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VOL. 123 | NO. 219 | Friday, November 7, 2008

Daily Digest

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Reed White Holdings To Build on G’town Lot

Reed White Holdings LLC has filed a $737,500 construction loan to build a single-story, 3,800-square-foot office building in the Forest Hill-Irene Commercial Subdivision, on the west side of Forest Hill-Irene Road between Poplar Avenue and Poplar Pike. The loan is through Bank of Fayette County.

Reed White Holdings is a partnership between Bob Reed and Brian White. The duo has built a series of office buildings on various lots in the subdivision, including one at 9045 Forest Centre Drive, which is nearly complete. The company will move into that building in about two weeks, with half of that 5,500-square-foot building available for lease.

As for the coming project, White said construction will start after the first of 2009 with a seven- to nine-month timeline, weather dependant. The building will be constructed on half of the 1.2-acre lot that fronts Forest Centre Drive.

The Forest Hill-Irene Commercial Subdivision has been a boon for Reed White Holdings.

“We’ve been real pleased. We think it’s a great area for business and will be good for a long time,” White said. “The people that buy in here are going to have a great asset on their books.”

Reed White Holdings will serve as general contractor on the office building and McGehee Nicholson Burke Architects will be architect.

Source: The Daily News Online & Chandler Reports

Smith and Nephew Misses Earnings Goal

The stock of Smith and Nephew was trading lower Thursday morning after the company reported third quarter revenue that did not meet projections.

The company had earnings of 61 cents per share, which was 7 cents lower than expected. The company reported revenue of $930 million for the third quarter compared to $845 million for the same period a year ago.

Its orthopedics revenue grew 6 percent, and its endoscopy delivered 8 percent revenue growth. The company said in the report it was “sensitive to the impact that the current economic turmoil may have on the patients, surgeons and health care systems.” It said it would focus on efficiency and managing costs.

The company’s orthopedics division is based in Memphis, where it employs about 1,800.

Oct. Total Sales Down at Fred’s

Memphis-based Fred’s Inc. has reported total sales for October were $128 million, down 2 percent from $130.4 million in October 2007.

The 2 percent drop reflects the company’s previously announced program to close 75 underperforming stores and 22 underperforming pharmacies this year. Excluding the closed stores, total sales from ongoing stores increased by 2 percent in October. Same-store sales for the month rose 1.3 percent, an increase of 0.6 percent from October 2007.

Total sales for the third quarter of 2008 were $417.8 million, down from $419.9 million in the same period last year. Same-store sales for the quarter rose 1.4 percent compared to a 1.1 percent increase in the third quarter last year.

Total sales for the year-to-date period have increased 3 percent to $1.329 billion compared to $1.287 billion in the previous year.

Same-store sales for the year increased 2.9 percent versus 1.2 percent from the previous year.

Retailers Report Steep Sales Declines

The nation’s retailers saw their sales plummet last month to the weakest October level since at least 1969, as the financial crisis and mounting layoffs left shoppers too scared to shop.

The stunning and rare drop from an already weak September is further darkening the outlook for the holiday season and raising more concerns about the financial health of the industry, which is not expected to see a recovery until at least the second half of 2009.

A number of stores cut their profit outlooks as they slashed prices on everything from coats to holiday ornaments in a desperate bid to pull in shoppers. Analysts expect a do-or-die holiday season for more retailers, which already have seen competitors like Mervyns LLC and Linens ‘N Things forced to liquidate.

As merchants reported dismal sales figures Thursday, Wal-Mart Stores Inc., the world’s largest retailer, was among the few bright spots as it benefits from shoppers focusing on basics. The discounter plans to cut prices on thousands of items over the next seven weeks.

According to the ICSC-Goldman Sachs index, sales fell 1 percent, the weakest October performance since at least 1969 when the index began. That compares to a 1 percent gain in September and well below the 1.8 percent average pace so far this fiscal year, which for retailers begins in February.

Excluding Wal-Mart, the October sales number was down 4.6 percent. The index is based on same-store sales, or sales at stores opened at least a year, which are considered a key indicator of a retailer’s health.

Wal-Mart posted a 2.4 percent gain in same-store sales, better than the 1.6 gain projected by analysts surveyed by Thomson Reuters. Including fuel sales, same-store sales rose 2.5 percent.

Target Corp. – which has lagged behind Wal-Mart because of its heavier emphasis on nonessentials – posted a 4.8 percent drop, worse than the 2.8 percent decline that analysts had expected.

Mumpower Predicts Becoming Tenn. House Speaker

Republican House Leader Jason Mumpower said he expects to be elected speaker when the Tennessee Legislature convenes in January.

The Bristol lawmaker in an interview with The Kingsport Times-News cited the unity of House Republicans in his time as leader in his party’s picking up four seats to gain a 50-49 majority in the General Assembly’s lower chamber.

But Mumpower isn’t the only potential candidate. Several Republicans are expected to explore a bid for speaker, including Nashville Rep. Beth Harwell, who argues that future GOP growth will be centered in Middle and rural West Tennessee.

Current Speaker Jimmy Naifeh, a Covington Democrat, may also seek to poach Republican votes to extend his record 18-year grip on the top post in the House.

The GOP will control both chambers for the first time since the aftermath of the Civil War in 1869, according to legislative historian Eddie Weeks.

Former U.S. Rep. Bill Jenkins was the last Republican elected speaker in 1969, when the two parties each had 49 seats.

Assassination Attempt Men Indicted by Grand Jury

Two men accused of planning an assassination attempt on President-elect Barack Obama were indicted this week by a federal grand jury.

Daniel Cowart of Bells, Tenn., and Paul Schlesselman of West Helena, Ark., face five counts of threatening a presidential candidate and firearms charges.

Both were arrested last month in Haywood County, Tenn., by local authorities after they had shot out the window of a church in Brownsville and scrawled neo-Nazi and white supremacy slogans on their car.

The indictment Wednesday, the day after Obama won the presidential election, cancels a probable cause hearing that had been scheduled for Thursday before U.S. Magistrate Gerald Cohn in Memphis.

The two made a brief appearance before Cohn last week but waived a detention hearing. They remain in federal custody pending trial on the charges.

The indictment offers more details of a plot hatched in September and October as Cowart and Schlesselman allegedly communicated with each other via a white supremacy Web site. Four of the five counts describe a plot to rob an un-named gun store in Jackson, Tenn., as part of the planning for a murder spree targeting black citizens.

The plot, which allegedly was to be capped off by shooting at Obama from a moving car while they wore white tuxedos and top hats, led to the two meeting in person last month, according to the indictment. Before the face-to-face meeting, Cowart and Schlesselman allegedly talked via the Internet. That included the two sharing detailed plans to rob the gun store on Sept. 11, according to the charges.

But the fifth count also claims that Cowart made a threat against Obama as early as May. It doesn’t offer any details about where or how the threat was made.

Local Developer Forecasts Dark Days

Local homebuilder and real estate developer Jackie Welch has been involved in the development business for more than 40 years. In a recent interview with The Daily News, he said the downturn in the local real estate market will result in some painful realities in 2009, the year of the next countywide property reappraisal.

“There’s just going to be so many appeals (of new property values), and I would say it’s probably going to take a year or two to shake out.

“But I would say it’s going to cost the city and county 20 to 25 percent of the (property tax) revenue that’s just going to diminish. The real estate market has taken the brunt of this recession that we’re in. Houses that were selling for $250,000 – they’re down $50,000, $60,000 and $70,000.”

PROPERTY SALES 0 322 4,193
MORTGAGES 0 320 4,710
BANKRUPTCIES 0 211 3,096