With mortgage rates still near historic lows, consolidating credit card debt in a refinance can substantially lower monthly expenses. Yet many financial experts advise against it.
Take the example of JoAnn and Ray Katz. Three years after Ray left an executive position, he found himself earning a fraction of his former income, while his self-employed wife, JoAnn, struggled to make up the difference in a faltering economy. With their savings dwindling and credit card debt mounting, they looked to their most valuable assets: their center-city Philadelphia home and a second house they were renting out. "We were property-rich and income-poor," says JoAnn.
The couple had refinanced six years before, but when mortgage rates dropped to historic lows in May, they saw an opportunity to eliminate their credit card debt by refinancing their home and rolling $25,000 of credit card debt into the loan. Thanks to an excellent credit rating and an appraisal valuing the house at $345,000 — four times what they owed on it — Ray and JoAnn managed to lock in a 30-year fixed mortgage interest rate of 4.8 percent, two points lower than before. They're now saving $1,000 per month — $350 less in mortgage, $650 less in credit card payments.
"I would only suggest this as a last-gasp strategy," says Susan Reynolds, author of "One-Income Household."
"In general, rolling credit card debt into mortgage loans is not a good idea. You will pay significantly more in interest over the life of the homeowner's loan than you would if you chipped away at your credit card debt over a period of three to five years. Remember, home equity loans are secured. Credit cards are not. If you renege, they can pester you for payment and ding your credit report, but they cannot
confiscate your home."
Todd Huettner, president of Huettner Capital, a mortgage brokerage specializing in debt consolidation, advises homeowners to answer three questions before rolling debt into a home loan:
Why do you have this debt? "If you're spending more than you can afford, consolidating your debt will not improve your spending habits and will likely be harmful in the long run," says Huettner. What are the costs of consolidating the debt? Those additional costs can add up to thousands of dollars compared to a regular refinance. If it doesn't make sense to refinance without the debt, you're probably spending more than you're saving. "If rates are low enough, the costs of a refinance should be paid back by interest savings within the first five years, preferably the first two," says Huettner. "If not, you're paying a lot in closing costs and that will offset any interest savings. I have even seen people try to cash out equity from their house even though it meant the new loan would have a higher interest rate."
Is there a more effective way to eliminate your debt than rolling it into your home loan? For example, a regular refinance may produce enough cash to cover the debt. "By timing the closing and your current loan payments, calculating any escrow refund and using incidental cash back, you can include several thousand dollars in your loan that wind up in your pocket," says Huettner. "For people who don't have much debt or where the costs of the cash-out are too high, this is often a better alternative." If your credit is good, there are still some 0 percent balance transfer credit cards that could help you pay the balance faster.
After working with nearly 5,000 families, Susan White of PlanPlus Inc. has her own reasons for advising against rolling debt into home loans. "The theory of turning higher debt rates (credit cards) into lower ones (mortgage) is a great idea," says White in an e-mail, "but it usually doesn't work because many of the people who end up in this situation have a habit of spending without conscious decision making." Refinancing? Weigh risks of debt consolidation - Personal finance Breaking bad habits
Gayle and Jim McWeeney are determined to break that habit. They refinanced their New Jersey home in July, rolling $30,000 of credit card and car loan debt into their 30-year fixed-rate loan. It was their third refi since buying their house in 1995 and, this time, they hired a professional adviser. Since much of their credit card debt went toward home repairs, he convinced them to take out an extra $20,000 to stash away as an emergency fund. "Homes are money pits," Gayle says. While the couple's mortgage payment increased by $175 (they were hoping to reduce their rate from 6 1/8 to 5 percent, but their broker locked in late), they netted $700 in monthly savings. Their adviser also helped them design a plan to avoid future debt and pay off their mortgage early. "It's extremely helpful to have a good adviser," Gayle says. "Not only does he help us think outside the box, he will hold us accountable. I don't want him coming for a meeting and seeing a new Lexus in the driveway!"
Both couples timed their refinancing well, taking advantage of this year's low rates and lending flexibility. Not only are they spending hundreds less each month, they turned car and credit card payments into a tax-deductible home loan. Now comes the hard part. "This is the beginning of their effort to get rid of debt, not the end," says Todd Huettner, president of Huettner Capital, a mortgage brokerage specializing in debt consolidation. Whether or not refinancing their debt proves a smart move may depend on whether they take the next steps:
Prepare a detailed cash flow analysis. Where is your money going and what are you putting on credit cards? Estimate your average monthly expenditure in all areas. Track spending carefully for three months.
Figure out ways to cut back, then set a target and stick to it. Put credit cards in a safe deposit box. To reprogram the charge habit, don't buy anything you can't
pay for upfront for at least six months. "I wouldn't advise cutting cards up," says White. "With the current credit situation, people may not be able to replace them later."
Start retirement and emergency funds and contribute monthly. The McWeeneys have a good start with the $20,000 extra they took out, but Huettner warns that fund will vanish if they don't feed it. "Saving for retirement and emergencies are line items, the first two things in your budget after taxes," Huettner says. "Then factor in food, shelter, etc. Most people think they'll just save whatever is left over. If that's your approach, there is nothing left over."
Hire a financial planner. Follow the McWeeneys' lead and develop a written plan. "A financial crisis is a good opportunity to look at your big picture," says White. "Don't shy away from this because you don't have money right now or don't think you are a big enough client." Sound financial advice will pay for itself.
Set a realistic goal for paying off your mortgage. Both couples plan to pay off their mortgages early, but experts say this may not be wise. "That 30-year fixed mortgage becomes an investment, after taxes, of close to 4 percent," says Huettner. "You're probably better off putting that money into a savings account or CD. A mortgage is an inflation hedge."
Whether you decide to consolidate debt into a home loan or chip away at it the old-fashioned way, have a plan in place. Cutting back on your lifestyle and changing spending behavior "takes sweat," says Huettner. "It's not fun." White recommends setting up a reward for achieving certain goals, "something you've wanted but haven't been able to afford."
For Gayle McWeeney, it won't be a new Lexus. "That first month with no payments, it sure is tempting to go hog wild," says McWeeney. "Don't. Treat yourself to a nice dinner out and leave it at that."
Wednesday, August 26, 2009
Housing market could be Bernanke's greatest challenge
CNBC's Erin Burnett led a discussion yesterday on why the housing market could be Fed Chairman Ben Bernanke's biggest challenge to economic recovery. Citing a comment from Case-Shiller co-creator Robert Shiller, in which the Yale professor predicted that home prices would increase by just 6 percent in the next five years, CNBC correspondent Diana Olick commented that the housing market outlook could be even bleaker. "Three factors were left out [of Shiller's report] that could be actually juicing the numbers to the upside," Olick said, referring to the first-time homebuyer tax credit, the second-quarter foreclosure moratorium, and the fact that Shiller's data was not seasonally adjusted. Bianco Research CEO James Bianco agreed that the market future could be rougher than thought. "The low-end home prices are really moving up," Bianco said, but added that this was largely due to the $8,000 tax credit for first-time buyers. "The middle- and high-end [are] not moving up. What happens when those tax credits come off and the moratoriums come off -- does the market sink back down?"
Tuesday, August 25, 2009
ULI Boston Panel Discussion Climate Regulations Will Change Our Industry: Are You Prepared? Tuesday, September 15, 2009
ULI Boston Panel Discussion
Climate Regulations Will Change Our Industry: Are You Prepared?
Tuesday, September 15, 2009
Recently enacted and pending state and federal regulations addressing climate change and building energy efficiency are profound game changers for the real estate industry. Once a second or third-tier concern, carbon footprints and energy performance are quickly becoming top-tier issues as regulations make improving building efficiency a prerequisite for doing business. Buildings from the 1980s, 1990s, and early 2000s will no longer be acceptable. Fundamental change is coming to the practice of design, development, and property management.
Leaders from Ceres, Boston Properties, Beacon Capital Partners and Gensler will discuss what the current and pending climate and energy regulations hold for the real estate industry, how the issues in existing and development portfolios are being addressed, and how these issues are affecting the design of the buildings of tomorrow.
Speakers Include:
Mike Cantalupa
Senior Vice President of Development, Boston Properties
Zeina Grinnell
Vice President, Beacon Capital Partners
Dan Bakal
Director of Electic Power Systems,Ceres
Doug Gensler, Principal, Gensler Moderator
SpeakerbiosSpeaker Biographies
MIKE CANTALUPA
Senior Vice President of Development, Boston Properties
Michael's group is currently responsible for the construction of Russia Wharf, a 850,000 square foot mixed-use project in Boston, MA, seeking LEED Gold designation from the USGBC and Weston Corporate Center, a 350,000 SF development and the future home of Biogen Idec's corporate headquarters. His group has most recently completed development of the Eli and Edythe L. Broad Institute for Genomic Research, a 230,000 square foot research and development laboratory formed with funds from the Broad Family, Harvard University and the Massachusetts Institute of Technology and 77 CityPoint, a 200,000 square foot speculative office building in Waltham, MA, which was recently completed fully leased and has been approved for USGBC's LEED Gold designation.
Additional pipeline projects include numerous other development sites in Boston, Cambridge, Waltham, Weston, Andover and Marlborough, totaling in excess of 5 million square feet of commercial space under various stages of permitting, design and development. In addition, he has served as a consultant to the United State Postal Service, providing advice and services for that agency's Greater Boston real estate holdings and to Children's Hospital Boston in their evaluation of a 350,000 square foot research laboratory at the hospital's Longwood Medical Area Campus in Boston, MA.
Prior to joining Boston Properties in 1988, Michael worked in project
supervision capacities in the construction industry with Perini Corporation, Manganaro Corporation and Component Assembly Systems, Inc. on a number of major commercial building projects in the Greater Boston and New York areas.
ZeinGrinZEINA GRINNELL
Vice President, Beacon Capital Partners
Zeina Talje Grinnell has been with Beacon Capital Partners for 5 years and has managed over 3 million SF of new development including Channel Center in Boston, 535 Mission Street in San Francisco, Reston Signature site in Virginia, City Center Plaza and Griffin Site in Bellevue.
She is currently the asset manager for Beacon's Boston portfolio in charge of leasing, operations and financial reporting for 2.4 million SF of Class A commercial office space.
Ms. Grinnell's broad experience includes sourcing new deals, public approvals, feasibility analysis, project management, contract negotiations, construction administration, debt financing, leasing and asset management.
Prior to joining Beacon Capital Partners, Ms. Grinnell practiced architecture for four years in Boston where she worked on a variety of office, hotel and residential developments from early design through construction. Ms. Grinnell holds a Bachelor of Science and Professional Degree in Architecture from McGill University in Montreal, Quebec, and a Master of Business Administration with a concentration in real estate from Columbia Business School in New York. She is also a Leadership in Energy and Environmental Design (LEED) Accredited Professional.
bakalDAN BAKAL
Director of Electric Power Programs, Ceres
Dan Bakal joined Ceres in 2000, and has helped launch and advance two of the organization's signature efforts, The Global Reporting Initiative (GRI), which develops sustainability reporting guidelines and the $7 trillion Investor Network on Climate Risk (INCR), whose members are addressing the risks and opportunities associated with climate change. Dan oversees Ceres' electric power and coal research, shareholder engagement, and furthers the understanding of environmental risks, with a particular focus on climate risk. He works closely with Ceres coalition members, including environmental, investor, labor and public interest groups, to engage in dialogues with electric power companies, which often involve a comprehensive review of environmental policies, performance, and disclosure practices.
In 2002, Dan developed and launched the Electric Power/Investor Dialogue, a working group of electric power companies, institutional investors, environmental NGOs, and analysts that focused on taking action on climate change by reducing carbon dioxide emissions from the electric power sector. In 2005, the group issued a report highlighting best practices by the industry and financial services sector in addressing climate change. Following this initiative, Dan organized two investor/analyst briefings in collaboration with Sanford C. Bernstein Research, a subsidiary of AllianceBernstein, to assess the financial impacts of climate change on the electric power sector.
Since 2002, Dan has worked with PSEG, Inc. and the Natural Resources Defense Council to publish four editions of the report, Benchmarking Air Emissions of the 100 Largest Electric Generators. The report compares the air pollutant emissions of power industry and provides analysis of issues and trends facing the sector.
Dan has also been helping institutional investors members of INCR deploy more than $3 billion into clean energy investments. Dan's work has been cited extensively in the media, including the Wall Street Journal, the New York Times, the Financial Times, Fortune, Pensions and Investments, BusinessWeek, the Boston Globe, and he has appeared on CNN Headline News, and CNBC's Closing Bell and Power Lunch. Dan holds a B.A. from the University of Pennsylvania.
MODERATOR - DOUG GENSLER
Principal, Gensler
Doug Gensler is a Principal and Managing Director of the Boston office of Gensler, a global design firm with 30 offices around the world. After graduating from Cornell's School of Architecture in 1991 and spending a year in Tokyo working for a large Japanese architecture firm, Doug officially joined Gensler in their San Francisco office. After three years working on a variety of large-scale projects, including a "build-to-suit" campus for a large publishing company and a 500,000 square foot World Trade Center facility in the Philippines, Doug was asked to relocate and help build the Boston office.
Under Doug's leadership the Boston office has grown to a team of 60, providing architectural and interior design services to a growing number of clients in the fields of finance, law, technology, academic, retail, mixed-use and entertainment, real estate, and professional services. Some of the notable projects that he has led include a 140,000 sf Headquarter facilities for Bain & Company, the development of a "proto-type" design and roll-out of multiple sites for both Fidelity Investments and PNC Bank and the master planning for a 200-acre mixed-use development on a Brownfield site just outside of Boston. Doug is currently working on a 750,000sf mixed-use tower in Pittsburgh, Pennsylvania; and with Plymouth Rock Studios on the master planning of a $500 million, 2 million square-foot full service media production campus including sound stages, production offices, a back lot, 5-star hotel with spa, housing, restaurants, retail, and education/research center, in Plymouth, Massachusetts.
Doug is a member of the AIA, CoreNet, NAIOP, ULI, and a former member of Boston Architectural Center's Board of Overseers Education Committee. At Cornell University, he serves on the Advisory Council for the School of Architecture, Art and Planning and is also a Council member for the University.
The mission of the Urban Land Institute is to provide leadership in the responsible use of land and in creating and sustaining thriving communities worldwide.
ULI Boston
111 Huntington Avenue
Boston, Massachusetts 02199
617.239.0564
Climate Regulations Will Change Our Industry: Are You Prepared?
Tuesday, September 15, 2009
Recently enacted and pending state and federal regulations addressing climate change and building energy efficiency are profound game changers for the real estate industry. Once a second or third-tier concern, carbon footprints and energy performance are quickly becoming top-tier issues as regulations make improving building efficiency a prerequisite for doing business. Buildings from the 1980s, 1990s, and early 2000s will no longer be acceptable. Fundamental change is coming to the practice of design, development, and property management.
Leaders from Ceres, Boston Properties, Beacon Capital Partners and Gensler will discuss what the current and pending climate and energy regulations hold for the real estate industry, how the issues in existing and development portfolios are being addressed, and how these issues are affecting the design of the buildings of tomorrow.
Speakers Include:
Mike Cantalupa
Senior Vice President of Development, Boston Properties
Zeina Grinnell
Vice President, Beacon Capital Partners
Dan Bakal
Director of Electic Power Systems,Ceres
Doug Gensler, Principal, Gensler Moderator
SpeakerbiosSpeaker Biographies
MIKE CANTALUPA
Senior Vice President of Development, Boston Properties
Michael's group is currently responsible for the construction of Russia Wharf, a 850,000 square foot mixed-use project in Boston, MA, seeking LEED Gold designation from the USGBC and Weston Corporate Center, a 350,000 SF development and the future home of Biogen Idec's corporate headquarters. His group has most recently completed development of the Eli and Edythe L. Broad Institute for Genomic Research, a 230,000 square foot research and development laboratory formed with funds from the Broad Family, Harvard University and the Massachusetts Institute of Technology and 77 CityPoint, a 200,000 square foot speculative office building in Waltham, MA, which was recently completed fully leased and has been approved for USGBC's LEED Gold designation.
Additional pipeline projects include numerous other development sites in Boston, Cambridge, Waltham, Weston, Andover and Marlborough, totaling in excess of 5 million square feet of commercial space under various stages of permitting, design and development. In addition, he has served as a consultant to the United State Postal Service, providing advice and services for that agency's Greater Boston real estate holdings and to Children's Hospital Boston in their evaluation of a 350,000 square foot research laboratory at the hospital's Longwood Medical Area Campus in Boston, MA.
Prior to joining Boston Properties in 1988, Michael worked in project
supervision capacities in the construction industry with Perini Corporation, Manganaro Corporation and Component Assembly Systems, Inc. on a number of major commercial building projects in the Greater Boston and New York areas.
ZeinGrinZEINA GRINNELL
Vice President, Beacon Capital Partners
Zeina Talje Grinnell has been with Beacon Capital Partners for 5 years and has managed over 3 million SF of new development including Channel Center in Boston, 535 Mission Street in San Francisco, Reston Signature site in Virginia, City Center Plaza and Griffin Site in Bellevue.
She is currently the asset manager for Beacon's Boston portfolio in charge of leasing, operations and financial reporting for 2.4 million SF of Class A commercial office space.
Ms. Grinnell's broad experience includes sourcing new deals, public approvals, feasibility analysis, project management, contract negotiations, construction administration, debt financing, leasing and asset management.
Prior to joining Beacon Capital Partners, Ms. Grinnell practiced architecture for four years in Boston where she worked on a variety of office, hotel and residential developments from early design through construction. Ms. Grinnell holds a Bachelor of Science and Professional Degree in Architecture from McGill University in Montreal, Quebec, and a Master of Business Administration with a concentration in real estate from Columbia Business School in New York. She is also a Leadership in Energy and Environmental Design (LEED) Accredited Professional.
bakalDAN BAKAL
Director of Electric Power Programs, Ceres
Dan Bakal joined Ceres in 2000, and has helped launch and advance two of the organization's signature efforts, The Global Reporting Initiative (GRI), which develops sustainability reporting guidelines and the $7 trillion Investor Network on Climate Risk (INCR), whose members are addressing the risks and opportunities associated with climate change. Dan oversees Ceres' electric power and coal research, shareholder engagement, and furthers the understanding of environmental risks, with a particular focus on climate risk. He works closely with Ceres coalition members, including environmental, investor, labor and public interest groups, to engage in dialogues with electric power companies, which often involve a comprehensive review of environmental policies, performance, and disclosure practices.
In 2002, Dan developed and launched the Electric Power/Investor Dialogue, a working group of electric power companies, institutional investors, environmental NGOs, and analysts that focused on taking action on climate change by reducing carbon dioxide emissions from the electric power sector. In 2005, the group issued a report highlighting best practices by the industry and financial services sector in addressing climate change. Following this initiative, Dan organized two investor/analyst briefings in collaboration with Sanford C. Bernstein Research, a subsidiary of AllianceBernstein, to assess the financial impacts of climate change on the electric power sector.
Since 2002, Dan has worked with PSEG, Inc. and the Natural Resources Defense Council to publish four editions of the report, Benchmarking Air Emissions of the 100 Largest Electric Generators. The report compares the air pollutant emissions of power industry and provides analysis of issues and trends facing the sector.
Dan has also been helping institutional investors members of INCR deploy more than $3 billion into clean energy investments. Dan's work has been cited extensively in the media, including the Wall Street Journal, the New York Times, the Financial Times, Fortune, Pensions and Investments, BusinessWeek, the Boston Globe, and he has appeared on CNN Headline News, and CNBC's Closing Bell and Power Lunch. Dan holds a B.A. from the University of Pennsylvania.
MODERATOR - DOUG GENSLER
Principal, Gensler
Doug Gensler is a Principal and Managing Director of the Boston office of Gensler, a global design firm with 30 offices around the world. After graduating from Cornell's School of Architecture in 1991 and spending a year in Tokyo working for a large Japanese architecture firm, Doug officially joined Gensler in their San Francisco office. After three years working on a variety of large-scale projects, including a "build-to-suit" campus for a large publishing company and a 500,000 square foot World Trade Center facility in the Philippines, Doug was asked to relocate and help build the Boston office.
Under Doug's leadership the Boston office has grown to a team of 60, providing architectural and interior design services to a growing number of clients in the fields of finance, law, technology, academic, retail, mixed-use and entertainment, real estate, and professional services. Some of the notable projects that he has led include a 140,000 sf Headquarter facilities for Bain & Company, the development of a "proto-type" design and roll-out of multiple sites for both Fidelity Investments and PNC Bank and the master planning for a 200-acre mixed-use development on a Brownfield site just outside of Boston. Doug is currently working on a 750,000sf mixed-use tower in Pittsburgh, Pennsylvania; and with Plymouth Rock Studios on the master planning of a $500 million, 2 million square-foot full service media production campus including sound stages, production offices, a back lot, 5-star hotel with spa, housing, restaurants, retail, and education/research center, in Plymouth, Massachusetts.
Doug is a member of the AIA, CoreNet, NAIOP, ULI, and a former member of Boston Architectural Center's Board of Overseers Education Committee. At Cornell University, he serves on the Advisory Council for the School of Architecture, Art and Planning and is also a Council member for the University.
The mission of the Urban Land Institute is to provide leadership in the responsible use of land and in creating and sustaining thriving communities worldwide.
ULI Boston
111 Huntington Avenue
Boston, Massachusetts 02199
617.239.0564
Monday, August 24, 2009
Great artical in The New York Times
As Heroes Disappear, the City Needs More
By NICOLAI OUROUSSOFF
Published: August 23, 2009
The death of Charles Gwathmey early this month has provoked a lot of nostalgic reminiscence in the New York architecture world: not just about Mr. Gwathmey himself, but also about the New York Five, a group of influential architects of which he was part.
Fred R. Conrad/The New York Times
The 1966 Gwathmey house, designed by Charles Gwathmey.
This nostalgia has much to do with what’s been lost in the years since the group’s prominence in the 1970s. The early years of that decade was a time when this city was beginning to close itself off to innovative architecture. But it was also a time when New York could still claim to be the country’s center of architectural thought, and Mr. Gwathmey and his colleagues had a great deal to do with maintaining that pre-eminence in the public imagination. The New York Five came to represent the idea that architecture could still express and advance our values as a culture. To some, the group embodies the last heroic period in New York architecture.
That the five came together at all seems almost an accident of fate. They had no real manifesto, no common aesthetic. Several young, promising New York architects were invited by Arthur Drexler, the director of the Museum of Modern Art’s legendary architecture department, to meet informally in the museum board room one day in the late ’60s to talk about their work. More meetings followed, a few attendees dropped out, others joined in. When the book “Five Architects,” which inspired the group’s name, was published in 1972, its success was a shock to everyone.
What the five architects did share, however, was a desire to reassert the importance of architecture as art form during a crisis in the profession. By the mid-1960s much of the Modernist dream was in ruins, and one of its central tenets — that architecture could act as an agent of positive social change — lay buried beneath decades of failed urban housing projects, soulless government buildings and sterile concrete plazas.
At the same time activists like Jane Jacobs were portraying modern architecture as the product of smug, pointy-headed academics out of touch with the way real people live. Her vision of the ideal city — a historical community of brownstones, front stoops and corner stores — was modeled on the North End in Boston and Greenwich Village. It left little room for new architectural ideas.
Faced with such a hostile climate, some of the New York Five began looking to other creative disciplines for a way out of this malaise. John Hejduk, for example, often cited Fernand Léger and Juan Gris as an inspiration. The carefully assembled forms of Michael Graves’s early projects drew inspiration from the still-life paintings of Giorgio Morandi. (Even Richard Meier’s refined glass-and-steel aesthetic, which owed its most obvious debt to orthodox Modernism, turned the classical Modernist house into a fetishized art object.)
The group’s greatest contribution, in retrospect, was its assertion that architecture had not reached a dead end. The architects saw themselves as artists and thinkers — not activists — and this was particularly true of Peter Eisenman, sometimes to a fault. The distorted grids of his early houses, with their references to Renaissance precedents and Structuralist theory, were not only a way to thumb a nose gleefully at Jacobs-style populism; they also elevated conceptual ideas above material and structure, the life of the mind over the life of the body.
To many in the profession this aesthetic approach represented a way forward. Philip Johnson, who seemed to rule the American architectural scene from his perch as a trustee at the Museum of Modern Art, began to fete the five over lunches at the Four Seasons and black-tie dinners at the Century club. He introduced them to powerful figures in the art establishment.
Yet to those who were paying attention, the party’s end was evident almost as soon as it had started. By the mid-1980s the effort to suburbanize the city’s core and make it safe for tourists — a process that many associate with Rudolph W. Giuliani and his mayoral quality-of-life campaigns a decade later — was well under way, and the group’s members had splintered off in different directions.
Mr. Graves, once a dogmatic Modernist, retreated into an ersatz historicism. Mr. Hejduk, who died in 2000, beat a similar retreat into academia. Although Mr. Meier continues to create works of remarkable refinement, his vision has not significantly changed in decades. Only Mr. Eisenman has kept up a theoretical practice, one in which the work is continually evolving, but he has built little — and nothing in New York.
The country’s creative energy shifted westward, to Los Angeles, whose vibrant mix of urban grit and nature, abundance of relatively cheap land and lack of confining historical traditions allowed architects to experiment with a freedom that had become virtually impossible in New York.
Frank Gehry, Thom Mayne, Eric Owen Moss, Robert Mangurian, Craig Hodgetts — these architects were not only the creative equals of their New York counterparts, they were making architecture that was rooted in popular culture and as rich in ideas as anything that has come out of New York in decades. They have been joined by a younger generation, including Greg Lynn, Michael Maltzan, Neil Denari and the team of Kevin Daly and Chris Genik, that has no real equivalent in New York.
A similar energy could be found in Europe and Japan, where the crisis of Modernism had not been felt as deeply and architects had never stopped experimenting.
Given that reality, it should not be surprising to anyone that the most important works of contemporary architecture to rise in New York over the past decade — Mr. Gehry’s IAC headquarters on the West Side Highway, Mr. Mayne’s Cooper Union building, the Tokyo firm Sanaa’s New Museum of Contemporary Art on the Bowery and Jean Nouvel’s tower under construction in Chelsea — were designed not by New Yorkers but by Angelenos, a Japanese woman and a Frenchman.
It is hard to know how the current financial crisis will affect this trend. More than once I’ve heard it suggested that the downturn will be good for architecture. The argument goes something like this: The economic tailspin will put an end to the boom in gaudy residential towers that are distorting the city’s skyline. Cheap rents will attract young, hungry creative types. This will spawn a cultural flowering similar to that of the 1970s, when the Bronx was burning, graffiti artists were the norm and Gordon Matta-Clark was carving up empty warehouses on the Hudson River piers with a power saw.
But cheap rents alone won’t do it. On the contrary, the construction slowdown, if it lasts long enough, will likely drive many young talents out of the profession for good. It also looks less and less likely that a government-sponsored, Works Progress Administration-style civic project will revive the profession — another favorite fantasy of the ever-optimistic architecture scene.
Real change will first demand a radical shift in our cultural priorities. Politicians will have to embrace the cosmopolitanism that was once the city’s core identity. New York’s cultural institutions will need to shake off the complacency that comes with age and respectability. Architects will need to see blind obedience once again as a vice, not a virtue. And New Yorkers will have to remember why they came to the city in the first place: to find a refuge from suburbia, not to replicate it. That’s a tall order.
By NICOLAI OUROUSSOFF
Published: August 23, 2009
The death of Charles Gwathmey early this month has provoked a lot of nostalgic reminiscence in the New York architecture world: not just about Mr. Gwathmey himself, but also about the New York Five, a group of influential architects of which he was part.
Fred R. Conrad/The New York Times
The 1966 Gwathmey house, designed by Charles Gwathmey.
This nostalgia has much to do with what’s been lost in the years since the group’s prominence in the 1970s. The early years of that decade was a time when this city was beginning to close itself off to innovative architecture. But it was also a time when New York could still claim to be the country’s center of architectural thought, and Mr. Gwathmey and his colleagues had a great deal to do with maintaining that pre-eminence in the public imagination. The New York Five came to represent the idea that architecture could still express and advance our values as a culture. To some, the group embodies the last heroic period in New York architecture.
That the five came together at all seems almost an accident of fate. They had no real manifesto, no common aesthetic. Several young, promising New York architects were invited by Arthur Drexler, the director of the Museum of Modern Art’s legendary architecture department, to meet informally in the museum board room one day in the late ’60s to talk about their work. More meetings followed, a few attendees dropped out, others joined in. When the book “Five Architects,” which inspired the group’s name, was published in 1972, its success was a shock to everyone.
What the five architects did share, however, was a desire to reassert the importance of architecture as art form during a crisis in the profession. By the mid-1960s much of the Modernist dream was in ruins, and one of its central tenets — that architecture could act as an agent of positive social change — lay buried beneath decades of failed urban housing projects, soulless government buildings and sterile concrete plazas.
At the same time activists like Jane Jacobs were portraying modern architecture as the product of smug, pointy-headed academics out of touch with the way real people live. Her vision of the ideal city — a historical community of brownstones, front stoops and corner stores — was modeled on the North End in Boston and Greenwich Village. It left little room for new architectural ideas.
Faced with such a hostile climate, some of the New York Five began looking to other creative disciplines for a way out of this malaise. John Hejduk, for example, often cited Fernand Léger and Juan Gris as an inspiration. The carefully assembled forms of Michael Graves’s early projects drew inspiration from the still-life paintings of Giorgio Morandi. (Even Richard Meier’s refined glass-and-steel aesthetic, which owed its most obvious debt to orthodox Modernism, turned the classical Modernist house into a fetishized art object.)
The group’s greatest contribution, in retrospect, was its assertion that architecture had not reached a dead end. The architects saw themselves as artists and thinkers — not activists — and this was particularly true of Peter Eisenman, sometimes to a fault. The distorted grids of his early houses, with their references to Renaissance precedents and Structuralist theory, were not only a way to thumb a nose gleefully at Jacobs-style populism; they also elevated conceptual ideas above material and structure, the life of the mind over the life of the body.
To many in the profession this aesthetic approach represented a way forward. Philip Johnson, who seemed to rule the American architectural scene from his perch as a trustee at the Museum of Modern Art, began to fete the five over lunches at the Four Seasons and black-tie dinners at the Century club. He introduced them to powerful figures in the art establishment.
Yet to those who were paying attention, the party’s end was evident almost as soon as it had started. By the mid-1980s the effort to suburbanize the city’s core and make it safe for tourists — a process that many associate with Rudolph W. Giuliani and his mayoral quality-of-life campaigns a decade later — was well under way, and the group’s members had splintered off in different directions.
Mr. Graves, once a dogmatic Modernist, retreated into an ersatz historicism. Mr. Hejduk, who died in 2000, beat a similar retreat into academia. Although Mr. Meier continues to create works of remarkable refinement, his vision has not significantly changed in decades. Only Mr. Eisenman has kept up a theoretical practice, one in which the work is continually evolving, but he has built little — and nothing in New York.
The country’s creative energy shifted westward, to Los Angeles, whose vibrant mix of urban grit and nature, abundance of relatively cheap land and lack of confining historical traditions allowed architects to experiment with a freedom that had become virtually impossible in New York.
Frank Gehry, Thom Mayne, Eric Owen Moss, Robert Mangurian, Craig Hodgetts — these architects were not only the creative equals of their New York counterparts, they were making architecture that was rooted in popular culture and as rich in ideas as anything that has come out of New York in decades. They have been joined by a younger generation, including Greg Lynn, Michael Maltzan, Neil Denari and the team of Kevin Daly and Chris Genik, that has no real equivalent in New York.
A similar energy could be found in Europe and Japan, where the crisis of Modernism had not been felt as deeply and architects had never stopped experimenting.
Given that reality, it should not be surprising to anyone that the most important works of contemporary architecture to rise in New York over the past decade — Mr. Gehry’s IAC headquarters on the West Side Highway, Mr. Mayne’s Cooper Union building, the Tokyo firm Sanaa’s New Museum of Contemporary Art on the Bowery and Jean Nouvel’s tower under construction in Chelsea — were designed not by New Yorkers but by Angelenos, a Japanese woman and a Frenchman.
It is hard to know how the current financial crisis will affect this trend. More than once I’ve heard it suggested that the downturn will be good for architecture. The argument goes something like this: The economic tailspin will put an end to the boom in gaudy residential towers that are distorting the city’s skyline. Cheap rents will attract young, hungry creative types. This will spawn a cultural flowering similar to that of the 1970s, when the Bronx was burning, graffiti artists were the norm and Gordon Matta-Clark was carving up empty warehouses on the Hudson River piers with a power saw.
But cheap rents alone won’t do it. On the contrary, the construction slowdown, if it lasts long enough, will likely drive many young talents out of the profession for good. It also looks less and less likely that a government-sponsored, Works Progress Administration-style civic project will revive the profession — another favorite fantasy of the ever-optimistic architecture scene.
Real change will first demand a radical shift in our cultural priorities. Politicians will have to embrace the cosmopolitanism that was once the city’s core identity. New York’s cultural institutions will need to shake off the complacency that comes with age and respectability. Architects will need to see blind obedience once again as a vice, not a virtue. And New Yorkers will have to remember why they came to the city in the first place: to find a refuge from suburbia, not to replicate it. That’s a tall order.
Saturday, August 22, 2009
Home Affordability Initiative Expires December 31, 2009
The Treasury Department along with the White House released the details on the new “Home Affordability” initiatives.
The refinancing program will allow an estimated 4-5 million borrowers with Fannie Mae or Freddie Mac loans to refinance into new 30-year loans at the current market rates.
First, homeowners will need to verify that either Fannie Mae or Freddie Mac actually holds the mortgage, by calling their mortgage servicer.
Beginning immediately, Fannie Mae and Freddie Mac can provide the following:
• Refinancing without requiring new mortgage insurance - normally mandatory for loans with less than 20 percent equity
• Maximum loan-to-value ratios up to 105 percent
Maximum mortgage amounts as high as $730,000
The second program, called “Home Affordability Modification” is provided to restructure 3-4 million seriously delinquent mortgages - those loans which would go to foreclosure this year and which meet the following criteria:
• Loans that closed prior to January 1, 2009
• Homeowners must agree to work with their servicer to make on-time payments at a reduced rate
• Under this program, loan servicers who help troubled homeowners, by reducing payments to no more than 38% of their monthly income, will receive matching government funds to reduce payments even further to 31% of monthly household income. To accomplish this, interest rates on some loans could go to as low as 2%, length of the loans extended to as long as 40 years, and loan balances could be reduced as well.
The refinancing program will allow an estimated 4-5 million borrowers with Fannie Mae or Freddie Mac loans to refinance into new 30-year loans at the current market rates.
First, homeowners will need to verify that either Fannie Mae or Freddie Mac actually holds the mortgage, by calling their mortgage servicer.
Beginning immediately, Fannie Mae and Freddie Mac can provide the following:
• Refinancing without requiring new mortgage insurance - normally mandatory for loans with less than 20 percent equity
• Maximum loan-to-value ratios up to 105 percent
Maximum mortgage amounts as high as $730,000
The second program, called “Home Affordability Modification” is provided to restructure 3-4 million seriously delinquent mortgages - those loans which would go to foreclosure this year and which meet the following criteria:
• Loans that closed prior to January 1, 2009
• Homeowners must agree to work with their servicer to make on-time payments at a reduced rate
• Under this program, loan servicers who help troubled homeowners, by reducing payments to no more than 38% of their monthly income, will receive matching government funds to reduce payments even further to 31% of monthly household income. To accomplish this, interest rates on some loans could go to as low as 2%, length of the loans extended to as long as 40 years, and loan balances could be reduced as well.
The YJP Real Estate Networking event!
On Wednesday, September 2nd, the YJP and I will be hosting our Real Estate Networking event!
Network with hundreds of young Jewish professionals from the real estate, construction, and allied trades industries, including developers, owners, brokers, service providers, attorneys, and investment strategists. The event will be co-chaired by David Picket (Gotham Developers), Jason Muss (MDL), and Jeff Levine (Levine Builders).
You will enjoy a Premium Open Bar, a selection of International Wines, Hors d'Oeuvres, Great Networking, Spirited Social and Chic Crowds.
Please purchase a ticket via this access link at:
http://www.wantickets.com/
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