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