(Part 1 of 3)

"Oops, wrong kidney."
In recent years, errors in treatment have become a serious problem for hospitals, ranging from operations on wrong body parts to medication mix-ups.  At least 1.5 million patients are harmed every year from being given the wrong drugs, according to the Institute of Medicine of the National Academy of Sciences.  That’s an average of one person per U.S. hospital per day.

One reason these mistakes persist: Only 10% of hospitals are fully computerized and have a central database to track allergies and diagnoses, says Robert Wachter, the chief of medical service at UC San Francisco Medical Center.  But signs of change are emerging.  More than 3,000 U.S. hospitals, or 75% of the country’s beds, have signed on for a campaign by the not-for-profit Institute for Healthcare Improvement to implement prevention measures such as multiple checks on drugs.

Though the system is improving, it still has a long way to go.  Patients should always have a friend, relative or patient advocate from the hospital staff at their side to take notes and make sure the right medications are being dispensed.

"You may leave sicker than when you came in."
A week after Leandra Wiese had surgery to remove a benign tumor, the high school senior felt well enough to host a sleepover.  But later that weekend she was vomiting and running a fever.  Thinking it was the flu, her parents took her back to the hospital.  Wiese never came home.  It wasn’t the flu but a deadly surgical infection.

About 2 million people a year contract hospital-related infections, and about 90,000 die, according to the national Centers for Disease Control and Prevention.  The recent increase in antibiotic-resistant bugs and the mounting cost of health care — to which infections add about $4.5 billion annually — have mobilized the medical community to implement processes designed to decrease infections.  These include using clippers rather than a razor to shave surgical sites and administering antibiotics before surgery but stopping them soon after to prevent drug resistance.

For all of modern medicine’s advances, the best way to minimize infection risk is low-tech: Make sure any hospital staffers who touch you have washed their hands.  Tubes and catheters are also a source of bugs, and patients should ask daily if they are necessary.

"Good luck finding the person in charge."
Helen Haskell repeatedly told nurses something didn’t seem right with her son Lewis, who was recovering from surgery to repair a defect in his chest wall.  For nearly two days she kept asking for a veteran, or "attending," doctor when the first-year resident’s assessment seemed off.  But Haskell couldn’t convince the right people that her son was deteriorating.  "It was like an alternate reality," she says.  "I had no idea where to go."  Thirty hours after her son first complained of intense pain, the South Carolina teen died of a perforated ulcer.

In a sea of blue scrubs, getting the attention of the right person can be difficult.  Who’s in charge?  Nurses don’t report to doctors but rather to a nurse supervisor.  And your personal doctor has little say over radiology or the labs running your tests, which are managed by the hospital.

Some facilities employ "hospitalists" — doctors who act as point people to conduct flows of information.  Haskell urges patients to know the hospital hierarchy, read name tags, get the attending physician’s phone number and, if all else fails, demand a nurse supervisor, likely the highest-ranking person who is accessible quickly.

(2 votes, average: 5 out of 5)

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Slowdown in real estate a blow, but not knockout

Chad Graham
The Arizona Republic

The national chatter over the flailing home lending industry and its effect on the U.S. economy became more heated this week than an Anna Nicole Smith memorial service.

With the jump in foreclosures, predictions quickly gravitated to a "mortgage apocalypse" scenario where more than a million Americans fall behind on payments and lose their homes. Whispers of an ensuing recession in the United States rattled world equity markets.

Still, it’s not time to call the Four Horsemen to Arizona.

"Is recession a possibility? Sure. Is recession a certainty? No," said Dennis Hoffman, an economics professor at Arizona State University.

"It is simply fair to say that the risks of recession are higher today than they were six to 12 months ago, probably somewhere between 1-in-3 or 1-in-4."

Those are still low odds. So far, housing market shakiness is only cooling Arizona’s economy a bit in 2007.

For example:

• We’re spending less money. Sales-tax collections in January rose a disappointing 1 percent due to a lackluster holiday season. Revenue for the month was $7 million below the June 2006 forecast, according to the Joint Legislative Budget Committee.

The uncertain real estate market should continue to curtail consumer spending, particularly on home improvement items.

• Retail jobs are slowing. Arizona lost nearly 40,000 retail jobs in January. While that was blamed on post-holiday layoffs, employment growth in that category has been anemic for months, mirroring a national trend, according to Austin Litvak, associate economist at Moody’s Economy.com.

In metropolitan Phoenix, the sector "has fallen from about 9 percent during the later half of 2005 to about 5.5 percent currently," he said.

• Residential construction jobs are stalling. During the past year, construction accounted for 21 percent of all new jobs created in Arizona. Yet a drop in new housing permits is drying up some work.

Last year, the industry created more than 22,000 jobs. Between December 2006 and January 2007, it lost 4,400, according to Arizona Department of Economic Security data.

• Income growth could taper slightly. "We expect that as commission incomes fall in real estate-related jobs and as jobs are cut in construction and real estate-related sectors, personal income will slow significantly," wrote University of Arizona economist Marshall Vest in a December report. He also predicted that wage growth would drop to about 3.5 percent from 6.1 percent.

Compared with what’s happening in other areas of the U.S., those are not dire developments.

Auto-industry ills and an anemic housing market led Comerica Bank to recently proclaim that Michigan was stuck "in a one-state recession."

That state recently joined Mississippi and Louisiana as places that led the nation in late mortgage payments. Arizona ranked 40th in that measure, and there is no proof yet foreclosures will rise anywhere near the late 1980s, when the bottom fell out of the real estate market.

Economists argue that Arizona’s economy, while still heavily dependent on construction, has diversified recently.

Business services, finance and insurance sectors have grown quickly, said Hoffman, adding that a continuing population boom should grow health care and other related services.

Litvak said, "I would still expect Arizona to remain one of the fastest-growing economies in the nation despite the housing slowdown."

(2 votes, average: 5 out of 5)

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Peter Corbett
The Arizona Republic
Mar. 17, 2007 12:00 AM

Custom-motorcycle builder Roger Bourget says he isn’t having any second thoughts about paying $3 million for his condominium overlooking the hottest corner at Kierland Commons.

The recent sale of the 2-year-old condo is believed to be the highest price paid per square foot for a Valley condo.

The 2,800-square-foot corner loft sits atop the Bebe clothing shop and looks out toward the sidewalk cafe of Zinc Bistro, where wine flows and patrons watch fashionable passers-by.

"It’s a little spendy," said Bourget, 49, owner of Bourget’s Bike Works, "but I believe that in the long run this stuff is going to go up in price."

Some buyers are downsizing from those big homes on estate lots. Some like the energy and entertainment options at Kierland, downtown Scottsdale and at the Biltmore.

(2 votes, average: 5 out of 5)

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Find adds new theory to debate on origin

Peter Corbett
The Arizona Republic
Mar. 12, 2007 12:00 AM

(5 votes, average: 4.4 out of 5)

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The Business Journal of Phoenix - March 9, 2007

by James Kindle

The Business Journal

Bulldozers ramble, excavators till up earth, construction crews traipse across newly placed rooftops.

The scene in Maricopa these days is nothing out of the ordinary in Arizona, where even amid a housing slump, new residential building soldiers on.

What is out of the ordinary in Maricopa, which rose out of the northern Pinal County desert in October 2005 — when it officially incorporated as a city — is the pace of this growth.

Since the city’s first census just less than three years ago, it has grown from 4,523 residents to an estimated 31,490 — a staggering increase of about 596 percent.

Though housing permit rates in the city have cooled significantly from the mid-2005 boom where some months saw more than 700 new-home permits issued, Maricopa still issues a healthy 200 permits or so a month.

As residents continue to pour into the fledgling city, officials are facing the new job of ensuring that Maricopa is more than simply a sleepy bedroom community.

Nearly 50 percent of Maricopa residents commute 21 to 30 miles into the Valley each day for work, according to an October survey of 1,041 residents, many to jobs at south Scottsdale employers such as Motorola Inc. Now, Maricopa is trying to bring employers to these workers, said Maricopa Mayor Kelly Anderson.

"We are working with land owners and property owners and keeping the residential-employment balance, so we’re not just a bedroom community," he said.

The town aggressively is pursuing high-end manufacturing and office jobs while maintaining a high residential building rate, thereby turning the "rooftops to retail to industrial" city model on its ear.

More diverse community

Since its recent incorporation, Maricopa has faced the challenge of building a city in only a matter of years.

"There’s unique challenges in Maricopa because it just incorporated a couple of years ago, and everything’s new," said Jordan Rose, a land-use attorney with Scottsdale-based Rose Law Group, which handles 90 percent of its cases in Pinal County. "You’re there before they’ve actually ever implemented anything."

Rose said the city requires developers to design creative, yet affordable housing options to avoid "the same old red-tile roofs."

She cites developments with amenities such as a telescope area, a duck pond, fishing pond and even a community farm as examples.

Anderson said the town is pushing developers to incorporate churches and nonprofits into communities and ensure affordable housing.

The median new home price in Maricopa in third-quarter 2006 was $251,010, according to the city census; the median price for a new home in Phoenix in 2006 was $303,665, according to figures from the Arizona State University Real Estate Center.

Ben Redman, president of WestPac Developers, said the market also is dictating more unique developments. WestPac has two projects in Maricopa: Sorrento, a 1,900-home master-planned community currently in its first stage of development, and Cortona, a 1,600-home community in the early planning stages.

"Everybody tries to come to the table with their own specific, creative elements to make their community a little different from their competitors," he said. "Collectively, when you look at that, that makes for a more dynamic, more diverse community."

Redman said that, like in other new communities in which he’s worked, the home builder is responsible for infrastructure.

Maricopa is working with a private company to develop its sewer and water infrastructure, which is being oversized in preparation for growth, Anderson said.

Though the city’s focus has been on single-family homes, Anderson said Maricopa has apartment and condominiums in the works, too.

"We do have a lot of condos and multifamily residential in the planning stages right now," he said. "In the next year and half, I would imagine you would see a lot of that product coming on the market."

Why not Maricopa?

To accompany this burgeoning citizen base, the city is pursuing high-end jobs that many other cities would wait a decade or more to attract, said Ioanna Morfessis, the city’s senior economic development consultant.

Many Arizona communities focus more on residential than retail, with high-end employment years down the road, Morfessis said.

"We’re getting things put into place for now, so we don’t have to wait 15 or 20 years for significant employment," she said.

The city is focusing on agri-biotech, manufacturing and regional aviation as several key employment opportunities.

"The citizens want and deserve a good employment base," Morfessis said. "As young as (this) city is, we’re looking to get behind the right kind of companies (and) the right kind of business parks in place. … We need to paint the picture for them what the city is going to be."

Anderson said his theory is, "Why not Maricopa?"

He often stresses the importance of the city’s interstate and rail connectivity — the Union Pacific railroad runs through Maricopa — in meetings with business leaders. He said he hopes to get derivatives of companies such as Intel Corp. and Motorola to open offices in the city.

Barry Broome, president and chief executive of the Greater Phoenix Economic Council, said Maricopa needs to focus on both residential and industrial needs for success.

"Retailers will follow employment centers more than they’ll follow housing," he said. "Rooftops to retail works, but what about the sustainability of that? … (With) employment to residential to retail, you’re going to be more sustainable and economically viable.

"All these communities are growing like crazy. I think it’s too easy to see that as an outcome," Broome added.

Morfessis said the community will use this growth to bring more businesses and people into the city.

"Our goal is to get behind companies that are growing or are continuing to grow because of their market and letting them know about the opportunities within Maricopa," she said.

(2 votes, average: 5 out of 5)

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The Valley’s real estate industry is lending regulators a hand in cracking down on mortgage fraud.

Several real estate, escrow and mortgage firms are working not only to educate their own employees but those at other firms on how to detect fraud and what deals to pass on.

Barbara McDugald, the Phoenix general counsel for Security Title, made mortgage fraud the subject of the agency’s newsletter in December.

She defines "classic mortgage fraud" as a deal that involves an inflated appraisal, a borrower who has falsified data on the loan application and a high loan-to-value loan.

"The borrower then draws out all the equity, stops making the payments and sticks the lender with a property that is not worth enough to cover the debt," she said.

Her tips to the real estate industry:

• If the loan-to-value ratio is 100 percent or more, beware. (That typically means if a borrower has put little to nothing down or the house is financed to the hilt.)

• If the buyer is getting money back, beware.

• If the sales price seems too high or too low, beware.

Security Title asked Amy Swaney to teach a class for Keller Williams’ Tempe office on mortgage-fraud awareness last week. Swaney, past president of the Arizona Mortgage Lenders Association and loan officer with Premier Financial of Scottsdale, started alerting people to the problem last year.

Phoenix-based Realty Executives asked her to speak about mortgage fraud at its quarterly education meeting in November.

Swaney is also speaking at the Arizona convention for escrow associations about mortgage fraud next month.

The Arizona Department of Financial Institutions brought in national mortgage and real estate fraud expert Richard Hagar to speak to Valley appraisers, escrow agents and mortgage brokers in January.

Now firms such as Countrywide, Seton Capital and the Mortgage Lenders are bringing back Hagar in April to speak to groups across the state. Hagar is a Seattle-area appraiser who has helped regulators across the country.

"We are turning away a lot of deals, but there’s peer pressure in the industry because other firms are turning them away, too," McDugald said.

Helping the hurting

The recent closings of Mesa-based mortgage firm Eagle First and other Valley mortgage firms have left many borrowers in the lurch.

Chicanos Por La Causa is trying to help. The Phoenix housing division of the non-profit is working with several "credible permanent mortgage lending partners" to help borrowers.

Eagle First was shut down by regulators for illegal loan practices. Other firms are being investigated. Some have folded because of losses from bad loans they have made and had to buy back.

Some home buyers were in the process of getting funding when their lender folded. Others who got adjustable rate loans with rapidly rising payments or prepayment penalties are in danger of losing those homes.

The non-profit housing agency can be reached at (602) 253-0838.

(2 votes, average: 4.5 out of 5)

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Glen Creno
The Arizona Republic
Mar. 10, 2007 12:00 AM

Buyers priced out of the new-home market by the big price increases of the housing boom may get another shot at something they can afford.

Many builders are cutting costs and prices as they struggle to attract more buyers and regain their footing in a market flooded with an excess of unsold homes. They’re creating less-expensive houses for new communities and spending less on finishing touches in existing subdivisions.

They’re asking subcontractors, like framing and concrete companies, to rebid projects at lower costs. And they’re pressing suppliers for better prices on things like carpet and electrical fixtures that are among the hundreds of options that can quickly cause a house’s base price to balloon.

It’s good news for consumers who may have thought housing had passed them by. But it also may mean getting less home because many of the features previously included in the price have either been cut back or become optional.

"Consumers were throwing money around during the run-up. But now, buyers are trying to get as much house as possible," said Ben Sage of Metrostudy, a housing consultant.

If lower ceilings and less-expensive fixtures can save a buyer upward of $10,000 on the price of a new home, it may be worth it, builders say.

Ingrid and Louis King just bought a new house for $300,000 in the Sun Valley area of Buckeye.

Louis said the house would have been much more expensive if they had picked out all the add-ons themselves.

"We had some sticker shock," he said. "On the higher-end homes, the upgrades are standard. In the less-expensive communities, they aren’t added on to the base price."

Builders that rely on mass sales see the cutbacks as a way to get back on track and broaden their pool of potential buyers.

Construction of new homes has slowed dramatically since 2004 and 2005, when demand was pushed out of proportion by investors.

Then, builders besieged by buyers were rationing lots and raising prices.

The median price for a new single-family home jumped to $306,355 last year from $195,000 in 2004, a 57 percent increase.

Builders enjoyed record sales and profits, but the incomes of their potential buyers didn’t keep pace. Per capita income increased 9.9 percent in the Phoenix area from 2003 to 2005, according to the U.S. Commerce Department.

"It’s a challenge for builders," said Reed Porter, president of Trend Homes, a private builder based in Arizona. "You need to have prices at a place where average Phoenicians can afford."

The reckoning

The reckoning came last year as builders began to cut production as buyers canceled contracts and unsold houses began to accumulate.

They pulled 42,460 permits for new homes in 2006 after running in the 60,000 range the previous two years. The permit total is expected to dip further this year while builders sell off empty houses.

According to Metrostudy, there were 11,161 finished but empty homes in metropolitan Phoenix at the end of December 2006.

There were more than 43,000 single-family homes listed with the Arizona Regional Multiple Listing Service in January.

With too many unsold homes, builders began to discover that the high prices of the boom were not affordable to rank-and-file buyers.

The local and national housing markets flipped from bliss to bleak in the first half of last year.

The change showed up in earnings reports from public builders. Revenue and earnings were down. Cancellations of sales contracts hit the 30 percent range for some companies, leaving them with swelling inventories of houses.

The energetic pursuit of land during the boom became a liability when it became clear the companies wouldn’t need as much as they had. Quarterly reports started showing big write-offs for land.

Meritage Homes, the only public builder based in the Valley, reported a 12 percent drop in earnings for 2006, even though revenue from home closings increased 15 percent. The culprit: $78 million in charges to cancel options or make reductions in the value of inventory.

It was a chorus for other big builders. Pulte Homes wrote off $151.2 million in deposit and pre-acquisition costs for land deals it decided not to pursue. Analysts are split on when home building will recover.

Changes under way

Builders are using a variety of strategies to make their houses cheaper and find more buyers.

KB Home has three Valley communities offering triplex homes, three houses in a single building.

One 1,200-square-foot plan has a base price of $149,900, said Brooks Longfellow, vice president of operations for the Phoenix divisions of KB Home.

Pulte Homes now offers a half-patio that doesn’t span the entire back of the house and has an optional bedroom bay window that once was standard in some home plans.

Spokeswoman Jacque Petroulakis says that moves like that can knock $3,000 to $8,000 off the price and estimated that buyers could save as much as $30,000 with some options removed from the base price.

Then there’s the rebidding with subcontractors. That alone can knock 10 to 12 percent off the price of lower-end homes, said Doug Fulton of Fulton Homes.

There is no doubt builders are getting tough, said Bill Washburn, vice president of operations for SelectBuild in Arizona, a subcontracting company.

"We’ll receive letters or direction that you have to lower your price 10 percent or 15 percent," he said. "They are taking a harder line."

It’s unclear whether the new emphasis on price will bring any fundamental changes to Valley housing. The single-family home has ruled this market since the end of World War II.

"We’ll never see the heady days like in ‘05, when builders would load up the houses to justify the prices they would charge," Sage said.

"This is a reasonable response to a slow market that will somewhat reverse itself when the market normalizes."

(3 votes, average: 3.67 out of 5)

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More and more it’s looking like the local housing bubble just isn’t going to burst.

It may take sellers a little longer to close a deal on their homes, but odds are they’re not going to be losing any money. That’s according to Arizona State University’s latest edition of the Arizona Blue Chip Economic Forecast.

Although sales are down and inventories are up, home prices have not collapsed. The experts say it increasingly seems unlikely that home price declines, if any, will be very large in Arizona.  That makes NOW and excellent time to buy, as inventories are loaded with high quality offerings at superb prices!

(3 votes, average: 3.67 out of 5)

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The Scottsdale Convention and Visitors Bureau has discovered some surprises in its annual visitor study.

Denver and San Diego represent two of the fastest growing markets for new visitors to Scottsdale. As a result, the CVB is planning for increased advertising in those markets this year.

The study also found that one-third of Scottsdale’s visitors came to the city at least twice during the 12-month period of the survey. That’s an increase from the 29 percent in 2005.

(2 votes, average: 5 out of 5)

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