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May 6, 2013

Host: Ted Simons

AZ Giving & Leading: Open Arms Home for Children

  |   Video
  • After taking a family mission trip to South Africa in 2005, Bob and Sallie Solis of Phoenix felt called to do something about the plight of children orphaned by AIDS in the country. They used their life savings and bought a 70-acre hilltop farm and established the Open Arms Home. Today, the home houses over 50 orphans. Bob Solis will talk about the Open Arms Home.
  • Bob Solis - Owner, Open Arms Home
Category: Giving/Leading   |   Keywords: AZ, Giving & Leading, special, open arms, children,

View Transcript
Ted Simons: Every month on "Arizona Horizon" our giving and leading segment looks at folks doing good things in the world. Tonight we learn about a local family that used their life's savings to open a home in South Africa to children orphaned by aids. Bob Solis, thank you for joining us.

Bob Solis: Great to be here.

Ted Simons: Congratulations on this. Give us a better definition of Open Arms Home.

Bob Solis: It's a residential facility, Ted, for children who have lost their parents to aids in South Africa, which is a particularly bad problem. Most of these children come to us with the shirts on their backs and end up we will raise them to adulthood. It's a residential home.

Ted Simons: You're based here, you live here. How did this start?

Bob Solis: My wife and I have five children of our own. About ten years ago we took our family on a mission trip of our own. We worked in an orphanage in South Africa so our kids could see how the other half of the world lived. We saw so many children in need from this aids problem we came home, thought, prayed about it. We had been saving up to pay off our house for many years. We said, what the heck, that's why they invented 30 year mortgages and we took a trip and bought the farm.

Ted Simons: When you went on the trip what did you expect to see and was there a moment when everything went, this is what we should be thinking about?

Bob Solis: Yes. It was when we went out to the community, townships, we would call slums, you saw so many children wandering around. You would ask, what is this child's story and the next door neighbor would be taking care of the child. They weren't related. You saw this over and over. It tugged on our hearts and we're blessed to be a part of it.

Ted Simons: What response did you get from folks in the community; the kids obviously are having a great time. They look good. What about folks in the community?

Bob Solis: We were welcomed with open arms. There was such a need for children's homes there. There's an overwhelming need. People really stepped up. Local farmers gave us meat and dairy and people knitted sweaters. They have been very, very kind to us.

Ted Simons: What about here? What about your family, your friends? It's one thing to say I'm going to take a motorcycle trip or have a midlife crisis. I'm going to open a home for orphaned kids in South Africa. What did you hear?

Bob Solis: Well, psychological counseling was a suggestion. But we have a very supportive family. So a big extended family in Arizona. They were all very supportive although scratching their heads a little bit. We started small. Got the first child in 2006 . We have been adding 10 to 12 children a year ever since.

Ted Simons: As far as challenges, what are some of the things you ran into that maybe you didn't expect?

Bob Solis: The distance, of course, is the number one challenge. When you're trying to run an organization on the other side of the world and living in Arizona that becomes very problematic. We have American executive directors, a couple from Virginia, that runs it for us. They are doing a great job. We're pleased about that. So we do the best we can to stay in touch but the distance is probably the hardest thing. Probably the most unexpected blessing thing has been giving people jobs. The unemployment rate around there is about 50%. We have 43 paid staff members at this point and so it's been gait giving them jobs.

Ted Simons: When we saw the kids they were obviously happy, having fun, playing, dancing and being kids. There has to be some emotional need going on there, physical needs. What have you run into?

Bob Solis: No question. We have a master's level play therapist that comes every Thursday and Friday to work through some of the issues. Obviously our children have issues with separation. With wondering about where their family is, et cetera. So we work through those issues as best we can. Then we have a couple children themselves that are HIV positive. So we have to attend to their needs. But they are doing great. On medication, Doing super.

Ted Simons: The first child, how is he seeing the world?

Bob Solis: He’s doing great. His name is Sephundo. In his local language Cosa that means a lesson. He's taught us a lot of lessons about resiliency and how to keep moving forward in your life. All our kids are so resilient it's inspirational to know him.

Ted Simons: How big a problem is aids in Africa in general, South Africa in particular?

Bob Solis: It's a big problem in sub-Saharan Africa. Some countries are further ahead in the fight than others. South Africa was one of the last to join the fight. So as a result 18 to 20% of the adult population is HIV positive. In a country 45 million you can imagine toll that takes. Because most of the people passing away are 20 to 40 years old they have a lot of kids, there's a lot of kids with no place to go.

Ted Simons: They have a place to go now. Expansion plans?

Bob Solis: We have beds now for 70 with 53 kids, so we'll get to 70 in a couple of years. At that point we'll catch our breath and see what's going on. We hope if we expand beyond that we build another campus. We want to maintain a family atmosphere. It's very important that it not get too large so it doesn't become an institution.

Ted Simons: A question for you. You work full-time?

Bob Solis: I do.

Ted Simons: Doing something else?

Bob Solis: Yes.

Ted Simons: How do you find the time for this?

Bob Solis: It's turned into my golf hobby. Which is fine because I'm terrible at golf. It's nights and weekend and whatever we can do, speaking at churches and rotary clubs. It's a great privilege, actually. I don't look at it as work. It's one of those things you are doing what you feel like you're supposed to be doing.

Ted Simons: It sounds like you walked across a major part of South Africa to raise money?

Bob Solis: Yes. Next time I'll take the bus. In 2008 we were out of space and funds on a personal basis, so we had a fund-raiser where I walked 720 miles across the country. It was great adventure. We raised about a quarter million dollars to build more cottages.

Ted Simons: Last question. Do you ever sit back, I was joking before saying you must sleep awfully well doing this kind of work, do you ever sit back and look at the ceiling, look outside and just marvel or wonder at what you've done?

Bob Solis: I will tell you my favorite thing at Open Arms without exception is to sit inside even though I love playing with kids and watch the children playing. Because what happens with children who have suffered like this is they lose their childhood. They lose their sense of joy and play. They are begging to stay alive. My favorite thing is to sit and watch them play. I think Open Arms has given them their childhood back.

Ted Simons: That must be a blessing and a half for you and certainly for them. Continued good work and congratulations. This is a fantastic story.

Bob Solis: Thank you.

Ted Simons: Good to have you.

Coyotes Arena Costs

  |   Video
  • A new report reveals the cost to operate the Coyotes Home Arena, Jobbing.Com Arena, is millions less than the Glendale City Council was willing to pay potential operators. Paul Giblin of the Arizona Republic tells us more.
  • Paul Giblin - The Arizona Republic
Category: Sports   |   Keywords: coyotes, phoenix, glendale, arena,

View Transcript
Ted Simons: Good evening. Welcome to "Arizona Horizon." I'm Ted Simons. The true cost of operating Glendale's arena is a significant point of contention in efforts to keep the Phoenix Coyotes in town. The Arizona Republic's Paul Giblin joins us now. Thanks for joining us.

Paul Giblin: Nice to see you to Ted.

Ted Simons: Disconnect on how much it costs to operate that arena. Talk to us.

Paul Giblin: Something of a mythical figure that no one could get their hands on. At least no one in the city could get their hands on it. But I found it on the city's website. The city right now is soliciting a new manager for the arena, and as part of the solicitation package they put the profit and loss statements from the current company that's operating the arena, operated by a subsidiary of the NHL, so there they were. Profit and loss statements for the past three years.

Ted Simons: It sounds as though the true costs are what, five-six million bucks?

Paul Giblin: Five-point-one million one year, five-point-five million another year. It costs more than that to operate the arena, but the manager gets some money back. When you do all of the math it comes out to five-point-five million and five-point-one million.

Ted Simons: Glendale has been paying how much?

Paul Giblin: That's an interesting question. They agreed to pay the NHL 25 million dollars. Now you can make a lot of arguments that the money could attract business to that development out there, come back through taxes and that sort of thing, but if you go the videotape of their city council meetings, look at the old tapes, they say specifically this not to subsidize the team, it is strictly for management of the arena. So that is 25 million dollars. They agreed to that twice. Their last dealings with a potential buyer for the team, they agreed to pay him 15 million dollars a year.

Ted Simons: Who figured out those costs? Who decided that 5155 makes sense? And who decided that 20-25 was a good deal?

Paul Giblin: These are the profit and loss statements from the NHL subsidiary running it. If the NHL says this is our profit and loss statement, this is what it costs, that's tough to argue with. The decisions to pay more than that, the 25 million and then later the 15 million, which didn't happen, those were decisions by the city council.

Ted Simons: So again, the variation here is huge. What's going on? How did it get this way? What's happening?

Paul Giblin: That's a good question. If you listen to what the people are saying they say strictly for management of the arena, but when you look at the profit and loss statements it's much more. You can throw in other things. If you want to say there's maintenance involved in a huge building like that. If it included maintenance that might push up the number but that's not what anyone ever said leading up to the decision.

Ted Simons: what reaction are you getting from city officials on this?

Paul Giblin: I took the profit and loss statements available on the website and I showed it to the mayor and to several of the city council members. I said, what do you think of this? She said, what is that? I said this is the NHL's figures on what it costs to run. They said I was completely unaware of that. Without exception that's what they said. I floated it around to other people who would be in the know and make it was correct and they said that's it. Yep.

Ted Simons: It sounds as though and you reported for the fiscal year '14 budget Glendale is penciling in $6 million for the operating budget.

Paul Giblin: That has gone through a lot of public hearings and meetings. They are arguing about whether they can pay a deficit that the fire department is supposed to have. The fire department says we have a deficit. We don't have money for fuel for the trucks and for maintenance because the call volume has gone through the roof. City council said we don't have money to cover that. The fire chief said I'm probably going to close a fire station unless you cover this. They said we still don't have the money for it. That's how tight the numbers in Glendale are right now.

Ted Simons: With 6 million dollars -- you've had all these offers of 15 to 20 and who knows what up there, how does that impact negotiations now to keep the Coyotes in Glendale?

Paul Giblin: That's a good question too. Now, keep in mind that the city had a deal with a guy named Greg Jameson, CEO of the San Jose Sharks. He had until December 31st of this year to buy the team to get a management deal with the city. The city was going to pay him $15 million. Shortly after he didn't come up with the money and the deal went away, then a bunch of other potential buyers started showing up. One guy named Anthony LeBlanc appears to be the frontrunner now. Back then I spoke to him he said he was interested but would need a deal similar to the one Jameson had for $15 million. Now months later he's in the front with another rich guy named George Gosby, both Canadians, a few other investors, and presumably he has not changed. I tried talking to him recently. He's not speaking now.

Ted Simons: Is there any likelihood someone would buy the team but not operate the arena because that seems highly unlikely from a distance. It sounds like all this extra money was thrown in there to attract buyers and even if you couldn't -- if Holsizer couldn't get folks to join his team with that kind of money thrown in, six million bucks, eight million bucks, good luck, fella.

Paul Giblin: Their finances are outside my earshot. I don't know, perhaps these investors think $6 million is enough. I don’t know. We'll have to see how it shapes up in the next several weeks.

Ted Simons: Do you think, though, someone would buy the team but not operate the arena?

Paul Giblin: I would think not. In fact I'll tell you no. I have spoken to all the frontrunners in this thing, not just LeBlanc's group the other groups. They all said the management component is vital to their interest in buying the team. Without that I don't see it happening.

Ted Simons: So LeBlanc is this renaissance in sports entertainment. A first line, though, but first line in what? It doesn't sound good to be quite honest. We report on this all the time, Paul. How many stories have we done are they staying, are they going, it sure does seem like they are starting to skate away.

Paul Giblin: I'm not sure. I will tell you that group renaissance sports and entertainment, these are guys with deep pockets. Deep pockets and a high interest in hockey. The two leading guys are Canadians. They see that market could work because the new alignment with the NHL will put the Coyotes in a division where they would expect to get a lot of Canadian hockey fans coming down from Canada to watch the game and get hot weather, get out of the snow. They think it can work. I don't know if it will work. We'll have to see.

Ted Simons: Sounds like with potential bids in late May, the Glendale budget early June, it's coming up.

Paul Giblin: There's about three weeks from when the bids are due until city council is supposed approve the budget.

Ted Simons: Great work. Good to have you here.

Paul Giblin: Great to be here again.

Rising Home Prices

  |   Video
  • Economists are starting to worry as home prices in Arizona and the Valley have risen over 30 percent in some cases. Real Estate Reporter Catherine Reagor and Economist Jim Rounds will discuss what quickly-rising home prices mean to the housing market.
  • Catherine Reagor - Real Estate Reporter, The Arizona Republic
  • Jim Rounds - Economist
Category: Business/Economy   |   Keywords: real estate, housing, market, update, ,

View Transcript
Ted Simons: A new ASU report shows that the median price for a single family home in the Phoenix area was at $175 thousand, that’s a 30 % year over year, and it's got some housing analysts concerned. Joining us is Arizona Republic real estate reporter Catherine Reager and Economist Jim Rounds of Elliott D. Pollock and Company. Thanks for coming in. Now we have ASU, 30 %. Prices are skyrocketing.

Catherine Reagor: Well, it's only up I think almost 4% from March, so we have had a steady 4% every month. Over the year 30% is nice. We have had some slow-down, months where it was faster. It's nice to see a median price of 175 instead of 119 if you're a homeowner but not a buyer.

Ted Simons: What's going on? Why are these prices doing this?

Jim Rounds: Keep in mind prices fell significantly, so we had this really low base to work off of. When your looking -- working off a low number we're realizing growth in population, some growth in employment, but the real estate market has to work through some unusual things that happened also. We expected a decent rate of growth this last year, maybe into the next year, but it's not sustainable over a five-or six-year period, so people need to temper their expectations some.

Ted Simons: The idea we hear oversupply, year after year. Now we're starting to have too few homes available?

Catherine Reagor: I guess undersupply is what you would say. Particularly 150-thousand dollars or less, very tight market. Then so we're seeing fewer investors but investors are still out there, like 29-30% of the deals were cash deals with investors, but they are mostly buying $250-thousand, and below. So really to balance the market we need some more sellers. The more home homeowners feel like they are not under water.

Ted Simons: That's a lot -- it seems like is it sustaining or dipping?

Jim Rounds: It's going to slow some. We were around 45% of sales to investors a year, year and a half ago. The question is what are the investors going to do with their homes. We did overbuild. There's a temporary shortage. Prices are set based on what's available today, not necessarily what's going to be available in two or three years. If the investors put these homes back on the market over a short time frame we have a problem. So far they are talking about putting them back on the market over six or seven years and some are going to keep renting the product. We're not going to see much of a blip in the economic data if they do this slowly enough.

Ted Simons: Is that what you are seeing in the investor market? Does it seem like there is a little bit of patience here?

Catherine Reagor: There's smart money behind this. This is Wall Street money, big money. The really big buyers, Blackstone. They say they are going to hold on and I still see them buying a few homes, but have not seen them putting things on the market. It's the first generation investors who bout in 2009, 2010, who can now sell and make money.

Ted Simons: Even so, it seems as though, we were all here back in 2006 and 2007, when things went topsy turvy. Compare and contrast what's happening now with what happened then.

Jim Rounds: We overbuilt by a lot of units. In greater Phoenix about 80-thousand units. Prices fell significantly. There were lots of problems in the mortgage market. We troughed. Then slowly we started getting back to more normal conditions. We had the investors come in. That helped stabilize prices and then pushed prices up over the last couple of years. That's part of the reason for that 30% increase. What you'll see is that 30% is going to give way to maybe 15% this next year and then I think we'll get back to 10%. Compared to 30, that doesn't sound like a lot but compared to the long perm average of 3 to 4 % that's not bad. You have to get those rates of growth to get back to normal by the end of this decade.

Ted Simons: You're saying 4% per month, but that will ease here.

Catherine Reagor: Yes. We're in prime home buying here from January to June. We could see that ease in August. Buyers, it's tough for regular buyers to get a loan. The lending guidelines are really tough.

Ted Simons: Is that still going on?

Catherine Reagor: First time home buyers have a little better shot because of the programs out there, but I'm talking about the documentation needed. It's 10-15 % down. That's not a bad thing for the market.

Ted Simons: What about the impact of those who walked away from their homes? Those folks are still probably having some trouble wrestling up the cash.

Jim Rounds: Fortunately the investors step in. Some are saying unfortunately, but it was needed to stop the bleeding. It's good to have the home in your neighborhood rented rather than vacant with weeds in the yard. It was a good thing over all. It depends how we work our way out of the investors. Right now 22% of the market is for rent. Normally it's around 12 . Normal conditions will probably be around 15 .

Ted Simons: What is that doing to the rental market?

Catherine Reagor: The rental market has become more competitive on the housing market except now I'm hearing on the apartment side it's flattening out, that we have so many rental homes it's hurting on the apartment side. Last summer is when it really picked up. There were people last August standing in line at rental homes. Six contracts coming in. Because there are more rentals out there, but with population growth and more people coming here we'll see. I'm also hearing some of these investors are looking at selling to the renters. So we have seen that trend come out.

Jim Rounds: A large percentage of those renting homes want to buy them. That's why to some extent those homes are absorbed. They are being rented but it's really a paperwork issue. We're not in as bad a situation as we initially thought but I still think it comes down to the investors. The plan for them is not to dump the product and run. They were originally talking about a two-year hold and exiting the market. You're seeing improvement in other economic data too. Last year some of the non-normal type resales was about a third of the market. Not the bank owned properties or foreclosures. Now it's two-thirds of the market, so we are seeing some underlined conditions, and prices are improving.

Ted Simons: Housing reflects economy, economy reflects housing. Which is chicken, which is egg?

Jim Rounds: In Arizona it's a little bit of both. We're moving in the right direction. Housing is moving in the right direction too. But if we see a 30% increase again for another year, then there's some stuff going on that will cause some imbalances. You see , 10-15% we're going to be okay.

Ted Simons: Last question. Foreclosures, what's the situation?

Catherine Reagor: Down. 900 last month, 900 the month before. Hasn't been at that level since 2007 . Don't you love now that we are talking about regular home sales we have to call them normal home sales because we have been doing foreclosures and short sales for so long. We're back. Pretty soon we won't have to say normal resale. Just sales.

Ted Simons: It's nice to have a discussion on this housing market and not be so doom and gloom. Good to see you both. Thanks for joining us.