Morning Brief: Stalling Development
The promise of new homes and high-end retail is running headlong into a withering economic slowdown and paralyzed credit markets, bringing new construction to a virtual stop throughout the Washington area and fueling anxiety among those who dreamed that their neighborhoods were the next frontiers.
"There's a question mark over every site in the D.C. area that is or was in the process of seeking financing," Samuel Simone, managing director of Trammell Crow Residential told reporters Paul Schwartzman and Dana Hedgpeth.
Carlyle Group, the District-based private-equity firm, suffered a new setback on Monday when one of its investments, a Hawaiian provider of local and long-distance telephone service, filed for bankruptcy protection.
Carlyle had put $425 million in Hawaiian Telcom Communications and borrowed almost $1.2 billion to buy the company from Verizon in 2005. But the telecommunications company struggled almost from the start.
Its collapse followed other reversals for Carlyle this year. In March, Carlyle wrote off a $700 million investment in Carlyle Capital, an offshore public company that invested in mortgage-related securities. Then Carlyle announced in July that it would liquidate Carlyle-Blue Wave Partners Management, which made similar bets in mortgages.
With skyrocketing demand for inauguration week housing, Washington area hotels are enjoying the kind of bargaining power usually reserved for hotels in cities that play host to Super Bowls, Final Four college basketball tournaments and soccer's international World Cup, industry experts said.
And despite gas prices plummeting in the past several weeks, commuters do not appear to be returning to their cars, according to transit officials in the region and elsewhere, who say the number of riders is still increasing.
December 2, 2008; 8:32 AM ET
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