The Real Estate Report (May 2009)

May, 2009

	The Real Estate Report Local Government News Impacting the Real Estate Industry

New Development Traffic Analysis Detailed for Carolina North By the year 2025 Carolina North will double the amount of traffic in Chapel Hill, mainly on Martin Luther King Jr. Boulevard, according to a draft of a traffic impact analysis released earlier in May. Vanasse Hangen Brustlin Inc., the consultants for the analysis, explained that vehicle, park and ride, transit, pedestrian, bike and others would increase from 40,000 to 80,000. The study does point out that MLK Jr Blvd will see a major increase in traffic regardless of whether the project is built and that the traffic improvements made by Carolina North will make the flow of traffic much better than if the project is not built. For the full story from The Herald Sun, click here. Carrboro Subdivision Denied Colleton Crossing, a development proposed for Reynard Road between Fox Meadow and Highlands, was unanimously denied by the Carrboro Board of Alderman on May 21. The project was designed to be a 39-dwelling subdivision on 31.6 acres of land. Residents were not supportive of the project due to concerns over traffic. For the full story from The Carrboro Citizen, click here. Schools Northside Elementary Construction in Question According to Orange County’s Budget Director, with Orange County nearing its 15 percent debt limit it is unlikely that there will be money available to build Northside Elementary 11 as planned for 2011. County Commissioners approved construction of the school, between McMasters and Caldwell Street, last year but current economic circumstances have put budget spending on hold. The Board of Commissioners will continue to meet the rest of the month to discuss options. For the full story from 1360 WCHL, click here. Orange County OWASA Requests Higher Water Rates Orange Water and Sewer Authority (OWASA) is calling for a 9.75 percent rate increase, raising the water bill of a typical, 5,000 gallons per month residence from $68.24 to $74.92. The rising prices of chemicals that clean wastewater are driving up costs. The public hearing to discuss rate increases will be May 28 at 7 p.m. in the Chapel Hill Town Hall and will also be televised on local cable channel 18. For the full story from the Chapel Hill News, click here. Property Tax Rate Decrease Proposed for Chapel Hill Chapel Hill’s Town Manager Roger Stancil is calling for a property tax rate reduction of 14 percent from last year, lowering the current rate of 58 cents per $100 of assessed property value to 49.7-cents. The proposal would include no job layoffs or furloughs and no salary increases for town employees. Stancil says that last year when the economy began to plummet the Council started taking money saving measurements that were so effective that Chapel Hill has room to reduce property taxes. Approximately $20 million will be delayed in taxpayer-authorized borrowing so as to not increase an already heavy debt burden. For the full story from The News and Observer, click here. Carrboro Proposes Budget Carrboro Town Manager Steve Stewart unveiled a 2010 budget proposal on May 12 that includes a property tax rate decrease from 68.63 to 58.94 cents per $100 valuation. The rate is considered revenue neutral meaning Carrboro will not see any increase in revenue despite increases in property valuations. Stewart said that because of the economic decline over the past months his proposal is a “conservative and very safe” route to take. The Aldermen were pleased to see the proposal include a revenue-neutral tax rate while maintaining services. A public hearing for the recommended budget will be held May 26 at 7 p.m. at Carrboro Town Hall. For the full story from the Carrboro Citizen, click here. Community Visioning Task Force Seated After the Town Council voted to expand the Community Visioning Task Force earlier this month, it voted to seat the Task Force on May 18. Several seats were designated for various segments of the community including business and university. Glen Greenstreet of Greenstreet Builders will be the business community representative, Gordon Merklein for UNC-Chapel Hill, and Etta Pisano will represent UNC Health Care. Civil engineer Bruce Ballentine will also be on the Task Force, which is charged with examining Chapel Hill’s comprehensive plan and making recommendations for how it can manage future economic growth. From Staff reports Orange County and MLS Figures According to the Triangle Multiple Listing Service 57 homes were sold in Orange County in April representing a 48 percent decrease from that month last year. April’s inventory for sale represented a 6.5 month supply, up from 5.9 a year ago while the median price fell 11 percent to $258,000. Overall, Triangle statistics for the past few months are trending better. For instance, 1,628 homes were sold in the Triangle in April, which is the highest monthly total in the past six months. Supply for the Triangle is also dipping from 14.9 months in November to 7.5 months in April. For the full story from Triangle Business Journal, click here. Orange County Manager Proposes Closing Libraries Orange County Manager Laura Blackmon’s budget proposal, given May 19, may close Carrboro Branch and Cedar Grove Libraries and decrease school funding by $3.1 million. In order to reflect this year’s property revaluation, Blackmon proposed a budget of approximately $177.6 million. This three percent budget decrease from last year would be reached by decreasing the tax rate from 99.8 cents per $100 assessed property to a “revenue neutral” 85.8 cents per $100. With the closure of the libraries, Blackmon suggested transferring staff to the new main county library opening in Hillsborough in the fall. At least one commissioner, former-Carrboro Mayor Mike Nelson, opposed Blackmon’s proposal to close the libraries. The county must adopt the budget on or before its final meeting of the fiscal year on June 16. For the full story from the News and Observer, click here. New Plans for University Square of Chapel Hill University Square, located on Franklin Street in downtown Chapel Hill, is likely to be replaced with a mixed-use development, according to plans developed by UNC-Chapel Hill. The redevelopment would be on a site including Granville Towers, which currently houses 1,300 students. Last year the university’s support foundation reported it would purchase the property from an affiliation with the Kenan family for $45.75 million. The foundation will own the property while the university will handle management and development. The deal is scheduled to close July 1. For the full story from the New and Observer, click here. Football Hikes Chapel Hill Economy Chapel Hill and Orange County economies received $6.5 million plus $325,000 in local and state tax revenue from the crowds of the 2008 North Carolina-Notre Dame football game. Nathan Tomasini, of Virginia Commonwealth University’s Center for Sports Leadership, says this study also shows that of the football game attendees from North Carolina, 38.6% were from the Triangle and 45% of all attendees planned to attend all Carolina home games. Programs like “Touch Downtown Chapel Hill”, designed to entice fans to start early and stay late, focused on benefiting 100 restaurants and 50 specialty stores. The program will be continuing in 2009. For the full story from the Tourism Newsletter, click here. The Triangle Local Counties Ace Clean Air Report Orange and Chatham counties rank among America’s cleanest for short term particle pollution along with two others in North Carolina, according to the American Lung Association. This annual report assigns a report card grade for counties across the country based upon three components—annual particle pollution, 24-hour particle pollution, and smog and ozone levels. Durham County received a passing C for 24 hour pollution but an F for ozone levels. Along with some of the cleanest counties, North Carolina’s Charlotte-Gastonia-Salisbury Metropolitan Statistical Area and Rowan County had two of the worst ozone levels in the country. For the full story from the Chapel Hill Herald, click here. Jordan Lake Bill Moving Through State Legislature A bill was recently passed by the House that would require Durham and surrounding communities to take responsibility for Jordan Lake’s cleanliness. The bill represents a compromise between the City of Durham, environmental groups and legislators over how best to improve water quality in Jordan Lake. The revamped bill will not require communities to develop catch basins or reduce impervious surface in already developed areas unless those areas are being redeveloped. The original bill that emerged from the NC Environment Management Commission required such efforts. Communities in Jordan Lake’s watershed will be required to begin planning public-education efforts in the coming months and if no water quality improvement occurs by 2014 new measures have to be identified. For the full story from the Herald-Sun, click here. Chatham Alters Budget Spending Next year’s Chatham County budget proposal includes a slash in merit based salary increases, a three percent decrease from current spending and a “revenue neutral” tax rate. Chatham recently underwent a property revaluation similar to Orange County and County Manager Charlie Horne is recommending that the property tax rate be reduced from 65.3 cents per $100 valuation to 60.32 cents. After excluding debt payments, County spending will actually be seven percent lower than previously due to departments cutting funding from some positions. Although these changes are painful to make, Horne says the county is in better shape than the state and most other local governments. For the full story from the Chapel Hill Herald, click here. Chatham Passes Liquor by the Drink Chatham businesses are now able to apply for liquor licenses after County residents voted 65 percent in the affirmative for a liquor by the drink referendum. Jeffrey Starkweather, one of the main proponents of the change, says that not only will business owners have the opportunity to acquire licenses, but that he is going to work with East West Partners to bring a new hotel to Powell Place. Without being able to offer liquor by the drink, a hotelier likely would not be interested in Chatham County. Opposition for the change came from people concerned with the rise in alcohol-related vehicular complications. For the full story from the Chapel Hill Herald, click here. Durham City Manager makes Budget Proposals City Manager Tom Bonfield proposed a 2009-10 fiscal year budget that would eliminate 35 jobs whose incumbents will either be laid off or forced to take on a different position on city staff. Bonfield’s budget will also cancel annual merit-based wage increases for all but fire personnel and sworn police officers. If passed, the cuts would be the first for Durham since 1996. Town Councilman Mike Woodard supports Bonfield’s proposal because the layoffs are not just positions at the bottom of “the city hierarchy.” Woodard explains that it is important to understand what these eliminations and cuts will mean “operationally and programmatically.” For the full story from The Herald-Sun, click here. DPS Board Rejects County Budget, Proposes Tax Increase On May 11, the Durham School Board voted to add $2.1 million to the superintendent’s budget, a decision opposing the county manager’s proposal for a $2.5 million budget cut. Instead of cutting 377 teacher and assistant positions, board member Stephen Martin’s new proposal would keep 33 teacher and 25 teacher assistant jobs. Martin also motioned for a 2-cent increase in property taxes to create $4.6 million, which would allow the county to meet its spending goals and keep a popular after school program, Encore!. Martin’s motioned for a tax and spending increase was unanimously approved. For the full story from The Herald-Sun, click here. Grubb & Ellis Reports Triangle Market Trends Triangle retail vacancy reached a new high, surpassing 8 percent, with 1.5 million square feet of vacancy in the first quarter 2009, according to Grubb & Ellis Research on retail market trends. Even though Orange County had a lower retail vacancy rate than Downtown Raleigh, Cary, and Central Durham at the end of March, Grubb & Ellis predict vacancy will continue to rise for the entire Triangle throughout the year. Research also shows that the leveling out of the unemployment rate in the Raleigh-Cary and Durham-Chapel Hill areas is due more to the increased discouragement of workers than of stabilization in the job market. For the full story from Grubb and Ellis, click here. State and Nation State Passes Smoke-Free Bill A bill enforcing smoke-free restrictions in all North Carolina restaurants and bars was signed into law by Governor Bev Perdue recently. Supporters noted the 2006 Surgeon General Report that states no amount of second hand smoke is healthy and that putting employees of restaurants and bars at risk for health issues in exchange for a paycheck was unethical. Fines of up to $200 will be issued to establishments that do not enforce the new law along with $50 fines for smokers who do not abide. For the full story from The Herald-Sun, click here. Minority Populations Growing Exponentially According to a recent US Census Bureau report, North Carolina may be headed toward a future similar to the United States where Asian, Black, and Hispanic minorities outnumber the Caucasian population. In 2010 minorities are estimated to make up almost 33 percent of the state’s population. Presently, 45 percent of children in North Carolina under the age of 5 are minorities. The Hispanic population in North Carolina grew by 79 percent between 2000 and 2003, with Asians in second place growing by 48 percent, and Blacks by 13 percent. Census officials are now predicting that minorities will outnumber the Caucasian population in the U.S. by the year 2050. For the full story from the News & Observer, click here. The Real Estate Report is produced monthly by the Chapel Hill Chamber of Commerce and the Greater Chapel Hill Association of Realtors

The Real Estate Report (April 2009)

Volume 4, Issue 4

April, 2009

	The Real Estate Report Local Government News Impacting the Real Estate Industry

New Development UNC Plans Hospital in Hillsborough UNC Health Care has filed for permission to build a 68-bed hospital in the Waterstone Economic Development District just south of Hillsbrough. UNC Hospitals main campus has 725 beds at its main facility and is running close to capacity. The move to Hillsborough would help alleviate some traffic congestion on campus and expand the hospital's capacity to serve its patients.The project is estimated at $227 million. While the purchase of land by UNC would remove some land from the property tax rolls, the hospital could draw in new medical related businesses to the Waterstone Economic Development District that has been stagnant for some time. For the full story from the Triangle Business Journal, click here. Plans for Hotel at Southern Village Dropped DR Bryan, developer of Southern Village in Chapel Hill, dropped plans for a 90-100 room hotel originally planned for the central business district of that neighborhood. It was hoped that the hotel would bring new shoppers and customers to the village businesses but the plan ran into opposition from the neighbors. Instead of building the hotel, Bryan plans to aggressively market village businesses this summer and help capture greater sales from visitors to nearby Southern Community Park. For the full story from the News and Observer, click here. Greenbridge Builders Propose Property Tax Freeze Developers of the Greenbridge project in downtown Chapel Hill are proposing a property tax freeze for the Northside neighborhood, immediately adjacent to the Greenbridge project. Residents of Northside have said the project will raise their property tax rates and force them to leave. In response, developers have looked at projects in Indiana and Washington, D.C. that keep property taxes at a fixed rate even when property values go up. County officials have not expressed optimism that the freeze could be implemented, and even if it could, it would need to be passed by the State Legislature. For the full story from the Daily Tar Heel, click here. Schools East Principal Retiring East Chapel Hill High School Principal Dave Thaden announced his retirement in mid-April. Thaden has served as principal for thirteen years and has worked in the Chapel Hill-Carrboro School district for another 17 years in various positions. Thaden cited health issues as part of the reason for his decision to step down. For the full story from the Carrboro Citizen, click here. Schools Considering Major Cuts The Chapel Hill-Carrboro City School Board is considering major cuts in the district's budget due to reductions in funds from Orange County and the State. Next year's budget incorporates $700,000 in budget cuts but according to Superintendent Neil Pedersen, it may need to be cut by $4 million. Cuts are targeted at arts, music, physical education, the world language program and teachers for the academically gifted. For the full story from 1360AM WCHL, click here. Orange County Transfer Tax Issue Resurfaces Almost one year after voters smashed the transfer tax at the ballots, Orange County Commissioners voted on a resolution stating, "support for the ability of all local governments to apply impact fees and/or taxes and to implement real estate transfer fees and/or taxes." Should the State Legislature approve new revenue options for the County, including a transfer tax increase, the Commissioners could enact the fee without local voter approval. Commissioner Steve Yuhasz was the lone opposition to including the transfer tax in the Board's legislative priorities list. For the full story from the Chapel Hill Herald, click here. Downtown Partnership Hires New Executive Director The Chapel Hill Downtown Partnership has hired a new executive director to replace former director Liz Parham. Jim Norton, current president of Tulsa (OK) Downtown Unlimited, will start at the Partnership on June 1. Norton has served as president of Downtown Unlimited for nearly 20 years and chaired a statewide effort in Oklahoma to approve tax increment financing and advocated for residential development in the downtown. For the full story from the Daily Tar Heel, click here. Unemployment Down in County Orange County's March unemployment figures were down by 0.4 percent over February to 6.1 percent. The unemployment rate remains the lowest in the state. Overall, 84 counties saw a decline in unemployment rate in March, which is a great sign. Neighboring Durham County dropped from 8 percent to 7.7 and Chatham County moved from 8.6 to 7.9 percent during the same period. For more unemployment data from the North Carolina Employment Security Commission, click here. Chapel Hill Town Council Adopts Improved Parking Regulations At their meeting on Monday, March 16, the Chapel Hill Town Council adopted a number of important downtown parking policy changes including a "courtesy ticket" and improved parking signage. The changes were put forward by the Chapel Hill Downtown Partnership and were unanimously adopted by the Council in a 9-0 vote. Chapel Hill-Carrboro Chamber President Aaron Nelson spoke in support of the recommendations at the meeting. The new "courtesy ticket" will give first-time parking offenders a free warning ticket that tells visitors and patrons of downtown they've parked illegally or overstayed at a meter instead of issuing a financial penalty. The move is aimed at welcoming and encouraging visitors to come downtown. Further, Town parking lots (Lots 2, 3, 4, 5) will be renamed to more geographic names giving people a better sense of their location and when combined with new, improved signage should make it easier to locate parking downtown. The Council also asked the Town Manager to review the impact of potentially making parking free in Town lots after 6pm and increasing on-street meter rates by $.25 per hour to offset the difference. Other changes include the following: developing a parking board to oversee policy and parking operations for the Town, move toward unified payment systems for all parking, evaluate event parking fees, work to add additional public parking using private lots, and begin planning for the future needs of parking. >From Chapel Hill eNews IFC and Carrboro Merchants Begin Dialogue The Inter-Faith Council for Social Service is looking at a location in downtown Carrboro to potentially house a full-service food operation. The change in location comes as IFC is working to relocate its Community House, currently on West Rosemary Street, to a former Duke Energy building in northern Chapel Hill. The food service operations, also currently housed in the West Rosemary building, will need to remain in a downtown according to IFC's Board of Directors. IFC is eyeing its property at 110 W. Main Street where the food pantry is currently located but the relocation has local businesses concerned that panhandling and loitering will come with the relocation. That concern has prompted IFC director Chris Moran to start a dialogue with business owners in Carrboro about where the best location for a soup kitchen might be. For the full story from the Chapel Hill Herald, click here. New LED Lights Installed in Downtown Chapel Hill A new pilot program between the Town of Chapel Hill and Duke Energy launched last week when Duke installed light-emitting diodes, or LEDs, along part of East Franklin Street. The project is a 12-month program that is testing the performance of the lights, which are supposed to use less energy, burn brighter and last longer than traditional high-pressure sodium lights. The LEDs came from RTP company Cree and cost about eight times more than traditional lights. Chapel Hill is the first town in North Carolina to try the lights and will use data and information from the pilot to decide whether to use LEDs more broadly. Residents are encouraged to submit comments about the lights here. For the full story from the Chapel Hill Herald, click here. County Economic Developer Working on Solar Cluster Brad Broadwell, Orange County Economic Development Director, is moving forward with the creation of a solar technology cluster that would expand the commercial tax base and bring new jobs to the county. A cluster is a geographic concentration of similar businesses and their suppliers and supporting businesses. Broadwell is working with existing solar companies like MegaWatt Solar and Solar Tech South to boost their image in the region and is looking to tap into stimulus funds. Broadwell has approached the developers of Buckhorn Village about potentially creating a solar technology park in place of the originally planned retail project. For the full story from the Chapel Hill Herald, click here. County Looking to Sell Surplus Buildings In an attempt to generate some revenue, Orange County Commissioners agreed to put four properties up for sale. The properties are the Clerk of Court Annex, 112 N. Churton St., Hillsborough; the Graham Building, 118 N. Churton St., Hillsborough; the Homestead Community Center, Homestead Road, Chapel Hill; and the old ABC store, N.C. 49, Cedar Grove. The County will get appraisals on three of the properties before selling them. The appraisals are part of the standard devestiture process the county uses to sell buldings. The tax value of all of the buildings except for the ABC store was $850,000. For the full story from the Carrboro Citizen, click here. Sustainable Community Visioning Task Force Receiving Applications The Town of Chapel Hill is now receiving applications for the recently created Sustainable Community Visioning Task Force. The Task Force is the idea of Mayor Kevin Foy and is charged with making recommendations to the Council "regarding the design, timing, scale and appropriate location of higher density, mixed use" and "sustainable development along major transportation corridors in Chapel Hill." The Task Force will consist of 11 members, five citizens-at-large and six members from various town boards and commissions. If you are interested in applying to be a part of this important task force, click here. The Triangle Chatham Gearing Up for Mixed Drink Referendum Supporters and opponents of mixed beverage sales in Chatham County are preparing for a show down at the ballot box on May 5. The vote will determine whether Chatham County will allow businesses to sell mix drinks, something supporters say would be an economic boon to the county. Supporters also point out that DWI arrests in dry communities such as Asheboro are higher than in Greensboro or High Point, which allow mixed drink sales. Opponents say the sale of mixed drinks will lead to more alcohol-related vehicular accidents. For the full story from the Herald Sun, click here. More Development Eyed at Southpoint WRS Realty Inc, a developer of Wal-Mart shopping centers, has made an offer of more than $20 million for a 55-acre plot of land near Southpoint Mall in Durham. The 55-acres are west of Fayetteville Road in the Kentington Heights neighborhood. While a deal has not yet been reached, Kentington residents have sought to sell their land for some time to a commercial developer. For the full story from the News and Observer, click here. Local Option Sales Tax Clears House The North Carolina House of Representatives approved House Bill 148, local option sales tax, on April 22. The bill would allow voters in all North Carolina counties to approve a sales tax increase for transit-projects. Specifically, it would allow voters in Forsyth, Guilford, Wake, Durham and Orange counties to approve a half cent sales tax increase and a $2 increase in car registration fees. Voters in the other 94 counties to approve a quarter cent sales tax increase. Mecklenburg County already won approval and used its half cent sales tax increase to fund an ambitious light rail project in its downtown. The next step for the bill is approval in the Senate. For the full story from the News and Observer, click here. State and Nation New Commercial Tenants Leasing Smaller Spaces Robert Bach, Chief Economist with Grubb and Ellis, reported last month that real estate tenants nationwide are using less space per deal. Bach sites that the average industrial lease signed in the first quarter of 2009 was 22,974 sq ft, which is the lowest its been this decade. In the office category, the average lease signed was 12,808 sq ft which is 50 percent smaller than the quarterly average from 2000 to 2008. The report states three reasons for the reduction in square footage: 1) Tenants signing new leases may have recently laid off staff and are "right-sizing" their space, 2) Tenants may be less optimistic about future expansion plans and are less aggressive in the amount of space being leased, 3) Smaller companies are scooping up the good deals being offered by landlords while larger companies are waiting for the economy to improve. From Grubb and Ellis "Weekly Market Insight" The Real Estate Report is produced monthly by the Chapel Hill Chamber of Commerce and the Greater Chapel Hill Association of Realtors

Real Estate Report (March 2009)

March, 2009

New Development Carrboro Aldermen Approve Claremont The Carrboro Board of Aldermen approved the fourth and fifth stages of the Claremont development in Carrboro. The project is located along Homestead Road and will include 27 townhomes and 69 single-family homes once built. The central issue in the approval of the project's final stages was the connection of the new development with the neighboring Wexford development. Wexford neighbors were deeply concerned about a road connection between the neighborhoods and the amount of new traffic it would create. The Carrboro Aldermen reached a compromise over the connection issue by requiring the Claremont developer to build a bike and pedestrian connection with a roadway sufficient enough for a firetruck. The roadway would be blocked by bollards and only used in case of emergency. For the full story from the Carrboro Citizen, click here. Council Denies Aydan Court Project At a Chapel Hill Town Council meeting last week, the Council voted unanimously against extending the R-SS-C development zone beyond downtown setting up a furious hearing with Aydan Court developer Carol Ann Zinn. The Aydan Court project followed the R-SS-C zoning discussion and needed the zone to be approved in order for the condominium and townhouse project to potentially be approved. Zinn aleged the Council was unfair in its process saying, "I think what you have done is outrageous. I think it's a discredit to the trust that we as citizens put in you for a fair process with integrity and transparency." Click here to hear Mayor Kevin Foy's response to Zinn on WCHL 1360AM. For the full story from the Chapel Hill Herald, click here. Carolina North Fiscal Impact Study Finalized Economic planning consultant TischlerBise released the fiscal impact study of the first (15-year) phase of development at Carolina North. The report shows that sales and property tax revenues would offset the costs incurred by local governments. The Town of Chapel Hill is the one jurisdiction that stands to lose somewhat in the project as the report shows a $12 million loss over 15 years, largely coming from a fire station that would need to be built in year 9. "This [report] says it shouldn't be terribly difficult to make this fiscally neutral," said Jack Evans, the Carolina North project's executive director. For the full story from the News and Observer, click here. Schools Schools Looking for Ways to Trim Budget The Chapel Hill-Carrboro City School District is facing a budget shortfall of $875,000 for fiscal year 2009 and is looking at ways to close the gap. Superintendent Neil Pedersen submitted potential action steps that include reductions in non-personnel expenses in the central office and the loss of a reading teacher at East and Chapel Hill High. Other potential cuts include reductions in after school programs and media center specialists. Click here to hear a sound clip from School Board Chair Lisa Stuckey and for more information about this story from 1360AM WCHL. CHCCS Releases Reading Results Students in the Chapel Hill-Carrboro City Schools continue to outperform their counterparts across North Carolina in reading, despite a drop in reading test performance. This year, significant changes were made in the tests given to students in grades 3-8, including setting higher standards for attaining proficiency. As a result, 78.5 percent of CHCCS students posted proficiency in reading while in 2008, that number was 93.4 percent. The drop in scores in the Chapel Hill-Carrboro district is approximately one-half of the decline seen statewide. “In raising standards, we may make students better readers in the end, but the presentation of the results the first year with new standards can be demoralizing to students and staff," said Executive Director for Testing and Program Evaluation Diane Villwock. For the full story, click here. Orange County Chapel Hill Town Council Adopts Improved Parking Regulations At their meeting on Monday, March 16, the Chapel Hill Town Council adopted a number of important downtown parking policy changes including a "courtesy ticket" and improved parking signage. The changes were put forward by the Chapel Hill Downtown Partnership and were unanimously adopted by the Council in a 9-0 vote. Chapel Hill-Carrboro Chamber President Aaron Nelson spoke in support of the recommendations at the meeting. The new "courtesy ticket" will give first-time parking offenders a free warning ticket that tells visitors and patrons of downtown they've parked illegally or overstayed at a meter instead of issuing a financial penalty. The move is aimed at welcoming and encouraging visitors to come downtown. Further, Town parking lots (Lots 2, 3, 4, 5) will be renamed to more geographic names giving people a better sense of their location and when combined with new, improved signage should make it easier to locate parking downtown. The Council also asked the Town Manager to review the impact of potentially making parking free in Town lots after 6pm and increasing on-street meter rates by $.25 per hour to offset the difference. Other changes include the following: developing a parking board to oversee policy and parking operations for the Town, move toward unified payment systems for all parking, evaluate event parking fees, work to add additional public parking using private lots, and begin planning for the future needs of parking. From Chapel Hill eNews Orange County Manager Resigns County Manager Laura Blackmon, the first female manager in Orange County, sent a letter to County employees on March 9 announcing her resignation. In the letter, Blackmon announced she and her husband are leaving to go to Tennessee and she will be resigning in June. Blackmon will have been manager for about two and a half years by that point and did not give specifics for her resignation in the letter. The resignation comes amidst an $8.7 million budget shortfall and citizen uprising over recent property revaluations. For the full story from the News and Observer, click here. Planning Board to Bring New Petition Before Council The Chapel Hill planning board submitted a new petition to the Town Council at the March 23 meeting regarding a Land Use Management Ordinance text amendment. Citizens and developers spoke against a past petition by the planning board saying it would force more commercial projects through the Special Use Permitting (SUP) process and add unnecessary delays to projects. The planning board responded by delaying the issue and and instead submitted a new petition that would allow redevelopment and renovation projects greater than 20,000 square feet in the downtown to be exempt from the SUP process so long as there are no exterior building changes or additions in square footage. From Staff notes Commissioners Say "Too Late" To Rescind Revaluations In a work session last week, Orange County commissioners agreed it was too late to rescind the property revaluations that have alarmed thousands of property owners in the county. County Attorney Geoff Gledhill advised the commissioners that state law does not allow counties to rescind revaluations. Were the revaluation rescinded, commissioners pointed out that it could double the current $8.7 million budget shortfall and exacerbate major budget cuts. Regarding the impact of the increases, tax assessor John Smith said the majority of taxpayers would see a tax increase. Data from the county show that more than 250 households saw an increase of more than 100 percent in their home value. For the full story from the Chapel Hill Herald, click here. Carrboro Merchants Launch WalkCarrboro.com Jesse Kalisher, president of the Carrboro Merchants Association, has led a new effort to draw residents and tourists to 22 Carrboro businesses through a Web site called www.walkcarrboro.com. The Web site lists various Carrboro businesses and also includes a map helping people navigate the town and parking. Beyond the site, Kalisher printed 10,000 copies of the map, which was designed by Carrboro artist Richard Clout. For the full story from the Chapel Hill News, click here. New LED Lights Installed in Downtown Chapel Hill A new pilot program between the Town of Chapel Hill and Duke Energy launched last week when Duke installed light-emitting diodes, or LEDs, along part of East Franklin Street. The project is a 12-month program that is testing the performance of the lights, which are supposed to use less energy, burn brighter and last longer than traditional high-pressure sodium lights. The LEDs came from RTP company Cree and cost about eight times more than traditional lights. Chapel Hill is the first town in North Carolina to try the lights and will use data and information from the pilot to decide whether to use LEDs more broadly. Residents are encouraged to submit comments about the lights here. For the full story from the Chapel Hill Herald, click here. Water Partnership Inches Closer Orange County Commissioners moved closer to joining the Jordan Lake Regional Water Supply Partnership, electing to place a draft memorandum of understanding for the Partnership on an upcoming agenda. The Partnership brings together the cities of Durham and Cary, Chatham County, Orange County and the Orange Water and Sewer Authority to jointly address water supply planning, future allocation requests, and a possible future intake facility. Commissioners expressed some reservation that the City of Durham would act as the lead agency in the effort and that no elected officials would be part of the partnership management team. The Commissioners will vote on the draft memorandum on Tuesday night. For the full story from the Herald Sun, click here. Sustainable Community Visioning Task Force Created The Chapel Hill Town Council approved the creation of the Sustainable Community Visioning Task Force at a recent Council meeting. The Task Force is the idea of Mayor Kevin Foy and would be charged with making recommendations to the Council "regarding the design, timing, scale and appropriate location of higher density, mixed use" and "sustainable development along major transportation corridors in Chapel Hill." The Task Force will consist of 11 members, five citizens-at-large and six members from various town boards and commissions. At the Council meeting, members modified the committee somewhat agreeing that at least one spot be reserved for a businessperson. For the full story from the Chapel Hill Herald, click here. County Facing Major Budget Shortfall Orange County Government is facing an $8.7 million budget shortfall this year, which amounts to 5 percent of this years $183 million budget. The shortfall is equal to 6.2 cents on the county's property tax rate. County Manager Laura Blackmon has listed various ways to make up the shortfall including service reductions and school district funding. For the full story from the Chapel Hill News, click here. The Triangle Durham Sales Tax Figures Bring Relief Durham Commissioners got a Christmas present in March as December sales tax figures came in 12 percent higher than 2007 figures. The increase was surprising given the November 2008 numbers were off by 20 percent compared to 2007. County Manager Mike Ruffin was pleased with the figures but cautioned that "one month does not make a trend." For the full story from the News and Observer, click here. More Development Eyed at Southpoint WRS Realty Inc, a developer of Wal-Mart shopping centers, has made an offer of more than $20 million for a 55-acre plot of land near Southpoint Mall in Durham. The 55-acres are west of Fayetteville Road in the Kentington Heights neighborhood. While a deal has not yet been reached, Kentington residents have sought to sell their land for some time to a commercial developer. For the full story from the News and Observer, click here. Durham Crime Dropping in 2009 Crime figures for the first two months of 2009 were down considerably compared to that period of 2008. Violent crime, which includes murder, rape, robbery, and agravated assault, was down 36 percent. Property crime was down 1 percent. According to Police Chief Jose Lopez, police have worked hard to identify suspects in multiple robberies which likely has reduced the violent crime rate. For the full story from the News and Observer, click here. Poll Shows Initial Support for Transit Sales Tax A new poll released by the Regional Transportation Alliance, a Triangle business leadership group, cites some support for a regional transit system funded through a sales tax. The poll interviewed residents of Orange, Durham and Wake Counties and found that 53 percent of respondents would vote in favor of a half-cent sales tax increase for new and/or expanded public transportation. The same poll shows that 57 percent of residents would not support a property tax increase for public transportation. Interestingly, only 9 percent of those surveyed said regional transit should be a top priority for elected officials. Twenty-nine percent of residents said attracting more jobs to the area should be elected officials' top goal. For the full story from the Triangle Business Journal, click here. Census Shows Raleigh Area is Fastest Growing Census figures released last week show the Raleigh-Cary metropolitan area is the fastest growing area in the country. The Raleigh-Cary area includes Wake, Johnston and Franklin counties and grew by 4.3 percent from July 2007 to July 2008. The closest area in terms of growth is Austin, Texas which grew at a rate of 3.8 percent during the same period. The figures for Raleigh-Cary do mark a slowdown for the area from the previous two years when it great at a rate of 4.7 percent. The Durham-Chapel Hill metropolitan area did not crack the top ten but still grew at a steady rate of 2.5 percent. Durham, Orange, Chatham and Person counties make up that area. For the full story from the News and Observer, click here. State and Nation New Commercial Tenants Leasing Smaller Spaces Robert Bach, Chief Economist with Grubb and Ellis, reported last week that real estate tenants nationwide are using less space per deal. Bach sites that the average industrial lease signed in the first quarter of 2009 was 22,974 sq ft, which is the lowest its been this decade. In the office category, the average lease signed was 12,808 sq ft which is 50 percent smaller than the quarterly average from 2000 to 2008. The report states three reasons for the reduction in square footage: 1) Tenants signing new leases may have recently laid off staff and are "right-sizing" their space, 2) Tenants may be less optimistic about future expansion plans and are less aggressive in the amount of space being leased, 3) Smaller companies are scooping up the good deals being offered by landlords while larger companies are waiting for the economy to improve. From Grubb and Ellis "Weekly Market Insight" MBA Estimates Major Increase in Originations The Mortgage Bankers Association upped its expectations for 2009 saying the low interest rates and new federal programs will spur significant refinancing. MBA's original national estimate for 2009 originations was just shy of $2 trillion; its revised figure is $2.78 trillion. Should the numbers this year actually pan out, it would make 2009 the fourth-biggest mortgage year in history. For the full story from the Triangle Business Journal, click here. Federal Action Helping Local Real Estate Market Local real estate agents say they are seeing some positive signs after the Federal Reserve's purchase of more than $1 trillion in troubled mortgage debt and treasuries. Sammy Martin, one of the owners of Franklin Street Realty, says he's seen rates around 4.75 percent for a 30-year fixed rate mortgage and that there are 275 homes for sale in Chapel Hill that are less than $350,000. Martin says sales were really slow during January and February but that March figures are triple the amount seen in the previous two months. For the full story from 1360 WCHL, click here.

Real Estate Report (February 2009)

Volume 4, Issue 2

February, 2009

Events Chatham County Development Briefing—March 10 With the real estate industry changing so rapidly, it is vital to have good up-to-date information about the local market. On Tuesday, March 10 from 7:30-9:30 a.m., the Chapel Hill-Carrboro and Chatham Chambers of Commerce, Greater Chapel Hill Association of Realtors, and Home Builders Association of Durham, Orange and Chatham Counties will host the third annual Chatham County Development Briefing at the Governors Club. Attendees can expect to get the most-up-to-date information about the status of development projects in Chatham County, hear about the County’s new economic development plan, and recent policy changes that will affect future development. This is a must attend event for anyone interested in Chatham County real estate. The briefing is presented by Osprey Marketing and Advertising and sponsored by Governors Club, Newland Communities, the Greater Chapel Hill Association of REALTORS, and Carolina Meadows. Seats are $25 for members, $35 for nonmembers and includes a full breakfast. Last year’s event sold out quickly so please register soon at www.carolinachamber.org/members/register.html or call 919-967-7075. New Development Innovation Center Approved The first building of Carolina North, the Innovation Center, was unanimously approved by the Chapel Hill Town Council. The Innovation Center will take University research ideas and turn them into businesses. University officials were pressed by Town elected officials to commit to energy efficiency standards beyond what is currently recognized by the American Society of Heating, Refrigeration and Air Conditioning Engineers (ASHRAE). Prior to the meeting, UNC committed to making the Innovation Center 20 percent more efficient than ASHRAE standards but eventually agreed to make it 25 percent more efficient. For the full story from the Herald Sun, click here. Mixed Use Project Considered in Northern Chapel Hill The Chapel Hill Town Council was presented with a potential development plan for a 13 acre parcel of land along Martin Luther King Jr. Drive near the intersection with Weaver Dairy Road Extension. The Altemeuller development, as it is called, would call for medium to high density mixed use including a hotel, office and retail space, and 110 townhomes. Bill Christian, developer of the property, is looking to target people making 120 percent of the area median income or about $60,000. You can listen to part of his presentation here. Del Snow, head of the Northern Area taskforce, expressed concern over the project that you can listen to here. For more on this story from 1360AM WCHL, click here. Glen Lennox Plans Starting from Scratch On Sunday, February 8, developers from Grubb Properties met with Glen Lennox residents for a facilitated discussion about future development at Glen Lennox. Residents in the area are seeking to become Chapel Hill’s seventh neighborhood conservation district and protect the neighborhood’s walkability and tree-lined streets. Grubb Properties, owner of Glen Lennox, says it has scrapped original plans for the site and is taking citizen feedback and comment into consideration as they form new plans for redevelopment. For the full story from the Chapel Hill News, click here. Council Getting Pushback over East 54 According to an article in the Chapel Hill News, the Chapel Hill Town Council is getting a number of complaints from citizens over the magnitude of the East 54 development, located along Highway 54. “Virtually all the reaction I get to East 54 is negative”, says Council member Matt Czajkowski. However, many of the council members who voted in support of the project still believe it was the right decision and critically important to a future rail line that is projected to stop behind the development. Regarding a regional rail system, Council member Bill Strom says, “In order to get federal and state support for these projects, you have to have density organized in a way that promotes ridership.” In order to come to some agreement in the community over future development, Mayor Kevin Foy plans to unveil a plan for collecting input and defining locations for desired density at an upcoming Council meeting. For the full story from the Chapel Hill News, click here. Schools School District Reports Lowest Dropout Rate in State The Chapel Hill-Carrboro City Schools have the lowest dropout rate in the state during 2007-2008. Fifty seven students, or 1.53 percent of students, dropped out of school last year, according to the District’s Web site. The rate is up slightly from 2006-2007 when only 41 students dropped for a rate of 1.12 percent. The most commonly cited reasons for leaving were attendance issues and a desire to attend a community college program. Recently, the District has made efforts to combat some of these problems by forming the Middle College program at Durham Tech. Middle College allows students to take high school and community college courses simultaneously. Drop outs were mostly even across the District’s three high schools and one middle school. For the full story from CHCCS, click here. CHCCS Releases Reading Results Students in the Chapel Hill-Carrboro City Schools continue to outperform their counterparts across North Carolina in reading, despite a drop in reading test performance. This year, significant changes were made in the tests given to students in grades 3-8, including setting higher standards for attaining proficiency. As a result, 78.5 percent of CHCCS students posted proficiency in reading while in 2008, that number was 93.4 percent. The drop in scores in the Chapel Hill-Carrboro district is approximately one-half of the decline seen statewide. “In raising standards, we may make students better readers in the end, but the presentation of the results the first year with new standards can be demoralizing to students and staff," said Executive Director for Testing and Program Evaluation Diane Villwock. For the full story, click here. Orange County Downtown Partnership Recommends Parking Tweaks On February 11, the Chapel Hill Downtown Partnership Board developed a series of recommendations for the Town Council regarding parking downtown. The recommendations were based on a study by Rich & Associates and include initiating “courtesy tickets” for first-time offenders in the downtown and a 50 percent increase in on-street parking rates to 25 cents per 10 minutes. The increased rate is designed to encourage the use of parking decks which cost $1.30 per hour and would also boost revenues from $250,000 to $375,000. The courtesy ticket would mean a decrease in revenues for the town but would improve visitor perceptions about parking in the community. The recommendations will be presented at the Council meeting this evening. For the full story from the Herald Sun, click here. Alderman Identify Priorities The Carrboro Board of Aldermen brainstormed priorities for the coming year at its retreat early this month. The Board talked about increasing aid to nonprofits and controlling taxes, among other things. In terms of the budget, Mayor Mark Chilton said sales tax revenues in Carrboro were flat, which was a bright sign in this economy. The Mayor also said the Town would adjust its property tax rate down to ensure a revenue neutral rate after the latest property revaluation. Board members will review the priorities and ideas at a work session on March 10. For the full story from the Carrboro Citizen, click here. Carrboro Merchants Launch WalkCarrboro.com Jesse Kalisher, president of the Carrboro Merchants Association, has led a new effort to draw residents and tourists to 22 Carrboro businesses through a Web site called www.walkcarrboro.com. The Web site lists various Carrboro businesses and also includes a map helping people navigate the town and parking. Beyond the site, Kalisher printed 10,000 copies of the map, which was designed by Carrboro artist Richard Clout. For the full story from the Chapel Hill News, click here. Foy Pushes for Regional Transit Funding Chapel Hill Mayor Kevin Foy made a strong push for regional transit in his annual state of the town report on February 9. Mayor Foy said regional transit is needed “for our economic health in the future, for our environmental health in the future and, frankly, for our sanity in the future, because we can’t continue to get on Interstate 40 to get around.” The Mayor plugged the half cent sales tax and urged residents in the Triangle to get behind the tax in order to partially fund the system. The remaining funds would come from the Federal government. Mayor Foy also encouraged supporting local businesses and applauded the collaboration between Town and University officials during Halloween and the relocation of the homeless shelter. For the full story from the Carrboro Citizen, click here. Planning Board Petitions Council over Site Plan Process The Chapel Hill planning board brought a petition before the Town Council at a January 12 meeting regarding their concern over developers “subverting” the site plan approval process. Essentially, the planning board wants to tighten the requirements for developments that would be subject to the site plan approval process. Projects with a floor area of less than 20,000 square feet and that disturb less than 40,000 square feet of land are currently allowed to go through the site plan process and not be subject to Council approval. The planning board’s initial petition proposed cutting those figures in half, thus requiring more projects to go through the lengthier special use permitting process. The petition was referred to town staff for comment and the Chamber is working to set up a meeting with staff to provide input on what, if any, changes would occur. From staff notes Carrboro Seeking Feedback about Budget Tomorrow night, the Town of Carrboro will hold a public hearing in which residents can voice items to include in the 2009-2010 budget. Town Manager Steve Stewart will present a draft budget on May 5 and the Town will again hold a public hearing on the budget on May 26. Residents can email comments to the Town Clerk at swilliamson@townofcarrboro.org and review budget materials at www.townofcarrboro.org/ms/budget.htm. From the Carrboro Citizen Water Partnership Inches Closer Orange County Commissioners moved closer to joining the Jordan Lake Regional Water Supply Partnership, electing to place a draft memorandum of understanding for the Partnership on an upcoming agenda. The Partnership brings together the cities of Durham and Cary, Chatham County, Orange County and the Orange Water and Sewer Authority to jointly address water supply planning, future allocation requests, and a possible future intake facility. Commissioners expressed some reservation that the City of Durham would act as the lead agency in the effort and that no elected officials would be part of the partnership management team. The Commissioners will vote on the draft memorandum on Tuesday night. For the full story from the Herald Sun, click here. Town Council Nixes Branch Library Expansion At the February 9 Chapel Hill Town Council meeting, Council members voted 8-1 to continue with a $16 million expansion of the library on Estes Drive. Town Manager Roger Stancil asked the Council at the meeting whether it wanted to reconsider alternatives to the expansion but Council members felt now was not the time to consider a new library. The Chamber spoke in support of reconsidering a library in the downtown as it would bring more people into the downtown business district. For the full story form the News and Observer, click here. The Triangle Durham County School Funding Cut Durham County Manager Mike Ruffin and School Superintendant Carl Harris reached an agreement at the end of January to cut $3 million in funding for Durham schools. The $3 million total is a three percent cut for the schools and is consistent with a three percent reduction in funding for noncounty agencies. The cuts at schools will not affect classrooms; the schools are expecting to use $2.7 million from uncommitted state lottery funds and another $400,000 earmarked for capital projects. For the full story from the News and Observer, click here. Durham Transit Center Set to Open After celebrating the opening of the Durham Performing Arts Center at the end of 2008, Durham is ready to celebrate the opening of its new Transit Center on Sunday. The station, a two-story, 10,000 square foot building, is a $17.6 million investment. City officials are working with Duke University to link buses between campus and the station. This summer, a new Amtrak station will open a few blocks from the transit station. For the full story from the News and Observer, click here. Raleigh Home Prices Down New data from real estate company Zillow show that Raleigh home prices dipped by 2.5 percent in the fourth quarter. Since a high of $209,204 in first quarter of 2008, median home values have dropped to $199,365 in the last quarter. Ten percent of all transactions in Raleigh were on foreclosed homes, compared to 20 percent nationwide. About 62 percent of homes in Raleigh have lost value this year according to Zillow. For the full story from the Triangle Business Journal, click here. Office Market Report Released By Grubb and Ellis The Triangle office market is behaving very differently according to a fourth quarter report by Grubb and Ellis. The report cites office vacancy at their highest levels since mid-2005, Class A rents flat, and 400,000 square feet of new space delivered with just 25 percent preleased. A bright spot in the report is the Chapel Hill submarket which saw vacancy decrease to 15.6 percent after UNC Dermatology leased 14,000 square feet in Southern Village. The outlook for 2009, on the whole, is not overly optimist with vacancy expected to increase. Grubb and Ellis seems optimistic that the vacancies will present opportunities for new entrepreneurs and relocating businesses lured by relatively low cost space. From Grubb and Ellis Research 4Q 2008 State Obama Outlines Home Foreclosure Plans On Wednesday, President Barack Obama outlined his plans to stem the foreclosure of up to nine million homes. North Carolina has fared well compared to the rest of the nation and the Southeast in terms of foreclosures, though some 54,000 foreclosure proceedings were started in 2008. Obama’s $75 billion plan provides incentives to lenders to reduce interest rates on troubled home loans, according to Mark Pearce, North Carolina's deputy banking commissioner. Under the plan, the federal government will provide lenders with half of the interest income lost, as a result of lower interest rates. For the full story from the News and Observer, click here. Retail Sales Up in January After six consecutive months of decline, national retail sales increased by one percent in January. The Commerce Department reported that sales excluding automobiles rose 0.9 percent from December. It is too early to tell but the one percent rise could be signs of resilience among consumers; economists predicted a 0.8 percent decline in January. However, compared to January 2008, sales were still off by 9.7 percent. According to Julia Coronado, an economist with Barclays Bank, “Consumers had cut back so sharply over the previous quarter that there was some pent-up demand on the sidelines.” For the full story from the New York Times, click here. State Incentives Program May be Revamped State lawmakers recently authorized drafting legislation that would radically transform a longstanding business tax credit program and lower the corporate income tax. The William S. Lee tax credit program has been in existence for 13 years and a study published by UNC shows that during 2001-2006 companies receiving major incentives from the program disappointingly added jobs at the same or slower rate than the statewide average. A Joint House/Senate Incentives Committee has been examining the report and is now creating a new bill that would gut the program and pump more money into the Jobs Development Industrial Grant (JDIG) program which rewards employers based on the number of jobs they create. For the story from the Triangle Business Journal, click here. The Real Estate Report is produced monthly by the Chapel Hill Chamber of Commerce and the Greater Chapel Hill Association of Realtors

Real Estate Report (January 2009)

January, 2009

	The Real Estate Report Local Government News Impacting the Real Estate Industry

New Development Council Kicks Off Southern Village Hotel Hearing Yesterday, the Chapel Hill Town Council opened a public hearing on a 120,000 square foot hotel proposed for “downtown” Southern Village. Some residents who spoke in opposition to the project were upset that the hotel will change the skyline, be destructive to neighborhood character, and eliminate parking. Other residents supported the proposal saying it would improve the quality of life in the neighborhood and support businesses. A few Town Council members were concerned about the size of the project. Councilman Ed Harrison said, “This proposal would be a lot easier to swallow if it were smaller.” The developers will present again to the Council at a meeting on February 23. For the story from the Daily Tar Heel, click here. Carolina North Meeting is Tense On Wednesday, Town Council members and members of UNC-CH’s board of trustees butted heads over what should be done with the remaining 750 acres of the 1,000 acre Carolina North site. UNC plans to build an academic and research campus over 250 acres of the site but would not agree to permanently preserve the remaining 750 acres of land as many on the Council want to. Click here for audio of the exchange between UNC Board of Trustees chairman Roger Perry and Mayor Pro Tem Jim Ward. The Innovation Center, Carolina North’s first building, will likely receive an up or down vote at the Council meeting on January 26. From WCHL 1360AM Schools Plans for New Elementary Moving Ahead Chapel Hill-Carrboro City Schools elementary school number 11 is continuing to move ahead despite the economic recession. The school is proposed to be built in the Northside neighborhood between Caldwell and McMasters streets. Concept plans for the school, the first step in the development process, were submitted to the Town in December. School Board Chairwoman Lisa Stuckey is cautious as she acknowledges plans could change, “I think we’ll see over the next several months what is going on with revenue streams to state and local government, and that might affect our plans,” Stuckey said. “I certainly hope it doesn’t. We need it badly.” The school is tentatively scheduled to open in August of 2011. For the story from the Daily Tar Heel, click here. CHCCS Releases Reading Results Students in the Chapel Hill-Carrboro City Schools continue to outperform their counterparts across North Carolina in reading, despite a drop in reading test performance. This year, significant changes were made in the tests given to students in grades 3-8, including setting higher standards for attaining proficiency. As a result, 78.5 percent of CHCCS students posted proficiency in reading while in 2008, that number was 93.4 percent. The drop in scores in the Chapel Hill-Carrboro district is approximately one-half of the decline seen statewide. “In raising standards, we may make students better readers in the end, but the presentation of the results the first year with new standards can be demoralizing to students and staff," said Executive Director for Testing and Program Evaluation Diane Villwock. For the full story, click here. Orange County Planning Board Petitions Council over Site Plan Process The Chapel Hill planning board brought a petition before the Town Council at a January 12 meeting regarding their concern over developers “subverting” the site plan approval process. Essentially, the planning board wants to tighten the requirements for developments that would be subject to the site plan approval process. Projects with a floor area of less than 20,000 square feet and that disturb less than 40,000 square feet of land are currently allowed to go through the site plan process and not be subject to Council approval. The planning board’s initial petition proposed cutting those figures in half, thus requiring more projects to go through the lengthier special use permitting process. The petition was referred to town staff for comment and the Chamber is working to set up a meeting with staff to provide input on what, if any, changes would occur. From staff notes Aldermen Looking at Ways to Improve Downtown Parking The Carrboro Board of Aldermen are reviewing findings from a downtown parking study recently completed by UNC’s Department of City and Regional Planning. The study states that parking demand throughout the entire downtown does not exceed 85 percent. However, the report says demand is greater than 85 percent in certain areas of downtown during certain times. At their meeting in mid-January, the Board expressed interest in finding some short-term solutions to the issue including improved signage to better direct visitors. Longer-term solutions might include building a parking deck, revising the parking ordinance and/or creating a parking fund. For the story from the Carrboro Citizen, click here. UNC Airport Off the Table At a press conference on January 9, Chancellor Holden Thorp formally called off the search for a new airport site in Orange County. Chancellor Thorp said that if the University will ever have a new airport that it will work more closely with the community and collaborate better with the County. A heap of pressure was applied to the University after the General Assembly authorized an airport authority for Orange County in the summer of 2008. Chancellor Thorp said that over the course of the past few months, the meetings and interviews he had with community members revealed the need for more information and due diligence on the project. In the interim, UNC will continue with a $3.5 million hanger at RDU to house the Area Health Education Centers program. For the story from the Chapel Hill News, click here. County Tax Increase Unlikely After 20 years of property tax increases, Orange County Commissioners are initially saying they oppose another increase. "It would take an extraordinary argument for me to support any [tax] increase beyond the revenue neutral rate," new Commissioner Steve Yuhasz said at the Commissioners retreat. The historical pattern for the County has been to increase spending faster than its tax base has grown and then make up the difference by raising taxes. This year, with a revaluation that reflected a 22 percent increase in the value of most properties, many commissioners are calling for a “revenue neutral rate”. The rate would be lower than the year before but still bring in as much money due to the increase in property values. For the story from the Chapel Hill News, click here. UNC Budget Cuts Could Force Layoffs After cutting budgets by five percent last November, the State is asking UNC to reduce budgets by another one percent. University administrators are concerned that budgets could be cut by another percent and the total cuts be made permanent. According to Tony Waldrop, vice chancellor for research and development, a one percent budget cut amounts to about five million dollars. In a campuswide email this month, Chancellor Holden Thorp said there would be major consequences for permanent cuts of seven percent including reduced enrollment, cutting courses and programs, and laying off faculty and staff. To date, no layoffs have occurred. For the story from the Daily Tar Heel, click here. Surge in Hotel Rooms Coming With the recently approved 300 East Main in Carrboro and East 54 in Chapel Hill, Chapel Hill and Carrboro will add 290 new hotel rooms to the current stock of 1,052 rooms. Other hotel projects, such as Chapel Hill 40, the Carolina Inn, and Southern Village, are currently going through the development review process and could add another 230 rooms. According to Laurie Paolicelli of the Chapel Hill/Orange County Visitors Bureau, the increase in rooms might cause some hardship for hotels at first but usually levels off, “Somebody always takes it on the chin… and then they get more competitive.” Paolicelli also says the increase in rooms may require looking at other tourist markets besides the University crowd. The good news is that from January to August of 2008, Chapel Hill-Carrboro hotels fared well compared to others around the nation. Local occupancy rates were up by 0.4 percent while rates were down 2.5 percent nationally. For the story from the Carrboro Citizen, click here. The Triangle Raleigh Crime Up A preliminary report by the FBI shows that crime was up in Raleigh during the first six months of 2008 compared to that same period in 2007. The statistics show a 12 percent increase in violent crime and a 2 percent rise in property crime. These figures buck nationwide trends that showed a 3.5 percent drop in violent crime and a 2.5 percent decrease in property crime. The FBI report did not provide information about Durham but early indications from the city show violent crime up a bit while property crime declined. Some leaders believe the increase in crime in Raleigh can be attributed to the 3.3 percent population increase that occurred during 2007-2008. For the story from the News and Observer, click here. Chatham Offering Five Sessions about Revaluation Chatham County’s Tax Office will offer five sessions to help property owners and others better understand the 2009 property revaluation. Presentations dates include: • January 28, 6:30 p.m., Goldston Town Hall; • January 29, 6:30 p.m., Moncure Fire Department; • February 4, 6:30 p.m., District Courtroom, Pittsboro; • February 5, 6:30 p.m., Siler City Town Hall; and • February 9, 6:30 p.m., North Chatham Elementary School Multipurpose Room. Property owners should receive the new valuations in early to mid-February. From the Carrboro Citizen Economy Prompting Durham to Build Durham County Commissioners and their staff believe now may be the best time to push forward with a number of government construction projects. The perfect storm of low-interest rates, construction companies hungry for projects, low energy costs, and reduced demand for steel and concrete in Europe and Asia is causing the Commissioners to consider pushing ahead with the financing of the $100 million Human Services Building on East Main Street and possibly the $143.5 million Courthouse complex. For the story from the Herald Sun, click here. Budget Cuts Tentatively Endorsed Mike Ruffin, Durham County Manager, laid out plans to cut the County budget in the face of an expected $14.5 million shortfall. The heaviest cut will be to the Durham Schools with $3.1 million slashed from the budget. All new open space preservation projects will also be cut bringing in a savings of $550,000. County Departments will be cut by 3 percent as will funding for Durham Technical Community College, the Museum of Life and Science, Urban Ministries, the Chamber of Commerce, Downtown Durham Inc., the Animal Protection Society and other nonprofits. For the story from the Herald Sun, click here. Newland Communities Honored with Green Award Briar Chapel, a 1,589 acre mixed use community by Newland Communities in Chatham County, was honored recently by the U.S. Green Building Council for its 11,000 square foot clubhouse. The USGBC awarded the clubhouse a LEED Silver certification for reducing energy and water consumption. Beyond the clubhouse, Briar Chapel is making other major efforts to be green. Briar Chapel is the largest community in the region to require its homebuilders to comply with the Green Building Initiative developed by Green Home Builders of the Triangle and ENERGY STAR. For the story from the Herald Sun, click here. State North Carolina is Fourth Fastest Growing State According to the U.S. Census Bureau, North Carolina was the fourth fastest growing state from July 2007 to July 2008. The state’s population grew by two percent, or 180,820 residents, during that time. Only Utah, Arizona and Texas grew faster than North Carolina from 2007-2008. For the full story, click here. State Incentives Program May be Revamped State lawmakers recently authorized drafting legislation that would radically transform a longstanding business tax credit program and lower the corporate income tax. The William S. Lee tax credit program has been in existence for 13 years and a study published by UNC shows that during 2001-2006 companies receiving major incentives from the program disappointingly added jobs at the same or slower rate than the statewide average. A Joint House/Senate Incentives Committee has been examining the report and is now creating a new bill that would gut the program and pump more money into the Jobs Development Industrial Grant (JDIG) program which rewards employers based on the number of jobs they create. For the story from the Triangle Business Journal, click here. State to Accelerate Key Projects In early January, North Carolina’s top officials agreed to press the gas pedal on several key government building projects totaling $740 million. Governor Mike Easley estimates the accelerated projects will create more than 25,000 new jobs. The new funds will accelerate a number of construction projects including university buildings, a museum and prisons by a few months. One of the projects to be accelerated is the construction of a new Dental School building at UNC. For the story from the Herald Sun, click here. Online Holiday Sales Down The Triangle Business Journal recently reported that holiday sales plummeted to their lowest levels since 2001. ComScore, a group that tracks spending, cited that from October 1 to December 28, orders at online retailers slipped to $36.8 billion from $38.4 billion last year. A few companies did see increases in traffic compared to last year, however, including Apple, Hewlett-Packard and Amazon.com. ComScore cites five fewer shopping days between Thanksgiving and Christmas and the economic recession as reasons for the overall downturn. For the story from the Triangle Business Journal, click here. Former Commissioner Moses Carey Tapped to Lead ESC After serving as an Orange County Commissioner for more than 20 years, Moses Carey was appointed by Governor Bev Perdue to be chairman of the Employment Security Commission (ESC). The ESC leads many of the work-force related services across the state and acts as a broker for helping workers in need of jobs connect with businesses in need of workers. Carey acknowledged the difficult economic climate he faces but has a clear view of his goal as chairman, “The important thing is for the ESC to be there to support and provide services for people who are displaced and re-engage them with employment opportunities.” For the story from the Herald Sun, click here. The Real Estate Report is produced monthly by the Chapel Hill Chamber of Commerce and the Greater Chapel Hill Association of Realtors

Real Estate Report (December 2008)

December, 2008

	The Real Estate Report Local Government News Impacting the Real Estate Industry

New Development Neighborhood Concerned about Possible Development Neighbors of a proposed new development called Colleton Crossing addressed the Carrboro Alderman in a December meeting, saying the new development would disrupt the existing neighborhood. The new plan calls for 39 new single family homes located off Reynard Road and Tally Ho Trail. Homes would likely be priced from $500,000-$800,000, with six being sold to the County Land Trust for $130,000. The primary concern of the residents is that the added development would increase traffic by 390 trips daily and would create a safety issue for kids playing in and around the street. For the full story, click here. Developer Seeks Housing Exemption Carrboro developer Trip Overholt appeared before the Carrboro Aldermen to ask that his proposed development, Verida, be exempted from the town’s affordable housing requirement. He claims that his development, which uses a co-housing model, and features $289,000, 3 bedroom, 2 bath detached condos, are more affordable than anything else being built in Carrboro right now. The Board of Aldermen did not make a decision on the affordability issue and are to bring it up again at a future meeting. For the full story, click here. Schools County Commissioners Approve Impact Fee Increase Orange County Commissioners approved an impact fee increase at their meeting in early December. For homes built in the Orange County school district, the $3,000 fee will remain the same in 2009 but increase to $3,749 in 2010, a 25 percent increase. Homes built in the Chapel Hill-Carrboro school district will have a $6,092 fee this year, which is a 38 percent increase over the current fee. In 2010, Chapel Hill-Carrboro home fees will increase again to $7,616. This is the first time the fees have increased since 2001. For the full story, click here. CHCCS Releases Reading Results Students in the Chapel Hill-Carrboro City Schools continue to outperform their counterparts across North Carolina in reading, despite a drop in reading test performance. This year, significant changes were made in the tests given to students in grades 3-8, including setting higher standards for attaining proficiency. As a result, 78.5 percent of CHCCS students posted proficiency in reading while in 2008, that number was 93.4 percent. The drop in scores in the Chapel Hill-Carrboro district is approximately one-half of the decline seen statewide. “In raising standards, we may make students better readers in the end, but the presentation of the results the first year with new standards can be demoralizing to students and staff," said Executive Director for Testing and Program Evaluation Diane Villwock. For the full story, click here. Orange County Forum Weighs Density Neighborhoods for Responsible Growth held a meeting at Chapel Hill Town Hall to discuss the town’s pursuit of density and ways to manage Chapel Hill’s growth. Citizens shared their thoughts on housing affordability and expanding the commercial tax base, while others voiced concerns about building design and the need to update the comprehensive plan. The meeting included a panel of experts, and was attended by about 100 people. For the full story, click here. Discussion Over Carolina North Continues Representatives from UNC Chapel Hill and members of the Chapel Hill Town Council continued discussions about Carolina North in an early December meeting. The meeting focused on how to stage and scale the development over its fifty year build out. Councilmember Bill Strom reminded university representatives that the town expects the development to function as a “mixed used, transit friendly, development from the outset.” A development agreement is expected to be reached by June of 2009. For the full story, click here. Downtown Parking to Tighten Up Once work on the Lot 5 development begins, parking in downtown Chapel Hill is likely to get worse before it gets better. Ram Development Co may break ground on 140 West condominium project at Parking Lot 5 in January, which will eliminate 170 parking spaces. The town has tried to put together other parking options, in the meantime, with most of the identified options on the west end of Franklin Street. Further plans and solutions for parking in downtown will be outlined in a January report by the Chapel Hill Downtown Partnership. For the full story, click here. Chapel Hill Transit Explores Pittsboro-Chapel Hill Route A direct express bus between Pittsboro and Chapel Hill is being developed by the two towns and is garnering support from Chatham County residents that make the commute to Chapel Hill daily. Many of the details, including stops, hours and costs are being worked out, and Chapel Hill Transit has received a state grant that will cover up to 50 percent of the cost for 18 months. It is estimated that 30 percent of UNC and UNC Hospital employees live in Chatham and Alamance counties. For the full story, click here. Town Manager Projects Budget Cuts The Chapel Hill Town Council is in the midst of deciding how to handle the local fall-out from the financial market crises. Town Manager Roger Stancil recently gave the Council an update on town revenue projections, citing that sales tax revenues are likely to be 5 to 10 percent below projections. Stancil is also projecting less revenue growth from property revaluations that will be done in 2009 and a decrease in money collected from development fees. In order to meet those challenges, Stancil has reduced expenditures by 5 percent -- approximately $2.5 million -- and declared that no departmental positions can be filled without his approval. In response to Stancil's report, Councilman Jim Ward urged a budget cut of $1 million beyond the prescribed five percent, arguing that budget shortfalls would likely be deeper and more long lasting. For the full story, click here. County Examining Procedures for Reviewing Potential Airport At a meeting this morning, the Orange County attorney, manager, and planning director met to discuss how they would handle a potential application for a new airport in the County. Part of the discussion in the meeting focused on determining whether a new airport authority created by UNC would be a private, public, or quasi-public body. Determining this will help shape how the potential project would move forward. If a private developer makes application to build the airport, a special use permit would be required and could take between six to nine months for approval. In Monday’s meeting, staff also reviewed whether the county’s current zoning is adequate for an airport and the properties surrounding it. Currently, county zoning only deals with building heights on an airport site and not the land around it. For the full story, click here. County Commissioners Welcome New Members The Orange County Commissioners welcomed newly elected Commissioners Pam Hemminger, Bernadette Pelissier and Steve Yuhasz to the board in a December meeting. The new seven-member board also elected Valerie Foushee as board chair and Mike Nelson as board vice-chair. Additionally, long time serving board member Moses Carey retired after 24 years of service. From the News of Orange Tax Values Up in Orange County The total assessed valuation for Orange County increased from $11.5 billion in 2004 to $14 billion in 2008, a 22 percent increase. Most properties throughout the county saw an increase of between 20 and 30 percent in value. The increase seems shocking to many, especially in light of recent reports of the housing and credit slump but appraisers say homeowners should remember the revaluation takes into account the past four years, which were strong years. For the full story, click here. The Triangle Pittsboro on Biofuels Map The Roundtable on Sustainable Biofuels, located in Lausanne, Switzerland, recently established an office in Pittsboro. The Chatham County office will lead efforts in America to create a seal of approval for biofuels produced in an ecologically sound manner. The Roundtable hired away Matt Rudolf of the Piedmont Biofuels Cooperative, a group that makes and sells biodiesel locally. For the full story, click here. Chatham County Revises Land Use Rules After two years of work, the Chatham County Board of Commissioners has approved major revisions to the County’s zoning ordinance, soil erosion and sedimentation control ordinance and subdivision regulations, and also adopted a new stormwater ordinance. The new regulations will help the county ensure that growth and development is managed, so that they “can better meet the infrastructure needs that come with population growth, according to George Lucier, chairman of the Chatham County Board of Commissioners. For the full story, click here. Entrepreneurship Fund Established in Chatham County Entrepreneurs in Chatham County could get a boost thanks to a recently implemented loan fund. The Chatham County Economic Development Corporation and the Center for Community Self-Help have established the Chatham Loan Fund, which will help finance loans to residents who are starting or operating a business in the area. Dianne Reid, president of the Chatham County EDC, says the fund will target local women, minorities and residents as young as 18. For the full story, click here. Durham Government Bracing for Tax Shortfall Durham County Manager Mike Ruffin recently instituted a hiring and buying freeze in county government. The city of Durham has had such a freeze for the past few months. Both the city and county will have a better sense of revenues in January when property tax revenue is received. In the meantime, Durham is seeing a drop in inspections and deed registrations, typically strong revenue sources. The County’s sales tax revenue during the first fiscal quarter (July-September) was close to projections but commissioners expect revenue to drop in the coming months. For the full story, click here. Business Closings and Layoffs Update Data derived from a statewide survey of newspaper accounts of business closings and layoffs and additional information supplied by the Employment Security Commission, suggests that approximately 467 individuals have been affected by regional (Orange, Chatham, Durham and Wake Counties) closings and layoffs. More specifically, 8 Durham businesses have closed, resulting in 70 layoffs and 17 Wake County businesses have closed, which affect 397 people. There were no closing or layoffs mentioned for Orange or Chatham counties. Light Rail Plans Possibly Changed Officials are now thinking a future rail-based transit system in the Triangle can use lightweight coaches and engines over its entire 56-mile length, rather than the heavyweight units they once envisioned. The potential change in approach comes after managers of the N.C. Railroad Co. signaled last month that they believe the region's main east-west rail corridor is wide enough to support a stop-and-go light-rail system for local traffic and heavier commuter trains for people arriving here from places as far afield as Greensboro and Goldsboro. Light and heavier rail would share the corridor with the Norfolk Southern and CSX freight trains that will continue traveling through the area, planners say. “It's been done elsewhere," Durham Transportation Manager Mark Ahrendsen said, "Definitely not on the same tracks, but on the same right of way." For the full story, click here. State Federal Reserve Bank Expects Recession to mid-2009 Minutes from the Fed’s Open Market Committee show that its members believe the national economy has been in a recession since the summer and will continue to struggle through the first two quarters of 2009. The bank says declining gas prices should ward off inflationary pressure. For the full story, click here. North Carolina's Banks Prepared for Bad Loans North Carolina’s state-chartered banks are more equipped than their national peers to handle future loan losses, according to new federal data. The FDIC says that the 93 FDIC insured NC state banks have reserves for loan losses equal to 87.6 percent of loans and leases that are at least 90 days past due. The nation-wide average for state-chartered banks is 69.5 percent and the average for nationally chartered banks is 85 percent. For the full story, click here. North Carolina is Fourth Fastest Growing State According to the U.S. Census Bureau, North Carolina was the fourth fastest growing state from July 2007 to July 2008. The state’s population grew by two percent, or 180,820 residents, during that time. Only Utah, Arizona and Texas grew faster than North Carolina from 2007-2008. For the full story, click here. The Real Estate Report is produced monthly by the Chapel Hill Chamber of Commerce and the Greater Chapel Hill Association of Realtors

Real Estate Report (November 2008)

Volume 3, Issue 11

November, 2008

	The Real Estate Report Local Government News Impacting the Real Estate Industry

New Development New Hotel Proposed for Southern Village Southern Village developers D.R. Bryan and John Fugo unveiled a proposal to Southern Village residents in late October that features an "architecturally distinctive hotel with approximately 100 rooms," underground parking and 5,000 square feet of street-level retail space. The plan is to build on an existing parking lot, although Bryan said recently that he is open to uses other than a hotel. The key, he said, is to add another draw to a roster of businesses that includes anchors Weaver Street Market and The Lumina Movie Theater. The plan was scheduled to go before the Town Council last week but was pulled from the agenda by the developers at the last minute. For the full story, click here. Council Gives Feedback on Homestead Road Project The Chapel Hill Town Council gave the Cary firm The Design Response mixed feedback at a public hearing on Monday night. The firm is considering a mixed-use project along Homestead Road on the Fraley Property that would include 32 townhomes-- five "affordable" -- and two two-story buildings featuring up to 49,000 square feet of office space. Members of the Town Council offered suggestions, including improving traffic patterns, maximizing the proposed retail space and mixing the affordable housing throughout the project. For the full story, click here. Schools District Disagrees over Impact Fees A proposal to increase school impact fees for the first time in seven years has the support of one of Orange County's two school districts, while the other is in favor of keeping the fee at its current level. Members of the Chapel Hill-Carrboro City School Board approved a resolution in September that urges the county commissioners to increase impact fees "in order to provide a source of funding to construct new schools to keep pace with the district's growing student population and the escalating cost of construction." The Orange County Schools Board of Education, however, agreed last month to support the current levels, adding that it "supports the county commissioners in all their efforts to fully fund our school district." For the full story, click here. Orange County Town Manager Projects Budget Cuts The Chapel Hill Town Council is in the midst of deciding how to handle the local fall-out from the financial market crises. Town Manager Roger Stancil recently gave the Council an update on town revenue projections, citing that sales tax revenues are likely to be 5 to 10 percent below projections. Stancil is also projecting less revenue growth from property revaluations that will be done in 2009 and a decrease in money collected from development fees. In order to meet those challenges, Stancil has reduced expenditures by 5 percent -- approximately $2.5 million -- and declared that no departmental positions can be filled without his approval. In response to Stancil's report, Councilman Jim Ward urged a budget cut of $1 million beyond the prescribed five percent, arguing that budget shortfalls would likely be deeper and more long lasting. For the full story, click here. James Merritt Appointed to Chapel Hill Town Council At a recent Town of Chapel Hill Council meeting, James Merritt was appointed by the Council to replace the late Councilman Bill Thorpe. Seven people sought the nomination to the Council, including Will Raymond, Gene Pease and Loren Hintz. Merritt, a retired middle school counselor and assistant principal, says he will focus on issues of public safety and affordable housing as well as Carolina North. For the full story, click here. Smaller Halloween Considered a Success Despite losses in revenue Halloween night, business owners, community officials and residents are calling the downsized Halloween celebration a success. “We really enjoyed partnering with the town officials to make it a safe Halloween,” said Robert Poitras, the owner of Carolina Brewery in Chapel Hill. There was a smaller, more manageable crowd, and officials say that Halloween was as good as they could have hoped for. However, more changes are expected next year. “I personally think it’s never small enough,” said Phil Smith, event coordinator for Chapel Hill police. Smith said town officials hope to implement and improve many of the same procedures used this year for Halloween 2009. Chapel Hill Public Information Officer Catherine Lazorko said that although cost estimates are not in for this year’s Halloween, rough estimates have it at about the same price tag as last year, $221,000. For the full story, click here. Innovation Center on Hold Alexandria Real Estate Equities, the firm developing the Innovation Center on Carolina North, has put the project on hold given the national economic downturn. University officials expect the project will occur once the economy turns around. The Chapel Hill Town Council is considering UNC’s request for a special use permit for the Innovation Center and will continue a public hearing on it at their January 26 meeting. For the full story, click here. County Officials Weigh 2009-10 Budget Issues As the nation’s economic future remains unclear, officials say it’s too early to worry about potential Orange County budget shortfalls. An early county budget report predicted a roughly $9.5 million shortfall between revenues and expenditures for the 2009-10 budget. “We do a process where we show where some budget issues will be coming up,” said Orange County Budget Director Dean Coffey. “We presented to the board things that we know are going to be issues.” But Coffey said the predicted shortfalls may not be as drastic as the early report indicates, so county officials are not yet taking action. Coffey said it is too early to predict exactly what the budget will look like for the next fiscal year, and real budget discussions won’t begin until early 2009. For the full story, click here. Orange County "lost" Millions Officials may take $5.9 million from Orange County's savings account to replace money they thought they had in capital accounts. The money was not in the capital accounts but was logged in the wrong accounts or line items. The mistakes, according to Orange County Finance Director Gary Humphreys, date back at least five years before he or County Manager Laura Blackmon were hired. "If I were to be asked to explain it to somebody else, I might be able to do it," said Commissioners Chairman Barry Jacobs. "I'm not sure I'd be right. I might be able to sound authoritative, but I'm not sure I'd be right." For the full story, click here. Comprehensive Plan Passed The Orange County Comprehensive Plan was passed unanimously by the Board of Commissioners during a November meeting. The Greater Chapel Hill Association of REALTORS was part of the Orange County Comprehensive Plan Coalition, which did not endorse the plan. The Coalition did not believe the plan laid out a compelling or adequate vision for growth in the County and neglected significant public input. The GCHAR will continue to be active during the implementation of the plan. From the Daily Tar Heel Airport Impact Study Results Questioned N.C. State University economist Mitch Renkow is skeptical of the recently released consultant’s report suggesting a new general aviation airport would inject $40 million to $53 million each year into Orange County's economy. The study, commissioned by UNC and done by Talbert & Bright, is based on a previous study by the same firm that examined possible sites for a new airport. Renkow believes the figures are “implausibly large.” For the full story, click here. Update from Chancellor Thorpe Chancellor Thorp recently sent an email update to the faculty and staff of the University of North Carolina at Chapel Hill. In his update he highlighted how the global economic crisis will affect the University’s budget in the coming months and years. His points were as follows: • North Carolina has cut one-time (non-permanent) state appropriations by 4 percent; an additional 1 percent is expected imminently. A 5 percent cut adds up to about $25 million for the University. • UNC has received no word that a general state or UNC system hiring freeze is imminent. The funding designated in this year's state budget for university building repairs, renovations and new capital projects has been frozen. • The university is planning for likely permanent (recurring) state budget cuts for fiscal 2009-2010 as revenues are expected to decline. • The state does not completely fund the University. Other revenue streams include: tuition and fees, sales and services such as patient care, research contracts and grants, athletics, and private support. Two New Restaurant Openings Johnny's restaurant has opened in Carrboro at 901 West Main Street. It was formerly known as Johnny's Sporting Goods (mainly bait and tackle) and now serves gourmet coffee, pastries and bread from Durham's Guglhupf Bakery, seasonal produce and microbrew beer. Shula’s 347 recently opened in the Sheraton Chapel Hill on Europa Drive. Shula’s serves breakfast, lunch and dinner at the full-service hotel. The restaurant’s atmosphere is casual and chic, sporting dark woods, flat panel TV’s and a sleek sports bar. Shula's 347 Grill has everything from gourmet salads to fresh specialty fish, and exclusively serves The Shula Cut—the same custom cuts and aging process from the legendary Shula's Steak House. From the Orange County/Chapel Hill Visitors Bureau County Turnout Tops 70 percet, Most Voting Early The unofficial Orange County turnout numbers for the 2008 general election break records in voter turnout for the state, according to the North Carolina Board of Elections Web site. One stop voting totaled 51,964 ballots and absentee voting by mail accounted for 3,466. Additionally, 19,490 residents voted in the traditional manner on Election Day. In total, over 70 percent of eligible Orange County voters voted. For more information on this year’s voter turnout in Orange County and throughout the state, visit the N.C. Board of Elections Web site at www.sboe.state.nc.us. For the full story, click here. Orange County Election Results N.C. State Senate District 23 Candidate Percent Votes Ellie Kinnaird 73.37 51,739 Jon G. Bass 26.63 18,780 N.C. House of Representatives District 50 Candidate Percent Votes Bill Faison 100 17,894 N.C. House of Representatives District 54 Candidate Percent Votes Joe Hackney 100 7,236 N.C. House of Representatives District 56 Candidate Percent Votes Verla Insko 100 30,835 Orange County Board of Commissioners At-Large Candidate Percent Votes Bernadette Pelissier 69.48 48,115 Kevin Wolff 30.52 21,132 Orange County Board of Commissioners District 1 (pick 2) Candidate Percent Votes Valerie Foushee 53.38 50,556 Pam Hemminger 46.62 44,155 Orange County Board of Commissioners District 2 Candidate Percent Votes Steve Yuhasz 100 54,670 The Triangle Credit Crunch Delaying Chatham School With credit markets tightening, Chatham County officials say their plans to build a fourth high school in the northeastern part of the county have been delayed as very few of the 12,000-14,000 homes approved there have been built. The County is focusing its school infrastructure investments in renovations to Northwood High School in Pittsboro and completing a new middle school in the Briar Chapel area. Chatham County Schools Superintendent Robert Logan says the renovations to Northwood should be finished by August 2009 and the new middle school will be done by August of 2010. For the full story, click here. Chatham to Revalue Properties After examining delaying property revaluations for one year, Chatham County Commissioners said they would not hold off but institute new values on January 1. Initially, the Commissioners were interested in delaying the revaluation to give tax payers a financial break, however data from the County tax office show the savings would not be significant. George Lucier, chair of the Commissioners says, "The estimated costs of a one-year delay were considerably higher than initial reports indicated.” For the full story, click here. Durham Performing Arts Center Slated to Open November 30 Construction workers are putting the finishing touches on the new Durham Performing Arts Center. The Center, along with the Durham Bulls Athletic Park and American Tobacco complex, is a cornerstone of the transformation of Downtown Durham. Blues legend B.B. King, who will give a concert November 30, will be the first performer in the new, 2,800-seat theater. The city of Durham is sponsoring a free, public open house and ribbon-cutting December 1. On Dec. 13, R&B artist John Legend will be the guest artist for the inaugural celebration of the performing arts center. Tickets for events that have been announced are available at www.DPACnc.com, or through www.Ticketmaster.com. Light Rail Plans Possibly Changed Officials are now thinking a future rail-based transit system in the Triangle can use lightweight coaches and engines over its entire 56-mile length, rather than the heavyweight units they once envisioned. The potential change in approach comes after managers of the N.C. Railroad Co. signaled last month that they believe the region's main east-west rail corridor is wide enough to support a stop-and-go light-rail system for local traffic and heavier commuter trains for people arriving here from places as far afield as Greensboro and Goldsboro. Light and heavier rail would share the corridor with the Norfolk Southern and CSX freight trains that will continue traveling through the area, planners say. “It's been done elsewhere," Durham Transportation Manager Mark Ahrendsen said, "Definitely not on the same tracks, but on the same right of way." For the full story, click here. Glaxo Makes RTP Sole Headquarters GlaxoSmithKline will make Research Triangle Park its sole U.S. headquarters and cut almost 2,000 sales jobs, the company said recently. The move eliminates the dual headquarters that London-based GSK has had in the U.S. since the 2000 merger that created GSK. Company spokeswoman Mary Anne Rhyne says the move makes sense in the midst of a major restructuring for GSK, “The announcements today are all aimed at streamlining the organization, and simplifying the business model.” RTP was picked over its Philadelphia office in part because the company has a bigger footprint here. The company has about 5,000 workers in RTP and owns 35 buildings on that campus. Rhyne says GSK also expects its new head of U.S. pharmaceuticals to be based in RTP. For the full story, click here. State Federal Reserve Bank Expects Recession to mid-2009 Minutes from the Fed’s Open Market Committee show that its members believe the national economy has been in a recession since the summer and will continue to struggle through the first two quarters of 2009. The bank says declining gas prices should ward off inflationary pressure. For the full story, click here. State Unemployment Hits Seven Percent The Employment Security Commission released figures for October which showed the State unemployment rate at seven percent. In October of last year, unemployment was at 4.7 percent. North Carolina’s unemployment rate is now higher than the national rate, which is 6.5 percent. Nevertheless, the state did create 5,076 jobs in October with most of those increases occurring in the construction industry. For the full story, click here. Online Shopping Growth Slowing According to a new report from ComScore, U.S. consumers are shopping less, even on-line. The study shows that online spending grew 6 percent in the third quarter, down sharply from a 13 percent annual growth rate in the second quarter. ComScore also surveyed 1,000 consumers about current attitudes on the economy. The survey results show that 27 percent expect the economy to be worse a year from now, while 50 percent expect it to be the same or better. For the full story, click here. Restaurant Index Reaches Record Low The National Restaurant Association’s Restaurant Performance Index (RPI) was released recently and reported contraction in the industry. The RPI measures industry health using four key indicators: same-store sales, traffic, labor, and capital expenditures. In September, the RPI reached an all-time low of 96.7 (100 is steady-state); figures below 100 represent contraction, figures above 100 represent expansion. September marked the 13th consecutive month the index dipped below 100. For the full story, click here.

The Real Estate Report is produced monthly by the Chapel Hill Chamber of Commerce and the Greater Chapel Hill Association of Realtors