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VOL. 123 | NO. 19 | Tuesday, January 29, 2008

Daily Digest

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GSK Files $5M Permit For Production Line Change

     GlaxoSmithKline has filed a $5 million permit with the city-county Department of Construction Code Enforcement for its facility at 2149 Harbor Ave. on Presidents Island. The facility is adding new filling and packaging lines for its BC, Goody's and Stanback headache powders, a company spokesman said.
     Construction is expected to start soon and wrap in 2009.
     The company's Memphis facility manufactures several of its non-prescription consumer products - including the headache powders; Polident denture cleanser, Poli-Grip Comfort Seal Strips and Chap-Et lip balm.
     GSK in July applied for a $1.8 million permit toward the $1.9 million warehouse renovation near its Harbor Avenue facility. The renovated, 50,000-square-foot facility was to be used as a storage facility, a GSK representative said at the time.
     Headquartered in Middlesex, England, the company employs more than 100,000 people worldwide. It has 80 manufacturing sites in 37 countries, according to the company's Web site. Its over-the-counter brands include Nicorette, Aquafresh, TUMS and Citrucel, while its prescription drugs include Paxil and Imitrex.
     GSK recently announced plans to lay off all 236 workers at its 400,000-square-foot pharmaceutical plant in Bristol, Tenn., starting in April, according to The Associated Press. The company originally announced the closure in 2006 after reporting sales of its signature penicillin drug, Augmentin, significantly declined when the company lost patent protection and began facing competition from generic versions of the drug.

First Horizon Narrows Lending Focus

     First Horizon National Corp. said Monday it will cease originating home builder and commercial real estate loans nationally.
     Instead First Horizon will continue to offer the loans through its banking unit, First Tennessee Bank, primarily in Tennessee and in the Southeast.
     The move is part of a plan to reduce its national real estate exposure and focus on growing in its local area. First Horizon is aiming to reduce its national real estate portfolio exposure by $2 billion in 2008.
     The national lending operations will continue to be used to complete any projects already started.

2007 New Home Sales Dropped by Record Amount

     Sales of new homes plunged by a record amount in 2007 while prices posted the weakest showing in 16 years, demonstrating the troubles builders are facing with a huge backlog of unsold homes.
     The U.S. Commerce Department reported Monday that sales of new homes dropped by 26.4 percent last year to 774,000. That marked the worst sales year on record, surpassing the old mark of a 23.1 percent plunge in 1980.
     The government reported that the median price of a new home barely budged last year, edging up a slight 0.2 percent to $246,900, the poorest showing since prices fell by 2.4 percent during the 1991 housing downturn.
     The new report reinforced the view that housing is currently undergoing its worst downturn in more than two decades, with the slump threatening to surpass in some ways the severe housing recession of the early 1980s.
     The housing weakness has dragged down overall growth and sent shockwaves through the rest of the economy including the financial sector, which is dealing with billions of dollars in losses in subprime mortgages. Some analysts are worried that the fallout could become so severe it will drag the entire country into a recession.
     The 26.4 percent drop in sales for 2007 represented weakness in every part of the country except the Northeast, where sales posted a small 1.6 percent advance. Sales recorded declines of 32.2 percent in the West, 26.7 percent in the Midwest and 26.3 percent in the South.
     The year ended on a weak note with new home sales in December falling by 4.7 percent after an even sharper 12.6 percent decline in November.
     While the median home price for the entire year was up slightly, the median price of homes sold in December was $219,200. That was down 10.4 percent from a year ago, the biggest 12-month price drop in 37 years.
     Analysts said that prices will likely keep falling in early 2008 as builders continue to struggle to work down the glut of homes.
     It would take 9.6 months to eliminate the backlog of unsold new homes at the December sales pace, the longest stretch of time since the month's supply stood at 10.3 months in October 1981.

Area Lenders Join THDA Advisory Board

     Four West Tennessee mortgage bankers have joined the lender advisory board of Tennessee Housing Development Agency.
     The area representatives are Jennie Allen of First Horizon Home Loans in Memphis; Kathryn Harris of Community Mortgage in Cordova; Lisa Reid of Magna Bank in Memphis; and Linda Sparks of First State Mortgage in Jackson.
     Nashville-based THDA was established by the Tennessee General Assembly in 1973. It helps first-time homebuyers by offering mortgages at interest rates lower than conventional market rates.
     The organization's main product is a 30-year fixed-rate loan, although it also offers down-payment assistance programs at slightly higher rates, said Lorrie Shearon, chief strategy officer for THDA and the coordinator of its advisory boards.
     It doesn't use state taxpayer funds; instead, THDA issues tax-exempt bonds, with the earnings on those investments paying for the organization's operating costs.
     The lender advisory board is focused on the foreclosure issue, and THDA urges homeowners to contact their mortgage providers as soon as a budget difficulty is anticipated.

Memphis Children Have Chance at Early Voting

     Someone has to drive them to the polls and a few of them might have problems spelling the name of their chosen candidate.
     But in addition to early voting in advance of the Feb. 5 Tennessee presidential primaries, kid voting is also underway at the Children's Museum of Memphis. The museum is running a mock election through Saturday for all who come to the facility at 2525 Central Ave.
     It's part of the price of admission to the museum and includes lots of kid-sized information about how the presidential primary system works. The "It's A Voting Thing" program is offered once every four years when political interest is at its highest level among adults.
     The presidential general election historically generates the highest turnout of any election cycle among Shelby County voters - the adult ones. Turnout in the Tennessee primary in Shelby County in 2000 and 2004 was around 10 percent. Early voting for the grownups continues through Thursday. Go to www.shelbyvote.com for information on early voting locations and their hours.
PROPERTY SALES 93 424 6,970
MORTGAGES 42 281 4,410
BUILDING PERMITS 196 704 16,619
BANKRUPTCIES 38 174 3,570