Bailing our eyes out

I try hard to not look at my 401(k), but I can't help it. Even after putting most of my meager fortune into fixed income, I watch it spiral downward each day like a banker on his way to meet the pavement. Thankfully I'm not anywhere near retirement, but I do wonder what the markets will look like when I get there.

I don't play the stock market, since I've proved time and time again that I'm no good at it. I got into the market at the tail end of the dotcom boom. I didn't understand what on earth I was doing. When eBay went public in 1998, the anticipated $18 share price blasted up to $53 before falling back to $47 the first day. A few weeks later it had settled down in the $20s, and I remember saying to Luis that buying it probably didn't seem like such a good deal after all. So I missed that boat.


So now almost all of our money is in real estate, the building that we bought with our friends 3-1/2 years ago. In 3-1/2 years you can build hotels and condo buildings of much greater size, apparently. Our little shanty has been tied up in some sort of bureaucratic morass since we've owned it. It took a year and a half to get a zoning variance, and for the last 2 years we've been paying various other agencies to get permits, approve plans, and bicker over things like whether we should be allowed to have Juliette balconies (they are classified as "obstructions"). We had hoped to be well into construction by now, but the most we've gotten is a gutted shell that will need to be razed completely anyway. And we've already laid out more than $100,000.

Now we are about to attempt to get a construction loan in the middle of a serious financial crisis. The contractors' bids have come in, and we're meeting with our architect next week to figure out our options. Luis spoke with a banker yesterday who said that we might be able to get 60 percent financing, which is better than a kick in the teeth, but that means we'd have to collectively front about a half-million dollars.

I'm seriously thinking of writing to HGTV to see if they'd be interested in our project. Or maybe Warren Buffett will come to our rescue.

To celebrate Luis's birthday, we're going to Danny Meyer's Shake Shack, where burgers cost $3.75. Desperate times call for delicious measures.

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Tear the roof off the sucker

Our building looks like a bomb hit it--and that's a good thing. Today was the first day of demolition. We've waited two-and-a-half years for this moment. It's the first actual sign that something is happening. The ceiling on the first floor came a-tumbling down, revealing beams that were a little higher than we thought.

We're doing limited interior demolition so we can see how much of the building we can salvage and how much will be new. It looks like we'll be saving very little. We also have to have four giant test pits (3 ft by 3 ft) dug on the first floor to determine the composition of the foundation. The second and third floor were never fully built out, so engineers need to test the bearing capacity of the soil underneath.

It's all very exciting, and now we just have to hope that getting a construction loan in this credit crisis isn't too difficult. Otherwise, we will need to call our building The Money Pit.

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