• Home sellers could pay hidden fee to real estate developers for generations

    Homes in San Antonio

    Jen wrote an interesting story about a company started in Austin that is trying to sell developers on a novel way to make a profit:

    Here’s a new concept in real estate: Buy a house, and when you go to sell it years later, owe the original developer or builder 1 percent of the sales price.

    Freehold Capital Partners, a company started in Texas, is selling developers across the country on a plan that would attach a private transfer fee to homes, allowing developers to profit for generations.

    Express-News story about developer feeJen, who covers real estate and architecture, said she got a tip about the company’s proposed fee and worked on the story in her spare time for a couple months while also working on stories about the retaining wall collapse at the Hills of Rivermist.

    “I thought it was a cool story, but I had all those Rivermist stories going on,” she said.

    I like enterprise stories like this that take a long time for a reporter to dig into. It’s a lot of work, but the payoff is a story based on a rich variety of sources that tells readers something new about the world.

    Some of the sources Jen relied on for the story included:

  • The user-friendly Texas legislative Web site, where Jen searched for bills pertaining to the real estate fee;
  • Property records that showed Freehold’s founder Joe Alderman was pitching the fee to developers across the country, but removed the fee from his own nine-bedroom home in Roundrock when it was listed for sale last year;
  • U.S. Patent office records that showed how the company had tried to patent the fee but the effort failed, at least for now;
  • The Internet Archive, which revealed how a predecessor company was trying to sell the fee to individual home sellers, not just developers. The company’s original Web site said: “Maybe you planted a tree, added on a room or rehabbed a home. Fifty years from now, when a family is enjoying the property that you improved, and making a profit by selling the property you improved, why shouldn’t you benefit? Of course you should.” The current company says it has stopped marketing the fees to individuals.
  • The story has already sparked outraged comments from readers, and Freehold has also posted several comments seeking to explain its position. One comment from Freehold says: “The issue is how to pay for infrastructure? Do you prefer that developers put 100% of the burden onto the first time buyer, or lower the initial cost by apportioning the costs over those who live in the development? More importantly, the only seller that will ever pay the fee is a seller who willingly agreed to do so.”

    A doctor responded:

    This is absolutely a ridiculous. I’m as pro-market and pro-business as just about anyone out there, but this even reeks of bald-faced greed and putrid corruption to me. The sooner these are banned the better. I’m a doctor…with their line of thinking, if I save a life should I be entitled to a percentage of my patients income for the rest of his life? Does Ford deserve a cut when you sell your car? Only the government has the balls to lay claim on people and property like that.

  • How developers skirt city codes

    Skinner Nurseries property, 2005
    Skinner Nurseries property, 2005
    Skinner Nurseries property, 2009
    Skinner Nurseries property, 2009

    Whenever a real estate developer bulldozes majestic oaks or paves over environmentally sensitive land on the Edwards Aquifer recharge zone, it’s usually because he has “vested rights.” He’s grandfathered from city codes, and he can do whatever he wants on a property.

    But sometimes trees are cut down not because of vested rights, but because of flaws in the actual ordinance that was intended to protect trees from urban sprawl.

    Here’s my latest story about a flaw I learned about recently in the city’s tree-preservation ordinance. We’ve also published stories here and here about other ways to get around city ordinances.

    The latest method of avoiding the tree ordinance involves a “homeowners exemption.” Lobbyist Ken Brown advised his client, Skinner Nurseries, that it didn’t have to follow city codes that required the company to preserve trees on its 19-acre property. That’s because the rural land had a house on it. The city’s tree ordinance sets no limits on the size of residential properties, so Skinner Nurseries could bulldoze all the trees it wanted — and it did.

    Skinner Nurseries bulldozed the property for — of all things — a tree-nursery business. But a sour economy killed the project after the trees were cut down. No tree-nursery was ever built, and the old house was eventually torn down.

  • Fay Sinkin’s papers track aquifer struggle

    Fay Sinkin helped establish Government Canyon, a state park located on the Edwards Aquifer Recharge Zone
    Fay Sinkin helped establish Government Canyon, a state park located on the Edwards Aquifer Recharge Zone

    Environmentalist Fay Sinkin died last week at the age of 90. There’s a rich archival resource available to the public for anyone who wants to learn about her life and the decades-long battle she fought to protect the Edwards Aquifer, San Antonio’s main drinking supply.

    The University of Texas at San Antonio established an archive of William and Fay Sinkin Papers, 1928-2008, located downtown at the Institute of Texas Cultures. The archives contain news clippings, brochures, studies, and other documents. There are certain rules you must follow to read these records but they’re open to everyone.

    p1060779Reading Sinkin’s papers, it’s striking how long fights over the Edwards Aquifer have been raging. The Edwards Aquifer is fed by runoff from rain that filters through limestone on the city’s North Side. In the 1970s, real estate developers started eyeing that area to build new homes, parking lots, and streets — the kinds of things that taint runoff with pollutants.

    Many of us remember the PGA Village — Jaime Castillo wrote a column about how Sinkin helped collect 100,000 signatures to turn in a petition opposing the proposed resort.

    But not so many people remember how Sinkin had drummed up signatures decades earlier in a similar battle.

    In 1975, real estate developer Sam Barshop sought a zoning change for a new “super mall” at U.S. 281 and Loop 1604. Sinkin showed up at City Hall with 47,000 signatures from people opposing the mall. Henry Cisneros supported the effort, at least initially, and the mall tore a rift in the San Antonio business community.

    Many downtown business owners opposed the city’s northward growth. A Greater Chamber of Commerce committee headed by construction magnate H.B. Zachry was a major proponent of the mall and operated with a $50,000 war chest.

    Barshop filed a lawsuit and Sinkin and others eventually lost the battle. The result is Northwoods Shopping Center.

    Not many shoppers looking for deals at Marshalls are probably aware of the heated political battles that were fought over that piece of land.