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Inside Real Estate (Aug 22nd, 2019)

1. Walmart's lawsuit against Tesla's SolarCity over solar panel fires may damage Tesla's roof panel business. Walmart claims that the panels were poorly installed and maintained, leading to seven separate fires. Walmart has SolarCity solar panels on over 240 stores. Walmart says Tesla has refused to compensate it for out-of-pocket damages and expenses. The panels suffered from hotspots some of which Tesla identified by putting tape over the areas, making the situation worse. SolarCity's sales have been down in recent months, causing Tesla to launch a rental program for homeowners. There is no installation fee but if the renter decides to uninstall, they are charged $1,500. — YAHOO FINANCE
 

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2. WeWork-rival Knotel has now raised a total of over $500 million as it continues to expand globally. Like WeWork, Knotel has increasingly focused on brands, building out bespoke workspaces on the enterprise level. It offers both a custom headquarters product as well as a move-in-ready option with basic workplace amenities. Knotel is now valued at over $1 billion. The newest $400 million round was led by Wafra, an entity associated with Kuwait’s Sovereign Wealth Fund. It was reported earlier this year that Knotel was seeking to raise a $200 million Series C round. Knotel has four million square feet of space in 200 locations around the world. It also offers flexible coworking in New York. Recently Knotel announced a line of modular office furniture for its tenants that can be rented monthly. — VENTURE BEAT

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3. Throwback Thursday: The legendary Grossinger's. Last week, Jackie Horner, a dancing teacher in New York's famed Catskills resorts, was honored with the Distinguished Citizen Award by the Sullivan County Legislature. Horner was a teacher at Grossinger’s, the legendary hotel that was the center of the Borscht Belt of summer getaways. She once taught a family that later became the inspiration for the movie "Dirty Dancing."

The hotel and the Grossinger family is also the inspiration for "Hotel Neversink" a new mystery novel by Adam O'Fallon Price. Grossinger's was closed in 1986 and fell into disrepair. Its indoor pool, once the largest in the country, abandoned and covered in graffiti became an image of the destruction of a once-famed resort destination.  In an interview, Price described sneaking into Grossinger's and taking pictures of the auditorium and pool as part of his research.

Earlier this year, a developer proposed the creation of a $50 million resort at the site with a golf curse, convention center, spa, and residences. The success of the second season of "The Marvelous Mrs. Maisel" also helped prompt nostalgia for the glory days of Catskills hotel life in the 1950s as we wrote about back in February.  Grossinger's was also in the news last week as people remembered Woodstock (the resort hosted many of the performers), all potentially helping to fuel the Catskill's renewal that is only waiting for the rebirth of its most legendary hotel.

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4. Fund That Flip – a company that gives short-term loans to people who are rehabbing rental properties — has raised $11 million from Edison Partners. The company offers investors fractional shares of the short-term loans it makes to developers seeking to buy, renovate and flip residential properties. 

Fund That Flip isn't the only fix-and-flip lender in the news. Wafra Capital Partners, mentioned in the Knotel story above, is now the majority shareholder in Anchor Loans, a California lender that gives loans to multifamily and single-family properties. The company originates over $1 billion in loans a year. Anchor gives loans for both purchases and renovations, mostly for a one-year term. Most of its lending activity is in California although it does provide loans nationwide. — COMMERCIAL OBSERVER
 

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5. Stay Tony, and the vision of short-term living. This week I checked out the newest location of StayTony, a short-term housing company that puts the emphasis on modern design. Stay Tony was created by Tony Diamond and has launched in Los Angeles. The newest location is in West Hollywood, a partnership with local developer and restaurateur Paul Kalt.

I caught up with Tony to ask a few questions about the brand and where he's headed next.  What's interesting about Stay Tony is that they offer a hotel-style experience that is an elevated version of the extended-stay model with bespoke furnishings and custom art. Diamond told Inside that while the minimum is one month, many residents stay several months or even a year. One reason might be that, unlike many other options, Stay Tony is dog-friendly.

Why do you think financing rent is becoming popular? What are the potential pitfalls?
Corporations finance their equipment and their infrastructure. Now they can finance rent for their employees as they send them on temporary job assignments around the country.  We see this as a way of allowing companies the ability to preserve cash and spread their payments over time as being a win-win.

What are the demographics of your average client?
Our guests are of all ages and backgrounds, but what they all share in common is their love of great interior design. We create a unique experience with our highly stylized design and that's what we believe draws our guests to StayTony.

Is your clientele a mix of individuals and corporate clients?
We have a supply issue. We have way more interested guests than we have apartments so until we add a great number of apartments we won't be able to form corporate relationships.

What one thing could make your business expansion easier?
Money. We are growing so fast we constantly need more money.  I wish money grew on trees, it would make things so much easier.

Imagine it's 2030, what does Stay Tony look like?
This is a tough question because we are in the process of developing a new housing model, that complements our existing model, that we think will permanently change the trajectory of housing.  I can't tell you what 2030 will look like without revealing this new model and unfortunately I've been sworn to secrecy!

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6. Lead paint for residential use was banned in 1978 but it is still in around 24 million properties around the country. The Department of Housing and Urban Development has announced $27.8 million to be distributed to 38 public housing groups in 25 states to help reduce lead paint in older public housing. The grants will focus on housing occupied by families with young children. Younger children are at risk to chew on paint chips and exposure to lead can cause developmental delays.— HOUSINGWIRE

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7. The former ConocoPhillips campus in Houston turned out not to be a fit for Occidental Petroleum, so the campus is now for sale. Occidental bought the 70-acre property in January of 2018, but it recently acquired Anadarko Petroleum and the campus doesn't have enough room to accommodate the combined company.  Occidental plans to retain Anadarko's current campus. The campus has 1.4 million square feet of space across five buildings as well as a fitness center. CBRE will market the property and is targeting developers, schools, and medical facilities. The bidding period will be open for six weeks, and no list price has been set. — HOUSTON CHRONICLE

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8. Developer Gil Dezer has submitted plans to build a new canal in North Miami Beach as part of a new vertical neighborhood with 48-story towers. The new canal will be connected to the Intracoastal Waterway. The project will have a waterfront promenade with docks, kayak launches, and a water taxi service. The project will have 2,000 residential units, retail, office space, and a hotel. Dezer Development first announced the project in 2017 as a "town for millennials." The proposal now awaits approval from the town of North Miami Beach.  — THE NEXT MIAMI

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9. A former missile silo in Indiana is for sale for $850,000. The silo is one of three on land in Dillsboro, Indiana, and has been converted into a four-bedroom home with an indoor pool. The 14-acre property also includes buildings used as army barracks and bomb shelters. There are hundreds of former missile silos around the United States, some of which have been turned into living quarters. Concerns about climate change and war have led to a boom in apocalyse-ready homes. — INDIANAPOLIS STAR

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10. An enterprising real estate agent in Lyons, Colorado, has created an homage to her town featuring local musicians. Levy worked with musician Arthur Lee Land and his wife songwriter Carol Lee as well as many locals to create "Two Rivers," a country-folk ballad that pays tribute to the town. Of course, Levy made sure that her real estate signs feature prominently in the video. Other local businesses are featured in the video which shows a family learning to appreciate the area and check out the sights. — DAILY CAMERA

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