (0)

Klein on Water Bankruptcy

KleinChristine Klein (Florida) has posted Water Bankruptcy (Minnesota Law Review) on SSRN.  Here's the abstract:

Many western states are on the verge of bankruptcy, with debts exceeding assets. And yet, they continue to take on additional debt through contracts and other commitments. Although such distress may sound like an outgrowth of the 2008 recession, this crisis involves water, not money. In particular, the problem concerns the western prior appropriation system of water law, which allocates the right to use water under the priority principle, “first in time, first in right.” In many states, the system is so “over-allocated” that it promises to deliver annually much more water than nature provides. The crisis will deepen as climate change causes variability in the water supply, and as over-tapped rivers push ever more species to the brink of extinction.

Increasingly, states recognize that the solution lies in reallocating water rights to support critical values such as environmental preservation. Bedrock principles of water law — including the requirement of “beneficial use” and the public trust doctrine — support such reallocation. But any such attempt runs up against fierce resistance from those who hold the oldest water rights and insist on a strict interpretation of another core principle — that of priority. In a titanic struggle for dominance between foundational concepts of water law, priority has been losing ground. Bargaining in the shadow of the priority doctrine, watershed stakeholder groups have convened throughout the West to negotiate plans to reallocate water for society’s most pressing and beneficial needs. But with considerable unease, these groups have developed ad hoc processes in search of a consistent conceptual framework. To harmonize the rhetoric of priority with the reality of reallocation, this Article develops the new concept of “water bankruptcy” that draws an analogy between water reallocation and Chapter 9 municipal bankruptcy. Just as traditional bankruptcy provides a familiar, comprehensive, and well-reasoned model that gives debtors a fresh start under dire circumstances, so too might water bankruptcy assist states in restructuring debts and reallocating assets related to society’s most precious, life-sustaining, and irreplaceable resource.

Steve Clowney

June 6, 2012 | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 5, 2012

Freeman v. Quicken Loans Inc.

The Supreme Court recently handed down a decision that could have a substantial effect on the fees that consumers pay during real estate transactions.  The case, Freeman v. Quicken Loans, centered on a provision of the Real Estate Settlement Procedures Act (RESPA) that prohibits lender kickbacks and referral fees.  The issue in Freeman was whether RESPA covers an "unearned" fee charged by the originator--these are fees for which lenders provide no service. SCOTUSblog reported that "the borrower Freeman argued that the plain language of the statute applies whenever a fee is “give[n]” for services that are not provided, even if the originator retains the whole fee.  The lender Quicken argued that the statute applies only when the fee is shared between two parties (the classic “kickback” situation)."

Last week the court handed down a 9-0 opinion in favor of Quicken; "Unearned" fees do not violate federal law as long as they are not split with other party.  The opinion declared that if Congress wants to control the level of the fees that a single actor can charge it would need to draft a more specific statutory provision.

The LA Times worries that the case opens the door to "controversial 'administrative' fees levied by real estate brokers, and could encourage the practice of 'marking up' fees by mortgage lenders, escrow officers and others that had been banned by federal regulators for the last decade."

Steve Clowney

June 5, 2012 | Permalink | Comments (0) | TrackBack (0)

Lefcoe on the End of Redevelopment in California

LefcoeGeorge Lefcoe (USC) has posted Redevelopment in California: Its Abrupt Termination and A Texas-Inspired Proposal for A Fresh Start on SSRN.  Here's the abstract:

This paper describes how redevelopment in California came to an end with the California Supreme Court’s decision in California Redevelopment Association v. Matosantos and how redevelopment could be resuscitated. The first part of the paper highlights the precipitating events leading up to the case: California’s unique property tax history, the successes and drawbacks of redevelopment, how redevelopment is financed, and the text and politics of Proposition 22, the state constitutional predicate for the Court’s opinion. The second section describes the arguments and outcome of the case in which the Court upheld a statute dissolving redevelopment agencies (RDAs) and simultaneously struck down a companion bill — a “pay-to-stay” law — that would have enabled cities and counties to preserve their RDAs by pledging local funds to the state. A concluding section proposes that California legislators consider a new redevelopment enabling law, modeled along the lines of Texas’s tax increment reinvestment zones (TIRZs). Such a statute would conform to the guidelines for constitutionality from the concluding paragraph of the Court’s opinion in Matosantos, and it would be fiscally responsible because it limits the use of tax increment financing.

Steve Clowney

June 5, 2012 | Permalink | Comments (0) | TrackBack (0)

Monday, June 4, 2012

Should We Just Buy Cuba, Already?

Purchase of land

Joseph Blocher muses over why countries no longer buy and sell territory from each other:

Somewhere along the way, the market for sovereign territory seems to have dried up, at least as far as I can tell. To be sure, there is still an active market for proprietary interests in public land; the federal government, after all, owns approximately 30% of the nation’s land. But borders–sovereign territory, rather than property–do not seem to be for sale, especially domestically. Why?

Read the post for no other reason than the great historical tidbit on Martha's Vineyard.

Steve Clowney

June 4, 2012 | Permalink | Comments (0) | TrackBack (0)

The Geography of College Grads

The New York Times investigates the lumpy distribution of college graduates in the nation's cities:

Dayton sits on one side of a growing divide among American cities, in which a small number of metro areas vacuum up a large number of college graduates, and the rest struggle to keep those they have. [...]

“This is one of the most important developments in the recent economic history of this country,” said Enrico Moretti, an economist at the University of California, Berkeley, who recently published a book on the topic, “The New Geography of Jobs.” The recession amplified the trend. Metro areas where more than one in three adults were college-educated had an average unemployment rate of 7.5 percent earlier this year, compared with 10.5 percent for cities where less than one in six adults had a college degree, according to Edward Glaeser, an economist at Harvard and the author of “Triumph of the City.

Steve Clowney

June 4, 2012 | Permalink | Comments (0) | TrackBack (0)

Recent SSRN Downloads

SsrnIn honor of the beginning of the month, here are the most downloaded property papers during the last 60 days on SSRN:

 

1.  [169 downloads] An Introduction to Property Theory
     Eduardo M. Penalver (Cornell) & Gregory S. Alexander (Cornell)

2.  [149 downloads] Modern Chinese Real Estate Law: Property Development in an Evolving Legal System (Chapter 1)
     Gregory M. Stein (Tennessee)

3.  [116 downloads] Of Backyard Chickens and Front Yard Gardens: The Conflict Between Local Governments and Locavores
     Sarah Schindler (Maine)

4.  [104 downloads] Irrevocability of Special Needs Trusts: The Tangled Web that is Woven When English Feudal Law is Imported into Modern Determinations of Medicaid Eligibility
     Mary F. Radford, (Georgia State) Clarissa Bryan (Georgia State)

5.  [93 downloads] Priceless Property
     Kirsten Matoy Carlson (Wayne State)

6.  [64 downloads] Finding Nemo Dat in the Land Title Act: A Comment on Gill v. Bucholtz
     Douglas C. Harris (British Columbia) & Karin Mickelson (British Columbia)

7.  [61 downloads] Neoliberal Land Conservation and Social Justice
     Jessica Owley, (Bufalo)

8.  [60 downloads] State Action Problems
     Christian Turner (Georgia)

9.  [59 downloads] Is the Common Law the Free Market Solution to Pollution?
     Jonathan H. Adler (Case Western)

10.  [58 downloads] The Future of Abandoned Big Box Stores: Legal Solutions to the Legacies of Poor Planning Decisions
      Sarah Schindler (Maine)

Steve Clowney

June 4, 2012 | Permalink | Comments (0) | TrackBack (0)