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VOL. 128 | NO. 253 | Tuesday, December 31, 2013

Daily Digest

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New Owner of Holmes Properties Files Loan

The new owner of the Memphis Logistics I and II buildings at 5510 E. Holmes Road and 5540 E. Holmes Road has filed a $28.9 million loan on the properties.

Midwest Memphis Industrial LLC, which bought the East Holmes Road properties for $23 million from Industrial Logistics Owner LLC, filed the loan Dec. 20 through Wells Fargo Bank NA.

The loan closed four days after the sale but wasn’t recorded by the Shelby County Register of Deeds until this week. Ron Ragsdale signed the loan as vice president of Midwest Memphis Industrial LLC, an affiliate of Midwest Industrial Investors LLC.

The adjacent properties, which are leased by Ozburn-Hessey Logistics LLC, sit at the northeast corner of Lamar Avenue and East Holmes Road, just north of the Tennessee-Mississippi state line.

Built in 1998, the 440,471-square-foot Memphis Logistics I warehouse at 5510 E. Holmes Road sits on 25.7 acres and has a 2013 appraised value of $11.5 million, according to the Shelby County Assessor of Property.

Built in 1999, the 283,080-square-foot Memphis Logistics II warehouse at 5540 E. Holmes Road sits on 17.7 acres and has a 2013 appraised value of $7.5 million, according to the assessor.

Source: The Daily News Online & Chandler Reports

– Daily News staff

Halbert Pulls Petition for Criminal Court Clerk

Memphis City Council member Wanda Halbert pulled a qualifying petition Monday, Dec. 30, to run for Shelby County Criminal Court clerk in 2014.

Halbert, who is serving her second term on the council after serving on the now-defunct Memphis City Schools board, would run in the May Democratic primary for the position, which is now held by Republican Kevin Key.

Halbert, along with other prospective contenders, has until Feb. 20 to file her petition.

Other likely contenders who already have petitions out for the Democratic primary for clerk are Vernon Johnson, who ran in the 2010 Democratic primary, and Michael McCusker, currently a Shelby County assistant district attorney.

Key, who won election to the clerk’s office in 2010, has a possible opponent in the May GOP primary. Richard DeSaussure has pulled a petition.

Also pulling a qualifying petition Monday was Brandon Echols for the Democratic primary in County Commission District 7.

– Bill Dries

Farmers Market Vendors Donate Food to Needy

Nine vendors from Agricenter International’s Farmers Market have donated 19,046 pounds of fresh produce and bread to help feed the needy in Memphis.

The vendors worked with the West Tennessee Gleaning Network. The vendors donated food between May 4 and Oct. 31 and topped last year’s total of 12,255 pounds by almost 6,800 pounds.

Food from the farmers market that hasn’t been sold is donated to a variety of groups. The gleaning network collected almost 35,000 pounds of food throughout Shelby County in 2013.

– Andy Meek

Wells Fargo in $591 Million Deal With Fannie Mae

Wells Fargo says it has made a $591 million deal with Fannie Mae to settle obligations related to loans that went bad after the housing bubble burst.

The deal announced Monday covers loans made through 2008. Wells Fargo & Co. says it resolves nearly all repurchase liabilities it has with Fannie Mae, the federal mortgage buyer.

After adjusting for other repurchases, San Francisco-based Wells Fargo will pay out $541 million, which it says it had already set aside. Wells Fargo agreed in September to pay $869 million to Freddie Mac to settle similar claims.

Lenders including Bank of America, Citigroup and JPMorgan Chase have also agreed to settle mortgage claims with Fannie this year.

– The Associated Press

Cooper Tire Ends Buyout Agreement With Apollo

Cooper Tire & Rubber Co. is calling off its sale to India’s Apollo Tyres, unraveling a $2.2 billion deal announced just over six months ago.

Cooper said financing is no longer available and it continues to claim, as it has for months, that Apollo breached the terms of the agreement.

Apollo said after the announcement Monday, which it called disappointing, that it may pursue legal remedies.

Both companies agreed to the sale in June, but things deteriorated rapidly. Negotiations with the union representing Cooper employees became a sticking point.

Apollo sought a better price citing labor issues in China and weaker profit, which Cooper said was a stalling tactic. The Findlay, Ohio, company took its claim to a Delaware court, but a ruling last month found no breach of obligations on Apollo’s part.

Cooper Chairman and CEO Roy Armes said during a brief, Monday morning webcast that Cooper never received a new offer from Apollo that came with committed financing and that presented “unreasonable risk” for his company.

Company executives vowed to pursue a reverse termination fee of $112.5 million and other possible damages. They do not believe the company owes Apollo a $50 million termination fee that was part of the initial agreement.

Cooper will return to court with Apollo to resolve some remaining issues, including whether Apollo made an appropriate effort to reach a deal with the union, said Chief Financial Officer Brad Hughes.

Apollo Tyres Ltd. said Monday that it had made “exhaustive efforts to find a sensible way forward over the last several months.”

Cooper shares soared to nearly $35 in June after it announced the buyout, but they have fallen steadily since then.

– The Associated Press

Signed Contracts to Buy US Homes Level Off

The number of Americans who signed contracts to buy existing homes in November was essentially unchanged from October, suggesting sales are stabilizing after several months of declines.

The National Association of Realtors said Monday that its seasonally adjusted pending home sales index ticked up to 101.7 from 101.5 in October. The October figure was revised lower from an initial reading of 102.1.

Higher mortgage rates and strong price gains over the past two years have slowed sales. The pending home sales index had fallen for five straight months before November. And completed sales of existing homes fell for three straight months, the Realtors said earlier this month.

There is generally a one- to two-month lag between a signed contract and a completed sale.

The average interest rate on a 30-year mortgage edged higher to 4.48 percent last week, from 4.47 percent the previous week. Rates jumped about 1.25 percentage points from May through September, peaking at 4.6 percent. That increase occurred after Federal Reserve Chairman Ben Bernanke indicated that the Fed would start to slow its bond-buying program before the end of the year.

Earlier this month, the Fed announced it will reduce its $85 billion in monthly bond purchases by $10 billion a month starting in January. The bond purchases are intended to push down longer-term interest rates and encourage more borrowing and spending.

Robert Kavcic, an economist at BMO Capital Markets, said that recent housing market indicators have been mixed. Applications for mortgages to purchase homes fell to a nearly two-year low last week, he said.

Still, “we continue to believe that the U.S. housing market will absorb the upward move in mortgage rates and push higher in 2014, helped by still-attractive affordability, better job growth and improved confidence in the recovery,” Kavcic said.

Despite the recent declines, home re-sales should reach 5.1 million in 2013, the best total in seven years, the Realtors forecast. That’s 10 percent higher than 2012’s total of almost 4.7 million. But it’s still below the 5.5 million that is consistent with a healthy housing market.

The Realtors forecast that sales will remain largely flat in 2014 and then rise to 5.3 million in 2015. Steady job gains should make it easier for more people to buy homes. And mortgage rates remain low by historical standards.

– The Associated Press

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 54 266 12,031
MORTGAGES 111 406 15,756
FORECLOSURE NOTICES 27 107 3,130
BUILDING PERMITS 0 606 28,832
BANKRUPTCIES 73 364 11,671
BUSINESS LICENSES 17 119 4,274
UTILITY CONNECTIONS 121 549 17,732
MARRIAGE LICENSES 23 104 3,668

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