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“The world of global real estate finance has grown continually smaller. International real estate investment opportunities are significant, and we believe that we have a significant role to play as an information source and key point on activities, events and information relating to the international flow of real estate capital both into and out of the United States.” --Jeff Williams, managing director of Babson Capital Management, Springfield, Mass., and chair of MBA’s International Committee, in reference to MBA's role within international commercial/multifamily real estate.

South Africa Property Returns Top Global Market, Research Says

Retail, Hotels Get 'Green Light' from Moody's

Commercial Briefs

MBA Launches New Focus on International Real Estate Developments
2004 European CMBS Reflects A Positive Outlook, Moody's Says
Mortgage Banking Examines International Non-Performing Loans

Hudson Realty Capital Provides $10.7M in Mezz Debt

MBA Submits Comment Letter to the SEC

MBA Membership Directory Available on CD
MBA Asks for CREF Speaker Proposals

Leach Joins GMAC Commercial Mortgage Europe from S&P

Baseball in D.C.: A Commercial Enterprise

"Although interest rates are increasing worldwide during 2004, the weight of funds for direct commercial real estate investments should persist, as contractual rental income will ensure higher returns than current low fixed income securities", a ResearchWorldwide spokesperson said.

Retail was the leading market sector in the U.S. with a 16.2 percent average return, according to the National Council of Real Estate Investment Fiduciaries (NCREIF). Meanwhile, across the pond, the United Kingdom’s retail market outperformed its other sectors with a 15.5 percent total return, but Ireland's retail market garnered a 26.9 percent total return, with 21.4 percent coming from capital growth. Australia also found retail as its leading sector at 16.9 percent in total returns. Although South Africa’s retail market hit 17.4 percent in total average returns for 2003, it was just below the country's industrial market return of 17.5 percent.

"Direct investment into retail real estate, monitored in seventeen countries worldwide, showed a guideline average total return of 12 percent in 2003,” a ResearchWorldwide spokesperson said. “The industrial market in these countries averaged a total return of 9.6 percent, while the office market lagged at an average total return of 5 percent."

South Africa’s overcapacity in the office market led to an 8.5 percent total return in the office sector, the study said. Australia received a 6.9 percent total return for its office market, Ireland hit 6.2 percent in total returns and the United Kingdom could only muster a 3.2 percent total return for the sector in 2003, Research Worldwide said.

In South Africa, industrial vacancy rates dropped to 6.6 percent to help elicit its 17.5 percent return in 2003, followed by the Australian industrial market at 15.2 percent, and the U.K. industrial sector at an 11.3 percent total average return for the industrial market. Ireland fell below other industrial sectors at 6.7 percent in total returns for 2003.
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"In the hotel sector overall, RevPAR is up by 8.4 percent year-over-year, and demand for new hotel rooms is expected to outpace supply by a strong 7.5 percent, because of strong demand and a shallow supply pipeline," said Sally Gordon, senior analyst at Moody’s and author of the report.

Moody’s uses the colors of a traffic light to describe the strengths or weaknesses of properties underlying commercial mortgage-backed securities (CMBS). The “green light,” or strong property is in the range of 67-100, yellow falls between 33-66 and red identifies a weak property between 0-33. The green score of 69 for the overall property market in the first quarter of 2004 increased from 66 (yellow) in the fourth quarter of 2003.

Retail continued strong into 2004 as shopping centers hit an 83 score, compared with suburban office buildings still struggling at a 48 score, a statistic that parallels the rest of the world. Moody’s said it uses real personal income as the principal variable to project demand.

"Community shopping centers remain the star commercial real estate product with a composite score of 83, the highest of any property type,” Gordon said. “Furthermore, the sector's strength is broad-based. Of the 50 markets covered, only three have growth in real personal income of less than 1 percent, and none is expected to see this income measure decline."

The central business district office score dipped slightly from 58 last period to 57 and the suburban score slid from 51 to 48. Markets with a CBD and suburban score did not have green segments for both CBD and suburban office with the exception of San Diego’s market. Two markets, Dallas and Detroit, are red in both, and no U.S. office market has a red score in one segment with a green score in the other.

The industrial sector showed a slight uptick of one point in the Moody’s report, from 63 to 64, continuing its upward trend in the U.S. The sector refrains from new development as the industrial supply pipeline of new construction delivered 0.5 percent of inventory.

Although the multifamily score slipped from 80 in the fourth quarter of 2003 to 77 in the first quarter of this year, Gordon said the multifamily sector remains well within the green territory and retains a favorable outlook in the Moody’s report.

The report said the top 12 real estate markets across all property types in the U.S. during the first quarter of 2004 included Los Angeles, Orange County, Calif., Honolulu (although its rating dropped slightly from the previous quarter), Ventura County, Calif., New York City (with a 10-point increase), Miami, Washington, D.C., Memphis, Seattle, Riverside, Calif., San Antonio, and Westchester County, N.Y.

The ten worst U.S. markets included Jacksonville, Fla. (down 8 points from the previous quarter), Pittsburgh, Austin, Texas, Stamford, Conn., Oklahoma City (dropping 19 points from the first quarter), Denver, Dallas, Las Vegas, Chicago, and Columbus, Ohio.
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Fitch created the new rating category 'CMBS Primary Servicer - Small Loans,' to recognize differences in the properties securing the smaller loans, such as owner-occupied businesses, analyzing physical property inspection reports, monitoring payment histories, and evaluating the credit scores of borrowers. The ratings agency said servicing small balance commercial mortgages typically requires greater customer service interaction with borrowers than is necessary with conduit loan servicing and could be more important sometimes than analyzing property operating statements. Therefore, asset administration of small loans often requires a “more personal touch,” Fitch said.

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GMAC Commercial Mortgage Corporation (GMACCM), Horsham, Pa., added RMC Mortgage, Inc. (RMC), a Vancouver, Wash. HUD lender, to its nationwide network of HUD lending offices.

The addition of RMC under the GMACCM brand enables GMACCM to better serve a growing client base and increase market share in the Pacific Northwest, the company said. GMACCM originated close to $1 billion in HUD loans in 2003. Dale Rohl established RMC in 1994 and, along with the rest of RMC’s five-person staff including vice president, Bruce James, joined GMACCM as senior vice president and will continue to manage the operation.

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Arbor Commercial Mortgage LLC, Uniondale, N.Y., offers a summer internship program where high school students could experience the entrepreneurial world. The selected students currently attend the North Shore Hebrew Academy High School in Great Neck, N.Y. The participating students would work in the marketing, legal and asset management departments in Arbor’s Uniondale office for six-weeks.

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KeyBank Real Estate Capital, a unit of Cleveland-based KeyCorp, acquired Atlanta-based American Capital Resource Inc. (ACR), to further expand its suite of permanent financing options available to its developer clients. The acquisition augments KeyBank Real Estate Capital's existing capabilities in agency finance, including participation in the Fannie Mae DUS (Delegated Underwriting and Servicing) program, Freddie Mac Program Plus and HUD Sections 223 (f), 221(d) and 232 programs.

This is the fourth commercial real estate acquisition Key made in five years as part of its ongoing strategy to expand its commercial mortgage finance and servicing capabilities. Key acquired National Realty Funding, Newport Mortgage and Conning Asset Management's real estate mortgage division to broaden its permanent product lending and servicing capabilities in the areas of commercial mortgage-backed securitizations (CMBS), Fannie Mae, Freddie Mac and FHA lending and institutional investment. Terms of the deal, structured as an asset purchase, were not disclosed. The company's employees continue to work from the Duluth, Ga. office location.

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Thornburg Mortgage Inc., Santa Fe, N.M., announced the establishment of a new $5 billion asset-backed commercial paper facility. The facility provides Thornburg Mortgage with an alternative way to finance its portfolio. New York-based Lehman Brothers Inc. is the structuring agent and lead dealer for the transaction. New York-based Merrill Lynch Money Markets Inc. and Goldman, Sachs & Co. Inc. also act as co-dealers.

Thornburg Mortgage Capital Resources LLC (TMCR), a special-purpose, bankruptcy-remote entity created especially for this transaction, can act as the financing vehicle by issuing commercial paper in the form of secured liquidity notes rated F1+ by Fitch Ratings, New York, and P-1 by Moody's Investors Service, New York. It is anticipated that the notes would be sold to money market investors.

The notes in essence are collateralized by adjustable-rate, agency and AAA-rated mortgage-backed securities purchased by Thornburg Mortgage or created through its loan securitization process. TMCR is authorized to issue up to $5 billion of asset-backed commercial paper having maturities of up 250 days.

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San Diego-based American Mortgage Network (AmNet), a wholesale mortgage bank serving mortgage brokers nationwide and a wholly-owned subsidiary of AmNet Mortgage Inc., reported it funded $2.6 billion in home loans for the quarter ending June 30, compared to $1.9 billion in home loans for the first quarter of 2004. In June, AmNet funded $669 million in mortgages, compared to $751 million in May.

New loan applications were $1.2 billion for June and May. Average loan fundings per workday were $30.4 million in June compared to $37.6 million in May. Average daily new loan applications were $56.4 million in June compared to $57.7 million in May.

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New York-based Fitch Ratings affirms Horsham, Pa.-based GMAC Commercial Mortgage Corporation's (GMACCM) CSS1 commercial mortgage special servicer rating.

With its acquisition last year of Lend Lease's North American Asset Management business, GMACCM incorporated the Lend Lease operations to create a single, fully integrated special servicing unit. The company devoted considerable time and effort to consolidating the procedures and technology of the two operations and to identifying and adopting the best practices of both groups to develop a strong, unified special servicing platform. The company now maintains offices in San Francisco, Irvine, Calif., Dallas and Horsham, Pa.

As of June 30, 2004, GMACCM was named special servicer on 180 CMBS transactions with a balance of more than $94.7 billion and actively specially serviced 358 CMBS assets totaling $2.5 billion.

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New York-based Fitch Ratings affirms San Francisco-based Wells Fargo Bank's primary servicer rating of CPS1, master servicer rating of CMS2 and special servicer rating of CSS1.

Fitch noted Wells's master servicer collection rate for borrowers' 2002 year-end financial statements was significantly low in comparison to other Fitch-rated servicers. The collection rate for year-end 2003 will be monitored and total collection and reporting rates will be published in an annual report in September 2004.

As of March 31, Wells was named master servicer or primary servicing 4,938 loans in 82 CMBS transactions, totaling $37.7 billion. Wells was also named special servicer on 23 CMBS transactions, totaling $11.6 billion. As of the same date, Wells was actively specially servicing 11 CMBS assets totaling $77.4 million.
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MBA hopes that its growing international constituency will find this new section interesting and helpful in identifying developments in international real estate investment. The first feature for this section highlights the work of MBA’s International Committee.

MBA’s International Committee is spearheading a new outreach effort on global real estate finance designed to bring new investment opportunities to MBA members. The committee’s mission is to advance international business opportunities within the commercial/multifamily real estate investment community.

“The world of global real estate finance has grown continually smaller,” says Jeff Williams, managing director of Babson Capital Management, Springfield, Mass., and chair of MBA’s International Committee . “International real estate investment opportunities are significant, and we believe that we have a substantial role to play as an information source and key resource on activities, events and information relating to the international flow of real estate capital both into and out of the United States.”

To fulfill its mission, the international committee identified four key goals:

*Increase international interest and membership in the MBA.
An MBA outreach program for embassies and consular officials is being launched. The effort emphasizes the benefits to international firms of working with MBA on international real estate finance issues. “MBA is presently more international than many of its members realize,” said Hal Holliday, senior vice president of Live Oak Capital, Houston, and vice chair of the International Committee.  “As the originators and servicers of the majority of America’s commercial and multifamily real estate debt, MBA’s membership is ideally positioned to help overseas investors identify the most promising U.S. real estate investment opportunities and to assist those investors in executing their U.S. strategies.”

“MBA’s members include the leading companies providing real estate capital on an international basis,” said Erin Stafford, vice president of Dominion Bond Rating Service, Chicago, and vice chair of the International Committee. “The major rating agencies who evaluate international real estate financings for investors also belong to MBA. Our reach can help members to identify investment opportunities and learn about transaction structures used outside the U.S.”

*Develop and maintain a comprehensive international membership directory.
MBA has designed a questionnaire to identify key international business contacts at MBA member companies, their parents and subsidiaries. MBA will electronically distribute the questionnaire this summer. The generated contact information from the survey will be available to MBA members to facilitate international business interests.

“Our members tell us that networking is critical to their business development strategies, especially in the global arena,” Holliday said. “An MBA database and directory will make international networking easier.”

*Create and implement forums and educational initiatives for international investors.
Ken Gordon, vice president of CDP Capital, Montreal, and committee vice chair, said the MBA International Committee's focus will be on transactional issues faced by international investors.

“We want to educate international investors about doing business in the United States, and help American capital sources do business abroad," Gordon said. "We encourage MBA members to get in touch with us with ideas for panels at MBA conventions, forums and executive training.” 

*Establish strategic alliances with other organizations.
“Our committee’s emphasis is on service to members,” Williams said. “To that end, MBA’s International Committee seeks to establish strategic alliances with other organizations that have similar international missions, as well as those that can provide information, assistance or services to those interested in international real estate activities.”

To support its international mission, MBA has created an international internship for June-September 2004. Rachel Passman, a graduate of the University of Maryland with significant experience in international studies and diplomatic relations, holds the post for the summer of 2004, and will be coordinating MBA’s international outreach efforts . Please contact Rachel at 202/557-2862 or at rpassman@mortgagebankers.org for further information on MBA’s international outreach effort, on the development of an international database, or to suggest ideas for MBA panels, forums or education on global real estate finance issues.
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2004 European CMBS Reflects A Positive Outlook, Moody's Says
MBA (7/15/2004) Murray, Michael

European commercial mortgage-backed securities (CMBS) issuance rose by about $3.08 billion in U.S. currency, in the first half of 2004 compared with the first half last year, according to a report from Moody’s Investors Service, New York City. The 2004 First Half Review and Second Half Outlook report shows that CMBS issuance increased to almost U.S. $9.86 billion in the first half of 2004, from nearly $6.78 billion in the first half of 2003.

Moody’s analysts said they expect more development for the remainder of 2004, with a likely increase in true-sale transactions. They also anticipate ongoing interest from German mortgage banks.

"First-half issuance volumes increased both in the United Kingdom and on the continent, with a mixture of new and repeat issuers, as in previous periods," said Hans Vrensen, vice president, senior credit officer and co-author of the report.

A total of 16 transactions were assigned definitive or provisional ratings, ranging in size from $138 million to $1.77 billion, with an average size of $616.35 million, compared with 13 deals at an average size of $516.5 million in the first half of 2003.

The United Kingdom accounted for eight of the 16 rated European CMBS deals in the first half of the year, or 47 per cent of issuance volume, while Sweden had an unusually high volume compared to previous years, representing 15 percent of issuance.

"Based on the current pipeline of deals, we anticipate further diversification into other jurisdictions as the year progresses, similar to the full-year 2003 distribution," Vrensen said.

The Moody’s report said one notable shift was a drop in synthetic deals, with only one synthetic transaction occurring in the period. However, Moody's expects further synthetic issuance to take place in the remainder of 2004.

Meanwhile, single-borrower type deals accounted for a growing share in the first half, corresponding to nine of the 16 transactions.

In terms of property type distribution, the largest single category, representing 38 per cent of first half volume, was derived from seven transactions composed of portfolios of mixed property types. Telecoms transactions accounted for an additional 22 percent of volume for the first half of the year.
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Mortgage Banking Examines International Non-Performing Loans
MBA (7/15/2004) MBA Staff

After long struggling under a mountain of nonperforming loans (NPLs), Asia’s banks have succeeded recently in removing more than $1 trillion of NPLs off their balance sheets, writes Jack Rodman in the July issue of Mortgage Banking magazine.

But Rodman, a partner in the Beijing office of New York-based Ernst & Young LLP, notes that while banks in Asia and Europe have made progress in resolving bad loans, it’s too early to proclaim victory. Europe, he says, is just staring to deal with NPL issues—banks in Europe and in particular Germany hold more than $300 billion in NPLs. And despite their progress, Asian banks must still contend with at least $1 trillion more in NPLs.

NPLs represent opportunities for banks and government-owned asset-management companies (AMCs) that buy NPLs. Rodman says these companies employ a variety of strategies to dispose of NPL portfolios and maximize asset recovery values. These strategies include workouts, restructurings, discounted payoffs, collateral redemption and debt forgiveness.

“Generally, global investors are looking for returns of 20 percent or more from high-risk NPL acquisitions—for example, those in which they settle the assets with borrowers, such as accepting land or other assets in exchange for debt forgiveness—to returns of 15 percent or less for relatively low-risk investments such as loans that offer a high chance of recovery from sale of the underlying collateral in a relatively short period,” Rodman writes.

Read the complete article in the July 2004 issue of Mortgage Banking, the award-winning monthly magazine from the Mortgage Bankers Association. For more information, go to Mortgage Banking’s Web site, http://www.mortgagebankingmagazine.com/index.asp.
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Generally, MBA commends the SEC for its efforts to address deficiencies in the current ABS reporting system but notes that the proposed rule, as drafted, would ultimately be detrimental to investors and borrowers by increasing transaction costs and thereby decreasing current and potential ABS transaction participants and available ABS and mortgage capital.  To avoid this outcome, MBA recommends that the SEC:

• Adopt a more practicable framework for reporting on compliance with servicing of ABS collateral;
• Reduce the excessive number of proposed disclosures;
• Clarify definitions included in the proposal; and
• Reconsider certain securitization restrictions and parameters.

MBA also requests that the proposed rule be re-proposed for further comment, or that if the SEC proceeds to release a final rule, that a one-year transition period be provided.

To review the MBA comment letter, click on http://www.mortgagebankers.org/documents/2004/MBA%20Response%20to%20SEC%20Regulation%20FINAL.pdf. 

To view the MBA enclosure to the comment letter, click on http://www.mortgagebankers.org/documents/2004/Enclosure%20to%20MBA%20Letter.pdf

To review the Federal Register publication of the proposed rule, please click on http://www.mortgagebankers.org/industry/docs/04/SEC%20Proposes%20New%20ABS%20Rules%20Federal%20Registar.pdf

The MBA will continue to report on the SEC’s progress in completing a final rule.  If you have questions, please contact MBA staff:
Kathy Gibbons at kgibbons@mortgagebankers.org
Katie Schwarting at kschwarting@mortgagebankers.org
Alison Utermohlen at autermohlen@mortgagebankers.org
Vicki Vidal at vvidal@mortgagebankers.org.
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“This state-of-the-art product is easily accessible via your computer and is always current,” said Paul Green, MBA’s senior vice president for membership. “The new Membership Directory is now portable and can be updated at your convenience through your normal internet connection. Our goal was to provide our members with a single source for information and communication needs—one with improved accuracy, timeliness, and efficiency.”

The new Directory contains the following:

• Real time information - Updated at your convenience, via the Internet
• Enhanced search capabilities – Search by product type, business type, mortgage functions, company name, individual name and more
• Complete Buyer’s Guide section with enhanced search capabilities
• Detailed company information including organizational information and key personnel
• Web site links for many member categories
• Email capability (limited to one individual at any given time)
• Bookmark and note capabilities
• Detailed “how to use” section…..and more.

The directory will contain instructions once you insert the CD into your computer to load the program and perform the simple initial sign-up steps for access. Once the download is complete, you will be prompted to register before proceeding into the directory. You will need your user name and password for the registration.

Green said moving from printed directory to a CD directory will save MBA substantial printing costs. “While our goal is to move away from a printed Directory—primarily because of its very short shelf-life—we understand that, for a few of our members, the printed version is preferable,” he said. “With that in mind, members have the option to ‘opt-in’ to receive one complimentary print version. MBA will publish a limited number of hard copy directories this year which will also be available for sale.”

The CD directory is limited to members only and access is provided to the primary contact and, depending on the type of member, additional individuals.
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MBA Asks for CREF Speaker Proposals
MBA (7/15/2004) MBA Staff

The Mortgage Bankers Association is currently accepting speaking proposals for its Commercial Real Estate Finance (CREF)/Multifamily Housing Convention & Expo being held February 6-9, 2005, in San Diego, California.

The CREF Convention & Expo is the leading industry event and largest annual gathering of its kind in the nation linking prominent investors with firms delivering mortgage banking expertise. It delivers important information and provides extensive networking opportunities for commercial and multifamily real estate finance professionals.

Join thousands of industry experts to exchange ideas and discover pragmatic solutions to help your business thrive in today’s challenging economy.

The CREF Convention & Expo is intended for: commercial and multifamily real estate finance professionals including mortgage bankers; real estate officers of life insurance companies, pension funds, credit corporations, and commercial banks and thrifts; CMBS issuers and investors; Fannie Mae and Freddie Mac multifamily seller/servicers; FHA-approved multifamily mortgage brokers and other interested real estate finance professionals.

If you would like to be considered to participate on a panel or make an individual presentation, please fully complete the form below and submit it to MBA’s Rebecca Sellers at rsellers@mortgagebankers.org.  The deadline for submitting a proposal is Tuesday, August 31, 2004. 

Click here for application information or go to: http://www.mortgagebankers.org/documents/speakerproposals.doc.
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G. Ryan Smith has joined Buchanan Street Partners , Newport Beach, Calif., as the head of a new investment group. He brings 11 years of experience in investment sales. Smith will focus the group’s activities on Southern California properties.

Stan Martin joined Freddie Mac, McLean, Va., as senior vice president and general auditor. He will be responsible for the company’s internal audit organization, as well as assessing risks to the organization. Martin has been in the industry for more than 30 years, most recently as a consultant to HSBC Bank USA on integration and divestiture matters.
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Major League Baseball officials will again make an attempt to determine the next home for the Montreal Expos , a baseball club lacking in attendance in Montreal and in its 22-game home in San Juan, Puerto Rico. But as with commercial real estate, demographic data and analysis of available information could provide the answer as to a new home and stadium for the Canadian baseball team.

"I think we would bring to baseball a successful business record,” said Frank Raines, CEO of Fannie Mae, in an interview with the Washington Business Journal last year. Raines did not return inquiries on this year's attempt to bring baseball to Washington.

The role of Goldman Sachs is to provide strategic advice and financial services for the Washington Baseball Club. The New York-based investment banking firm is familiar with sports acquisitions. It advised John Henry and Tom Werner on their purchase of the Boston Red Sox and the New England Sports Network , as well as the National Football League on its 1998 sale of the Cleveland Browns franchise to Baltimore. Goldman Sachs has been involved in various franchise sales including the New York Jets, Cleveland Indians, Los Angeles Dodgers and St. Louis Blues .

But if the fiscal savvy of the Washington Baseball Club is not enough to bring a team to Washington, D.C., a city without baseball since the Washington Senators moved away in 1971, then up-to-date demographics and data could make a case.

The D.C. area contends with the Northern Virginia area, Norfolk, Va., Portland, Ore., Las Vegas, Nev., Monterrey, Mexico and San Juan, Puerto Rico , to purchase the Montreal Expos.

The Expos play 22 games at Hiram Bithorn Stadium. Baltimore Orioles owner Peter Angelos, consistent in blocking Washington's attempts for a baseball team, supports a group from Puerto Rico to bring the team there, different from the original group that brought the team to Puerto Rico for the 22 games. The Baltimore Sun, however, reported that after 11 games, attendance averaged 11,844 in a stadium that would expand to hold 20,000 by 2005. But Angelos believes that a Washington, D.C. baseball team would reduce support for the Baltimore baseball franchise.

In the Monterrey area, or Nuevo Leon, Mexico, the population of more than 3.68 million has a demographic growth rate of 2.4 percent, and the “open unemployment rate” in Monterrey is 2.4 percent, said AGIM Corp. , a global real estate firm based in Chicago.

Although analysts say the area has a higher standard of living than the rest of Mexico, The Baltimore Sun reported that the average Mexican worker earns less than $500 per month. Although Monterrey bid for the 22 Expos games in 2004, the players preferred to play in Puerto Rico.

Meanwhile, D.C.’s Metropolitan Statistical Area (MSA) is more than 4.6 million in population compared with nearly 1.2 million in Las Vegas and less than 2.2 million in Portland, according to statistics from Sales and Marketing Management , a subsidiary of VNU Business Publications, New York. Within a 35 mile radius, Sales and Marketing Management said the population exceeds 5.1 million in the Washington, D.C. area, compared with nearly 1.2 million in Las Vegas and 1.85 million in Portland.

The Norfolk region, including Newport News and Virginia Beach, has a population of 1.63 million, with a median household income of less than $42,500, based on a U.S. Census Bureau estimate.

Preliminary forecasts at the Federal Bureau of Labor Statistics (BLS) show unemployment rates in Portland and Las Vegas dropping to 6.5 percent and 3.7 percent, respectively, in May 2004. In May 2003, Portland had 8.5 percent unemployment compared with 5 percent in Las Vegas, Nev. The BLS forecasts the unemployment rate in San Juan-Bayamon, P.R. at 8.9 percent in May 2004.

Despite an unemployment rate forecast in the Norfolk, Va. area at 4 percent, down from 4.5 percent in January 2004, the Northern Virginia portion of the Washington, D.C. MSA was 2 percent in May of this year, down from 2.8 percent in May 2003, according to the Virginia Employment Commission (VEC). Although the Norfolk region employs more than 777,000, the Northern Va. region of the Washington D.C. MSA employs more than 1.3 million as of May 2004, the VEC said.

While the national unemployment rate remains steady at 5.6 percent, the BLS forecasts the unemployment rate in the Washington, D.C. area to drop to 3 percent in May 2004, falling from 3.5 percent in May 2003.

Sales and Marketing Management said the effective buying income (EBI) per household in Washington, D.C. is more than $59.3 thousand, compared with $42.55 thousand in Las Vegas and $44.278 thousand in Portland. While retail spending hit nearly $47 million in the Nation’s Capital, the Las Vegas market spent more than $15.2 million in retail and Portland has more than $23.2 million in retail spending.

If demographics prevail in this battle for a baseball team, then Northern Virginia’s Virginia Stadium Baseball Authority and Washington, D.C.’s Washington Baseball Club, are the two likely contenders.

Last year, the Washington Baseball Club signed a deal with the DC Sports and Entertainment Commission for exclusive negotiating rights on a lease for a D.C.-based baseball franchise to play at RFK Stadium, and the city proposed public financing of a new stadium with a possible location across from L’Enfant Plaza .

This year, the Virginia Stadium Baseball Authority held a pep rally in Loundon County at the site of a possible stadium site in the future. The group said its package is “in place” to build a stadium and bring baseball to the Northern Virginia area.

But Washington Baseball Club officials note the demographic data and say that Northern Virginia would cut the overall area population to about 2.2 million of the D.C.-metro area, equivalent to the city of Pittsburgh, Pa. That number could take away from the potential 5 million in the entire D.C.-metropolitan area.

Although Northern Va. attempts to separate itself from Washington, D.C., and appease Angelos and the Baltimore Orioles, the Washington Baseball Club noted that the D.C. media would determine the fan base. The media in Washington, D.C. spans from Montgomery County and Prince Georges County in Maryland to Northern, Va., Loudon County and as far south as Fredericksburg, Va. and Spotsylvania County.

"We truly think the Washington, D.C. bid is the only one that will tap into the core of this vibrant region that we are in," Fred Malek told MBA Commercial/Multifamily NewsLink. "The Washington, D.C. market is where people work and live."

The decision on the move of the Montreal Expos could take place at the end of this month or beginning of August. MLB originally said the decision would be made at the All-Star break which took place earlier this week.
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