California REIT Buys Three Senior Living Communities

     Nationwide Health Properties, a Newport Beach, Calif.-based real estate investment trust (REIT) specializing in senior housing and long-term care facilities, has bought three Memphis retirement communities for nearly $30 million.
     The sales include Kennington Pointe at 6301 Village Grove Drive, Heritage Place at 2990 Hickory Hill Road and Franklin Park at 3393 Kirby Road.
     Nationwide bought the properties under the limited liability company NHP SH Tennessee LLC. The seller, HRT of Tennessee Inc., is affiliated with Nashville-based Healthcare Realty Trust Inc., a REIT specializing in outpatient healthcare facilities.
     Kennington Pointe, which sold for $11 million, is a three-story, 115,000-square-foot retirement community built in 1989. It has 155 units and sits on 9.9 acres on the south side of Village Grove Drive east of Ridgeway Road. HRT bought the property in 2005 for $6.2 million, and the Shelby County Assessor's 2006 appraisal was $5.9 million.
     Heritage Place, which sold for $11.6 million, is a 162,000-square-foot, 160-unit, two-story nursing and retirement home built in 1985. It sits on about 13 acres on the east side of Hickory Hill north of Pebble Beach Avenue. HRT bought it in 2005 for $7.7 million. The assessor's 2006 appraisal was $7.5 million.
     Franklin Park, which sold for $7.1 million, is a 98,600-square-foot, two-story nursing and retirement home built in 1989. It has 129 units and sits on the west side of Kirby Road north of Winchester Road. HRT bought it in 2005 for $4.7 million, and the assessor's 2006 appraisal was $4.5 million.
     In addition to the sales, HRT assigned its rights as landlord to NHP. Signed in 2005, those agreements leased the properties to Cordia Enterprises of Memphis LLC, an affiliate of Cordia Senior Living.

Living Wage Ordinance Highlights Commission Agenda

     Shelby County Commission members will hold a second reading for an ordinance implementing a living wage for county government employees and contractors at a meeting today at 2:30 p.m.
     This is the second of three required readings for the ordinance. Commission members first voted on the living wage ordinance last month when they approved it with a 7-6 vote.
     If passed, the living wage would require county workers to be paid $10 per hour with health insurance or $12 per hour without insurance.
     The Memphis City Council passed a living wage for all city employees in December.
     Other items on the agenda include a resolution to endorse Shelby County Mayor A C Wharton Jr.'s efforts to establish a Blue Ribbon Panel to develop short- and long-term strategies about the organization and funding of the Regional Medical Center at Memphis.
     Also being considered is a resolution amending the fiscal year capital improvement plan to appropriate $2.5 million in interest earnings for capital funding for The Med and amending the fiscal year operating budget to provide $2 million in operating funds for The Med.
     The meeting will be held at the Shelby County Administration Building, 160 N. Main St.
     For a full commission agenda, see Page 8.

Fairgrounds Redevelopment Holds First Meeting

     The Mid-South Fairgrounds Redevelopment Committee is holding the first of a series of community meetings to discuss proposed changes to the fairgrounds Tuesday from 6 p.m. to 7:30 p.m. at Christian Brothers University, 650 E. Parkway South.
     The city of Memphis Division of Housing and Community Development is spearheading the initiative.
     During the meetings, several redevelopment options will be available for viewing and comment. Market research, an overview of the baseline conditions and the preliminary analysis of fiscal and economic impact also will be discussed.
     Key partners and consultants involved in the redevelopment process of the fairgrounds are the city's Division of Housing and Community Development, RKG Economic Planning and Real Estate Consultants and Looney Ricks Kiss Architects Inc.

Southern Steel Expansion Among Chamber Accomplishments

     Southern Steel Supply Co. Inc., which buys steel and distributes to customers, is in the process of buying 3.7 acres near its current Downtown Memphis facility at 475 N. Dunlap St. for an expansion that will create a $3.6 million steel manufacturing plant. The expansion is one of 26 projects the Memphis Regional Chamber was involved with between July 1, 2006, and April 24, 2007 - efforts that brought more than $1 billion in capital investment to the Memphis area.
     Officials from the chamber gave their latest quarterly update to a Memphis City Council committee recently, updating council members on efforts that are bringing companies such as Southern Steel to the area. In total, according to the chamber presentation, the chamber and its partners helped bring 11,700 new jobs to the Memphis area in 2006.
     The expansion Southern Steel is pursuing gives a hint of what those efforts entail. In a letter to the Memphis-Shelby County Industrial Development Board, Southern Steel's chief financial officer, Michael Wexler, wrote that the company now serves customers in West Tennessee, East Arkansas, North Mississippi and the Missouri bootheel. The expansion, he added, will allow the company to bring new services to its regional customers because of new and refined manufacturing capabilities.

IP Reports Huge Q1 Net Earnings

     International Paper Co., a Memphis-based supplier of paper and packaging materials, last week reported preliminary first quarter net earnings of $434 million. The amount represents a 250 percent increase from first quarter 2006.
     Quarterly net sales were $5.2 billion, compared to $5.3 billion in the fourth quarter 2006 and $5.5 billion in first quarter 2006. According to a company statement, this change primarily is due to lower forestland sales.
     "The first quarter was our best first quarter since 2000," said IP chairman and CEO John Faraci in a company Webcast. "I'd say it's a good solid start to the year."
     The company had record first-quarter profits in Europe. Operating margins are up 300 basis points since first quarter 2006. Its earnings from continuing operations before special items in first quarter 2007 were $203 million, up from $58 million in first quarter 2006.
     IP announced some price increases during the quarter, which Faraci said now are either partially or fully implemented.
     Higher wood and pulp costs throughout Europe and Russia - the results of unexpected warmer weather in the latter - have caused shortfalls in supply, which contributed to the company's price increase for wood products.

Morgan Keegan Buys New York Firm

     Morgan Keegan & Co. Inc. on Thursday announced plans to acquire Shattuck Hammond Partners LLC, an independent investment banking and financial advisory firm specializing in the health care services industry.
     The new entity will operate as a division of Morgan Keegan under the name Shattuck Hammond Partners. The firm will continue to provide comprehensive investment banking and financial advisory services to clients across a variety of health care sectors.
     "The acquisition of Shattuck Hammond strengthens our firm's position in an important industry segment which has potential for tremendous growth," said G. Douglas Edwards, president and CEO of Morgan Keegan, in a statement. "We are very impressed with the quality of Shattuck Hammond's platform and the reputation of their investment bankers in the health care industry. Both firms share the same philosophy of providing high quality, solution-based investment banking services to meet their clients' needs and building long-term relationships."
     Morgan Keegan is a subsidiary of Birmingham, Ala.-based Regions Financial Corp.
     Shattuck Hammond is one of the largest health care-focused advisory firms on Wall Street with about 50 employees. Headquartered in New York, the firm has offices in Atlanta, Chicago and San Francisco.
     The transaction is expected to close during the second quarter 2007. Terms of the agreement were not disclosed.