O.C. luxury condo developer in bankruptcy

September 7th, 2009, 3:00 pm · 15 Comments · posted by Jon Lansner

The Los Angeles Business Journal reports that real estate developer Bob Bisno, whose development company constructed high-profile luxury condos near MainPlace mall in Santa Ana, has filed for Chapter 11 bankruptcy protection. He reportedly has recently lost an LA mansion to foreclosure.

Storefront living

LABJ reports that this Los Angeles developer owes his largest 20 unsecured creditors more than $250 million, according to an Aug. 31 filing in U.S. Bankruptcy Court. His largest creditor is listed as commercial real estate investment firm iStar Financial, which is owed $109 million.

Bisno Development Co. built in Orange County a mixed-use project known as City Place combining shopping and homes, some with their own storefront setups. The project (click on pictures above for larger views) is still selling units …

City Place is described on the Web site as “an eclectic, decidedly urban collection of live/work lofts, classic brownstones and contemporary townhomes.”
Sales have been slow, so, as the Web site puts it: “And with new seriously reduced pricing, urban living no longer comes with an outrageous price tag.”
City Place shopping includes McCormick & Schmick’s seafood restaurant and Mother’s Market. “You could walk out your front door and inside of 180 seconds have a cup of coffee and buy your dinner,” The Register quoted Bisno saying upon the project’s opening.

LABJ notes that Bisno “withdrew plans last year for a controversial redevelopment of 109 acres in downtown Baldwin Park that would have relied on eminent domain to clear the land. Bisno’s plan called for thousands of homes, a school and a hotel, but it reportedly ran into financing problems. The city is now moving forward with a much smaller plan.”

According to The Real Estalker blog, Bisno late last year listed his mansion in the hillside North Beverly Park neighborhood above Beverly Hills for $29 million. Then, in August, a bank took over the Beverly property through foreclosure, according to Real Estalker. Other real estate Web sites now show it listed for $22.5 million.

Bisno could not be reached for comment.

Real estate troubles:

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NationalBubble.com says:

September 7, 2009 at 4 pm

Unfortunately, this is just the beginning. Many other companies are going to go under.

My heart goes out to all those people who are going to lose their jobs.

Gunner says:

September 8, 2009 at 8 pm

Only the few that made mistakes that cost them. For every one of these, there are 100s that are doing just fine…only the press will not report them. Dear student, you must look at the big picture.
- not buying it says:
  
  September 8, 2009 at 8 pm
  
  you just love talking out of your arse Gunnner
  
  This place is boring without your pulp fiction
  - Gunner says:
    
    September 9, 2009 at 12 pm
    
    I know, the reality of the big picture is so hard to understand for people with mice brains. In fact, it seems more like pulp fiction than reality which is the way they like to keep it because of denial.

Tex says:

Pessimistic outlook for US commercial real estate
Friday, 04 September 2009
http://www.propertywire.com/news/north-america/pessimistic-outlook-for-us-commercial-real-estate-with-some-predicting-it-will-take-a-generation-to-200909043474.html (excepts):

It could take a generation for the US commerical property market to return to the kinds of deals seen during the boom years of 2005 to 2007, according to analysts.

The prediction comes from real estate services company Jones Lang LaSalle whose latest analysis also shows that US commercial real estate sales fell 80% in the first half of 2009 compared with the same period a year earlier, and down an astonishing 93% from the peak in the first half of 2007.

From the peak of the market to the end of the second quarter in 2009, office asking rents fell on average 10 to 25%, office leasing was down 25 to 50% and commercial real estate prices fell 30 to 55%, according to the report.

Jc says:

September 7, 2009 at 7 pm

I doubt it very much that it might happen again, the “Realestate-Accident” it won’t happen again. for many reason.
#1 There would be a Global-Bank supervision to banks
#2 There would be the creation of a global new currency
# 3 All of the above would be very soon
#4 the dollar it won’t lead no more commercially

In other words…all the denials, from goverment, and realestate to keep this artificial inflation going will collapse.
- Outsider says:
  
  September 7, 2009 at 9 pm
  
  I’m from Ohio. That is very close to Kentucky and yet I still have no idea what you are saying. I’m pretty good at interpreting weird jibber jabber.
  
  Global currency - is this another things spun up about the Ameuors or whatever its called. That was most likely thought up by someone in Cali for sure on a dope binge.
  
  I do agree that the dollar is going to collapse or well on its way.
  
  Here is great story of missed opportunity. The CEO I worked for back in 1991 told me to put all my eggs in gold. He was switching over all his assets into Gold and Silver. Kills me almost daily that I didn’t listen.

Josh says:

September 7, 2009 at 5 pm

Is he still going to build the 26-story condo tower on the City Place site, I wonder?

uncle bill says:

September 7, 2009 at 10 pm

Obama will save us by printing more money and artifically keeping interest rates low. Never mind value of the dollar….

shockg says:

September 7, 2009 at 11 pm

My heart goes out to bubble because the economy and housing will never get as bad as he is hoping.

Troy says:

September 8, 2009 at 1 am

That CityPlace development is stupid. It’s a bunch of ugly loft/storefront condos facing a huge surface parking lot, with a predictable strip mall on the other side of the lot. The stores are cheesy little boutiques, all built in the bubble and all selling junk that no one actually needs. There aren’t many of those boutiques left open now. Behind the first line of storefront condos there are more and more 3 story condos all packed tightly together, all facing each other and not getting any sun or air, and all connected by a series of narrow alleyways. It’s not attractive.

Last time I drove through there a few months ago just for kicks, the place looked totally deserted. I think “slow sales” in developer-speak means devoid of human life. CityPlace is devoid of human life, and probably will be until they slash their “radically discounted” prices in half again, or rent the places out to kids going to Chapman or working at Disneyland.

Dre says:

September 8, 2009 at 3 am

And Commercial real estate will be the next shoe to drop….

Drew says:

September 8, 2009 at 4 am

I can’t help but wonder how Pelican Hill is staying alive, after this article and the recent news of Terrena in Palos Verdes, just seems they cannot continue.

OC says:

September 8, 2009 at 5 am

Any chance the prices of these places will be lower to $250k? Where’s the pool and jacuzzi located in the complex?

mtus says:

September 8, 2009 at 8 am

Price starting in the high $400. LOL

Slice	Price	Ch.	Sold	Ch.
House	$500,000	+18%	1,833	+11%
Condo	$290,000	+7%	881	+22%
New	$617,500	+24%	171	-17%
All OC	$435,000	+10%	2,885	+12%

Orange County Register