EARLY WINTER NEWSLETTER

FOUR'S NOT ENOUGH

We usually only hear one complaint about our newsletter - there aren't enough issues each year. In this ever-changing real estate market, and in response to our readers, we will now publish at least six newsletters per year. And so, here is our first extra edition.

ANOTHER HIGH-RISE APPROVAL

The second of seven proposed high-rise hotels has received its CAFRA approvals from the NJ Department of Environmental Protection.

Martinique Resort LLC received the go ahead for constructing a 23-story, 253-foot tall hotel with 289 units. The project will also include a 180-seat private restaurant for hotel guests only and a 120-seat restaurant open to the public. The approval requires 578 parking spots, plus another 94 spaces off-site.

The developers are now searching for a national chain to put their brand on the hotel and operate it. There will not be sale of any units as condominiums. The high-rise will be located between Wildwood Avenue and Oak Avenue just west of the Boardwalk, the site of the former Martinique Motel.

In May, the Starlight Resort Hotel became the first to get the coveted nod from CAFRA. That 23-story complex is approved for 264 residential units, a 200-seat restaurant, 654 parking spaces, a fitness club, spa and swimming pool. Starlight developers had to fork over $445,000 to the newly-formed Wildwood Parking Authority. Martinique was no doubt hit for a similar fee.

The Starlight project, which is being shopped in the hope of landing a big developer to bankroll the construction, is located between Juniper Avenue and Poplar Avenue along Ocean Avenue.

The next high-rise to gain NJDEP approvals should be the Nouveau Wave, located between Rio Grande Avenue and Andrews Avenue across the street from the Wildwood Convention Center parking lot and the Boardwalk.

WILDWOOD SELLS OLD LANDFILL

The City of Wildwood pulled off a last minute sale of the 24-acre old landfill for $5 million, with $3 million up front, to roughly cut in half a projected 25-cent tax increase. The purchaser was Brian Horn of SLRD Company of Mullica Hill.

The project had originally named K. Hovnanian as the developer about six years ago. They paid $1 million to the city in 2003 and another $1.5 million in 2006. They spent another $5 million on environmental studies, permitting, etc. They proposed 222 residential units. In 2007, with another payment to the city on the horizon, K. Hovnanian pulled the plug and walked away.

The redevelopment area is located on the west side of Wildwood, in a five block wide area between Baker Avenue and Garfield Avenue directly on the backbay. The landfill needs to be remediated, meaning either the buried trash has to be dug out and removed, or a 10-foot cap of clean fill must be placed on top. SLRD, a company whose business is reclaiming landfills, chose the latter.

DEAL OF A LIFETIME

Every once in a while, a real estate property comes up for sale that offers the type of monetary return that is usually associated with winning the LOTTERY. It just so happens that Jewell Real Estate Agency has recently acquired such a listing.

Let us start by saying that we can't recall ever promoting in our newsletter a property we had listed for sale. This is a first. That's how good we think this deal is.

The property is nine city blocks in West Wildwood, with zoning allowing 114 single family homes. It totals 11.87 acres and is being sold at the fire-sale price of just $2 million. CAFRA approval is close on 1½ of the blocks for 25 single family homes.

Here's the strategy to cash out. Apply for CAFRA and city approvals for the balance of the property. City approvals should come in less than six months, NJDEP approval will take 2-3 years. So now it's 2011, the real estate market is booming again, and you've spent under $3 million. Put the property up for sale for $8 million to $15 million. You do the math.

In 2005, we were close to selling this land to a big developer for $18 million. So now it's for sale for 11 cents on the dollar. Wow!

We also have an adjacent island for sale for $900,000. It also nearly went in that same 2005 deal for $4.5 million. It's now 20 cents on the dollar. It's 68 acres, with about 20 acres of it an upland island that is zoned for one single family home per acre. Just imagine the possibilities!

Call Douglas at 609-780-7129 to discuss either of these incredible deals. And remember me in your will.

DEVELOPERS ARE BUSY

While everyone sits home and listens to the national media trash the real estate market, developers are snatching up large properties and getting approvals for big projects. Like us here at JREA, they know that the market is going to come roaring back. They are positioning themselves to be ready to make windfall profits.

The owners of the Wharf restaurant on West Burk Avenue in Wildwood have one such project on the drawing board. On the south side of Burk Avenue they've proposed a five-story building, with the Wharf and parking on the first floor and 27 condominiums above. Across the street, they've slated 63 residential units in a six floor building.

A boardwalk would run 460-feet along Otten's Harbor, then another 300-feet or so to the restaurant. There would be 28 floating boatslips along OH, with 15 more for restaurant patrons.

The entire project will need Wildwood approvals and CAFRA approvals. If everything proceeds as planned, expect construction to commence in 2011 or 2012.

FALSE HOPES

Unfortunately, some sellers are stubbornly refusing to admit to themselves that there is nothing so special about their property that buyers are willing to fork out about $100,000 more than its real value. Their expectations are too high, as is their asking price.

In today's real estate market, it's all about PRICE. If the price is right, the property will sell. It's as simple as that.

For sellers, that means coming to the realization that it's not 2005 anymore. Those inflated prices of three or four years ago don't hold water today. If you really want to sell, you've got to be realistic.

Another reality of today's market is that the upgrades you may have done on your unit - such as granite countertops, hardwood or ceramic tile floors, ceiling fans, a ventless fireplace, etc - may not particularly add the money spent to the value of the home. That's especially true for properties purchased in 2004 or 2005, when properties were appreciating three percent a month.

Holding an overpriced property can cost you money. Add a monthly mortgage of $2,000, plus taxes, condo fees, etc, plus decreased value, and an extra year on the market can cost you $50,000. Drop your price instead and sell it now.

JEWELL REAL ESTATE AGENCY

We love to talk about real estate and our island. We're always glad to share our insights, observations, and vision with you.

Stop by our office at 5602 New Jersey Avenue and chat. Or give Joyce or Douglas a call at 609-729-8505. We answer phones 6am to 9pm EVERYDAY. That's service!

www.JewellRealEstateAgency.com