INDIANA Real Estate News Uniting and Growing Real Estate Professionals in Indiana
GIVE THE GIFT OF REAL ESTATE Give your home to your Alma mater, pg 6
FORT WAYNE'S HOTTEST HOUSING MARKET See how this city ranks 4th in the nation, pg 10
TEACH HERE, LIVE HERE Affordable housing becomes reality for IPS teachers, pg 15
GARY SCHOOL DISTRICT Gary Schools are on the market, pg 21
JULY/ AUGUST 2018
INDIANA Real Estate News Editor in Chief Aaron Henze
Editors Aaron Henze Tera Moore Chris Zazzetti
Writers Aaron Henze Tera Moore
Photographers Chris Zazzetti
Teresa Stephens
Ben Pidgeon
Marius Peter
Dustin Jenkins
Contact aaron@indiana-realestate-news.com
News Tips tera@indiana-realestate-news.com
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LETTER from the EDITOR Hello Readers! Welcome back for the latest issue of Indiana Real Estate News magazine! If this is your first time hearing about IREN, we are a multimedia organization dedicated to educating, uniting, and growing real estate professionals in all branches of the industry across the state by use of educational videos, informative articles, and networking opportunities that give back to the communities these professionals serve. As we get into the crisp weather of the fall season, we hope you enjoy this look back toward the final months of summer. In this issue we cover an alternative charitable contribution option, an Indiana market that is making waves nationally, a program to benefit our education system, and another visit to Gary. We also have the lists to round out the summer season and a look ahead to some events coming up over the next month. And more than ever, we want to hear from you! Our goal is to start publishing an issue monthly by the start of next year if not sooner, so let us know what you like, what you could do without, and help us continue to grow by sharing us with your friends in and out of the industry.
This also means we’ll be looking to add additional sponsors, so we will be reaching back out to those of you who have expressed an interest in partnering with us very soon! We also have a website (Indiana-realestate-news.com), email (aaron@indiana-realestatenews.com), Facebook (Indiana Real Estate News), and Twitter (@Indiana_RE_News). For news tips, contact Tera Moore at Tera@indiana-realestate-news.com. Happy reading!
Aaron Henze Editor in Chief
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Table Of
CONTENTS 6
A NEW WAY TO "SELL" YOUR PROPERTY
The Stewart Family shows us how gifting real estate properties to universities is a win-win for all.
WAYNE HOUSING IS 10 FORT GOING FAST Fort Wayne wins the top housing marketing in the United States from Realtor.com.
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TOP 150 INDEPENDENT LIST
See Realtors who made the list. (Accumulating from January 1, 2018 August 31, 2018).
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AFFORDABLE HOUSING FOR IPS TEACHERS
Teach Here, Live Here project breaks ground for incoming teachers in Downtown Indy.
150 18 TOP NATIONAL LIST See Realtors who made the list. (Accumulating from January 1, 2018 August 31, 2018).
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GARY SCHOOLS GO ON MARKET Abandoned Gary Schools go on market in hopes investors will rebuild and refurbished the troubled area.
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COMMUNITY CALENDAR See what events are going on in Indiana ~ Featuring events from local groups and organizations.
GIVE
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REAL ESTATE Hoo Hoo Hoo Hoosiers! Boiler Up! Chirp Chirp! Do you remember your alma mater’s fight song? We’ve all had fond memories during our time at college, and treasure the reputation gained from such institutions. But have you considered donating towards your favorite university? Milt and Judi Stewart who attended Indiana University’s Maurer School of Law had, but they realized while thinking of a way to create a scholarship fund for the university that they did not possess enough liquidity to make a sizable donation. So they opted for a less conventional solution. The Stewarts had planned on building a home on a piece of property located in Portland, Oregon. Instead of wanting to continue the building process, the couple graciously donated the property to Indiana University. The university was able to proceed with creating a new program/scholarship fund, and Milt was able to receive dividends, tax deductions, and charitable annuity, all while avoiding a capital gains tax. Since donating the piece of property to his alma mater, Milt is now a strong believer in the gift giving of real estate. It was a win-win for all! Milt deflated the assumption that universities are not always receiving “multi-million dollar checks”, but instead are receiving “an increasing number of gifts [in] real estate”. He also plans to donate as many as two more properties to Indiana University in the near future. Other alumni are following suit, donating sizable properties and other real estate assets to their respected universities. Linda Durant, Vice President for Development for the Council for the Advancement and Support of Education highly recommends donating your property, especially if “you are couple that is ready to retire and downsize”.
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n 2013, colleges and universities began their peak of receiving real estate gifts, reaching a total of $129 million. By 2016, the total number sky rocketed to over $209 million. Indiana University, since 2003, has accepted over 91 properties at over $43 million in total worth. Matthew Kavgian, director of strategic communications and projects for the Indiana University Foundation, believes that donating real estate is a smart investment, especially to relieve the “burden” for the generation after baby boomers. “There is an upward trend in real estate donations over the past decade or more that coincides with the transfer of wealth occurring with the baby boomer generation,” Kavgian discloses, “Many baby boomers are making decisions about their property and tangible assets while they still can, as a way to ease the burden and complications for their children. For instance, many beneficiaries may not know how to liquidate complex assets.” This is why Milt and Judi (and their family) decided it was time to donate their properties from Portland Oregon, and soon their second home in Arizona. The Stewarts’ adult children agreed wholeheartedly that they do not want the stress of dealing with the homes after their parents are gone.
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Rather than trying to maintain them, or sell the properties themselves, the Stewart family found it best to donate the properties instead. “There are emotional benefits in doing something wonderful for [the] university, but there are huge psychological benefits of not having your family having to deal with the very real and thorny problems of getting a house emptied,” Milt remarks. Even after the property belongs to the foundation, the family will have enough time to gather any belongings from the home before the foundation takes over completely. The Indiana University foundation made a smart choice by holding onto the Oregon property from the Stewarts: the market rose and the property sold for a great price. The foundation works closely with five carefully chosen realtors who give suggestions on updates and other ways to bring value to the property. When Indiana University was given the donation of the prestigious Sunset Lane address boasting 5 bedrooms and 4.5 baths with 7 acres, the listing agent John Stewart with F.C Tucker Company went straight to work. John helped the foundation spruce up the property with new landscaping, new carpeting, and new paint.
The original list price was $2.8 million and sold in just 2 months. John gives credit to the amazing housing market today as well as the home being deemed “move in ready”. “We are seeing a trend that buyers want properties ready to move in versus ten years ago when they were more than likely to want a better sale price and do upgrades themselves.” John explains. A college or university who sells a property will also get positive feedback and encouragement from its buyers. Kavgian believes that a “university's involvement can add cachet to the property in some instances. That fact appears in the public record and it’s up to the Realtor whether or not to share that information. Often they do, as buyers may feel good about a purchase that will help its students”. Milt Stewart agrees, “If I were an IU grad in Indianapolis looking for a property, it’s good karma.” Good karma indeed, since both buyer and seller receive the benefit of helping out a local university. Would you be willing to donate property to your alma mater? Weigh in at facebook.com/indianarealestatenews!
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HOTTEST HOUSING MARKET
Fort Wayne, IN
Ranks 4th in the nation for the hottest housing market.
Photo contributed by Teresa Stephens
he housing market is going crazy in Fort Wayne right now, and homes are selling super quickly. In fact, Realtor.com has recently moved Fort Wayne up to the 4th hottest housing market in the nation. You may be quick to assume that the western edges of the United States tend to dominate the housing market, but for the first time in 6 years, California is not even ranked near the top of the list. Currently, the hottest markets are scattered across the entire country.
Photo contributed by Teresa Stephens
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Cities who join Fort Wayne on the list include Midland, Texas (with an average of only 29 days on market) and Columbus, Ohio. By comparison, Fort Wayne had an average of 34 days on market, becoming the only Indiana city to make the list currently on Realtor.com.
Danielle Halle, chief economist at Realtor.com agrees that this market is targeted towards affordability rather than location.
Photo contributed by Ben Pidgeon
During the most hectic home buying season to date, more buyers are eager to purchase lower priced homes, starting in the $299k range. Inventory has also decreased to lower days on market. The average days on market used to be 40 days or less, and has now reached to 34 days or less in most of the top markets.
"This market is targeted towards affordability rather than location." Photo contributed by Teresa Stephens
“As the record pace of sales continues to challenge would-be home-buyers, the hottest market rankings show that buyers are looking for markets that offer relative affordability,” Hale continues, “In three cities that were on Amazon’s list of possible HQ2 contenders---Columbus, Boston, Dallas---affordability isn’t taking as big a hit as in other hot markets despite properties selling faster than just about everywhere else. This would be the change if Amazon were to come to town”. Realtor.com also reports that inventory is at an all time low, stating that it decreased over 4% this year and is expected to increase 2% by the end of this historic season. Congratulations to Fort Wayne, and hopefully the success of its realtors can spread to the rest of the state.
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TOP 150 Independent Brokerage Standings
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TEACH HERE LIVE HERE
Bottom row photos (3) contributed by Marius Peter
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A project developed by Near East Area Renewal has almost come to completion. The project, “teach here, live here”, is a program to create affordable housing for teachers with lower income salaries. The program became established after teachers left for better pay and better living in the suburbs. The project in Indianapolis has over 22 homes that were transformed and remodeled from vacant or abandoned homes, which are now available for purchase to teachers who meet income requirements. The price range for these homes will start in the $136k’s and will run up to $193k. So far, three homes have been purchased in the area, and many more are expected to sell quickly. NEAR Executive Director John Franklin Hay says that Indianapolis Public School teachers qualify if they have been with the school for 1 to 3 years. “Most IPS teachers start at $40,000”, states Hay, “Indianapolis loses 400 school teachers a year because more lucrative jobs are available in the suburbs.” The city of Indianapolis and an Indianapolis neighborhood housing partnership were able to give NEAR the necessary funds and tax credits to begin the project. NEAR gained millions of dollars of tax credits and funding from the Department of Housing and Urban Development. The “Teach Here, Live Here” movement has been a great success in other cities around the country. Newark, New Jersey began the first phase of its Teachers Village last October. The village consists of over 204 apartments, 3 charter schools, and more than 60,000 square feet of retail space. Most of the space is occupied by teachers who qualified for lower rent based on income.
Photo contributed by Dustin Jenkins
Investor Nicolas Berggruen and the city of Newark funded $150 million toward the successful project and have high hopes that the affordable housing for educators will boost the economic development for the city. In Palo Alto, California, the city funded over $9 million towards affordable housing for educators. A study of the San Francisco metro area found that less than 1 percent of available housing was affordable based on an average K-12 teacher’s salary. California school districts are hoping that the teacher shortage will be resolved once this project is complete. While it’s still awaiting approval, the project is expected to contain 60 to 120 housing units for educators. Joe Simitian, president of the board of supervisors for Santa Clara County, is excited for the building to commence, but understands the difficulty to get started. “It’s never easy to develop workforce housing in such an expensive area, but we have the land, we have some funding available and we’re finding the partners we need to make this work,” Simitian explains, “With a little creativity and collaboration we can make progress”. It will be an invigorating spark to see teachers returning to IPS while being able to afford housing nearby. This will be an innovative step to hopefully ending teacher shortages in the urban areas of Indianapolis.
Photo contributed by Dustin Jenkins
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TOP 150 National Brokerage Standings
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Hope for
ABANDONED Gary Schools
For the past 8 years, Gary’s school district has been suffering multitudes of low enrollment in schools, as well as arson, theft, and vandalism toward abandoned school buildings.
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or the past 8 years, Gary’s school district has been suffering multitudes of low enrollment in schools, as well as arson, theft, and vandalism toward abandoned school buildings. The district officials feel they have no choice but to put the abandoned school properties on the market after many threats of money owed to the government and tax liens. The NWI Times states that the Gary school district has over $100 million dollars in debt owed to the government. The state was forced to appoint an emergency manager for the Gary school district in 2017. The board of trustees continually spent more than what the district allowed, thus racking up an undesirable amount of debt. Hoping to get out of debt quickly, the school district placed multiple tax liens on the school properties. The IRS agreed to a $320,000 settlement in hopes to see a return back from the district. Peggy Hinckley, appointed Emergency Manager of Gary, stated that “We have not been a good neighbor with these abandoned properties over the last 20 years as the school fell into financial distress.” Over the last few years, more than arson and graffiti has appeared inside the abandoned schools. In 2015, the body of a 17 year old girl was found in the old Emerson building off Seventh Ave. Even more bodies have been found since then. Ron Brewer, Gary City Council president, worries about the continuing vandalism toward the buildings. “We had the three homicides, and we continue to have a lot of fires. It's a constant drain of our resources." Karen Freeman-Wilson, Mayor of Gary, understands the frustration for the fire department’s accountability when receiving multiple calls and alerts. “While I can't tell you how much it costs each time we respond, I can tell you that if our crews are responding to a school, and there’s another fire, that presents a challenge in the community.” So far, the Gary Fire Department has received calls and responded to at least 6 arsons this year. Horace Mann High school and Ivanhoe Elementary have each been targeted a minimum of 2 times, and Lew Wallace
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“We had the three homicides, of fires. It's a constant drain
and we continue to have a lot of our resources. "
and Washington Carver have also become targets. Horace Mann suffered a terrible blaze in the auditorium, set off by an unnamed arsonist back in May of 2017. In August of 2017, Lew Wallace was set ablaze, potentially by the same individual. The schools have experienced burglary by squatters and gangs, and have been picked clean of valuable items such as important pieces of school equipment that were left behind. Arson, graffiti, and many other forms of vandalism are common amongst the abandoned school buildings. Not only have the schools been destroyed, they have also been neglected. Overgrown shrubbery and weeds have taken over, and broken windows allow anyone or anything into the schools at all times. Brewer, Freeman-Wilson, and Hinckley have expressed high hopes in selling the properties, but grasp the fact that most, if not all properties are not suitably “market” ready and will not sell quickly. Hinckley hopes that the properties sell for their asking value, based on estimates from an assessor in Lake County. Since Wirt-Emerson’s location is so close to Gary’s Lake and the Michigan beaches, Hinckley knows this will be a tempting area for investors to scoop up. Thomas A. Edison Elementary has been the main focus for the officials of Gary Airport. Hinckley hopes that investors see some value in buying the properties. “We have no illusion the properties are worth this much, but it's a starting point. We know we have properties with deteriorating buildings, and that places a negative value on there. Whoever buys it would have to tear down." Hinckley wants to hold off on donating the properties until she has exhausted all other options. The properties are going for great deals on the real estate market. So far, the undeveloped land at Mount Street and Ninth Avenue is going for $39,300 and DunbarPulaski Middle School is in the $5.85 million range. After removing the tax liens early this year, the properties are now considered “market ready” and are sure to sell.
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The pursuit to sell off the buildings began in 2010 after a major decline in enrollment, losing money to local charter schools, and lower tax collections and funding from the state. However, buyers that did take advantage of the low market price did not redevelop the properties, thus leaving an even bigger mess for Gary to clean up. There are currently 33 school properties for sale in Gary, IN. The official notice for bids began on July 2nd of this year. The Indiana law states that universities, colleges, and libraries have the first opportunity in a 30 day window to purchase the properties before the general public is allowed to make any offers. The general public was then allotted a 60 day window for offers. This ended on August 24th of this year. The last building that will go up for sale is the Bethune Early Learning Center, which will officially close its doors at the end of 2019. Hinckley wants to sell the properties quickly, but does not want them to necessarily go to the first person rather than the best person. “The sooner we can move these properties along, the better. But it does not mean we just want to unload them for anybody. We want to be good neighbors in understanding the use proposed by bidders may not be compatible with the neighborhood. We have to be sensitive to that." Hinckley will also receive community feedback about property use that may not be in favor of the city of Gary. Currently, Gary is reviewing 6 bids it received after the August 24th window. A NWI Times article states that the bids are worth over $555,000. The Franklin Elementary school was already bought for $100,000 24
and is now being developed for affordable housing and mixed commercial properties. Unfortunate to Hinckley’s wishes, the properties are not selling for their appraised value. George Carver Elementary was originally listed for $1.14 million, but received a bid for just over $35,000 by Henry Leong, a member of Little Calumet Greenspace. Leong plans to demolish the building entirely, and create a logistics complex. Jefferson Elementary listed for $5.05 million, and received a bid for only $150,000 from Indiana American Water Co. The company wants to expand the Borman Park Water Treatment facility just off Madison Street. Duncan Elementary, listed at $1.64 million, received a $100,000 bid from Patheon Corp to be made into six townhomes, office space, and warehouse space specializing in appliances, cabinets, and other developments. The Gary Community School Corporation
administration office listed for over $2 million, but acquired a bid for $35,000 for Richardson Disposal to expand its operations and offer a drop off program for the community. First Metro Development put a bid in for Nobel Elementary for $75,000. The property was originally listed for over $1.2 million. First Metro plans on transforming the building into something new and exciting. “It is our intent to create a planned unit development consisting of affordable housing complexes and comparable commercial retail development, with the goal of keeping Gary citizens in Gary, and attracting new people to Gary.” The last bid received was for Ernie Pyle Elementary for $160,000 from the Gary Housing Authority. While the property was originally listed for just over $1.9 million, the Gary Housing Authority plans to establish single family housing and senior living. If Hinckley and Freeman-Wilson do not accept these bids, they will be forced to auction off the properties or donate them. However, this will be a last resort option for Hinckley.
COMMUNITY CALENDAR OCTOBER 1st- 21st
Holmes & Watson IRT - Indianapolis, IN
Summoned to a remote asylum on a rocky island, Dr. Watson investigates three inmates who all claim to be the late master sleuth Sherlock Holmes. This eerie new puzzler by award-winning playwright Jeffrey Hatcher will stir your blood and tease your mind.
5th
Indy Whisky & Fine Spirits Expo Allison Pointe Boulevard, Indianapolis, IN
Welcome to the 10th Annual Indy's Whisky & Fine Spirits Expo! This event, sponsored by Vine & Table, continues to grow each year over the last several years and is considered a feature of Indianapolis’ Events Calendar. Highlights include over 300 spirits to taste, a gourmet buffet by Kahn’s Catering and an expanded lineup of producers and many special guests.
20th Indiana Teen Sci-Fi & Horror Writers Festival Indiana State Library Indianapolis, IN The first-ever Indiana Sci-Fi & Horror Writers Festival brings together established sci-fi and horror authors with their teen audiences to celebrate all things speculative and creeptastic! During this day-long extravaganza, aspiring young writers are invited to explore new genres, ask questions and bring to life their own literary creations.
20th Tour de Cure
Indianapolis Motor Speedway
The Tour de Cure is an event where no matter what road you take, you will be joining thousands of people from around the country who have the same passion as you to fight diabetes and its burdens.
23rd Poverty: Examining 12th - 27th Anything Goes Civic Theatre Indianapolis, IN Music, dance, laughs, and the age-old tale of Boy Meets Girl– no musical puts it on stage better than ANYTHING GOES! A hilarious shipboard romp, wrapped around one of Cole Porter’s most magical scores, ANYTHING GOES is Delightful, Delicious, and De-Lovely.
Roots, Working Towards Solutions Clowes Memorial Hall indianapolis, IN Determining the best ways to address the poverty and inequality we see in our community requires that we examine the various social and economic forces that help create and maintain them. As it kicks off its third year, the Faith & Action Project at Christian Theological Seminary seeks to dig into those forces, help the community confront them, and seek solutions to overcome poverty.
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Exposure Every MIBOR Realtor will receive a copy and more industry offices will receive a copy across more mediums.
Education In addition to the articles in our magazine, we also produce educational videos and blog posts.
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ADVERTISE WITH US! Contact Aaron Henze at aaron@indiana-realestate-news.com