Own a home or renting? 5 questions about what Trump’s tax plan could mean to you

It’s little more than bullet points on a single page.

But the effect of President Donald Trump’s plan to overhaul the U.S. tax system is being hotly debated in real estate circles.

The National Association of Realtors, citing Trump’s proposals to double the standard deduction while scrapping write-offs for expenses like state and local property taxes, warns that such a plan would hurt a wide swath of homeowners and the residential real estate market.

“It’s going to continue to make California a renter’s state vs. a homeowner’s state,” said Tammy Newland-Shishido, Orange County Association of Realtors president-elect, who was in Washington D.C., with the national advocacy group last week.

Not every real estate expert foresees dire consequences. Some say if the plan prevails in Congress, it could spread the wealth.

“It’s beneficial to the everyday person,” said Fadel Lawandy, director of the Hoag Center for Real Estate and Finance at Chapman University in Orange. “The middle class is going to benefit, whether they own a home or not. It will help renters significantly.”

Trump’s simple, one-page outline was expected to forge major changes in the tax code this year, but some Wall Street analysts believe the repeated crises faced by the White House could push tax reform into 2018.

Regardless of when it happens, here’s how arguments over what it could mean for housing are unfolding:

What’s been proposed?

Trump’s plan raises the standard deduction to $24,000 from $12,600 for a married couple filing jointly. Only deductions for only mortgages and charitable donations would be allowed. Deductions for state and local taxes, including property taxes, and other write-offs would be eliminated.

The mortgage interest deduction — which allows homeowners to deduct interest paid on home loans up to $1.1 million — would still be an option. But the Realtors group and a national home builders’ organization say it would carry far less value; most people would have to file for the standard deduction and many would pay higher taxes.

Why the alarm?

Real estate agents and builders say they’d be losing what they consider an important incentive for homebuyers — the prospect of receiving a mortgage deduction on their taxes. And, they say, getting rid of deductions for state and local taxes would decrease home values.

“Current homeowners could very well see their home’s value plummet and their equity evaporate if tax reform nullifies or eliminates the tax incentives they depend upon, while prospective homebuyers will see that dream pushed further out of reach,” said William E. Brown, NAR’s president. “While we appreciate the administration’s stated commitment to protecting homeownership, this plan does anything but.”

Brown, from Alamo, added, “Common sense says owning a home isn’t the same as renting one, and American’s tax code shouldn’t treat those activities the same either.”

The National Association of Home Builders also sounded a warning.

“Doubling the standard deduction could severely marginalize the mortgage interest deduction, which would reduce housing demand and lead to lower home values,” said Granger MacDonald, the association’s chairman.

How popular is the mortgage interest deduction?

The write-off, enacted in 1913, has been a third rail in U.S. politics. No one ever touches it.

Proposals to eliminate it, turn it into a tax credit or limit it for high-income taxpayers have come and gone.

In 2014, some 32 million homeowners claimed it, saving about $2,173 each, the National Association of Realtors says.

The real estate industry typically makes a strong push to keep the deduction, saying that to do otherwise would price-out would-be buyers and threaten the housing market.

But some economists and academics say the write-off favors the upper-middle class and the wealthy.

Zillow economist Svenja Gudell said she doesn’t believe that a desire to claim the mortgage interest deduction necessarily drives home purchases.

Dennis C. Smith, a Huntington Beach mortgage broker, agrees.

“Having interviewed potential homeowners for 30 years, I can state that very few, about 10-15 percent or less, of those I have spoken to over the years, make their decision to buy a home because of the tax deduction they will receive,” Smith, co-owner of Stratis Financial, recently wrote in his blog.

How could the tax plan affect pricey housing markets?

Getting rid of property tax deductions would hit expensive markets harder than other places, Realtors, economists and academics say.

“For households in higher-tax states, the benefit of itemizing is higher,” states an article entitled “Tax plan could hurt homeowners” published on the national Realtor group’s’ website. “And for second-home owners, the net tax benefit of itemizing can be substantial.”

“There’s a segment of borrowers who would be adversely affected,” said Paul Habibi, a faculty member at the Ziman Center for Real Estate at UCLA. “It just depends on what side of the income spectrum you’re on.”

In coastal markets, including Los Angeles and Orange County, San Francisco and New York City, he said, “You’re going to have a greater percentage of those potential homeowners adversely affected because they have median prices high enough to kick them into benefiting from the (itemized) deductions.”

Under the plan, a married couple would need a home-loan balance of about $608,000 to use the mortgage interest deduction, up from about $322,000 now, Bloomberg reported.

Ralph McLaughlin, an economist at home search website Trulia, does not think the plan, if implemented, would create a major disruption in the overall housing market.

But, he said, “The proposed tax reform will push the benefits of the mortgage interest deduction further out of reach of the middle class. Under the current tax code, the top 43 percent of household earners can itemize their mortgage interest if they purchased a home. Under the proposed tax plan, that number would shrink to just the top 17 percent.”

In Orange County, only 26 percent of households could afford to buy a home with a mortgage high enough to qualify for the mortgage interest tax deduction under the proposed tax plan – down from 55 percent of households that currently qualify, by Trulia’s math.

What’s next?

Despite arguments that Trump’s proposals could help renters and those struggling to become homeowners, Senate Democrats say Trump’s overall plan is aimed at the rich, including the president.

And the nonpartisan Tax Policy Center has said nearly 8 million families – including a majority of single-parent households – would be worse off.

Much still is unknown. The plan has three tax brackets of 10, 25 and 35 percent. But it’s not yet clear what the income levels would be.

And, of course, what Congress would do remains to be seen.

But the plan’s advocates, as well as those who do not see it harming the housing market, predict the savings for most households could actually become a boon to homeownership.

“For many lower and middle-income taxpayers, a higher standard deduction will increase their after-tax income, which could end up boosting home buying demand from these groups if net income rises enough,” said Gudell of Zillow.

“At the end of the day, what really matters is whether people have more or less after-tax money to spend on housing and other living expenses,” she said.

As to those at the higher end who would see no benefit, Smith wrote, “There is an old saying, ‘If you can afford a Ferrari you aren’t worried about the price of gas or an oil change.’

“Similarly, if you can afford a $10 million dollar estate, you aren’t worried about the mortgage interest and property tax deduction.”

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Nations grapple with huge cyberattack, but more’s coming

By ALLEN BREED, JIM HEINTZ and SYLVIA HUI

LONDON (AP) — Teams of technicians worked around the clock Saturday to restore Britain’s crippled hospital network and secure the computers that run factories, banks, government agencies and transport systems in other nations after a global cyberattack.

The worldwide cyberextortion attack is so unprecedented that Microsoft quickly changed its policy, announcing security fixes available for free for the older Windows systems still used by millions of individuals and smaller businesses.

After an emergency government meeting Saturday in London, Britain’s home secretary said one in five of 248 National Health Service trusts had been hit. The onslaught forced hospitals to cancel or delay treatments for thousands of patients, even some with serious aliments like cancer.

Home Secretary Amber Rudd said 48 NHS trusts were affected and all but six were now back to normal. The U.K.’s National Cyber Security Center said it is “working round the clock” to restore vital health services.

Security officials in Britain urged organizations to protect themselves by updating their security software fixes, running anti-virus software and backing up data elsewhere.

Who perpetrated this wave of attacks remains unknown. Two security firms — Kaspersky Lab and Avast — said they identified the malicious software in more than 70 countries. Both said Russia was hit hardest.

And all this may be just a taste of what’s coming, a cyber security expert warned.

Computer users worldwide — and everyone else who depends on them — should assume that the next big “ransomware” attack has already been launched, and just hasn’t manifested itself yet, Ori Eisen, who founded the Trusona cybersecurity firm, told The Associated Press.

The attack held hospitals and other entities hostage by freezing computers, encrypting data and demanding money through online bitcoin payments. But it appears to be “low-level” stuff, given the amounts of ransom demanded, Eisen said Saturday.

He said the same thing could be done to crucial infrastructure, like nuclear power plants, dams or railway systems.

“This is child’s play, what happened. This is not the serious stuff yet. What if the same thing happened to 10 nuclear power plants, and they would shut down all the electricity to the grid? What if the same exact thing happened to a water dam or to a bridge?” he asked.

“Today, it happened to 10,000 computers,” Eisen said. “There’s no barrier to do it tomorrow to 100 million computers.”

This is already believed to be the biggest online extortion attack ever recorded, disrupting services in nations as diverse as the U.S., Russia, Ukraine, Spain and India. Europol, the European Union’s police agency, said the onslaught was at “an unprecedented level and will require a complex international investigation to identify the culprits.”

The ransomware appeared to exploit a vulnerability in Microsoft Windows that was purportedly identified by the U.S. National Security Agency for its own intelligence-gathering purposes. The NSA tools were stolen by hackers and dumped on the internet.

A young cybersecurity researcher has been credited with helping to halt the spread of the global ransomware attack by accidentally activating a so-called “kill switch” in the malicious software.

The Guardian newspaper reported Saturday that the 22-year-old Britain-based researcher, identified online only as MalwareTech, found that the software’s spread could be stopped by registering a garbled domain name. It said he paid about $11 on Friday to buy a domain name that may have saved governments and companies around the world millions. His action couldn’t help those already infected, however.

Before Friday’s attack, Microsoft had made fixes for older systems, such as 2001’s Windows XP, available only to mostly larger organizations that paid extra for extended technical support. Microsoft says now it will make the fixes free for everyone.

Russian agencies slowly acknowledged that they were affected but insisted that all attacks had been resolved.

The Russian Interior Ministry, which runs the country’s police, confirmed it fell victim. Ministry spokeswoman Irina Volk was quoted by the Interfax news agency Saturday as saying the problem had been “localized” with no information compromised.

A spokesman for the Russian Health Ministry, Nikita Odintsov, tweeted that the cyberattacks on his ministry were “effectively repelled.”

“When we say that the health ministry was attacked, you should understand that it wasn’t the main server, it was local computers … actually nothing serious or deadly happened yet,” German Klimenko, a presidential adviser, said on Russian state television.

Russian cellular phone operators Megafon and MTS were among those hit. Russia’s national railway system said it was attacked but rail operations were unaffected. Russia’s central bank said Saturday that no incidents were “compromising the data resources” of Russian banks.

French carmaker Renault’s assembly plant in Slovenia halted production after it was targeted. Radio Slovenia said Saturday the Revoz factory in the southeastern town of Novo Mesto stopped working Friday evening to stop the malware from spreading.

Krishna Chinthapalli, a doctor at Britain’s National Hospital for Neurology & Neurosurgery who wrote a paper on cybersecurity for the British Medical Journal, said many British hospitals still use Windows XP software, introduced in 2001.

Security experts said it appeared to be caused by a self-replicating piece of software that enters companies when employees click on email attachments, then spreads quickly as employees share documents.

The security holes it exploits were disclosed weeks ago by TheShadowBrokers, a mysterious group that published what it said are hacking tools used by the NSA. Microsoft swiftly announced that it had already issued software “patches” to fix those holes, but many users haven’t yet installed updates or still use older versions of Windows.

Elsewhere in Europe, the attack hit companies including Spain’s Telefonica, a global broadband and telecommunications company.

Germany’s national railway said Saturday departure and arrival display screens at its train stations were affected, but there was no impact on actual train services. Deutsche Bahn said it deployed extra staff to help customers.

Other European organizations hit by the massive cyberattack included some soccer clubs. IF Odd, a 132-year-old Norwegian soccer club, saying its online ticketing facility was down.

In the U.S., FedEx Corp. reported that its Windows computers were “experiencing interference” from malware, but wouldn’t say if it had been hit by ransomware.

___

Heintz reported from Moscow and Breed from Raleigh, N.C.

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Maternity leave dispute: Wescom settles complaint against Santa Ana couple who sought loan

The Housing and Urban Development department and Wescom Credit Union have resolved allegations the company denied a Santa Ana couple’s mortgage loan application because the wife was on maternity leave.

The couple’s name was redacted from the HUD agreement.

The agreement requires the Pasadena-based credit union refinance the couple’s existing mortgage at a lower rate and create a $50,000 compensation fund for applicants who were similarly denied loans or withdrew mortgage applications from Wescom during 2015.

Refusing to provide a mortgage loan or mortgage insurance because a woman is pregnant or on family leave violates the Fair Housing Act’s prohibition against sex and familial status discrimination, which includes discrimination against individuals who have or are expecting a child.

HUD in a statement said it has received nearly 150 complaints alleging maternity leave discrimination and has obtained more than $8 million in compensation for victims.

“An otherwise qualified borrower should not have their mortgage loan denied or delayed just because they’re having a baby,” said Bryan Greene, HUD’s general deputy assistant secretary for Fair Housing and Equal Opportunity.

The agreement announced Wednesday stems from a complaint that a married couple from Santa Ana filed with HUD. The couple alleged Wescom unfairly denied their mortgage loan and the lender requested the woman return to work and provide a current pay stub before they would approve the loan application.

Wescom denied they were engaged in any of the discriminatory acts alleged in the complaint, according to HUD. The agreement between Wescom and HUD was signed by Charles Thomas, senior vice president of lending at Wescom.

Other terms of the agreement Wescom include:

— Ensure its lending policies regarding parental leave comply with the Fair Housing Act;

— Provide fair lending training to its employees; and

— Send a notice to its employees regarding its parental leave lending policies.

Anyone who believes they have experienced discrimination can file a complaint by contacting HUD’s Office of Fair Housing and Equal Opportunity at 800-669-9777 or 800-927-9275 (TTY). Housing discrimination complaints may also be filed by going to hud.gov/fairhousing, or by downloading HUD’s free housing discrimination mobile application, which can be accessed through Apple and Android devices.

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Signature sauces by Huntington Beach teen with autism a big hit at Pacific City restaurant

  • From right, Julen Ucar and Executive Chef Danny Allen pose for a photograph at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

    From right, Julen Ucar and Executive Chef Danny Allen pose for a photograph at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

  • Julen Ucar combines various ingredients in a mixing bowl to create Julen’s Non-Verbal Herbal Ausome Sauce at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

    Julen Ucar combines various ingredients in a mixing bowl to create Julen’s Non-Verbal Herbal Ausome Sauce at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

  • Julen Ucar combines various ingredients in a mixing bowl to create Julen’s Non-Verbal Herbal Ausome Sauce at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

    Julen Ucar combines various ingredients in a mixing bowl to create Julen’s Non-Verbal Herbal Ausome Sauce at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

  • From left, Julen Ucar and Executive Chef Danny Allen pose for a photograph at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

    From left, Julen Ucar and Executive Chef Danny Allen pose for a photograph at Ways and Means Oyster House in Huntington Beach on Wednesday, April 26, 2017. (Photo by Drew A. Kelley, Contributing Photographer)

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HUNTINGTON BEACH Julen Ucar carefully measures the ingredients for his special “Non-verbal Herbal” marinade in the cozy confines of the Ways & Means Oyster House at Pacific City. The sauce, with just the right proportions of extra virgin olive oil, two kinds of vinegar, basil and other spices, has become a popular complement to the restaurant’s steak, fingerling potatoes and spinach dish.

After finishing the first sauce, he starts combining soy sauce, ketchup, brown sugar and enough red chili flakes to give it a little zing. At the restaurant, the sauce, called “Off the Charts,” is paired with an in-house aioli to flavor a tricolor cauliflower entree.

The 18-year-old Fountain Valley High senior with autism created two flavors of “Julen’s Ausome Sauces” that have been featured on the restaurant’s menu for the past year.

Ucar comes to the restaurant on Wednesday mornings to prepare his sauces for the day. During the rest of the week, the prep cooks prepare the sauces from recipes in a book they call “the bible.”

Executive Chef Danny Allen said when Ucar and his mother, Michelle, first brought in samples of their sauces for the restaurant to consider about a year ago, he realized they would pair nicely with the food.

“I’d put it up against anything that’s on the market,” Allen said of the marinades.

According to Allen, many cooks and chefs incorporate too many flavors into their creations. Ucar’s sauces hit just the right note.

“They’re simple, but they’re unique. It’s amazing,” Allen said.

The Wednesday morning visits, made before the restaurant opens, are clearly a highlight for the soft-spoke teen. Dressed in a T-shirt that reads “This is what ausome looks like,” he seems at home in the prep area, surrounded by jars of black pepper, paprika, minced onion and cumin.

Ucar says he likes the friendly atmosphere in the kitchen, particularly when the prep cooks crank up the music.

For years, Ucar and his sister, Isabel, have helped their mother prepare meals at home. Michelle Ucar said her son often liked to add ingredients to the salad dressing prepared for the family meal.

“We started watching him and he was really good a making sauces,” she said.

That’s when the idea of “Julen’s Ausome Sauces” began to percolate.

“We were looking forward and making a sustainable future for him,” his mother said.

After experimenting with different tastes, the Ucars, who live in Huntington Beach, winnowed their sauces to three versions of each of two sauces and held a taste-testing party for friends. They refined the selections and in February 2014 had the final recipes.

After they got Food and Drug Administration approval, the first batch was commercially bottled in October 2014 by a company hired by the Ucars.

Michelle Ucar said a chance meeting with the owners of Ways & Means led to a chance to have the sauces taste-tested at the restaurant and added to the menu.

Since then, the Ucars have produced three batches of 85 cases each of Non-verbal Herbal and Off the Charts. 

Although the sauces haven’t made the family any money yet, Michelle Ucar said she is looking to widen distribution beyond a few smaller stores in her home state of Ohio and to peddle the marinades at special events and fairs.

The sauce is also available online at ausomesauces.org.

Ways & Means donates $1 from each of its meals sold with Ucar’s sauces to New Vista School in Laguna Hills, for children with autism spectrum disorder. Ucar was a student there before transferring to Fountain Valley High.

“For us, it’s great to give back and give Julen a chance to do what he loves,” said Barbara Holder, general manager of the restaurant.

Michelle Ucar said when her son was an infant he hit all the normal benchmarks for a healthy baby. It wasn’t until he was 3 years old and in preschool that teachers said he had a speech delay. That was when others began to put labels and limitations on him, his mother said.

But Michelle Ucar has a different vision.

“This journey became not about what he cannot do, but about what he can do and finding a way to make that happen,” she said.

She said the family’s goals are to strengthen the brand and possibly expand the offerings.

Until then, she says her faith makes her believe in her son’s future.

Julen Ucar is now taking culinary arts classes at Fountain Valley and says he gets “Iike Bs and As,” in his classes.

He said he plans to study culinary art at Orange Coast College next semester.

It’s likely he will be the only one in his class with his own signature sauces.

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30-year mortgage rates at 4.03% after small increase

What’s up with mortgage rates? Jeff Lazerson of Mortgage Grader in Laguna Niguel gives us his take.

Rate News Summary

From Freddie Mac’s weekly survey: The 30-year fixed rate broke the 4 percent barrier, rising 6 basis points and landing at 4.03 percent. The 15-year fixed also was up a bit, averaging 3.27 percent, 4 basis points worse than last week’s 3.23 percent.

The Mortgage Bankers Association reported a 2.7 percent increase in loan application volume from the previous week.

Bottom line: Assuming a borrower gets the average 30-year fixed rate on a conforming $424,100 loan, last year’s rate of 3.66 percent and payment of $1,942 was $90 less than this week’s payment of $2,032.

What I see: Locally, well-qualified borrowers can get the following fully amortizing fixed rates loans with zero cost: A 15-year at 3.25 percent, a 20-year at 3.875 percent, a 30-year at 4.0 percent, a Federal Housing Administration  or Veteran’s Administration 30-year at 3.75 percent, a 15-year conventional high-balance loan (or a loan from $424,101 to $636,150) at 3.625 percent, a high-balance 30-year at 4.25 percent, an FHA/VA 30-year high-balance at 3.875 percent, a 15-year jumbo (loan amounts over $636,150) at 4.50 percent and a 30-year jumbo at 4.625 percent.

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Venture capital investors betting big on cannabis

Silicon Valley investors are known for pouring money into risky bets like flying cars and asteroid mining. Now, a handful are diving into one of the few industries that makes most of their peers squeamish — pot.

As the marijuana industry soars, with New Frontier Data predicting legal pot sales will balloon to more than $24 billion by 2025, a handful of venture capitalists are climbing on board — albeit cautiously. Those putting money into the industry say it’s a rare chance to stake an early claim in a lucrative market with little competition from other investors. But they’re keeping one eye on President Donald Trump’s administration, watching for signs of a federal crackdown that could derail the burgeoning industry.

“It’s a completely untapped market with huge opportunity,” said Tusk Ventures Founder and CEO Bradley Tusk, an investor in Eaze, a marijuana delivery company founded by Orange County entrepreneur Keith McCarty.

For Tusk Ventures, a VC firm that specializes in helping startups like Uber and FanDuel navigate complex regulatory landscapes, the controversial marijuana industry seemed like a natural fit. The firm is considering a second investment in the space.

And it’s not alone. DCM Ventures, a 21-year-old VC firm with an office on Sand Hill Road, also invested in Eaze, as did Fresh VC and the Winklevoss twins — the brothers who made headlines by claiming they came up with the idea for Facebook. Other investors dabbling in pot companies include prestigious Mountain View-based startup accelerator Y Combinator, Peter Thiel’s Founders Fund and New York City-based Lerer Hippeau Ventures — which also backs big names like Soylent, which makes meal-replacement drinks and bars popular among Silicon Valley techies, and Venmo, a mobile payments platform.

Industry insiders say there’s been a slow uptick in interest. Investors have poured nearly $30 million into marijuana-tech startups — companies that sell marijuana-related technology or use tech to sell cannabis products — so far this year, according to PitchBook Data. That means 2017 is on track to beat last year’s total of $49 million. But much of that money is coming from niche firms created exclusively to fund cannabis-related businesses, such as Phyto Partners and Poseidon Asset Management.

Despite the marijuana industry’s massive potential, interest from Sand Hill Road has amounted to more of a trickle than a flood. Though California voters approved recreational marijuana use last November, and lawmakers are working on crafting regulations to allow sales to start next year, the plant remains illegal on the federal level. That leaves most VCs unwilling to venture into the industry. Many venture capital firms are forbidden from entering the space by agreements with their limited partners — the pension funds and other institutions that supply the VCs’ investment capital.

“This is a no-go area for traditional venture funds, at least for now,” said Venky Ganesan, chairman of the board of the National Venture Capital Association and managing director of Menlo Ventures.

While mainstream VCs hesitate, a crop of investment firms specializing in marijuana have sprung up to fill the void. Groups like Los Angeles-based Casa Verde Capital, backed by rapper Snoop Dogg; and Gateway, an Oakland-based incubator for cannabis startups, can take much of the credit for keeping the marijuana tech industry afloat.

Pranav Sood, whose Oakland-based startup Trellis sells inventory management software to cannabis growers and distributors, recently turned to the industry’s niche investors after striking out with mainstream VCs.

“It quickly became apparent that more traditional VCs are not really getting into this space,” he said. “That’s when we kind of shifted focus as well. It was a pretty quick lesson learned.”

Trellis is closing its first round of funding, which will bring in $2 million from a group of investors led by Casa Verde. Sood said investor sentiment toward the marijuana industry has been volatile — spiking as support grew for legalized recreational marijuana, dropping with Trump’s arrival in office, and picking back up recently.

“Honestly, it’s been a little bit of a roller coaster,” he said. “On any given day, you don’t know how an investor’s going to feel.”

Brian Sheng, a partner at Fresh VC, said his firm was drawn to Eaze partly because the startup never actually touches marijuana — Eaze only provides the online platform that connects dispensaries with customers. That cuts down on the risk, Sheng said.

Private equity also is expanding into marijuana. MedMen, a Los Angeles-based firm that manages companies in the cannabis space, launched its first marijuana-focused private equity fund last summer, which now controls almost $100 million in assets. The firm also held its first investment conference last month, drawing more than 300 people interested in putting their money into the marijuana industry. So far the cash going into these types of funds has mostly been from wealthy individuals and families, MedMen Co-Chairman Chris Leavy said, but pension funds, endowments, foundations and other institutional investors are starting to show interest.

“Access to capital for this industry is slowly improving,” Leavy said. “Wherever you look, you can see signs that the investor interest is broadening.”

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Cheap ways to use your tax refund to fix up your home

If you’re looking to spend it on your home, the typical tax refund is no great windfall. It won’t cover a kitchen revamp or a solar system installation.

The average refund through early April was $2,851, according to the Internal Revenue Service. The California Franchise Board typically gave back about $850.

Almost any remodeling job requires more than a paltry $3,700. Even adding a deck can set you back more than $13,000, according to Remodeling’s online Cost Vs. Value report.

Still, that refund check could come in handy around the house.

It may not get you a makeover. But it can give you a marketing edge.

It can pay for modest home fixes to spruce up your property before you put it up for sale. Even if you’re staying put, it can turn a loathsome eyesore into eye candy. It can help you splurge on a trend.

Here are a few ways to improve – or indulge – on even a skimpy sum.

BRING THE BLING

The market is hot, home prices are up and interest rates are still low. Thinking of making a move?

“I would focus on increasing the ‘bling’ in the house to capture the attention of buyers,” said Ryan Lundquist, a Sacramento real estate appraiser.

He reeled off some smaller-ticket examples: New light fixtures, a few ceiling fans, an updated kitchen faucet, switch plates and some fresh paint in the living room. Even a new mailbox out front.

In all, you’ll be giving your home a more polished presentation, said Lundquist, who writes a lively blog to educate consumers about all things related to the housing market.

“In contrast, I could spend $3,700 on brand new insulation,” he said in an interview. “But focusing on what buyers can readily see instead is a better way to get higher offers.”

However, adding cosmetic improvements to make your home more appealing doesn’t mean it will eventually appraise for more, even if it may appear that way on reality TV.

“That’s not how the real world works,” Lundquist said.

TRENDING NOW

A stroll through HD Buttercup at the SoCo Collection in Costa Mesa revealed some items pronounced drool-worthy in House Beautiful’s 2017 home design forecast.

For one, you can embrace what the editors call hygge – pronounced hoo-ga – a trendy Danish concept that translates roughly to a cozy feeling, by purchasing one of the large, soft throws adorning sofas all over the sprawling store.

A white, furry-looking one for $125 would just take a nibble out of that tax refund.

That would leave plenty of money left over for furniture with nailhead accents, or something covered in what designers say is also popular these days: Benjamin Moore’s 2017 color of the year, Shadow. (Yeah, we had to ask, too. It’s a deep purple.)

Nearby at Pirch, a kitchen and bathroom showroom, we found a sleek, oversized kitchen faucet that would eat up the whole $3,700 refund – and then some.

But, as salesman Jon Brown (whose business card reads “Advisor, Lifestyle Experiences”) noted, “It’s a statement all by itself.”

The Gantry faucet, with an “articulated” spout (it moves a couple of different ways), goes for $3,895.

We also saw a Coyote grill priced at about $2,500 with exact spots designated for beef, chicken or vegetables.

In the bath section, shower heads in the shape of large water drops were grouped together. They cost $1,500 each, Brown said, and people typically like to buy them as a trio.

“It’s a piece of art,” he said. “Plus a functional fixture.”

SECURITY CHECK

You’ll probably never come anywhere near to affording the James Bond-like set-up at “The Fortress,” a seven bedroom house in the Hollywood Hills that recently wowed readers of The Wall Street Journal.

But do you really want to bother with a key fob for every room? And how often would you use a bulletproof plate that slides down from the ceiling?

You can put in a less intensive security system at your average castle for an affordable price.

PC Magazine’s Best Smart Home Security Systems of 2017 has an extensive round-up including a wide range of do-it-yourself products, professional services and reviews.

At home improvement stores like Home Depot, video doorbells, motion sensors and security cameras sell for just a few hundred dollars.

BOOST CURB APPEAL

Dean Zibas, like Lundquist, cites small fixes that can add up – especially outside your home.

“In general, it is typically best to just do an overall cosmetic improvement if one is looking for the best return,” said Zibas, a real estate appraiser based in San Clemente. “Put in some elbow grease. Buy some new plants at the local nursery or home improvement warehouse and spruce up the front landscaping.

“Most homes, I believe, can be repainted for less than $3,000, so perhaps get the house painted,” he said.

Install new window screens, and do minor repairs to the hardscape and planters yourself, Zibas added. And don’t stop at the curb.

“Carry that effort over to the side and rear yards,” he said.

If you think that’s too much DIY, or you won’t get enough of an ROI, there’s always another option.

You can do nothing.

Sock the money away. Add it to other savings to add a room someday or go full-on solar.

Over the years, tax refunds can add up. So can your home equity.

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O’Reilly forced Out at Fox News

Bill O’Reilly has been forced out of his position as a prime-time host on Fox News, the company said Wednesday, after the disclosure of multiple settlements involving sexual harassment allegations against him. His ouster brings an abrupt and embarrassing end to his two-decade reign as one of the most popular and influential commentators in television.

“After a thorough and careful review of the allegations, the company and Bill O’Reilly have agreed that Bill O’Reilly will not be returning to the Fox News Channel,” 21st Century Fox, Fox News’ parent company, said in a statement.

O’Reilly’s departure comes 2 1/2 weeks after an investigation by The New York Times revealed how Fox News and 21st Century Fox had repeatedly stood by O’Reilly even as sexual harassment allegations piled up against him. The Times found that the company and O’Reilly reached settlements with five women who had complained about sexual harassment or other inappropriate behavior by him. The agreements totaled about $13 million.

Since then, more than 50 advertisers had abandoned his show, and women’s rights groups called for his ouster. Inside the company, women expressed outrage and questioned whether top executives were serious about maintaining a culture based on “trust and respect,” as they had promised last summer when another sexual harassment scandal forced the ouster of Fox News’ chairman, Roger Ailes.

That put pressure on 21st Century Fox and the Murdoch family that controlled it. After the dismissal of Ailes, the company struck two settlements involving sexual harassment complaints against O’Reilly and also extended his contract, even as it was aware of the complaints about his behavior.

Last week, the Murdochs enlisted the law firm Paul, Weiss, Rifkind, Wharton & Garrison to conduct an investigation into O’Reilly’s behavior after one woman, who had detailed her allegations against O’Reilly to The Times, called the company’s hotline to report her complaints. Another complaint was reported Tuesday, according to the lawyer who represents the woman making the allegations.

O’Reilly has denied the allegations against him.

O’Reilly, 67, has been an anchor at Fox News since he started at the network in 1996. He was the top-rated host in cable news, serving up defiant commentary every weekday at 8 p.m., with a message that celebrated patriotism and expressed scorn for political correctness. His departure is a significant blow to Fox News’ prime-time lineup, which in January lost another star, Megyn Kelly, from a lineup that dominated the prime-time cable news ratings.

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Irvine Company buys 19-building Alton Plaza

  • Irvine Company has bought the 19-building Alton Plaza in Irvine Spectrum. The company plans to revitalize the 216,000-square-foot campus on Alton Parkway near the Irvine train station. (Courtesy of Irvine Co.)

    Irvine Company has bought the 19-building Alton Plaza in Irvine Spectrum. The company plans to revitalize the 216,000-square-foot campus on Alton Parkway near the Irvine train station. (Courtesy of Irvine Co.)

  • Brandywine Homes has closed escrow on 1.66 acres at 8572 Stanton Avenue in Buena Park and will break ground in May on Corsica, a new community offering 17 two-story townhomes. (Courtesy of Brandywine Homes)

    Brandywine Homes has closed escrow on 1.66 acres at 8572 Stanton Avenue in Buena Park and will break ground in May on Corsica, a new community offering 17 two-story townhomes. (Courtesy of Brandywine Homes)

  • Rancho Santa Margarita-based Cypress West Partners has hired Casey Immel as director of leasing.

    Rancho Santa Margarita-based Cypress West Partners has hired Casey Immel as director of leasing.

  • Rancho Santa Margarita-based Cypress West Partners has added Ryan Borzouei as director of asset management.

    Rancho Santa Margarita-based Cypress West Partners has added Ryan Borzouei as director of asset management.

  • Chris Tindall has been appointed associate and director of mechanical, electrical and plumbing engineering at LPA Inc. in Irvine. In his role, Tindall will be responsible for overseeing the financial and operational aspects of the MEP engineering group and provide technical leadership for integrating appropriate and sustainable engineering systems into projects.

    Chris Tindall has been appointed associate and director of mechanical, electrical and plumbing engineering at LPA Inc. in Irvine. In his role, Tindall will be responsible for overseeing the financial and operational aspects of the MEP engineering group and provide technical leadership for integrating appropriate and sustainable engineering systems into projects.

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Irvine Company has bought the 19-building Alton Plaza in Irvine Spectrum. Terms of the deal were not disclosed.

The company in a statement said it plans to revitalize the 216,000-square-foot campus on Alton Parkway near the Irvine train station. When completed, roughly 700 employees from 25 companies will have access to indoor and outdoor workspaces “designed to foster innovation and collaboration,” Irvine Co. wrote.

The real estate company also reports that its “NextGen” campus at Sand Canyon Business Center, and the 21-story 200 Spectrum Center, which opened last year, are nearly fully leased. The company’s twin 21-story building — 400 Spectrum Center — will be completed this summer.

Alton Plaza, the landlord reports, is 95 percent leased to technology, medical device, R&D, real estate and engineering companies.

Buena Park homes

Irvine-based homebuilder Brandywine has secured nearly 2 acres in Buena Park for its next development, Corsica. The new community will include 17 townhomes on 1.66 acres at 8572 Stanton Ave. It will break ground in May and vertical construction is expected to begin this summer, the company said in a statement. Corsica is scheduled to open for sale in the fall.

The homes, roughly 1,842- to 2,100-square-foot Mediterranean-style townhomes, will include energy-efficient tankless water heaters, recessed lighting, double-strength glass windows, and state-of-the-art communication and networking systems.

Corsica is near Knott’s Berry Farm, the Buena Park downtown shopping district, Ralph B. Clark Regional Park and major employers including Prologis, Leach and Access Business Group.

On the Move

Chris Tindall has been appointed associate and director of mechanical, electrical and plumbing engineering at LPA Inc. in Irvine. In his role, Tindall will be responsible for overseeing the financial and operational aspects of the MEP engineering group and provide technical leadership for integrating appropriate and sustainable engineering systems into projects.

Rancho Santa Margarita-based Cypress West Partners has added Ryan Borzouei as director of asset management and acquisitions and Casey Immel as director of leasing. Previously, Borzouei was a vice president with Bank of America. Immel has spent the last 10 years focused exclusively on healthcare tenant representation, leasing, marketing, sales and site selection during his prior role as vice president with CBRE.

The real estate briefs are compiled by contributing writer Karen Levin and edited by Samantha Gowen, business editor at the Register. Send related items to sgowen@scng.com. Allow one week for publication. High-resolution photos also can be submitted.

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Commercial real estate: A new lease is signed – now what?

You, on behalf of your manufacturing or distribution company just signed a commercial real estate lease for a new location. Congratulations!

Many believe the deal is now done (including many in my profession), we can move-in, cue the band, alert the media – and let’s get the party started. Hmmm, not so fast. There is a multitude of issues still to address, some seen and some unseen and not the least of which is the physical move!

The list below is intended to be a list of issues to consider as opposed to an “end all, be all” moving checklist – which if I published would make your eyes bleed.

Inspection of the building

Normally, this step is accomplished prior to signing the lease, in case there are latent issues that the landlord should handle before occupancy. In the off chance this was not done, you may still be OK as the lease that you signed should contain a provision for an inspection to be conducted within the first 30 days, post-lease signing.

Generally, the owner must fix anything that is broken. Americans with Disabilities Act upgrades are typically an exception to the owner’s responsibility.

I would recommend you engage someone to do two things – inspect ALL of the systems within the building – fire system,* truck doors, plumbing, electrical, roof, HVAC, etc., and prepare a report including images of the condition of the building pre-move in. You will be able to use the report when you move out of the building to recall this condition.

*Take a look at the most recent fire sprinkler certification and make sure that is up to date. If not, request that this be done.

Warranties on the building systems

I will assume your lease provides a mechanism for the owner of the building to make things right if any repairs to the systems (mentioned above) are needed. In Southern California, assuming you signed an AIR lease, this warranty is 30 days for non-HVAC items and six months for heating, ventilating and air conditioning. Use the report I recommended that you create and place the owner on notice to accomplish whatever repairs are needed.

Permits and licenses

Once again, I will assume that the necessary permits and licenses were obtained before the lease execution – or at least some serious due diligence was accomplished on what was needed. If not, shame on someone! Please don’t just move

Please don’t just move into a building without talking about your use with the city to make sure the zoning is correct for the use, no special permitting is needed for high pile storage, storage rack permitting (in SoCal seismic testing is needed for new rack installs). You also should consider machinery that will be moved and any UL rating that may be needed.

The physical moveI would highly recommend that you engage a moving and storage company familiar with moving your operation. Some careful vetting and planning here can save you time and aggravation.

I would highly recommend that you engage a moving and storage company familiar with moving your operation. Some careful vetting and planning here can save you time and aggravation.

Lease administrationMost in my profession will prepare a lease abstract of the key dates of options to renew, options to purchase, rent amounts and rent increases. I would suggest making two copies of your lease and place one in your top desk drawer or in an easily accessed digital file for ease of reference and the other with your payable department. Make sure the lease is signed by all parties – sounds silly but I’ve encountered many situations where the occupant is never given a fully executed lease copy. Also, make sure you know where to send your rent check and whether your new owner prefers direct deposit vs. mailing a check.

Make sure the lease is signed by all parties – sounds silly but I’ve encountered many situations where the occupant is never given a fully executed lease copy. Also, make sure you know where to send your rent check and whether your new owner prefers direct deposit vs. mailing a check.

Most in my profession will prepare a lease abstract of the key dates of options to renew, options to purchase, rent amounts and rent increases. I would suggest making two copies of your lease and place one in your top desk drawer or in an easily accessed digital file for ease of reference and the other with your payable department.

Make sure the lease is signed by all parties – sounds silly but I’ve encountered many situations where the occupant is never given a fully executed lease copy. Also, make sure you know where to send your rent check and whether your new owner prefers direct deposit vs. mailing a check.

Also, make sure you know where to send your rent check and whether your new owner prefers direct deposit vs. mailing a check.

The transition

Where practical, I recommend having a face to face meeting with the owner. Chances are, your negotiations were conducted through commercial real estate brokers or attorneys and you
Where practical, I recommend having a face to face meeting with the owner. Chances are, your negotiations were conducted through commercial real estate brokers or attorneys and you have never met the owner.

Make sure you exchange name, address, and contact information – email and mobile phone. Who will tell your customers and suppliers that you moved? How will you deal with plant shutdowns and production interruptions? When and how will you tell your employees that you are moving?

Planning your next move. Wait a minute – I JUST MOVED! Precisely. There is no better time to reflect on the move, what you will do at lease expiration, what went well – what didn’t go well, etc.

Allen C. Buchanan is a principal and commercial real estate broker with Lee & Associates, Orange. He can be reached at 714.564.7104 or abuchanan@lee-associates.com. His website is allencbuchanan.com.

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