Former Libertarian National Committee Operations Director Robert Kraus has authorized us to report that prior to the end of his employment with the LNC he sent the following email to LNC Chair Angela McArdle and others:
Insider LP Baseball Post #2: The following email was sent a few weeks ago to officers & others on the LNC:
Selling 1444 Duke St
Dear Angela & other interested parties,
This may surprise many – but a while ago I came to the conclusion that we should sell LPHQ.
The simple fact is – the pandemic proved LP Staff really can work from anywhere. Aside from that, a past culture dictated that certain LP Staff such as Executive Director, Political Director, Media Director, & various Operations staff should work out of HQ & especially near Washington, DC.
Since the culture of the LP has changed, the circumstances requiring an office have also changed. It can be argued that a smaller office may suffice elsewhere – Austin TX comes to mind –you still need a place to “receive the mail” after all – but the future location of an LPHQ can be put to a “Building Committee” to properly explore all the options, plus benefits & negatives of each.
A previous Building Committee came up with a list of 10 “must haves” & 1444 Duke St fulfilled 9 out of the 10 – not bad for a “starter home.” The current LPHQ was never intended to be our last HQ. A future Building Committee should come up with their own list of “must haves” & then get the full LNC to vote to accept that – which will make selecting a new HQ so much easier. I wish all of you luck with the process & urge you all to keep it as transparent & open as possible.
Back to 1444. I believe the right commercial real estate agents can sell the current property in 6-9 months provided you all invest about $15,000 first in much needed roofing repairs & interior painting on the main & 2nd levels (the basement level has already been done). The carpets also need a good cleaning. The outside brick & windows should also be power scrubbed which can be arranged thru the HOA. This should be enough to put the property in a good sellable condition.
The two realtors (they work as a team) I would suggest for this market – & Old Town in particular are:
Michael Porterfield
Tartan Properties Commercial – Old Town
703.836.6555 – [email protected]Matt Garcell
Cushman & Wakefield
202.550.1493 – [email protected]The reasons I recommend them are as follows: Mike is embedded in the Old Town market & personally has been involved in over 35 sales transactions over just the last couple years in the 22314 zip code. No one knows this market like Mike.
Matt, Mike’s partner, is known as the “Cold Calling King” – he works for one of the largest commercial real estate management companies – not only in the DC area – but the entire US. Thus, he has access to many leases in the DC Metro area – & Alexandria in particular – & knows just who to call when their lease is about to expire. He then convinces them that buying will save them 60-75% over renting. After all – he’s the reason we ended up buying 1444 Duke St in the first place – & it all started with a cold call to Mark Hinkle about a year before our Watergate lease expired.
I would urge the future Building Committee to interview them – along with a few others who are very active in the Old Town market (it’s a very special & different market then the rest of DC & NOVA) – & make an informed recommendation.
If an agent says they can not sell within 12 months – then they are not willing to do the work to make a sale happen. If an agent tells you they can sell in 3 months they’re not being honest. If they personally have not made multiple sales in Old Town – then they are not the right agent. A good agent might try a higher price for 3 months to see if it generates any interest & then knock it down.
I personally think you can expect to ultimately receive about $850-$895K for the property – which means after closing costs & commissions you will likely just break even. That’s the current market reality. This means perhaps listing it at first around $995K then knocking it down to $950K. Eventually you may need to list it at $895K to generate enough interest.
I’ve said in the past that it may make sense to hold onto the property as an investment – sooner rather than later (2-5 years) a developer will want the entire Round House Square parcel. In which case you can expect a 25% premium or so on the property which means $1.1M would not be out of reach based on what has happened to other areas of Old Town. This is also something the Building Committee can investigate of course.
Finally, yes you can lease all or part of HQ. The issue with this is that the rents you receive will be subject to Federal, State & Local taxes which will take about 47.5% of your rental revenue (rental income is considered an “unrelated” activity) before any other expenses such as the HOA fees, property taxes, utilities / cleaning (if you decide to include that in the rent – which is common in the Alexandria area) & general maintenance.
So, if you can get market rent (a very big “if”) – about $5K-5.5K a month – by the time you’re done with taxes & other expenses you’ll just about break even. You’ll get even less with a NNN lease but your expenses will also be less. Best case – you might make about $1K in profit a month which you can use for a very small rental office in another location. The Building Committee should also fully research this option with your realtors, especially if you decide you want to hold onto HQ as an investment.
One last thing – if you do sell –$751K ($750,672.00 to be exact) of the proceeds must be held in the restricted Building Fund account – or possibly a 3rd party trust (check with your legal & tax advisors), to be used towards a new purchase. This is the amount of restricted funds used for the down payment & excess mortgage/loan payments. My understanding of the regulations is that any amount you receive for the sale above this can go to the general funds & you can use as you wish. These funds held in reserve can, of course, be invested in a CD & as such can actually produce a higher rate of return then renting HQ can provide.
Please let the Building Committee (if & when established) know that I am willing to volunteer & help them in any way they need.
Thank you,
Robert Kraus
Operations Director
“Remember, unlike the revisionist history some in the south want you to believe, the confederacy was not about state’s rights, but about their desire to keep slaves. Go look at the statements from South Carolina and other states when they left to try to form their own country. Nothing about freedom, nothing about rights, nothing about anything other than their desire to keep slaves. Of course they did call it a right. Sane people don’t agree.”
Well without slaves at that point, their economy went to zero. Which is what happened post-war. The South was an economic backwater for a century after the Civil War, something that only died when the ’70s and ’80s came and northern-based manufacturing went south publicly for diversity, privately for cheaper wages and union activity is not really a thing in Southern states. I have a serious point as well that the greatest thing that ever happened to Southern economic development was the invention of air conditioning. It’s why Democrats are for greater state support of the masses and why the South was so heavily Democratic until arguably the 1980s. North Carolina as short a time ago as 40 years was an economic backwater whose main economic activities were farming (heavily driven by cotton and tobacco) and textiles. Charlotte is now a business and banking hub and the Triangle is an IT and pharmaceutical hub.
Stewart -I don’t know that everyone in the Mises Caucus is a neo-Confederate, but it is a standard viewpoint. At least one leader of the Caucus has published a book on the subject.
The neo-Confederate element is strong @ lewrockwell.com, and among so-called Rothbardian libertarians. Dr Murray Rothbard considered the war of Southern Independence to be one of the justified revolutions, along with the American revolution and, apparently, the Bolshevik revolution in Russia.
I agree with you that the southern rebellion was about slavery, and not state’s rights. Indeed, in the Declarations of Causes separately adopted by seven of the states to justify their secession, they complained that the federal government did not have enough power, and that northern states were refusing to enforce the federal fugitive slave act.
Additionally, the Constitution of the Confederate States was almost totally a copy of the US Constitution, with no additional protections for state autonomy. The only real addition was a prohibition on any state ending slavery, and a prohibition on any state interfering with a master taking his servants into that state. The CSA was more centralized than the United States, and the neo-Confederate “libertarians” are just as insane as the libertarians defending Russian aggression in the Ukraine. They are often the same people, and they run the LNC.
I stand by my statement. Neo-Confederates took over the LNC, and everything went South.
LNC California Representative Malagon has asked that discussion of this topic be moved to the forthcoming LNC meeting on July 2. As always, Independent Political Report will- live-blog this meeting.
RTAA: the extreme polarization of the country did not begin in mid 2022. The LNC had revenue in excess of $2 million for 4 or the last 7 years, including the last three years in a row. With 5 months in, 2023 is on pace to be the first sub-$1 million year since 1994.
Vs 2021, the Green Party is on pace to have revenue of +8%, the Constitution Party +25%, and the Libertarian party -55%.
Gene,
I agree with everything you just wrote except for one small part. I have not followed everything they are doing, but living in Charleston, the heart of the remains of the confederacy, I know what confederates are. I have not gotten the impression that these people are confederates. I am not sure what they are, but I do not believe that they openly support a return to slavery.
Remember, unlike the revisionist history some in the south want you to believe, the confederacy was not about state’s rights, but about their desire to keep slaves. Go look at the statements from South Carolina and other states when they left to try to form their own country. Nothing about freedom, nothing about rights, nothing about anything other than their desire to keep slaves. Of course they did call it a right. Sane people don’t agree.
These long dead people, and their descendants — who are alive and thriving in parts of the south — are evil incarnate. But if these people currently running the LP really are neo-confederates, then you need to purge them completely and permanently. Eradicate all reference to them and burn anything they touched.
“The LNC was taken over by Neo-Confederates, and everything went South.” – Gene Berkman
I honestly believe this does a real disservice to true neo-Confederates.
RTAA – certainly the polarization is a factor in the current political climate,
But there are actually many – more than you think – of more traditional libertarians who don’t have confidence in the current leadership, or, more likely, did not receive solicitations to join or renew memberships in the Libertarian Party.
It is not just the Mises Caucus. I let my membership in the Libertarian Party of California lapse because the LPC leadership opposed the initiative that legalized recreational marijuana.
The Mises Caucus has alieanated some Libertarians by their positions on abortion, immigration, and Russia. But most of those who have not joined or renewed have done so without knowing these Mises Caucus positions. But thanks to the focus on internal discipline rather than promoting libertarian views to the public, most people don’t know The Libertarian Party still exists.
They said the previous leadership dropped the ball on defending freedom. But where is the LNC in the major freedom issues today – reproductive freedom, property rights, taxes, free trade, and immigration – when the Mises Caucus – in contrast to Ludwig von Mises – often takes an anti-freedom position.
The LNC was taken over by Neo-Confederates, and everything went South.
Robert,
Once again, I thank you for your dedication to keeping your former employer solvent and functional. You will always make friends and you will always make enemies in any job. The people who do not understand all the things you did over the years cannot possibly appreciate your value to that organization.
And while I believe that the era of working at home will be short-lived, and offices will once again become popular, I understand and appreciate your opinion regarding valuations of property in the DC area, and the benefits of selling versus holding on.
He did not ‘resign’. His contract expired and was not renewed, though he wished to continue, as covered here and elsewhere.
Gene: the decline in membership and activism since the takeover indicates other Libertarians are not in line with the “Mises” Caucus.
Not necessarily.
The decline in LP membership is mostly due to the polarization of this country. People are rallying behind the major party they regard as the “lesser evil” because they hate the other major party so much more.
The LP ( and all third parties) was going to suffer declining membership regardless of who controlled the LNC.
Yeah, I know some polls say Americans want a third party. That doesn’t mean they’ll actually support a third party, rather than support their preferred “lesser evil” major party.
Robert Kraus, thank you for resigning.
Just a clarification. The values of Libertarians and the Libertarian Party have not changed.
The composition of the Libertarian National Committee has changed, through a well-organized takeover by people who have in most cases not been involved in The Libertarian Party before deciding to take it over, along with its assets.
Some Libertarians may agree with the new overlords, but the decline in membership and activism since the takeover indicates other Libertarians are not in line with the “Mises” Caucus. If Ludwig von Mises were alive, he too would be denouncing the “Mises” Caucus.
ATBAFT is correct. The “should have not purchased a building” is long past. The LNC Board voted to buy a building provided it met all or most of a long list of requirements. It was the number one fundraiser in the history of the LP. No project or program ever raised as much as the building fund.
The building was used properly for a number of years by many LP staff, candidates, local affiliates, etc. As I said the “values” of the LNC has changed so today’s reality is for sure different then the reality of those who served back in the 2011-14 period. The funds are permanently restricted until those donors release their restrictions. For sure they can be asked if they wish to have their funds put towards another use (you know, like suing another affiliate) – towards the purchase of another HQ – or returned.
Whether or not the “building should never have been purchased in the first place” the fact is that it was. Mr. Berkman can probably corroborate that large donations were raised to purchase it as a memorial to David Nolan, and that donations were made for the sole purpose of purchasing a headquarters building. Should that building be sold, then those donations need to be rolled into the purchase of another building, not put into a general fund. Should the LP decide to lease office space, instead of buying another building, then those donors should be given the option to have their donations returned. If they aren’t given that option, then indeed “looter” comes to mind.
The building should have never been purchased in the first place. I said that as soon as I received the donation request in the mail. Selling it is the correct move. I applaud Angela’s outstanding leadership. I disagree with Gene’s characterization of the current LNC.
Gene, the number of states where the LP has ballot access in the year before a presidential election is in line with what it has been in the year before the last few presidential elections. The LP will likely pick up ballot access in at least 2 or 3 more states before the year is over.
I have been saying the same thing for years myself. Thank you Robert Kraus for pointing this out.
The current leadership of the Libertarian National Committee is composed of people who did little or nothing to make the purchase of a national headquarters possible. They did a hostile takeover of an organization with a national hq owned outright, and ballot status in 40 states.
After more than a year of their leadership, the LP has ballot status in 34 states, and they are considering the sale of a building that they did not buy.,
Ayn Rand would call these people “looters” and I would stand with Ayn Rand on this characterization.
At one time we probably could have received $950K+ but yes the market is different then a few years ago hence the price I think the LP can get. The Old Town market for class C is interesting simply because it is so much less than the class A out there. There’s still sales going on because there are small associations & non-profits paying $45-85 PSF leases that can save substantially by buying over leasing – if a great agent shows them how.
Commercial real estate in this high interest rate environment is going down at the moment…now is not the time to sell. Work from Home has also decreased demand for renting office space.
D.C. is not San Francisco by any stretch but for example Mitsubushi’s financial group sold an office tower for $60 million that they had bought for $300 million pre-pandemic.
Mr. Kraus is very knowledgeable of the real estate market there and the factors affecting a sale of the National Headquarters office.