The report by the Irvine, Calif.-based firm shows the Santa Rosa-Petaluma Metropolitan Statistical Area as the 18^th most profitable market for those who buy, renovate and resell homes, part of a list of the 25 markets where the practice generated the highest rate of return in 2012.

Brian Burke

Yet Brian Burke, managing director of the Santa Rosa-based real estate private equity investment fund Praxis Capital, cautioned against labeling the area or any other as a hub for that activity.

“It’s very deal specific — it’s hard to generalize,” said Mr. Burke, whose company specializes in real estate investments that include flipping homes. “What that tells me is not that Santa Rosa is the best place to buy homes because you can buy at a deep discount. Houses in Santa Rosa have appreciated faster than homes in other areas.”

A “flipped” home in Santa Rosa generated an average gross profit of 19 percent, or $53,558, according to the report. There were an estimated 527 such sales over the year, with an average original purchase price for the home of $285,344. The number of single family homes involved in the practice had increased 47 percent from the year before.

The city was the least profitable of other Bay Area markets that made it to the list. Flipped homes in San Francisco and San Jose generated an average return of 23 percent.

The most profitable market on the list was Orlando, Fla., where a home purchased at an average price of $103,701 generated an average profit of 63 percent upon resale, according to RealtyTrac.

Climbing home prices have attracted an array of investors in the current market, with “flipping” being among those practices. RealtyTrac estimated the sales that involved a flip by counting transactions that occurred within six months or less of a previous sale of the same home. The firm looked at 600 metro areas for the report.

The practice has changed from the days when buyers could purchase a distressed property at a deep discount and sell at a profit after basic renovations, Mr. Burke said. While investors were able to put between $10,000 and $30,000 into a property for a profitable sale while the market was at its low, those activities now entail from $30,000 up to as much as $250,000, he said.

“Now the business has shifted to looking for properties that may need another bedroom, or even a full rebuild of a home,” he said. “It’s basically the homebuilding of this decade. It used to be you buy a property and build 20 homes on it — that was real estate development.”

Investors, which account for the majority of absentee buyers, purchased 24.2 percent of all homes across the Bay Area in April, according to San Diego-based real estate data tracker DataQuick. That number was up from 23.5 percent in April 2012, with investors paying a median of $362,000 across the Bay Area region.

With multiple private placement funds involving single-family homes, “flipped” homes and multifamily properties in Texas, Praxis has grown to $25 million under management in four years, Mr. Burke said. Those funds have generated an average 20 percent annualized return for investors, but it is the stability of the funds that has proven attractive in a volatile investment climate, he said.

Median home prices in Sonoma County were up 23.5 percent in April versus the same month in 2012, at $376,000, according to DataQuick. The number of sales, 611, was also up 15.3 percent, while the number of sales Bay Area-wide notched down 0.6 percent.

Median prices continued to climb outside of Sonoma County as well, with approximately half of that due to price appreciation and half due to a greater number of higher-priced homes in the sales mix, according to DataQuick. Distressed sales are also on the decline, accounting for 24 percent of sales versus 44 percent across the Bay Area one year ago.

In Marin County, a median price of $799,000 was 29.3 percent greater than one year ago, with 345 homes sales representing an 18.2 percent increase. Napa County saw an April median of $385,000, up 21.3 percent, and a 13.3 percent increase in homes sales, at 136. There were 1.3 percent more homes sold in Solano County, at 564, and the median price of $238,000 was up 36 percent from April 2012.

Bay Area-wide, median prices rose above $500,000 for the first time since almost five years. Prices first passed that threshold in May of 2004, and continued rising for four years before dropping below $500,000 in June 2008. Median prices for homes sold across the Bay Area reached a low of $290,000 in March 2009.

Bill Facendini

With fewer distressed properties in the mix, larger investors are now looking towards higher-end homes and income properties, said Bill Facendini, president of Terra Firm Global Partners. More of their investor clients are holding on to their current properties, particularly those that are generating rental income, he said.

Meanwhile, the period of flipping distressed properties has left a positive mark on many neighborhoods, he said.

“It has been good for communities. I’ve seen some communities that had started to slide, but then these people come in and refresh some of these distressed homes. People are having pride of ownership again,” he said.

Article source: http://www.northbaybusinessjournal.com/73472/santa-rosa-ranked-one-of-most-profitable-flip-markets/

TORONTO, April 11, 2012 /PRNewswire via COMTEX/ –
Leading Canadian commercial real estate firm opens 12th location outside
Canada as part of strategic plan to expand its services across U.S.; Nick Slonek becomes Principal and Managing Director, Northern California

Mark E. Rose, Chair and CEO of Avison Young, Canada’s largest independently-owned commercial real estate services
company, announced today the opening of a new office in San Francisco.

The newest American office marks Avison Young’s 12th location outside of
Canada, the company’s third California office, and the next step in the
firm’s aggressive growth and expansion strategy.

Effective immediately, Nick Slonek joins Avison Young as a Principal and Managing Director of the Northern
California region. Based in Avison Young’s new downtown San Francisco
office, Slonek will focus his efforts on overseeing the growth and
development of the company’s presence throughout Northern California,
as well as servicing new and existing clients. He was most recently a
Principal and Senior Vice-President in the San Francisco office of
Cornish Carey Commercial Newmark Knight Frank.

Over the past three years, Avison Young has grown from 11 to, now, 29
offices in 26 markets and from 300 to more than 900 real estate
professionals across Canada and the U.S.

“We are excited to be opening our newest office in San Francisco, which
will enhance our growing presence in the U.S. The hiring of Nick Slonek
is in line with our strategic plan to expand our commercial real estate
services with high-quality leaders across the nation,” comments Rose.
“The San Francisco Bay Area – and the entirety of the Western U.S.
region – is a vast and expanding real estate market and a focal point
for many of our investor and occupier clients. We are thrilled that
Nick has joined us to lead our efforts in Northern California as he has
an extensive and excellent track record of building a first-class
service platform in this market.”

“Nick is an experienced dealmaker and has terrific relationships with
many clients, both corporate and institutional, throughout the Bay Area
and beyond,” says Earl Webb, Avison Young’s President, U.S. Operations. “He shares our common
culture and our company’s enthusiasm for all the opportunities we have
in growing our market presence in Northern California and the Western
region. His commitment to our shared vision and our passion for
excellent client service was a determining factor in adding Nick as a
Principal.”

He continues: “The Bay Area is a critical location to our U.S. strategy,
given the city’s position as a corporate-occupier market as well as a
highly desirable investment market for our investor clients. We
couldn’t be more pleased to have Nick on our management team.”

Webb adds that Avison Young is using its highly profitable platform and
its pristine balance sheet to recruit other senior brokers and
executives to fill the company’s service delivery needs in San
Francisco and the Western region, and that plans for the company
include further acquisitions to grow the Avison Young brand
internationally.

Effective May 1, Avison Young’s new San Francisco office will be located
at 601 California Street, 5th floor, in downtown San Francisco.

Avison Young opened its first California office in Los Angeles in August
2011, followed by a second Los Angeles office in December through the
acquisition of Ramsey-Shilling Commercial Real Estate Services, Inc.
Today’s announcement comes on the heels of industry veteran Christopher Cooper joining Avison Young as a Principal and Managing Director of the
Southern California region last month.

“I am thrilled to be joining Avison Young at this point in my career.
The Bay Area market is well-positioned for a firm that is strategic,
debt-free and well-capitalized,” says Slonek. “I am also proud to
become a Principal at Avison Young. To be joining a firm and a
management team with a proven track record, and that is executing on
its plan to aggressively expand across the U.S. and globally, is very
exciting.”

“Avison Young has undergone significant growth over the past three years
and is prepared to continue on this pace. I am impressed by the
company’s current performance and leading-edge strategic direction.
Avison Young is composed of a savvy group of professionals and I look
forward to learning from them. Of course, servicing existing and new
clients with a fresh set of eyes is my number one priority.”

Slonek brings to Avison Young 25 years of experience in the commercial
real estate industry. In 1988, he worked at Nelson Peterson
Associates as a downtown San Francisco office leasing broker. In 1990,
he joined Coldwell Banker (now CBRE) and enjoyed a successful career
there until 2004, at which time he opened the San Francisco office of
Cornish Carey Commercial, Inc. (which merged in 2010 with Newmark
Knight Frank to become Cornish Carey Commercial Newmark Knight
Frank).

Primarily focusing on corporate tenant representation on a local,
national and international basis, Slonek has represented more than 10
million square feet of office tenants during his career. At Cornish
Carey Commercial Newmark Knight Frank, Slonek consistently ranked among
the top performers during his nine years with the company. While with
Coldwell Banker, he ranked # 1 in revenue production in the San
Francisco downtown office in 1998, 2002 and 2003. He and his partners
were also Top 5 performers from 1996 to 2003.

Recent lease transactions include: First Republic Bank (230,000 square
feet (sf)), Citigroup (120,000 sf), Sears (50,000 sf) and Western Union
(26,000 sf). Slonek also represents GLL at 199 Fremont Street and 350
Mission Street (a 350,000-sf development site); Langley Investments,
Ashforth and GE Pension at Foundry II, 405 Howard Street; Sumitomo’s
123 Mission Street; and Kennedy Wilson’s 300 California Street.

Slonek is a senior member of The Guardsmen, a group that raises money
for underprivileged children. He has served with the March of Dimes and
the San Francisco Boys Girls Club and participated on the board of
directors of the Bay Area chapters for both organizations. He is a
member of the Big “C” Society/Bear Backers, which assists with funding
for the University of California at Berkeley’s athletic department; and
is acting President of the California Vintage Wine Society, of which he
has been a board member for the past five years. Slonek holds a
Bachelor’s degree in history from the University of California at
Berkeley where he played varsity water polo.

In February, Avison Young was named a winner of Canada’s 50 Best Managed Companies program for 2011, sponsored by Deloitte, CIBC, National Post and Queen’s School of Business.

Founded in 1978, Avison Young is Canada’s largest independently-owned
commercial real estate services company. Headquartered in Toronto,
Ontario, Avison Young is also the largest Canadian-owned,
principal-managed commercial real estate brokerage firm in North
America. Comprising more than 900 real estate professionals in 29
offices across Canada and the U.S., the full-service commercial real
estate company provides value-added, client-centric investment sales,
leasing, advisory, management, financing and mortgage placement
services to owners and occupiers of office, retail, industrial and
multi-residential properties.

•Editors/Reporters: please click on link to view and download photo of
Nick Slonek

http://www.avisonyoung.com/sites/default/files/content-files/Media_Room/Temp/Slonek_Nick.jpg

SOURCE Avison Young (Canada) Inc.

Copyright (C) 2012 PR Newswire. All rights reserved

Article source: http://www.marketwatch.com/story/avison-young-opens-new-office-in-san-francisco-2012-04-11