By DENIS PAISTE
New Hampshire Union Leader Staff
Tuesday, Dec. 23, 2008
MANCHESTER – Federal bailout money has started to arrive for troubled financial institutions in the Granite State.
Monadnock Bancorp. Inc. of Peterborough will use $1,834,000 in federal Troubled Asset Relief Program funds to increase business and home loans, its president said yesterday.
The parent of Monadnock Community Bank received the funds Friday, William M. Pierce, president and chief executive officer said, yesterday.
The money, part of the government's massive $700 billion financial system bailout, was made available through Treasury's Capital Purchase Program, which is part of a part of the TARP.
Monadnock Bancorp. appears to be the only New Hampshire bank so far to receive TARP money. Once the funds are approved, the Treasury waits two business days to report the deals.
Monadnock's federal assistance is part of the initial distribution of the first $250 billion in bailout money. The government closed on another $1.9 billion in bailout money with 43 banks yesterday, but details will not be reported until Friday or Monday.
"We had to apply and we had to be approved because, really, only the strong banks would qualify for this program," Pierce said.
The U.S. Treasury Department announced the funding yesterday, which was part of a $2.8 billion investment in 49 banks made on Friday, Dec. 19. Treasury receives preferred stock and warrants from participating institutions.
The Treasury Department purchased 1,834 shares of newly issued, non-voting Monadnock Bancorp, Inc. cumulative senior preferred stock, Series A, valued at $1.834 million, with an initial annual dividend rate of 5 percent. The Treasury also received warrants, which were immediately exercisable, for 92 shares of non-voting Monadnock Bancorp, Inc. cumulative senior preferred stock, Series B, with an annual dividend rate of 9 percent. The Treasury immediately exercised the warrant, Monadnock Bancorp said in an SEC filing.
"By adding to our capital, it really allows us to grow, stay independent and be a community-oriented financial institution," Pierce said. "We also are an SBA lender, so we do business loans as well as home loans."
Pierce said he believes economic conditions in New Hampshire are more favorable than the rest of the country.
Monadnock Bancorp. has assets of $110 million, with one branch in Peterborough, and one in Winchendon, Mass.
It has 28 employees.
Monadnock Community Bank evolved from AWANE (Automotive Wholesalers Association of New England, Inc.) Credit Union, which was chartered in 1971.
Monadnock Bancorp, Inc. (MNKB) is traded over the counter. Shares were unchanged yesterday at $3.45.
Wednesday, December 24, 2008
10 SECRETS TO SUCCESS
With New Year's approaching and the mandatory resolutions being trotted out, I thought I'd send this along... always a good thing to regain focus on what's important... AND it can apply to all of those pesky resolutions!
10 SECRETS TO SUCCESS
1. HOW YOU THINK IS EVERYTHING : Always be positive. Think success, not failure. Be aware of a negative environment.
2. DECIDE UPON YOUR TRUE DREAMS AND GOALS : Write down your specific goals and develop a plan to reach them.
3. TAKE ACTION : Goals are nothing without action. Don’t be afraid to get started. Just do it.
4. NEVER STOP LEARNING : Go back to school. Read books. Get training and acquire skills.
5. BE PERSISTENT AND WORK HARD : Success is a marathon, not a sprint. Never give up.
6. LEARN TO ANALYZE DETAILS : Get all the facts, all the input. Learn from your mistakes.
7. FOCUS YOUR TIME AND MONEY : Don’t let other people or things distract you.
8. DON’T BE AFRAID TO INNOVATE; BE DIFFERENT : Following the herd is a sure way to mediocrity.
9. DEAL AND COMMUNICATE WITH PEOPLE EFFECTIVELY : No person is an island. Learn to understand and motivate others.
10. BE HONEST AND DEPENDABLE; TAKE RESPONSIBILITY : Otherwise, numbers 1 to 9 won’t matter.
10 SECRETS TO SUCCESS
1. HOW YOU THINK IS EVERYTHING : Always be positive. Think success, not failure. Be aware of a negative environment.
2. DECIDE UPON YOUR TRUE DREAMS AND GOALS : Write down your specific goals and develop a plan to reach them.
3. TAKE ACTION : Goals are nothing without action. Don’t be afraid to get started. Just do it.
4. NEVER STOP LEARNING : Go back to school. Read books. Get training and acquire skills.
5. BE PERSISTENT AND WORK HARD : Success is a marathon, not a sprint. Never give up.
6. LEARN TO ANALYZE DETAILS : Get all the facts, all the input. Learn from your mistakes.
7. FOCUS YOUR TIME AND MONEY : Don’t let other people or things distract you.
8. DON’T BE AFRAID TO INNOVATE; BE DIFFERENT : Following the herd is a sure way to mediocrity.
9. DEAL AND COMMUNICATE WITH PEOPLE EFFECTIVELY : No person is an island. Learn to understand and motivate others.
10. BE HONEST AND DEPENDABLE; TAKE RESPONSIBILITY : Otherwise, numbers 1 to 9 won’t matter.
Friday, December 19, 2008
Festival Marketplace Portfolio on the Market
Interesting news... includes Faneuil Hall in Boston, which is of course near and dear to our hearts and market... keep in mind the proposed redevelopment of Salisbury Beach, MA... and they're selling... how might this bode for Salisbury Beach? Keep your eyes and mind open, and read the tea leaves... BF
General Growth puts Festival Marketplace Portfolio on the Market
Description:
Portfolio includes Harbor Place & The Gallery in Baltimore, South Street Seaport in New York City and Faneuil Hall in Boston
Real Estate Investment Trust General Growth Properties, the country’s second largest mall owner, has put its Festival Marketplace portfolio on the market, according to an investment offering obtained by citybiz real estate. The investment offering is being distributed by DTZ Rockwood, a full service real estate investment banking firm headquartered in New York.
General Growth’s Festival Marketplace portfolio includes Harbor Place & The Gallery Mall in Baltimore, a 544,453 square foot, multi-use building with nearly 260,000 square feet office and 285,000 square feet of retail; South Street Seaport, a 285,847 square foot retail center in New York City; and Faneuil Hall in Boston, which like Harbor Place, is a mixed use facility with 350,980 total square feet, 155,333 of which is office.
Harbor Place & The Gallery has an office occupancy of 77.3 percent and its retail occupancy is 85.6 percent. It generates $522 per square foot in sales. The property generated nearly $114 million in retail sales for the 12 month period ending September 30, 2008.
South Street Seaport in New York City is a 285,847 square foot retail center that is 94.3 percent occupied with retail tenants. The investment offering says the site is one of the top five tourist attractions in New York City. Located on the East River directly south of the Brooklyn Bridge in Downtown Manhattan, South Street Seaport generated more than $102 million in retail sales for the 12-month period ending September 30, 2008.
Faneuil Hall’s office and retail occupancies are just short of 90 percent. Located in the heart of downtown Boston, Faneuil Hall Marketplace is a historic landmark and mixed-use project comprised of retail, office, dining and entertainment components. Home to the world-famous Quincy Market Colonnade, one of the largest and most heavily trafficked foothalls in the world, the property intersperses local boutique and well-known national retailers and over 50 dining venues. Faneuil Hall Marketplace generated more than $102 million in retail sales for the 12-month period ending September 30, 2008.
In total, the investment offering is for 1.181 million square feet
DTZ Rockwell’s team of David Monahan, Thomas Dobrowski and John Coury will manage the investment sale for General Growth.
citybiz real estate is a daily online news service serving the local commercial real estate community. In association with citybizlist.com, a localized business website currently available in five cities, citybiz real estate targets the brokers, owners, investors, developers, architects, engineers, accountants, construction industry professionals and all others responsible for changing the local business landscape through real estate.
General Growth puts Festival Marketplace Portfolio on the Market
Description:
Portfolio includes Harbor Place & The Gallery in Baltimore, South Street Seaport in New York City and Faneuil Hall in Boston
Real Estate Investment Trust General Growth Properties, the country’s second largest mall owner, has put its Festival Marketplace portfolio on the market, according to an investment offering obtained by citybiz real estate. The investment offering is being distributed by DTZ Rockwood, a full service real estate investment banking firm headquartered in New York.
General Growth’s Festival Marketplace portfolio includes Harbor Place & The Gallery Mall in Baltimore, a 544,453 square foot, multi-use building with nearly 260,000 square feet office and 285,000 square feet of retail; South Street Seaport, a 285,847 square foot retail center in New York City; and Faneuil Hall in Boston, which like Harbor Place, is a mixed use facility with 350,980 total square feet, 155,333 of which is office.
Harbor Place & The Gallery has an office occupancy of 77.3 percent and its retail occupancy is 85.6 percent. It generates $522 per square foot in sales. The property generated nearly $114 million in retail sales for the 12 month period ending September 30, 2008.
South Street Seaport in New York City is a 285,847 square foot retail center that is 94.3 percent occupied with retail tenants. The investment offering says the site is one of the top five tourist attractions in New York City. Located on the East River directly south of the Brooklyn Bridge in Downtown Manhattan, South Street Seaport generated more than $102 million in retail sales for the 12-month period ending September 30, 2008.
Faneuil Hall’s office and retail occupancies are just short of 90 percent. Located in the heart of downtown Boston, Faneuil Hall Marketplace is a historic landmark and mixed-use project comprised of retail, office, dining and entertainment components. Home to the world-famous Quincy Market Colonnade, one of the largest and most heavily trafficked foothalls in the world, the property intersperses local boutique and well-known national retailers and over 50 dining venues. Faneuil Hall Marketplace generated more than $102 million in retail sales for the 12-month period ending September 30, 2008.
In total, the investment offering is for 1.181 million square feet
DTZ Rockwell’s team of David Monahan, Thomas Dobrowski and John Coury will manage the investment sale for General Growth.
citybiz real estate is a daily online news service serving the local commercial real estate community. In association with citybizlist.com, a localized business website currently available in five cities, citybiz real estate targets the brokers, owners, investors, developers, architects, engineers, accountants, construction industry professionals and all others responsible for changing the local business landscape through real estate.
Tuesday, December 16, 2008
FOMC Cuts Rates to Lowest Level on Record
What does it mean? Most folks automatically equate a fed drop with mortgage rates, which isn't a safe assumption. This cut will affect the broader credit markets- see Mark's last paragraph from the bottom for a wrap-up of what this can mean to you directly... it's good news,but it's not an overnight game changer...
What does this mean to the commercial real estate market? It can mean plenty... Banks will free up more money to banks... this will mean liquidity to commercial loans... BF
What does this mean to the commercial real estate market? It can mean plenty... Banks will free up more money to banks... this will mean liquidity to commercial loans... BF
FOMC Cuts Rates to Lowest Level on Record
Mark Lieberman, Senior Economist
FOXBusiness
The Federal Open Market Committee today agreed unanimously to cut the Fed Funds rate to a target range of 0% to 0.25%, the lowest rate in the Federal Reserve’s 95-year history.
In the statement announcing its decision, the FOMC said since its last meeting “labor markets have deteriorated, and the available data indicate that consumer spending, business investment, and industrial production have declined.”
The Committee added: “overall, the outlook for economic activity has weakened further.”
The unusual step of establishing a range for the Fed Funds rate took most analysts by surprise. The consensus forecast had been for a ½ percentage point cut to 0.50%.
In the 1989, the FOMC established a range of 9.50% to 9.625% for the Fed Funds rate.
In its statement, the Committee said the Federal Reserve “will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability.”
Those tools, the Committee said, would mean the Federal Reserve “will purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets, and it stands ready to expand its purchases of agency debt and mortgage-backed securities as conditions warrant. The Committee is also evaluating the potential benefits of purchasing longer-term Treasury securities. Early next year, the Federal Reserve will also implement the Term Asset-Backed Securities Loan Facility to facilitate the extension of credit to households and small businesses. The Federal Reserve will continue to consider ways of using its balance sheet to further support credit markets and economic activity.”
The effect of these actions, would the Committee believes, bring down interest rates and unclog stalled credit markets.
The FOMC’s action means consumers will see lower rates for home equity lines of credit, credit cards and auto loans since those loans are generally linked to the prime interest rate which is set at three percentage points above the Fed Funds rate. Mortgage rates are not directly affected as those rates are tied to rates for treasury borrowings which don’t react as quickly. But the real target of the FOMC’s action was the broader financial services sector, providing more money for banks.
Mark Lieberman is the senior economist for the Fox Business Network. Prior to joining FOX, he served as first vice president and manager of economic analysis and research at Washington Mutual in New York. Before that, he served as senior vice president at Dime Savings Bank of New York (which was later acquired by Washington Mutual), where he specialized in credit and risk management. He is a member of the Executive Committee of the New York Association for Business Economics. He has a degree in Economics from the Wharton School of the University of Pennsylvania.
$8.5 Million in Expansion Capital for Timeshare Resale Company
Interesting development in the marketplace that certainly will have implications in the commercial and residential real estate markets...the extent of which will unfold with time... if the likes of the Edison fuind is willing to invest, (risk), this kind of capital in a business geared at selling what is traditionally looked at as horrible investments, can the support of solid backing for solid commercial projects be far behind? BF...
$8.5 Million in Expansion Capital for Timeshare Resale Company Sell My Timeshare NOW
Sell My Timeshare NOW plans expansion with funding from Edison Venture Fund.
DOVER, NH--(Marketwire - December 16, 2008) - With an $8.5 million injection of capital, Sell My Timeshare NOW launches a new growth and expansion plan designed to better serve the timeshare resale needs of both consumers and the timeshare development industry. After extensive diligence, Edison Venture Fund has become Sell My Timeshare NOW's sole institutional investor, continuing Edison's investment commitment to high-growth, entrepreneurial, technology companies.
Sell My Timeshare NOW and its family of websites provide advertising tools and marketing services to assist owners with timeshare resale and rental options. In addition to its by-owner advertising platform, the company also offers success-based services through its brokerage arm, Timeshare Broker Services. The company has experienced dramatic growth so far in 2008 with more than 23 million visitors and over $1 million in daily offers to buy or rent timeshare, landing it as one of the fastest growing privately held companies according to Inc.com. Despite the economic downturn, Sell My Timeshare NOW has experienced a 90 percent increase in the number of offers to rent or buy timeshare advertised through its website and a 74 percent increase in the dollar amount of those offers over 2007.
Jason Tremblay and co-founders Mark Eldridge and Cindy Gonzalez started Sell My Timeshare NOW in 2003 as a home-based business with three employees. Through cutting-edge internet search technologies and excellent customer service, the company has grown to over 150 employees with offices in Dover, NH, and Orlando and Tampa, FL.
Jason Tremblay, company's CEO and founder, explains, "Sell My Timeshare NOW is well on its way to become the de-facto destination for the vacation ownership secondary market. With Edison as our investment partner, we can expand our innovative, business-to-business solutions in ways that will provide proactive, developer-friendly solutions."
Michael Kopelman, Principal at Edison Venture Fund, noted, "The company's search engine leadership drives massive exposure to sellers. Buyers now have the ability to purchase timeshare intervals online at attractive discounts to retail prices."
Tremblay elaborates, "Sell My Timeshare NOW is already the global leader in online timeshare advertising and the number one resale solution for consumers today. Edison's due diligence recognized the utility of our platforms. Edison's investment enables Sell My Timeshare NOW to further expand, offering resale and rental solutions for both timeshare developers and owners.
"We understand that the secondary market has been highly inefficient in the past. Our goal is to provide real solutions that create tangible results for timeshare owners and developers," said Tremblay.
About Sell My Timeshare NOW
The company is the recognized global leader in online timeshare resale and rental marketing with over $400 million in offers through its websites in 2008. The company's flagship website property, SellMyTimeshareNOW.com, provides internet advertising and marketing solutions for timeshare owners who seek to sell timeshare or rent timeshare. In addition, the company also offers success-based services through its brokerage arm, Timeshare Broker Services. Headquartered in Dover, NH with offices in Orlando, FL and Tampa, FL, the company has over 150 employees and was recently recognized as one of the fastest-growing privately held companies in the country by Inc.com.
About Edison Venture Fund
Established in 1986, Edison partners with entrepreneurs, service providers and other financing sources to build successful companies. Edison provides capital and value-added services to expansion stage ($5 to 20 million revenue), information technology businesses. Initial investments range from $5 to 8 million. Edison typically serves as a sole or lead investor in financings up to $10 million. In addition to providing expansion capital, Edison funds management buyouts, recapitalizations, spinouts and secondary stock purchases.
Edison's investment professionals are based in Lawrenceville, NJ, McLean, VA, New York, NY, Needham, MA, and West Chester, PA. Industry specialties include application software, communications, financial technology, interactive marketing, healthcare, & pharmaceutical IT. Edison's successes include Best Software, Dendrite, E-Transport, Gain Capital, Liberty Tax, VirtualEdge, Visual Networks, Vocus and many other information technology leaders, which have a combined market value exceeding $5 billion. Edison currently has $550 million under management and is actively making new investments. www.edisonventure.com
$8.5 Million in Expansion Capital for Timeshare Resale Company Sell My Timeshare NOW
Sell My Timeshare NOW plans expansion with funding from Edison Venture Fund.
DOVER, NH--(Marketwire - December 16, 2008) - With an $8.5 million injection of capital, Sell My Timeshare NOW launches a new growth and expansion plan designed to better serve the timeshare resale needs of both consumers and the timeshare development industry. After extensive diligence, Edison Venture Fund has become Sell My Timeshare NOW's sole institutional investor, continuing Edison's investment commitment to high-growth, entrepreneurial, technology companies.
Sell My Timeshare NOW and its family of websites provide advertising tools and marketing services to assist owners with timeshare resale and rental options. In addition to its by-owner advertising platform, the company also offers success-based services through its brokerage arm, Timeshare Broker Services. The company has experienced dramatic growth so far in 2008 with more than 23 million visitors and over $1 million in daily offers to buy or rent timeshare, landing it as one of the fastest growing privately held companies according to Inc.com. Despite the economic downturn, Sell My Timeshare NOW has experienced a 90 percent increase in the number of offers to rent or buy timeshare advertised through its website and a 74 percent increase in the dollar amount of those offers over 2007.
Jason Tremblay and co-founders Mark Eldridge and Cindy Gonzalez started Sell My Timeshare NOW in 2003 as a home-based business with three employees. Through cutting-edge internet search technologies and excellent customer service, the company has grown to over 150 employees with offices in Dover, NH, and Orlando and Tampa, FL.
Jason Tremblay, company's CEO and founder, explains, "Sell My Timeshare NOW is well on its way to become the de-facto destination for the vacation ownership secondary market. With Edison as our investment partner, we can expand our innovative, business-to-business solutions in ways that will provide proactive, developer-friendly solutions."
Michael Kopelman, Principal at Edison Venture Fund, noted, "The company's search engine leadership drives massive exposure to sellers. Buyers now have the ability to purchase timeshare intervals online at attractive discounts to retail prices."
Tremblay elaborates, "Sell My Timeshare NOW is already the global leader in online timeshare advertising and the number one resale solution for consumers today. Edison's due diligence recognized the utility of our platforms. Edison's investment enables Sell My Timeshare NOW to further expand, offering resale and rental solutions for both timeshare developers and owners.
"We understand that the secondary market has been highly inefficient in the past. Our goal is to provide real solutions that create tangible results for timeshare owners and developers," said Tremblay.
About Sell My Timeshare NOW
The company is the recognized global leader in online timeshare resale and rental marketing with over $400 million in offers through its websites in 2008. The company's flagship website property, SellMyTimeshareNOW.com, provides internet advertising and marketing solutions for timeshare owners who seek to sell timeshare or rent timeshare. In addition, the company also offers success-based services through its brokerage arm, Timeshare Broker Services. Headquartered in Dover, NH with offices in Orlando, FL and Tampa, FL, the company has over 150 employees and was recently recognized as one of the fastest-growing privately held companies in the country by Inc.com.
About Edison Venture Fund
Established in 1986, Edison partners with entrepreneurs, service providers and other financing sources to build successful companies. Edison provides capital and value-added services to expansion stage ($5 to 20 million revenue), information technology businesses. Initial investments range from $5 to 8 million. Edison typically serves as a sole or lead investor in financings up to $10 million. In addition to providing expansion capital, Edison funds management buyouts, recapitalizations, spinouts and secondary stock purchases.
Edison's investment professionals are based in Lawrenceville, NJ, McLean, VA, New York, NY, Needham, MA, and West Chester, PA. Industry specialties include application software, communications, financial technology, interactive marketing, healthcare, & pharmaceutical IT. Edison's successes include Best Software, Dendrite, E-Transport, Gain Capital, Liberty Tax, VirtualEdge, Visual Networks, Vocus and many other information technology leaders, which have a combined market value exceeding $5 billion. Edison currently has $550 million under management and is actively making new investments. www.edisonventure.com
Hinsdale Race Track Declares Bankruptcy
Interesting article from the New Hampshire Business Review... speaks more to the area near Hinsdale rather than the market in general... although that applies too...
http://www.nhbr.com/apps/pbcs.dll/article?AID=/20081216/NEWS06/812159969/-1/XML08
The anti gambling statement at the end of the article by Jim Rubens is naive and uninformed, in my opinion... the demo's in Salem/ Rockingham County couldn't be more different than in Hinsdale... as well as the opportunity... BF
Business News/Analysis
Hinsdale race track declares bankruptcy
Tuesday, December 16, 2008
Hinsdale Greyhound Park announced that it was shutting it doors and filed for bankruptcy Monday, leaving 49 people out of work, and more than 200 unsecured creditors owed about $1.75 million holding the bag.
“Business was not good. But when gas prices spiked earlier this year, things went from bad to worse. People simply have less money to wage,” said Joseph E. Sullivan in a prepared release. “People simply have less money to wager in New Hampshire and nationally.”
Sullivan added that “efforts to attract investors or a buyer were, in the end, unsuccessful,” he said.
Sullivan referred all calls to his attorney, John M. Sullivan (no relation), who could not be reached for further comment by deadline.
Hinsdale, one of the four live racing venues in the state, started in 1948 as a harness track, and added dog racing in 1973, but live racing at all the tracks took a back seat to the simulcasting of other races around the country. This year, for instance, a little more than $700,000 was bet on dog races at Hinsdale as of Dec. 7 out of a total of $29.5 million.
But that take was a 32 percent drop from the previous year, when the track took in $43 million. That left the track with $5.8 million last year after paying off the winners and the state (but before operating expenses and debt payments), the smallest revenue stream of any of the four live-racing tracks in the state.
The bankruptcy filing indicated the company owed large sums of money to various racing suppliers, other racetracks and individual investors, as well as taxes: $189,000 to the Internal Revenue Service and $139,000 to the town of Hinsdale, and $4,500 to the New Hampshire Racing and Charitable Gaming Commission.
The largest unsecured creditor is the Tote Company ($185,000), which designs, manufactures and operates pari-mutuel wagering systems.
Other large creditors include Herschel Bird ($138,000) of Henderson, Nevada, Kevin Matties ($71,000) of Las Vegas and Paul Matties ($52,000) of Pittsfield, Mass., Public Service of New Hampshire ($95,000), and the Hawthorne Race Course ($65,000).
The release does give a hint that the track was anticipating a possible shut down. At the end of October, it transferred control and care of all greyhounds to several independent non-profits.
Hinsdale and the other racetracks have long argued for the state to adopt casino gambling, and indeed – because of the economy and the state’s fiscal trouble – this seemed like as good as time as any to propose it. Track owners will point to the closing as evidence that they need the investment and revenue that slot machines can bring to the tracks.
But Jim Rubens, leader of Granite State Coalition Against Expanded Gambling, drew a different lesson.
“Gambling is a saturated industry that’s in decline,” he said. “It should lead to suspicion that claims that tracks like Rockingham Park could open a $450 million casino gambling in Salem. If Hinsdale couldn’t raise enough capital to stay open, why would Rockingham be able to raise that much money?” – BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW
http://www.nhbr.com/apps/pbcs.dll/article?AID=/20081216/NEWS06/812159969/-1/XML08
The anti gambling statement at the end of the article by Jim Rubens is naive and uninformed, in my opinion... the demo's in Salem/ Rockingham County couldn't be more different than in Hinsdale... as well as the opportunity... BF
Business News/Analysis
Hinsdale race track declares bankruptcy
Tuesday, December 16, 2008
Hinsdale Greyhound Park announced that it was shutting it doors and filed for bankruptcy Monday, leaving 49 people out of work, and more than 200 unsecured creditors owed about $1.75 million holding the bag.
“Business was not good. But when gas prices spiked earlier this year, things went from bad to worse. People simply have less money to wage,” said Joseph E. Sullivan in a prepared release. “People simply have less money to wager in New Hampshire and nationally.”
Sullivan added that “efforts to attract investors or a buyer were, in the end, unsuccessful,” he said.
Sullivan referred all calls to his attorney, John M. Sullivan (no relation), who could not be reached for further comment by deadline.
Hinsdale, one of the four live racing venues in the state, started in 1948 as a harness track, and added dog racing in 1973, but live racing at all the tracks took a back seat to the simulcasting of other races around the country. This year, for instance, a little more than $700,000 was bet on dog races at Hinsdale as of Dec. 7 out of a total of $29.5 million.
But that take was a 32 percent drop from the previous year, when the track took in $43 million. That left the track with $5.8 million last year after paying off the winners and the state (but before operating expenses and debt payments), the smallest revenue stream of any of the four live-racing tracks in the state.
The bankruptcy filing indicated the company owed large sums of money to various racing suppliers, other racetracks and individual investors, as well as taxes: $189,000 to the Internal Revenue Service and $139,000 to the town of Hinsdale, and $4,500 to the New Hampshire Racing and Charitable Gaming Commission.
The largest unsecured creditor is the Tote Company ($185,000), which designs, manufactures and operates pari-mutuel wagering systems.
Other large creditors include Herschel Bird ($138,000) of Henderson, Nevada, Kevin Matties ($71,000) of Las Vegas and Paul Matties ($52,000) of Pittsfield, Mass., Public Service of New Hampshire ($95,000), and the Hawthorne Race Course ($65,000).
The release does give a hint that the track was anticipating a possible shut down. At the end of October, it transferred control and care of all greyhounds to several independent non-profits.
Hinsdale and the other racetracks have long argued for the state to adopt casino gambling, and indeed – because of the economy and the state’s fiscal trouble – this seemed like as good as time as any to propose it. Track owners will point to the closing as evidence that they need the investment and revenue that slot machines can bring to the tracks.
But Jim Rubens, leader of Granite State Coalition Against Expanded Gambling, drew a different lesson.
“Gambling is a saturated industry that’s in decline,” he said. “It should lead to suspicion that claims that tracks like Rockingham Park could open a $450 million casino gambling in Salem. If Hinsdale couldn’t raise enough capital to stay open, why would Rockingham be able to raise that much money?” – BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW
Thursday, December 11, 2008
Dunkin' Brands Appoints CEO
Dunkin' Brands Appoints Nigel Travis as Chief Executive Officer
Jon Luther Remains Executive Chairman of the Board
CANTON, Mass., Dec. 10 /PRNewswire/ -- Dunkin' Brands, the parent company of Dunkin' Donuts and Baskin-Robbins, today announced that Nigel Travis has been appointed Chief Executive Officer. Most recently, Travis, 58, was the President & CEO of Papa John's (NASDAQ:PZZA) , a pizza chain with annual system-wide sales of $2.1 billion and more than 3,300 restaurants throughout the U.S. and 29 international markets.
Effective January 6, 2009, he will assume the role from Jon Luther, who will remain Executive Chairman of the Board. Luther, 65, joined Dunkin' Brands in January 2003 as Chief Executive Officer and added the role of Chairman in 2006.
Luther had been working closely with Dunkin' Brands' Board of Directors since early 2008 to develop a succession plan and identify a new Chief Executive Officer.
Travis joined Papa John's in 2005 as President & Chief Executive Officer. Under his leadership, Papa John's accomplished outstanding results, with industry-leading comp sales, consistent earnings growth and excellent franchise relationships. During his four-year tenure with the company, Papa John's online sales tripled through the innovative use of technology. In addition, Travis helped position the company's international business as a major growth platform and oversaw the successful rollout of several new products, including Papa's Pan Pizza.
Prior to Papa John's, Travis was with Blockbuster, Inc. from 1994 to 2004, where he served in increasing roles of responsibility, including President & Chief Operating Officer. During that time, global sales increased over 50% and the international business was developed to encompass 26 countries with revenues of $1.8 billion. Travis also built a worldwide franchise network of 300 franchisees in 15 countries with revenues of approximately $1 billion, and transitioned the company from a video rental store chain to a complete movie and game source.
Before that, he was with Burger King, first as Senior Vice President of Human Resources and later as Managing Director for Europe, the Middle East and Africa. As Managing Director, he turned around the region, significantly increasing sales and operating profits. He dramatically increased the rate of store development in the region, and successfully drove expansion into new countries and alternative points of distribution.
Mr. Luther commented, "In Nigel , Dunkin' Brands has found a leader with a proven track record of delivering extraordinary results. His wide-ranging achievements in retail and the foodservice industry will strengthen our overall senior leadership team, further enhancing our ability to execute our long-range strategic plans. Nigel's ability to develop strong franchisee networks, his understanding of the intensely competitive global marketplace, and his innovative, results-oriented style will build on the powerful momentum already in place at our Dunkin' Donuts and Baskin-Robbins brands."
Luther will remain with Dunkin' Brands in a full-time capacity as Executive Chairman of the Board, and will work closely with Travis to ensure a smooth transition for the company.
Said Mr. Travis, "I am delighted to have the opportunity to join Dunkin' Brands and build on the remarkable transformation that has taken place under Jon's leadership. I am looking forward to working with Jon, the executive team, and all of the employees and franchisees who have helped to reinvigorate two of the world's most powerf ul, recognized and beloved brands."
Travis will relocate to Massachusetts with his family.
About Dunkin' Brands, Inc:
With more than 14,000 franchises in 44 countries worldwide, Dunkin' Brands, Inc. is renowned for its leadership in the quick quality category. At the end of 2007, there were 7,988 Dunkin' Donuts franchised restaurants and 5,874 Baskin-Robbins franchised restaurants and the company had system-wide sales of approximately $6.6 billion. Dunkin' Brands, Inc. is headquartered in Canton, Massachusetts. For more information, visit www.dunkinbrands.com.
Jon Luther Remains Executive Chairman of the Board
CANTON, Mass., Dec. 10 /PRNewswire/ -- Dunkin' Brands, the parent company of Dunkin' Donuts and Baskin-Robbins, today announced that Nigel Travis has been appointed Chief Executive Officer. Most recently, Travis, 58, was the President & CEO of Papa John's (NASDAQ:PZZA) , a pizza chain with annual system-wide sales of $2.1 billion and more than 3,300 restaurants throughout the U.S. and 29 international markets.
Effective January 6, 2009, he will assume the role from Jon Luther, who will remain Executive Chairman of the Board. Luther, 65, joined Dunkin' Brands in January 2003 as Chief Executive Officer and added the role of Chairman in 2006.
Luther had been working closely with Dunkin' Brands' Board of Directors since early 2008 to develop a succession plan and identify a new Chief Executive Officer.
Travis joined Papa John's in 2005 as President & Chief Executive Officer. Under his leadership, Papa John's accomplished outstanding results, with industry-leading comp sales, consistent earnings growth and excellent franchise relationships. During his four-year tenure with the company, Papa John's online sales tripled through the innovative use of technology. In addition, Travis helped position the company's international business as a major growth platform and oversaw the successful rollout of several new products, including Papa's Pan Pizza.
Prior to Papa John's, Travis was with Blockbuster, Inc. from 1994 to 2004, where he served in increasing roles of responsibility, including President & Chief Operating Officer. During that time, global sales increased over 50% and the international business was developed to encompass 26 countries with revenues of $1.8 billion. Travis also built a worldwide franchise network of 300 franchisees in 15 countries with revenues of approximately $1 billion, and transitioned the company from a video rental store chain to a complete movie and game source.
Before that, he was with Burger King, first as Senior Vice President of Human Resources and later as Managing Director for Europe, the Middle East and Africa. As Managing Director, he turned around the region, significantly increasing sales and operating profits. He dramatically increased the rate of store development in the region, and successfully drove expansion into new countries and alternative points of distribution.
Mr. Luther commented, "In Nigel , Dunkin' Brands has found a leader with a proven track record of delivering extraordinary results. His wide-ranging achievements in retail and the foodservice industry will strengthen our overall senior leadership team, further enhancing our ability to execute our long-range strategic plans. Nigel's ability to develop strong franchisee networks, his understanding of the intensely competitive global marketplace, and his innovative, results-oriented style will build on the powerful momentum already in place at our Dunkin' Donuts and Baskin-Robbins brands."
Luther will remain with Dunkin' Brands in a full-time capacity as Executive Chairman of the Board, and will work closely with Travis to ensure a smooth transition for the company.
Said Mr. Travis, "I am delighted to have the opportunity to join Dunkin' Brands and build on the remarkable transformation that has taken place under Jon's leadership. I am looking forward to working with Jon, the executive team, and all of the employees and franchisees who have helped to reinvigorate two of the world's most powerf ul, recognized and beloved brands."
Travis will relocate to Massachusetts with his family.
About Dunkin' Brands, Inc:
With more than 14,000 franchises in 44 countries worldwide, Dunkin' Brands, Inc. is renowned for its leadership in the quick quality category. At the end of 2007, there were 7,988 Dunkin' Donuts franchised restaurants and 5,874 Baskin-Robbins franchised restaurants and the company had system-wide sales of approximately $6.6 billion. Dunkin' Brands, Inc. is headquartered in Canton, Massachusetts. For more information, visit www.dunkinbrands.com.
Hampton plan wins praise, but how to pay?
Interesting article in the Union Leader this morning. Sure to be detractors and supporters- there are certainly plenty of investment and business opportunities down on the main beach right now… and this might bring more opportunity forward even before state support is committed… IF it’s committed. BF
Hampton plan wins praise, but how to pay?
By CLYNTON NAMUO
New Hampshire Union Leader Correspondent
HAMPTON – Local business owners last night asked the state to fully fund an $18 million redevelopment of Hampton Beach this legislative session, putting them at odds with state parks officials, who are asking to pay for the project over several years in light of the bad economy.
Both sides agree Hampton Beach needs a makeover and the plans have already been assembled; a new seashell stage with seating for 750 and two pavilions with bathroom facilities, new bathhouses on the north and south ends of the beach and a new visitor's center.
The project's entire $18 million cost is expected to come from the state, but that amount is a hefty sum when budgets are being slashed.
"I think it's important people recognize that this is going to be an uphill battle," said John Nyhan, head of the Hampton Beach Area Commission, which is pushing for the redevelopment.
Nyhan said the state's capital improvement budget is expected to be $95 million this year, making the Hampton Beach redevelopment nearly 20 percent of that, should it be approved.
The Department of Resources and Economic Development has pegged the Hampton Beach redevelopment as its number-one priority, but even that isn't enough for the department to ask for the full sum this legislative session.
Officials said they plan to ask for enough money to build the two bathhouses this session and then ask for the remaining money at the next capital budget in two years. The department previously planned to ask for the full sum, but recently changed its tune.
"This is our number-one project," Division of Parks and Recreation spokesman Amy Bassett said. "We just have decided to phase it over a couple years of capital budgeting because the economy is just not there for it."
To push the project to state legislators, local officials are framing the redevelopment as a benefit to the entire state in added tourists and visitor spending.
Laurence Goss, a state economist, said fiscal 2008 direct spending at Hampton Beach totaled $170 million. He said that number would increase by 30 percent within five years of completing the redevelopment.
"While a lot of it is being spent in Hampton, a lot of it is also being spent in other communities," he said. "The money is spent regionally."
Goss estimated a redevelopment would also increase the number of tourist visits at Hampton Beach by 15 percent.
Support for full funding was strong at last night's meeting of the Hampton Beach Area Commission at Ashworth by the Sea, but the real support is needed in Concord, a fact not lost on anyone last night.
"We're not going to give up until that last vote is taken," Nyhan said as he implored everyone on hand to reach out to legislators.
Hampton plan wins praise, but how to pay?
By CLYNTON NAMUO
New Hampshire Union Leader Correspondent
HAMPTON – Local business owners last night asked the state to fully fund an $18 million redevelopment of Hampton Beach this legislative session, putting them at odds with state parks officials, who are asking to pay for the project over several years in light of the bad economy.
Both sides agree Hampton Beach needs a makeover and the plans have already been assembled; a new seashell stage with seating for 750 and two pavilions with bathroom facilities, new bathhouses on the north and south ends of the beach and a new visitor's center.
The project's entire $18 million cost is expected to come from the state, but that amount is a hefty sum when budgets are being slashed.
"I think it's important people recognize that this is going to be an uphill battle," said John Nyhan, head of the Hampton Beach Area Commission, which is pushing for the redevelopment.
Nyhan said the state's capital improvement budget is expected to be $95 million this year, making the Hampton Beach redevelopment nearly 20 percent of that, should it be approved.
The Department of Resources and Economic Development has pegged the Hampton Beach redevelopment as its number-one priority, but even that isn't enough for the department to ask for the full sum this legislative session.
Officials said they plan to ask for enough money to build the two bathhouses this session and then ask for the remaining money at the next capital budget in two years. The department previously planned to ask for the full sum, but recently changed its tune.
"This is our number-one project," Division of Parks and Recreation spokesman Amy Bassett said. "We just have decided to phase it over a couple years of capital budgeting because the economy is just not there for it."
To push the project to state legislators, local officials are framing the redevelopment as a benefit to the entire state in added tourists and visitor spending.
Laurence Goss, a state economist, said fiscal 2008 direct spending at Hampton Beach totaled $170 million. He said that number would increase by 30 percent within five years of completing the redevelopment.
"While a lot of it is being spent in Hampton, a lot of it is also being spent in other communities," he said. "The money is spent regionally."
Goss estimated a redevelopment would also increase the number of tourist visits at Hampton Beach by 15 percent.
Support for full funding was strong at last night's meeting of the Hampton Beach Area Commission at Ashworth by the Sea, but the real support is needed in Concord, a fact not lost on anyone last night.
"We're not going to give up until that last vote is taken," Nyhan said as he implored everyone on hand to reach out to legislators.
Wednesday, December 10, 2008
Surviving Your Business Debt Seminar Offered
From the NHBR
Another great opportunity... The Women's Business Center sponsoring a topical and valuable speaker... BF
WBC readies ‘Surviving Business Debt’ seminar
Wednesday, December 10, 2008
The Women’s Business Center is sponsoring a breakfast roundtable on Wednesday, Dec. 17, featuring Kenneth P. Easton Jr., author of “Surviving Your Business Debt.”
Easton is expected to touch on such topics as launching immediate and effective business financial survival strategies, controlling current borrowing, coping under lender pressures, and how to leverage recovery, future business growth and opportunities through intelligent business borrowings.
Julie Vogt, WBC’s interim executive director, said she has received many phone calls from the organization’s worried members about how to deal with debt in the struggling economy.
“Now is not the time to put your head in the sand,” said Vogt. “You need to deal with debt like the businessperson you are. If you have business debt, large or small, you will benefit from Ken’s insights.”
The seminar will take place from 7 to 9 a.m., Wednesday, Dec. 17 at the Portsmouth Country Club, 80 Country Club Lane, Greenland. The event is presented free of charge to WBC member, $25 for non-members.
Advance registration is required.
For more information, call Nancy Blake at 603-430-2892, ext. 4. — CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW
Another great opportunity... The Women's Business Center sponsoring a topical and valuable speaker... BF
WBC readies ‘Surviving Business Debt’ seminar
Wednesday, December 10, 2008
The Women’s Business Center is sponsoring a breakfast roundtable on Wednesday, Dec. 17, featuring Kenneth P. Easton Jr., author of “Surviving Your Business Debt.”
Easton is expected to touch on such topics as launching immediate and effective business financial survival strategies, controlling current borrowing, coping under lender pressures, and how to leverage recovery, future business growth and opportunities through intelligent business borrowings.
Julie Vogt, WBC’s interim executive director, said she has received many phone calls from the organization’s worried members about how to deal with debt in the struggling economy.
“Now is not the time to put your head in the sand,” said Vogt. “You need to deal with debt like the businessperson you are. If you have business debt, large or small, you will benefit from Ken’s insights.”
The seminar will take place from 7 to 9 a.m., Wednesday, Dec. 17 at the Portsmouth Country Club, 80 Country Club Lane, Greenland. The event is presented free of charge to WBC member, $25 for non-members.
Advance registration is required.
For more information, call Nancy Blake at 603-430-2892, ext. 4. — CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW
Business News/ Analysis
from the NHBR - New Hampshire Business Review
Very good news for startups and home business owners, and the availability of the Incubator on a part time basis is no doubt a sign of the times... BF
Business incubator offers part-time deals
Tuesday, December 9, 2008
The Amoskeag Business Incubator has created an affiliate member program for small-business owners who need professional services on a part-time basis.
“The affiliate member program is geared toward owners of home-based businesses that are not quite ready for a full office, but do need some professional space,” said Michele Peterson of the incubator, which provides affordable office space and technical assistance to early-stage companies. “They can use the space to meet with clients, to use professional services, or just get out of the house to get work done if they’re outgrowing their home office.”
Affiliate membership comes at two cost levels -- $70 per month and $100 per month.
Under the $100 monthly program, members can use the incubator as a mailing address and 30 hours per month of office space as well as use of the conference room for three hours twice a month. Under the $70 monthly package, members receive 10 hours of office space use per month.
Additional hours of office space use can be rented for $5 an hour.
Some of the other services offered include the use of computer and/or laptop, wired/wireless Internet, LCD projector for use in the incubator’s conference room, notary services and kitchen facilities.
If affiliate members decide to upgrade their membership to full status, they can receive additional services, such as taking priority when permanent office space becomes available as well as the use of technical assistance, business coaching and support from the incubator’s business experts committee.
The Amoskeag Business Incubator currently has 20 full-time businesses at its location in the Manchester Millyard. For more information about the affiliate program, call ABI at 603-629-9511 or visit abi-nh.com. — CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW
Very good news for startups and home business owners, and the availability of the Incubator on a part time basis is no doubt a sign of the times... BF
Business incubator offers part-time deals
Tuesday, December 9, 2008
The Amoskeag Business Incubator has created an affiliate member program for small-business owners who need professional services on a part-time basis.
“The affiliate member program is geared toward owners of home-based businesses that are not quite ready for a full office, but do need some professional space,” said Michele Peterson of the incubator, which provides affordable office space and technical assistance to early-stage companies. “They can use the space to meet with clients, to use professional services, or just get out of the house to get work done if they’re outgrowing their home office.”
Affiliate membership comes at two cost levels -- $70 per month and $100 per month.
Under the $100 monthly program, members can use the incubator as a mailing address and 30 hours per month of office space as well as use of the conference room for three hours twice a month. Under the $70 monthly package, members receive 10 hours of office space use per month.
Additional hours of office space use can be rented for $5 an hour.
Some of the other services offered include the use of computer and/or laptop, wired/wireless Internet, LCD projector for use in the incubator’s conference room, notary services and kitchen facilities.
If affiliate members decide to upgrade their membership to full status, they can receive additional services, such as taking priority when permanent office space becomes available as well as the use of technical assistance, business coaching and support from the incubator’s business experts committee.
The Amoskeag Business Incubator currently has 20 full-time businesses at its location in the Manchester Millyard. For more information about the affiliate program, call ABI at 603-629-9511 or visit abi-nh.com. — CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW
Tuesday, December 9, 2008
Reworked Mortgages Not Working
from the Boston Globe this morning... nd it's not exactly encouraging news... BF
http://www.boston.com/realestate/news/articles/2008/12/09/reworked_mortgages_not_working?mode=PF
Reworked mortgages not working
Even after help, homeowners end up back in default
By Jenifer B. McKim, Globe Staff | December 9, 2008
More than half of delinquent borrowers who had their mortgages reworked earlier this year to avoid foreclosure were behind on their new loan payments after just six months, a federal regulator said yesterday.
John C. Dugan, US comptroller of the currency, told a housing forum yesterday that data his agency is collecting show the increase in repeat defaults by homeowners is "remarkably high."
"Put simply, it shows that over half of the loan modifications seemed not to be working after six months," Dugan said.
The findings raise several major questions for government and lending industry executives as they struggle for a fix to the nation's foreclosure crisis: Are lenders not doing enough to modify loans so delinquent borrowers can afford them? Or, are too many borrowers just not cut out to be homeowners and shouldn't be bailed out of their debts?
Dugan said his agency is asking lenders and their representatives why these redefault rates are so high. But many housing advocates and industry specialists said they already know: Lenders are failing to give troubled homeowners affordable long-term fixes. In fact, lenders were more likely to offer a modified loan that resulted in a higher, not lower, monthly payment, according to a recent report by analysts at the financial services company Credit Suisse.
Ask LaWanda Fils. This single mother was behind on payments on her Dorchester two-family home when she asked for help from her lender, Option One Mortgage Corp. The solution Option One offered didn't seem to make sense - she would pay $800 a month more, after rolling in past-due principal, taxes, and insurance. Desperate to save her home, Fils agreed to the deal anyway in February.
Two months later, she defaulted and now is again facing foreclosure.
"I think it is more for them to pat themselves on the back to say at least they tried," said Fils. "It's not feasible and it doesn't work and they end up having people falling behind."
Option One declined to comment.
Loan modifications can take several forms. Lenders can either reduce the mortgage's interest rate, which results in a lower payment; they can write off some of the unpaid principal, which could either lower monthly payments or lower overall debt; or they could postpone some of the debt or extend the life of the loan, which may lower payments in the short term, but drive costs over the life of the loan higher.
A loan modification can result in a higher payment if lenders roll back into the note unpaid principal, as well as interest and escrowed taxes, according to Faith Schwartz, executive director of Hope Now, a private sector alliance of mortgage servicers, counselors, and investors that is coordinating loan modifications.
"They tried to help them, but they could have foreclosed as the alternative," Schwartz said. She added lenders should examine the federal data to see which approach works and which doesn't. "It doesn't mean they didn't get a lower rate."
Even some professionals in the lending industry are mystified at why so many companies are charging delinquent borrowers more in a modified loan when they clearly could not afford the original, lower amount.
"I don't know why a lender would enter into that kind of agreement knowing what the outcome would be," said Kevin Cuff, executive director of the Massachusetts Mortgage Bankers Association. "Why would it not go into foreclosure? Why would it not fail?"
The new federal data did not distinguish among types of loan modifications. It showed that of borrowers receiving loan modifications earlier this year, 39 percent were 30 days in arrears after three months, and 51 percent after six months.
Dugan said 60 days in arrears is a more reliable indicator of homeowners who will ultimately lose their homes. On that measure, the results were equally dismal: More than 35 percent were 60 days past due on their mortgage payments six months after getting help.
It's clear the type of help can determine the outcome. Credit Suisse's analysis revealed that 44 percent of modifications that included higher payments redefaulted within eight months. Meanwhile, among those who had some of their principal permanently forgiven, 23 percent had redefaulted within eight months, while just 15 percent of those with adjustable rates whose rates were decreased or frozen had defaulted.
Even an increasingly popular proposal floated by the head of the Federal Deposit Insurance Corp. to refinance as many as 2.2 million troubled homeowners into affordable, fixed-rate mortgages estimates as many as a third, or about 700,000, could fall behind again by the end of 2009.
US Representative Barney Frank said that even with significant default rates, the majority of those who are helped stay in their homes and slow the bleeding in neighborhoods struggling from abandonment and blight.
Frustrated with the pace of help to homeowners, the Newton Democrat yesterday threatened to tie up the remaining half of the $700 billion financial industry rescue money unless the Bush administration provided some of it for modifying troubled loans.
Other specialists said the problem is as much the homeowners. Paul Willen, an analyst for the Federal Reserve Bank of Boston, said too many borrowers simply cannot afford to own their homes.
"Many of the people in the foreclosure process are in deep, deep trouble. They are not a modified loan away from financial happiness," said Willen. "Many people who are heading into foreclosure don't need a modification, they need an exit strategy."
Jenifer McKim can be reached at jmckim@globe.com.
http://www.boston.com/realestate/news/articles/2008/12/09/reworked_mortgages_not_working?mode=PF
Reworked mortgages not working
Even after help, homeowners end up back in default
By Jenifer B. McKim, Globe Staff | December 9, 2008
More than half of delinquent borrowers who had their mortgages reworked earlier this year to avoid foreclosure were behind on their new loan payments after just six months, a federal regulator said yesterday.
John C. Dugan, US comptroller of the currency, told a housing forum yesterday that data his agency is collecting show the increase in repeat defaults by homeowners is "remarkably high."
"Put simply, it shows that over half of the loan modifications seemed not to be working after six months," Dugan said.
The findings raise several major questions for government and lending industry executives as they struggle for a fix to the nation's foreclosure crisis: Are lenders not doing enough to modify loans so delinquent borrowers can afford them? Or, are too many borrowers just not cut out to be homeowners and shouldn't be bailed out of their debts?
Dugan said his agency is asking lenders and their representatives why these redefault rates are so high. But many housing advocates and industry specialists said they already know: Lenders are failing to give troubled homeowners affordable long-term fixes. In fact, lenders were more likely to offer a modified loan that resulted in a higher, not lower, monthly payment, according to a recent report by analysts at the financial services company Credit Suisse.
Ask LaWanda Fils. This single mother was behind on payments on her Dorchester two-family home when she asked for help from her lender, Option One Mortgage Corp. The solution Option One offered didn't seem to make sense - she would pay $800 a month more, after rolling in past-due principal, taxes, and insurance. Desperate to save her home, Fils agreed to the deal anyway in February.
Two months later, she defaulted and now is again facing foreclosure.
"I think it is more for them to pat themselves on the back to say at least they tried," said Fils. "It's not feasible and it doesn't work and they end up having people falling behind."
Option One declined to comment.
Loan modifications can take several forms. Lenders can either reduce the mortgage's interest rate, which results in a lower payment; they can write off some of the unpaid principal, which could either lower monthly payments or lower overall debt; or they could postpone some of the debt or extend the life of the loan, which may lower payments in the short term, but drive costs over the life of the loan higher.
A loan modification can result in a higher payment if lenders roll back into the note unpaid principal, as well as interest and escrowed taxes, according to Faith Schwartz, executive director of Hope Now, a private sector alliance of mortgage servicers, counselors, and investors that is coordinating loan modifications.
"They tried to help them, but they could have foreclosed as the alternative," Schwartz said. She added lenders should examine the federal data to see which approach works and which doesn't. "It doesn't mean they didn't get a lower rate."
Even some professionals in the lending industry are mystified at why so many companies are charging delinquent borrowers more in a modified loan when they clearly could not afford the original, lower amount.
"I don't know why a lender would enter into that kind of agreement knowing what the outcome would be," said Kevin Cuff, executive director of the Massachusetts Mortgage Bankers Association. "Why would it not go into foreclosure? Why would it not fail?"
The new federal data did not distinguish among types of loan modifications. It showed that of borrowers receiving loan modifications earlier this year, 39 percent were 30 days in arrears after three months, and 51 percent after six months.
Dugan said 60 days in arrears is a more reliable indicator of homeowners who will ultimately lose their homes. On that measure, the results were equally dismal: More than 35 percent were 60 days past due on their mortgage payments six months after getting help.
It's clear the type of help can determine the outcome. Credit Suisse's analysis revealed that 44 percent of modifications that included higher payments redefaulted within eight months. Meanwhile, among those who had some of their principal permanently forgiven, 23 percent had redefaulted within eight months, while just 15 percent of those with adjustable rates whose rates were decreased or frozen had defaulted.
Even an increasingly popular proposal floated by the head of the Federal Deposit Insurance Corp. to refinance as many as 2.2 million troubled homeowners into affordable, fixed-rate mortgages estimates as many as a third, or about 700,000, could fall behind again by the end of 2009.
US Representative Barney Frank said that even with significant default rates, the majority of those who are helped stay in their homes and slow the bleeding in neighborhoods struggling from abandonment and blight.
Frustrated with the pace of help to homeowners, the Newton Democrat yesterday threatened to tie up the remaining half of the $700 billion financial industry rescue money unless the Bush administration provided some of it for modifying troubled loans.
Other specialists said the problem is as much the homeowners. Paul Willen, an analyst for the Federal Reserve Bank of Boston, said too many borrowers simply cannot afford to own their homes.
"Many of the people in the foreclosure process are in deep, deep trouble. They are not a modified loan away from financial happiness," said Willen. "Many people who are heading into foreclosure don't need a modification, they need an exit strategy."
Jenifer McKim can be reached at jmckim@globe.com.
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