VOL. 124 | NO. 6 | Friday, January 9, 2009
Hickory Pointe Sells For $5.8M to Utah Investor
The Hickory Pointe Apartments at 2775 Hickory Pointe Lane in Hickory Hill has sold for $5.8 million in a substitute trustee’s sale to Hickory Pointe Apartments Utah LLC, an affiliate of Salt Lake City-based Capital Growth Corp.
The buyer submitted a bid Nov. 25 on the steps of the Shelby County Courthouse, and the sale closed Jan. 6 with Blake Pera and Tommy Bronson of CB Richard Ellis Memphis’ multifamily division representing the seller, MBIA Inc.
Formally, the sellers were substitute trustees Carla Peacher-Ryan and Mary Aronov on behalf of MBIA. Also, the property was previously operated by the Health, Educational and Housing Facility Board of Memphis.
Hickory Pointe Apartments financed the purchase with a $5.1 million loan through Greystone Servicing Corp. Inc.
Hickory Pointe Apartments is a 240-unit multifamily complex built in 1984, along Mount Moriah Road near Ridgeway Road. Hickory Pointe has one- and two-bedroom units averaging 813 square feet and $591 in rent per unit. The property features a clubhouse, swimming pool, fitness center and tennis court.
“This acquisition allows the buyer to expand their presence in the Memphis market with an asset that should deliver immediate upside once repositioned within the submarket,” Pera, senior vice president at CBRE, said in a statement.
The Capital Growth Corp. executive familiar with the acquisition also was unavailable for comment Thursday.
Fogelman Management Group was the former property manager for Hickory Pointe, but the company will not manage the apartments for the new owner, said Fogelman Management president Mark Fogelman.
Source: The Daily News Online & Chandler Reports
Fred’s December Sales Down 4 Percent
Fred’s Inc. has reported total sales for December were $201.6 million, down 4 percent from $209.8 million in December 2007.
Fred’s is closing 75 underperforming stores and 22 underperforming pharmacies this year. Excluding those stores, total sales from ongoing stores increased 2 percent in December compared to December 2007. Comparable store sales for the month were flat.
Total sales for the 11-month fiscal period that ended Jan. 3 increased 2 percent to $1.673 billion. Total sales in the same period a year earlier were $1.648 billion. Comparable store sales during the same period increased 2.2 percent.
Continuing Jobless Claims Rise More Than Expected
The number of people continuing to seek unemployment benefits has risen sharply, according to government data released Thursday, indicating that laid-off workers are having a harder time finding new jobs as the recession enters its second year.
The U.S. Department of Labor also reported that initial applications for unemployment insurance dropped by 24,000 to a seasonally adjusted 467,000 for the week ending Jan. 3. Wall Street economists expected initial claims to increase, but analysts said the new figure reflects the difficulty the government has in making seasonal adjustments over the holiday period.
The four-week average of initial claims, which smooths out fluctuations but also includes the shortened holiday weeks, fell by 27,000 to 525,750.
The number of people continuing to claim jobless benefits jumped unexpectedly by 101,000 to 4.61 million. That was above analysts’ expectations of 4.5 million and the highest level since November 1982, when the nation was emerging from a steep recession, though the labor force has grown by about half since then. The data for continuing claims is for the week ended Dec. 27.
“Getting a job in this environment ... is extremely difficult,” said Joshua Shapiro, chief U.S. economist at MFR Inc., a New York consulting firm.
Companies have resumed mass layoffs after a brief respite over the holidays. This week alone, insurance provider Cigna Corp., aluminum producer Alcoa Inc., data-storage company EMC Corp. and computer products maker Logitech International have announced large job cuts.
Unemployment figures due out today are expected to show that the U.S. lost a net total of 500,000 jobs in December. If accurate, that would bring total job losses last year to 2.4 million, the first annual job loss since 2001 and the highest since 1945, though the number of jobs has more than tripled since then.
The job cuts are expected to send the unemployment rate to 7 percent in December, up from 6.7 percent the previous month. That would be the highest level since June 1993. The unemployment rate also will be released today.
Last week was the second in a row that initial claims have come in below 500,000, after seven weeks above that level. A Labor Department analyst said the dip could be a result of companies laying off workers earlier this winter than in previous years. Initial claims reached a 26-year high of 589,000 two weeks ago.
Mortgage Giants Extend Suspensions of Foreclosures
Mortgage giants Fannie Mae and Freddie Mac said Thursday they will extend the suspension of foreclosure sales and evictions from single-family homes through the end of January.
The companies had suspended foreclosures through the holidays, but were expected to resume proceedings after today.
The government-controlled home loan giants said the extension will allow borrowers facing foreclosure to keep their homes as it works with mortgage servicers to find options for troubled mortgage holders under the Streamlined Modification Program.
Freddie and Fannie began the modification program in December, in an effort to create more affordable mortgage payments for borrowers at risk of foreclosure. The program applies to borrowers who have missed three payments or more, own and occupy their homes, and have not filed for bankruptcy.
Under the program, borrowers can reduce their interest rate, extend the life of the loan or defer payments on part of the principal.
The extended hiatus on foreclosures will give Fannie more time to launch a new policy that will allow renters in company-owned foreclosed properties to stay in their homes, Fannie said in a news release. Details of the new policy have not been announced.
Fannie personnel have been reviewing seriously delinquent loans to see if borrowers have been contacted and all options to work out their situations have been exhausted, the company said.
Freddie Mac Chief Executive David Moffett said in a statement the mortgage giant is “committed to pursuing every responsible opportunity to reduce foreclosures and accelerate the return of stability to the U.S. housing market.”
Fannie and Freddie own or guarantee about half of the $11.5 trillion in U.S. outstanding home loan debt. The government seized control of the sibling companies in September.
BlueHippo to Set Aside $1M in Tennessee
BlueHippo, a company that markets computers nationwide to people with poor credit, was ordered Wednesday to set aside $1 million to cover potential claims from unhappy Tennessee residents.
The Tennessee attorney general’s office is suing BlueHippo, accusing the company of misleading customers with confusing advertising claims and financial arrangements.
The state had asked for a deposit of more than $2.5 million on arguments that up to 4,500 Tennessee customers were lured into buying computers that cost hundreds of dollars more than expected, many of which were never delivered.
Judge Walter Evans of state Chancery Court ordered BlueHippo to deposit $1 million with the clerk of court to cover potential claims from the lawsuit that is expected to go to trial in June. Evans also issued an order telling BlueHippo to abide by the state’s consumer protection laws.
At a hearing before Evans, BlueHippo said the deposit was unnecessary, largely because the company entered into a settlement with the Federal Trade Commission in 2008 agreeing to abide by national consumer protection laws.
That settlement followed complaints that BlueHippo, which advertises nationally on TV and radio, in print and on the Internet, misrepresented its sales agreements with customers with “less than perfect credit” who allowed the company to withdraw weekly payments from their bank accounts.
BlueHippo lawyer Gerald Neenan said the Tennessee suit primarily covers complaints from customers who bought computers under a “business model” the company no longer uses.
The Tennessee lawsuit names three businesses operating under the BlueHippo name, BlueHippo Funding of Maryland; BlueHippo Capital, Virginia; and BlueHippo Capital, Nevada.
Cohen Wants to Block Congress Pay Raise
U.S. Rep. Steve Cohen, D-Memphis, has signed on to legislation that would block a nearly $4,700 automatic pay raise members of Congress could receive next year.
The pay raise is the result of a 1989 law Congress passed that made pay raises automatic each January unless the lawmakers specifically vote to reject the pay hike. The legislation Cohen has signed on to is a bill introduced by U.S. Rep. Harry Mitchell, D-Ariz., and U.S. Rep. Ron Paul, R-Texas, that would block a pay raise and save taxpayers nearly $2.5 million.