Hospitality operators and industry observers have attempted to quell the rising panic over the credit crunch by insisting that there is still money to be made, despite uncertainty over consumer spending.
Companies such as Clapham House, Regent Inns, The Restaurant Group and Greene King have been all hit by the credit crunch, prompting fears that leisure spending across the board is set to slump.
But not everyone is suffering, with some operators taking advantage of their size. Stuart Hawthorn, co-founder of Heartstone Inns, an operator based in the South-west with four pubs in its portfolio, revealed that trading during December had been "reasonable" while January had been "really strong".
"We do not feel we are suffering the effects of the worsening economic climate," Hawthorn said.
"The main effect has been on planning. We have revised our budgets downwards as we want to have sensible, accessible prices for our customers. It is easier to bob and weave when you have four pubs not 4,000. You can make changes very quickly."
And it's not just the smaller operators that are still feeling confident. Graham Turner, chief executive of Café Rouge owner Tragus, said that his expansion plans were still on track for 2008. "It is tougher out there - there is definitely tightening of belts. But we are not in a situation like the late 1980s or early 1990s," he said. "We're still planning to open 30 outlets this year and 25 the next. The demand is still there for new sites, so the economy cannot be that bad."
Robert Barnard, partner at hotel consultancy PKF, agreed that the market was definitely not in early-1990s territory. "If you compare that with today, even if there are little nudges of inflation, we are in fact in very benign economic conditions," he said. "Yes there is the credit crunch, but that cannot last forever."
http://www.caterersearch.com/
Friday, February 15, 2008
Make money from your mistakes
It is possible to profit from your mistakes. Let me tell you a little true story.
“ Once upon a time, one Saturday morning my (then) hosting company accidentally deleted one of my reseller accounts and failed to get the hosting back on-line for 2 and a half days, (the hows and whys of it are not for this post).
As you can imagine, my clients were furious. Even though it was not my error — I was responsible for it. So, once everything was back up and running, what did I do? Did I give them an imaginative excuse, using lots of acronyms and blaming everyone else? No. I sent all the affected clients a personalised email. Apologising and explaining what had happened and what I was doing to prevent it happening again. I sent this email to everyone, even to the clients who had not noticed the outage.
The response to that email was actually incredibly positive:
“Thanks for letting us know”
“I appreciate your honesty”
“Oh, by the way I need “X” doing, can you send me a quote.”
And business continued on happily after…
THE END ”
The moral of the story?
Now, whilst it is not the most exciting story, there is a moral: and no, it isn’t that you should disable your client’s hosting in order to get more sales. It is by being honest and upfront about your mistakes is not necessarily a bad thing; you can earn client respect, trust and sometimes even a little cash.
Have you ever profited from your mistakes? and if so how?
http://www.sitepoint.com/
“ Once upon a time, one Saturday morning my (then) hosting company accidentally deleted one of my reseller accounts and failed to get the hosting back on-line for 2 and a half days, (the hows and whys of it are not for this post).
As you can imagine, my clients were furious. Even though it was not my error — I was responsible for it. So, once everything was back up and running, what did I do? Did I give them an imaginative excuse, using lots of acronyms and blaming everyone else? No. I sent all the affected clients a personalised email. Apologising and explaining what had happened and what I was doing to prevent it happening again. I sent this email to everyone, even to the clients who had not noticed the outage.
The response to that email was actually incredibly positive:
“Thanks for letting us know”
“I appreciate your honesty”
“Oh, by the way I need “X” doing, can you send me a quote.”
And business continued on happily after…
THE END ”
The moral of the story?
Now, whilst it is not the most exciting story, there is a moral: and no, it isn’t that you should disable your client’s hosting in order to get more sales. It is by being honest and upfront about your mistakes is not necessarily a bad thing; you can earn client respect, trust and sometimes even a little cash.
Have you ever profited from your mistakes? and if so how?
http://www.sitepoint.com/
Saturday, December 29, 2007
The short way to make money as share prices fall
Selling something you don't own may seem perverse, but short-selling has become increasingly common as fund managers seek to fully exploit their ability to forecast stock returns.
The concept is quite simple. The short-seller borrows shares in the expectation of selling high and buying low. If a short-seller borrows shares at 100p per share and the price falls to 90p per share, he or she can buy shares at 90p to replace the borrowed shares and keep the 10p per share as profit. Of course, if the price goes up to 110p, the short-seller must buy the shares back at a loss of 10p a share.
While ordinary investors are unlikely to do much short-selling, alternative investment vehicles such as single-stock futures and spread betting do permit smaller retail investors to try their hand. More commonly, though, the technique is the province of experienced fund managers who use it only for certain funds.
In the context of fund management, short-selling is all about stock picking. The manager is able to act on the view that a particular stock or security is overpriced or likely to underperform. If the manager has a strong negative view of a stock, short-selling enables that view to be expressed much more effectively than holding less of the stock relative to the fund's benchmark (under-weighting), or not holding it at all (zero-weighting).
There are other reasons for short-selling. One is to take advantage of perceived pricing differences between different stocks. A manager could take contrary positions in two companies whose share prices are closely related to each other: a long (buying) position in one and a short position in the other. Over time these positions would gradually be reversed (or 'unwound'), with profits earned by the price movements of the positions – assuming, of course, they move in the way the manager expects.
So-called short-sellers saw average gains of 7% in November while the FTSE 100 lost about 4.3%.
Two types of investment fund can make use of a short view. One is absolute-return funds, which look to produce a positive return regardless of market conditions. The strategies for these funds can be quite complex and often rely on sophisticated financial instruments in addition to short-selling.
The other type is the short-extension fund, which is usually benchmarked against a stock market index. Short-extension funds facilitate a limited amount of short-selling, with the short-sold shares balanced by an equal proportion of shares in other companies. In this way, the portfolio remains 100% exposed to the stock market.
One of the more popular examples of a short-extension fund is the 130/30 fund. Here, the fund manager may either invest 100% of the investment capital in long positions and add to it by short-selling an additional 30% (a "bolt-on" approach) or invest the portfolio as one entity, 130% long and 30% short (an "integrated" approach).
The higher the degree of shorting, the more opportunities the manager has to deploy his or her stock-picking acumen. But this can also increase risk, which may not be suitable for more cautious investors.
There are alternative means of gaining the benefits associated with short-selling. For instance, a series of
derivatives instruments can be tantamount to short-selling. These include single-stock futures (an agreement to buy or sell an asset at a specified price and time), single-stock put options (the right, though not the obligation, to buy or sell an asset at a specified price and time), swaps (an exchange of one series of cash flows for another), Contracts For Difference (a cash-settled agreement or contract between two parties) and forward currency contracts (an agreement between two parties to buy or sell a currency at a pre-agreed future point).
The increased risk associated with short-selling means that managers need to have proven stock-picking skills to identify appropriate short-selling opportunities – which, of course, underlines the need for rigorous, careful analysis.
http://scotlandonsunday.scotsman.com/business/The-short-way-to-make.3616145.jp
The concept is quite simple. The short-seller borrows shares in the expectation of selling high and buying low. If a short-seller borrows shares at 100p per share and the price falls to 90p per share, he or she can buy shares at 90p to replace the borrowed shares and keep the 10p per share as profit. Of course, if the price goes up to 110p, the short-seller must buy the shares back at a loss of 10p a share.
While ordinary investors are unlikely to do much short-selling, alternative investment vehicles such as single-stock futures and spread betting do permit smaller retail investors to try their hand. More commonly, though, the technique is the province of experienced fund managers who use it only for certain funds.
In the context of fund management, short-selling is all about stock picking. The manager is able to act on the view that a particular stock or security is overpriced or likely to underperform. If the manager has a strong negative view of a stock, short-selling enables that view to be expressed much more effectively than holding less of the stock relative to the fund's benchmark (under-weighting), or not holding it at all (zero-weighting).
There are other reasons for short-selling. One is to take advantage of perceived pricing differences between different stocks. A manager could take contrary positions in two companies whose share prices are closely related to each other: a long (buying) position in one and a short position in the other. Over time these positions would gradually be reversed (or 'unwound'), with profits earned by the price movements of the positions – assuming, of course, they move in the way the manager expects.
So-called short-sellers saw average gains of 7% in November while the FTSE 100 lost about 4.3%.
Two types of investment fund can make use of a short view. One is absolute-return funds, which look to produce a positive return regardless of market conditions. The strategies for these funds can be quite complex and often rely on sophisticated financial instruments in addition to short-selling.
The other type is the short-extension fund, which is usually benchmarked against a stock market index. Short-extension funds facilitate a limited amount of short-selling, with the short-sold shares balanced by an equal proportion of shares in other companies. In this way, the portfolio remains 100% exposed to the stock market.
One of the more popular examples of a short-extension fund is the 130/30 fund. Here, the fund manager may either invest 100% of the investment capital in long positions and add to it by short-selling an additional 30% (a "bolt-on" approach) or invest the portfolio as one entity, 130% long and 30% short (an "integrated" approach).
The higher the degree of shorting, the more opportunities the manager has to deploy his or her stock-picking acumen. But this can also increase risk, which may not be suitable for more cautious investors.
There are alternative means of gaining the benefits associated with short-selling. For instance, a series of
derivatives instruments can be tantamount to short-selling. These include single-stock futures (an agreement to buy or sell an asset at a specified price and time), single-stock put options (the right, though not the obligation, to buy or sell an asset at a specified price and time), swaps (an exchange of one series of cash flows for another), Contracts For Difference (a cash-settled agreement or contract between two parties) and forward currency contracts (an agreement between two parties to buy or sell a currency at a pre-agreed future point).
The increased risk associated with short-selling means that managers need to have proven stock-picking skills to identify appropriate short-selling opportunities – which, of course, underlines the need for rigorous, careful analysis.
http://scotlandonsunday.scotsman.com/business/The-short-way-to-make.3616145.jp
Directors make money by buying close to home
FOR as long as I remember, one of the big unanswered questions in stockmarket investing has been whether directors of listed companies who buy their own shares do better than the rest of us.
Deductively, you'd have to say they must do well. After all, they are the insiders.
Now we've got an answer. Keith Nielsen operates a website called www.theinsidetrader.com.au and for years he's been tracking directors' trades. Recently, he had the sense to spend money on research to examine the area.
After monitoring 6000 trades over the past four years, the results are out - and they are compelling. Six times out of 10, when directors buy their own stock, they make money - and on average those returns are double the market return for the year.
The smaller the company, the more likely the directors are to make huge returns. Again, it makes sense, because in small companies the directors can have a thorough understanding of operations. We're not talking about inside trading: this is all above-board, "on market" activity common in every listed company.
Nielsen focuses exclusively on situations in which directors actually spent cash buying shares. He ignores all the other variations by which directors pick up shares, such as stock options and share plans. In other words, he only includes trades where the directors put their hand in their wallets.
And sometimes, when people win, they win big. The largest gain made over the past four years was, ahem, 49,976% made by John Borshoff, of the uranium miner Paladin Energy. He bought 633,330 shares for 1.3 cents each. When the report was signed off for the 12 months to September this year, Paladin shares were $6.77 and Borshoff's $8229 had turned into $4.2 million.
Of course, not every director makes money on every trade. When directors lose, they lose on average 34%.
But mostly they make money. One of the best directors' dealings I have seen reported this year came last Monday, when James Hodgkinson - a director of property trust Goodman and an executive director of Macquarie Bank - put a buy order into the market for Goodman. (This was the day Goodman's rival, property trust Centro, collapsed.) Hodgkinson put down half a million dollars worth of Goodman stock at $4.37; they closed for the weekend at $4.90.
http://business.theage.com.au/directors-make-money-by-buying-close-to-home/20071222-1imw.html
Deductively, you'd have to say they must do well. After all, they are the insiders.
Now we've got an answer. Keith Nielsen operates a website called www.theinsidetrader.com.au and for years he's been tracking directors' trades. Recently, he had the sense to spend money on research to examine the area.
After monitoring 6000 trades over the past four years, the results are out - and they are compelling. Six times out of 10, when directors buy their own stock, they make money - and on average those returns are double the market return for the year.
The smaller the company, the more likely the directors are to make huge returns. Again, it makes sense, because in small companies the directors can have a thorough understanding of operations. We're not talking about inside trading: this is all above-board, "on market" activity common in every listed company.
Nielsen focuses exclusively on situations in which directors actually spent cash buying shares. He ignores all the other variations by which directors pick up shares, such as stock options and share plans. In other words, he only includes trades where the directors put their hand in their wallets.
And sometimes, when people win, they win big. The largest gain made over the past four years was, ahem, 49,976% made by John Borshoff, of the uranium miner Paladin Energy. He bought 633,330 shares for 1.3 cents each. When the report was signed off for the 12 months to September this year, Paladin shares were $6.77 and Borshoff's $8229 had turned into $4.2 million.
Of course, not every director makes money on every trade. When directors lose, they lose on average 34%.
But mostly they make money. One of the best directors' dealings I have seen reported this year came last Monday, when James Hodgkinson - a director of property trust Goodman and an executive director of Macquarie Bank - put a buy order into the market for Goodman. (This was the day Goodman's rival, property trust Centro, collapsed.) Hodgkinson put down half a million dollars worth of Goodman stock at $4.37; they closed for the weekend at $4.90.
http://business.theage.com.au/directors-make-money-by-buying-close-to-home/20071222-1imw.html
Small savings can make you money
After being relegated to the sidelines in the last few years, small savings schemes are now staging a comeback of sorts. Several changes have been incorporated in recent times, to enhance the attractiveness of small savings schemes.
For example, the Post Office Monthly Income Scheme (POMIS) ranks as a popular scheme that offers assured returns (at 8% per annum) on a monthly basis. This makes the scheme apt for investors seeking regular income.
Not too long ago, the investment limits for POMIS were hiked from Rs 300,000 (for a single account) and Rs 600,000 (for a joint account) to Rs 450,000 and Rs 900,000 respectively. This augured well for investors like senior citizens and retirees who afford importance to regular income.
A press release issued by the ministry of finance earlier this month, mentioned that the bonus on investments in POMIS has been restored (albeit partly). To begin with, the scheme offered a 10% (of initial amount invested) maturity bonus; however, the same was discontinued.
As per the press release, investments in POMIS made on and after December 8, 2007, are eligible for a 5% maturity bonus. And there's more in store.
* Small Savings Schemes: An overview
The gamut of investment avenues eligible for tax benefits under Section 80C stands widened. The press release also mentions that with a retrospective effect (from April 1, 2007), investments in the Senior Citizens Savings Scheme (SCSS) and 5-Yr Post Office Time Deposits are eligible for tax benefits under Section 80C of the Income Tax Act. Clearly, the changes have provided the small savings segment a much-needed shot in the arm.
What should investors do?
At Personalfn, we have always maintained that while investing, not losing sight of one's risk profile is imperative. The aforementioned changes will go a long way in helping risk-averse investors adhere to their risk profile while investing.
Risk-averse investors often grudge the lack of adequate suitable investment opportunities; then there is the need for regular and assured income which has to be addressed. With the enhanced investment limits in POMIS, this issue has been dealt with to some extent. Senior citizens and retirees can now invest up to Rs 1,950,000 in the SCSS and POMIS, and earn a (taxable) income of up to Rs 171,000 per annum to meet their liquidity needs.
The tax benefits on SCSS and the restored maturity bonus on POMIS will make the investments more attractive.
From a tax-planning perspective, the risk-averse investor now has more to choose from. Earlier, Public Provident Fund, National Savings Certificate, infrastructure bonds and tax-saving fixed deposits from banks were the available avenues. 5-Yr Post Office Time Deposits and SCSS (albeit the scheme isn't open for investors across the board) are new additions.
With more attractive and a wider range of offerings to choose from, the onus to make the right choice now lies with investors.
http://inhome.rediff.com/money/2007/dec/28perfin.htm
For example, the Post Office Monthly Income Scheme (POMIS) ranks as a popular scheme that offers assured returns (at 8% per annum) on a monthly basis. This makes the scheme apt for investors seeking regular income.
Not too long ago, the investment limits for POMIS were hiked from Rs 300,000 (for a single account) and Rs 600,000 (for a joint account) to Rs 450,000 and Rs 900,000 respectively. This augured well for investors like senior citizens and retirees who afford importance to regular income.
A press release issued by the ministry of finance earlier this month, mentioned that the bonus on investments in POMIS has been restored (albeit partly). To begin with, the scheme offered a 10% (of initial amount invested) maturity bonus; however, the same was discontinued.
As per the press release, investments in POMIS made on and after December 8, 2007, are eligible for a 5% maturity bonus. And there's more in store.
* Small Savings Schemes: An overview
The gamut of investment avenues eligible for tax benefits under Section 80C stands widened. The press release also mentions that with a retrospective effect (from April 1, 2007), investments in the Senior Citizens Savings Scheme (SCSS) and 5-Yr Post Office Time Deposits are eligible for tax benefits under Section 80C of the Income Tax Act. Clearly, the changes have provided the small savings segment a much-needed shot in the arm.
What should investors do?
At Personalfn, we have always maintained that while investing, not losing sight of one's risk profile is imperative. The aforementioned changes will go a long way in helping risk-averse investors adhere to their risk profile while investing.
Risk-averse investors often grudge the lack of adequate suitable investment opportunities; then there is the need for regular and assured income which has to be addressed. With the enhanced investment limits in POMIS, this issue has been dealt with to some extent. Senior citizens and retirees can now invest up to Rs 1,950,000 in the SCSS and POMIS, and earn a (taxable) income of up to Rs 171,000 per annum to meet their liquidity needs.
The tax benefits on SCSS and the restored maturity bonus on POMIS will make the investments more attractive.
From a tax-planning perspective, the risk-averse investor now has more to choose from. Earlier, Public Provident Fund, National Savings Certificate, infrastructure bonds and tax-saving fixed deposits from banks were the available avenues. 5-Yr Post Office Time Deposits and SCSS (albeit the scheme isn't open for investors across the board) are new additions.
With more attractive and a wider range of offerings to choose from, the onus to make the right choice now lies with investors.
http://inhome.rediff.com/money/2007/dec/28perfin.htm
How to Become a Billionaire
Each year, Forbes releases its list of the 400 richest Americans. The list was particularly notable in 2006, because you had to be at least a billionaire to be included.
As you might expect, a significant number of the folks on the list made their fortunes by investing. That subset includes Warren Buffett (worth $46 billion), Carl Icahn (worth $9.7 billion), and Jim Simons (worth $4 billion).
So here's important lesson No. 1: You can make a lot of money if you learn to manage your portfolio like a pro.
Easier said than done ...
Of course, that collection of billionaire investors offers no clue regarding what strategy is most likely to make you a billionaire. Warren Buffett is a dyed-in-the-wool value investor. That strategy has helped him achieve annual returns greater than 20% for more than 40 years on the back of investments in boring companies with competitive advantages at value prices such as Geico and Washington Post. That investment tack continues in his company's portfolio today, with Tyco (NYSE: TYC), Costco (Nasdaq: COST), and CarMax (NYSE: KMX) among the company's current holdings.
Jim Simons, though, can point to 34% annualized returns at his Medallion fund since 1982, net of what are believed to be some incredibly stiff fees. He favors a mechanical strategy based on computer models that are constantly refined by an army of Ph.D.s.
So while there is no best strategy, important lesson No. 2 is obvious: You gotta dance with the one that brung ya.
Say what?
Colloquialisms aside, all of these investors are astoundingly successful because they've figured out how they make money best, stuck with their strategy in good times and bad, and refined their best practices over time.
Buffett was mocked during the technology bubble when companies that he avoided and professed not to understand as well as others -- companies such as eBay -- were zooming to the moon. But they've come back to earth, and Buffett's still doing just fine today.
Icahn has a reputation as a corporate raider; he's made a lot of money instituting changes at underperforming companies. Although Icahn's recent efforts at Lear (NYSE: LEA) and Biogen Idec (Nasdaq: BIIB) did not end well, don't expect him to go soft. He's worth $10 billion. Why mess with success?
And Simons doesn't try to analyze businesses as Buffett does, because that's not where his expertise lies.
Mimic the masters
The secret to successful investing, then, is not found in any single strategy, but rather in picking the strategy that's right for you and executing it faithfully. As lauded NYU finance professor Aswath Damodaran writes in his book Investment Fables, "Each strategy has the potential for success if it matches your risk preferences and time horizon and if you are careful about how you use it."
That's it. That's the secret. Because if you get too cute -- chasing hot sectors, buying high and selling low, and giving yourself only six months or less to master a given investment strategy -- you're simply setting yourself up for failure.
http://www.fool.com/investing/small-cap/2007/12/29/how-to-become-a-billionaire.aspx
As you might expect, a significant number of the folks on the list made their fortunes by investing. That subset includes Warren Buffett (worth $46 billion), Carl Icahn (worth $9.7 billion), and Jim Simons (worth $4 billion).
So here's important lesson No. 1: You can make a lot of money if you learn to manage your portfolio like a pro.
Easier said than done ...
Of course, that collection of billionaire investors offers no clue regarding what strategy is most likely to make you a billionaire. Warren Buffett is a dyed-in-the-wool value investor. That strategy has helped him achieve annual returns greater than 20% for more than 40 years on the back of investments in boring companies with competitive advantages at value prices such as Geico and Washington Post. That investment tack continues in his company's portfolio today, with Tyco (NYSE: TYC), Costco (Nasdaq: COST), and CarMax (NYSE: KMX) among the company's current holdings.
Jim Simons, though, can point to 34% annualized returns at his Medallion fund since 1982, net of what are believed to be some incredibly stiff fees. He favors a mechanical strategy based on computer models that are constantly refined by an army of Ph.D.s.
So while there is no best strategy, important lesson No. 2 is obvious: You gotta dance with the one that brung ya.
Say what?
Colloquialisms aside, all of these investors are astoundingly successful because they've figured out how they make money best, stuck with their strategy in good times and bad, and refined their best practices over time.
Buffett was mocked during the technology bubble when companies that he avoided and professed not to understand as well as others -- companies such as eBay -- were zooming to the moon. But they've come back to earth, and Buffett's still doing just fine today.
Icahn has a reputation as a corporate raider; he's made a lot of money instituting changes at underperforming companies. Although Icahn's recent efforts at Lear (NYSE: LEA) and Biogen Idec (Nasdaq: BIIB) did not end well, don't expect him to go soft. He's worth $10 billion. Why mess with success?
And Simons doesn't try to analyze businesses as Buffett does, because that's not where his expertise lies.
Mimic the masters
The secret to successful investing, then, is not found in any single strategy, but rather in picking the strategy that's right for you and executing it faithfully. As lauded NYU finance professor Aswath Damodaran writes in his book Investment Fables, "Each strategy has the potential for success if it matches your risk preferences and time horizon and if you are careful about how you use it."
That's it. That's the secret. Because if you get too cute -- chasing hot sectors, buying high and selling low, and giving yourself only six months or less to master a given investment strategy -- you're simply setting yourself up for failure.
http://www.fool.com/investing/small-cap/2007/12/29/how-to-become-a-billionaire.aspx
Detroit Considers Sale of City’s Small Parks
Save for a rusty, seatless swing set, the Brinket-Hibbard Playlot resembles many vacant lots pockmarking Detroit’s hardscrabble east side.
Looking across Hibbard Street at what is left of her childhood park, Patricia Scott, whose family lives in the only home remaining on the block, recalled better days.
“There were nine of us kids, and I can remember how we used to have fun over there, when there was a sandbox and some hobbyhorses, and I think a seesaw,” said Ms. Scott, 56. “The way it is now, I think it’s pitiful.”
Detroit’s own assessment of the park is similarly grim, according to a recent report, which said, “Except for an old swing set frame, this appears to be another vacant lot in a neighborhood of many vacant lots.”
Now, some city officials are wondering, Would you like to buy it?
The Brinket-Hibbard playground is one of about 90 municipal parks — mostly small play spaces — that the city of Detroit is considering putting up for sale under a contentious proposal that seeks to condense and consolidate park space and resources in thriving areas. The city would use the money earned from any sales to maintain and possibly expand parks in parts of the city that are more densely populated than, say, areas like the one around Hibbard Street.
The Recreation Department’s master plan calls the proposal “park repositioning,” which officials promote as a clear-eyed way to look at necessary downsizing, a way to align park space with the significant demographic shifts over the last half-century in Detroit, which has lost about a million people since 1950.
But critics say it could further hurt downtrodden areas where parks are equally appreciated, and that green space is too precious to be bartered for money.
“They call some of these parks ‘surplus,’” said City Councilwoman JoAnn Watson, an opponent of the plan, “but I don’t know what the heck that means because there is no such thing as a surplus of something that is necessary for the good and welfare of the community. The very concept of selling off public parkland in somebody’s hope to address a one-time money crunch is not something you do as a big city. We have to protect these parks for future generations.”
Some proponents of the parks say that eliminating a park in a declining neighborhood would make a resurgence much harder.
“It could be a case of penny wise, pound foolish,” said Abe Kadushin of Kadushin Associates, an architecture firm that does a lot of work in Detroit. “I understand the need to make money, if it’s an asset that’s valuable and the city can dispose of it. But it may not be the wisest thing in the long run.”
The proposal seems to have stalled in the City Council’s Neighborhood and Community Services Committee, whose chairwoman is Ms. Watson. But the administration of Mayor Kwame M. Kilpatrick plans to pursue it, possibly along with other options like neighborhood or corporate sponsorships. Though with more than 300 parks — 40 percent of which are in poor condition — sales to developers or other for-profit entities could be most beneficial.
If private buyers emerge for most of the parks in question, the city estimates it can raise $8.1 million from selling the land (about 124 acres) and more than $5 million a year in tax revenue, while saving hundreds of thousands of dollars on maintenance.
“It’s an opportunity to look at where we can put parks closer to people,” said James Canning, a city spokesman. “We’ve constantly looked for ways to make government more efficient, and we see this whole idea of possibly repositioning parks as promoting an increased quality of life for those living in our neighborhoods.”
Some experts say the idea makes sense. While many cities and states are preoccupied by figuring out how to grow, several, like Detroit and New Orleans, are grappling with how to shrink, an alternative that is rarely pleasant. Recently, a melee erupted when the New Orleans City Council voted to demolish four public housing projects (to be replaced by fewer units for poor people).
http://www.nytimes.com/2007/12/29/us/29parks.html?hp
Looking across Hibbard Street at what is left of her childhood park, Patricia Scott, whose family lives in the only home remaining on the block, recalled better days.
“There were nine of us kids, and I can remember how we used to have fun over there, when there was a sandbox and some hobbyhorses, and I think a seesaw,” said Ms. Scott, 56. “The way it is now, I think it’s pitiful.”
Detroit’s own assessment of the park is similarly grim, according to a recent report, which said, “Except for an old swing set frame, this appears to be another vacant lot in a neighborhood of many vacant lots.”
Now, some city officials are wondering, Would you like to buy it?
The Brinket-Hibbard playground is one of about 90 municipal parks — mostly small play spaces — that the city of Detroit is considering putting up for sale under a contentious proposal that seeks to condense and consolidate park space and resources in thriving areas. The city would use the money earned from any sales to maintain and possibly expand parks in parts of the city that are more densely populated than, say, areas like the one around Hibbard Street.
The Recreation Department’s master plan calls the proposal “park repositioning,” which officials promote as a clear-eyed way to look at necessary downsizing, a way to align park space with the significant demographic shifts over the last half-century in Detroit, which has lost about a million people since 1950.
But critics say it could further hurt downtrodden areas where parks are equally appreciated, and that green space is too precious to be bartered for money.
“They call some of these parks ‘surplus,’” said City Councilwoman JoAnn Watson, an opponent of the plan, “but I don’t know what the heck that means because there is no such thing as a surplus of something that is necessary for the good and welfare of the community. The very concept of selling off public parkland in somebody’s hope to address a one-time money crunch is not something you do as a big city. We have to protect these parks for future generations.”
Some proponents of the parks say that eliminating a park in a declining neighborhood would make a resurgence much harder.
“It could be a case of penny wise, pound foolish,” said Abe Kadushin of Kadushin Associates, an architecture firm that does a lot of work in Detroit. “I understand the need to make money, if it’s an asset that’s valuable and the city can dispose of it. But it may not be the wisest thing in the long run.”
The proposal seems to have stalled in the City Council’s Neighborhood and Community Services Committee, whose chairwoman is Ms. Watson. But the administration of Mayor Kwame M. Kilpatrick plans to pursue it, possibly along with other options like neighborhood or corporate sponsorships. Though with more than 300 parks — 40 percent of which are in poor condition — sales to developers or other for-profit entities could be most beneficial.
If private buyers emerge for most of the parks in question, the city estimates it can raise $8.1 million from selling the land (about 124 acres) and more than $5 million a year in tax revenue, while saving hundreds of thousands of dollars on maintenance.
“It’s an opportunity to look at where we can put parks closer to people,” said James Canning, a city spokesman. “We’ve constantly looked for ways to make government more efficient, and we see this whole idea of possibly repositioning parks as promoting an increased quality of life for those living in our neighborhoods.”
Some experts say the idea makes sense. While many cities and states are preoccupied by figuring out how to grow, several, like Detroit and New Orleans, are grappling with how to shrink, an alternative that is rarely pleasant. Recently, a melee erupted when the New Orleans City Council voted to demolish four public housing projects (to be replaced by fewer units for poor people).
http://www.nytimes.com/2007/12/29/us/29parks.html?hp
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