Revolutionary Real Estate Service Takes Off

In an enlightened twist to traditional real estate services, a boutique brokerage firm in South Florida added a revolutionary service for potential buyers: FACAFUNDS (Future Appropriation of Clients' Advanced Funds).

The boutique firm, Kaiser Associates, Inc, has successfully specialised in an unusual niche in South Florida: the market for contemporary and mid-century modern architecture. A second division of the office focuses on buyer representation in triple-net investments.

Founder and principal Tobias Kaiser, an affable German with a US Master’s degree and 22 years experience as an independent broker, explains his newest client service which is to be introduced today:

“When a buyer contacts a real estate broker, client and broker sort of sniff each other out and then establish property criteria and a price corridor. Often though, these criteria are a moving target."

"Consequently, clients have to constantly adjust their budget and their expectations, which can be very frustrating for both parties.”

Kaiser goes on: “With FACAFUNDS, select clients now have the possibility to transfer all of their earmarked acquisition funds into our escrow account – even before we identify one or more matching properties. The funds stay in the designated account until either we have found a property or until they are earmarked for other purposes and cleared out by the client or by us.”

Typical acquisition budget flow in a FACAFUNDS application; here a nightly refresh cycle.

Only select clients will be invited to participate in the program, and fees for the service are kept on purpose at an affordable monthly 0.9999% of the parked deposit to cover all sorts of expenses.

“FACAFUNDS is not meant to generate a profit for the brokerage while the funds – with a minimum US$130,000 – are parked, which can be as long as 13 years ” explains Kaiser. “Any profit is generated through the acquisition, or when the funds are transmogrified and withdrawn by the authorised parties”, which only include the client and the broker, whoever comes first.

“With FACAFUNDS, the question ‘It’s 11 pm - do you know where you money is?’ has become obsolete. The client has total budget transparency as long as the funds stay in the account, and to a certain extent even after they are gone.”

As much as the new service sounds like a forehead-slapper for consumers and dead-simple to imitate by brokerages, title companies or attorneys, it should be noted that working closely with loan experts from Madoff Bank NLC, Kaiser has spent considerable time and espresso to develop FACAFUNDS, virtually ensuring it will be a huge success for someone.

If you are interested in learning more about Kaiser Associates, Inc. and their FACAFUNDS program, contact them here.

©Pookeeboo Real Estate Times, April 1st, 2013.

Wright house fighting for Survival; a Modern Real Estate Transaction

©Scott Jarson via NYT

The David and Gladys Wright house in Phoenix, designed 1952 by David's father Frank Lloyd Wright, is in immediate danger to be torn down; a developer is chomping at the bit to raze it and subdivide the lot. 

Michael Kimmelman, NYT's architectural critic, wrote a enlightening and detailed piece about the dilemma the house is facing; please read it here.

And while you're at it, please cast your vote here to preserve this endangered design. 

Update Wed, 3 Oct: The City of Phoenix and the developer have reached an agreement that will put any work on hold while a search continues for a buyer. A senior adviser for Mayor Frank Stanton said Wednesday that the agreement with the developer who bought the 1952 home delays for nearly a month any demolition of the house. The adviser said the deal allows time to find a buyer who will preserve the house. The potential demolition of the sweeping home, built on more than two acres, set off a firestorm among architects (dpa via nyt).

Real Estate Transactions in Modern Times

Some of you may know that I also practice commercial real estate, specialising on NNN or net-leased properties (this is the case when a tenant is responsible for every building expense including taxes, repairs and insurance. Typical are a Walgreens, CVS, McDonalds or many others you see every day). 

But recently, I was part of one the more interesting commercial transactions in my 20+ years of practice – interesting because of the geographical aspects of the deal. 

The way this transaction was conducted would not have been possible when I was a noobie in real estate:

• the two investments were located in Ohio
• the seller was located in Tennessee
• the buyer was located in North Carolina
• the listing broker was located in Michigan
• the selling broker – me – is located in Florida

I never saw the properties, never met the seller, never met my colleagues, and didn't fly up to the closing (which in most cases has to take place in the county the property is located). All done electronically, all done from afar.

I have conducted negotiations, inspections and closings long-distance before, some even from overseas. But this was the first time when I handled every part of a transaction from my desk. In my opinion, this clearly works only in commercial, and even then only in some cases.

Have you done a similar deal? And what are your thoughts on conducting business without any face-time?