I am pleased to report that the Seaview project is on track and we expect income to the Fund from its cash flow to commence in 2012. Unfortunately, the Astoria Station and Webster Avenue developments are not doing as well, with the Astoria project in a foreclosure action and, although I am working with the bank on Webster, I don't have much hope that anything good will come out of it, since the fact that the originally planned Webster development project cratered due to lack of financing and availability of subsidy, which situation has not changed. It is no secret that construction financing has and continues to be generally just not available, and government budget cuts have severely limited the availability of affordable housing subsidies.
The Fund allows for the substitution of other/new projects, and that is the present intent. The Fund is structured, so that there is no liability to the Fund itself, nor to the individual investors from bank actions such as those in Astoria and Webster.
The Victory Fiedler project is under construction and moving ahead, albeit on a slower track than anticipated. It suffered a severe timing setback from Hurricane Irene, as well as being physically damaged.
The Grove Avenue project is still being worked on and because of the long term nature of the contract and the cooperative nature of the owners, it probably will be developed at some point in the future. The development plan is being finalized and will be posted to the web site in the next few weeks.
I continue to maintain balanced optimism, in terms of there being enough potential left in the remaining Fund projects to keep the Fund moving forward in a positive direction. We are looking for substitute long-term projects to replace Astoria Station and Webster Avenue, and I am hopeful that, as the economy improves, these projects will be replaced. In the future we will need to adjust some of the Fund's assumptions to reflect the fact of longer timing than originally contemplated.
On a personal note, I want to mention to you that, as we enter the fifth year of the real estate downturn/depression, I am facing some personal financial challenges, separate and apart from the Fund. The Fund is structured so that it is protected from these types of issues and will continue its independent operation, separate from my personal situation, which I am hopeful will be short lived and quickly resolved. Ken Simons has stepped in on the management side to make sure there is consistency and continuity.
I will look forward to providing further updates in the near future.
Best regards,
Randy
