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VOL. 127 | NO. 99 | Monday, May 21, 2012

Daily Digest

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Nucor Files Permit App to Expand Shipping Bldg.

Nucor Steel Memphis Inc. is planning to grow its shipping building, according to a $2 million building permit application filed with the city-county Office of Construction Code Enforcement. The scope of work includes the foundation, fabrication and construction of the addition, according to the permit, which does not list a general contractor.

Nucor is taking steps toward increasing its Memphis steel operations at 3601 Paul R. Lowry Road. The local expansion is part of a two-year, $290 million effort to expand the Charlotte-based company’s production of special bar quality and wire rod, with a goal of completing the projects by 2013.

The city-county Economic Development Growth Engine (EDGE) board in recent months awarded Nucor a 15-year tax freeze for the company’s local expansion, which Nucor says will increase its manufacturing output by up to 25 percent, create 27 new jobs at its Paul R. Lowry Road location and include the acquisition of about 42 acres on the east side of Paul Lowry to help expand its rail infrastructure.

In return, the company would invest $113 million to produce “high-quality carbon alloy steel for the automotive, heavy equipment and service center markets.”

The tax freeze will save Nucor about $9.4 million in taxes over the 15-year term.

Source: The Daily News Online & Chandler Reports

– Daily News staff

Fitch Ratings Downgrades Memphis Airport Bonds

The credit rating agency Fitch Ratings reacted Friday, May 18, to decreasing passenger flights and passenger counts at Memphis International Airport by downgrading airport bonds from an A+ rating to an A and revising its rating outlook from negative to stable.

The new rating affects $415.5 million in outstanding bonds the Memphis-Shelby County Airport Authority has issued.

Service cutbacks by Delta Air Lines Inc. that started in August and the prospect of more cuts caused Fitch to have “elevated concerns over financial flexibility and cost stability,” according to a statement from the agency.

“At a lower traffic base, the airport will still remain exposed to continued concentration from Delta Air Lines and could be more dependent on FedEx’s cargo operations and revenues should a larger de-hubbing scenario take place,” the statement continues.

The bonds the airport uses to finance construction projects are backed with net revenues from the airport operation.

The notice of the change in rating and the ratings outlook also mentions that Memphis International is one of the few airports rated by Fitch that does not impose a passenger facility charge.

Airport executives have touted that as an asset and have said they can do without the charge because of the presence of the FedEx hub that makes Memphis International the largest cargo airport in the U.S. But the Fitch report said “it could be instituted in the future to support future capital needs.”

The report was released the day after the airport authority board approved a $1 million pool of incentives designed to land new non-stop air service at Memphis International, providing competition to Delta and thereby lowering airfares.

– Bill Dries

$1 Million Permit Filed for FDIC in Lakecrest III

B&B Specialty Contractors Inc. has filed a $1 million building permit application with the city-county Office of Construction Code Enforcement for tenant space alterations for Federal Deposit Insurance Corp. in Lakecrest III, 6060 E. Primacy Parkway, according to The Daily News Online, www.memphisdailynews.com.

Commercial Advisors Asset Services LLC manages the office building for the Massachusetts-based owner, REIT Management & Research LLC.

Frank Bryan, president of B&B Specialty Contractors, said the space is 32,306 square feet and build-out is scheduled for completion Sept. 1.

– Sarah Baker

Medtronic Bone Graft Investigation Closed

The Associated Press reported that Medtronic Inc. Wednesday, May 16, said federal prosecutors have closed their investigation of the company’s InFuse bone graft.

The Minneapolis-based medical technology company’s Spinal & Biologics Business is based at 1800 Pyramid Place in Memphis. InFuse brought in most of Medtronic’s spinal business revenue.

Medtronic was being investigated by the U.S. Department of Justice and the U.S. Attorney for the District of Massachusetts.

InFuse contains a genetically engineered protein that can stimulate bone growth. In June, a medical journal alleged Medtronic had downplayed the product’s risks and failed to disclose millions of dollars in payments to the authors who wrote initial studies of the product.

InFuse is approved for use in spinal, oral and dental graft procedures, but most of the time it was used in neck surgeries and other procedures. Use of InFuse in neck surgeries can lead to problems swallowing, breathing and speaking.

Doctors are allowed to use drugs and medical products off-label as they see fit, but companies are not permitted to market their products for off-label uses.

Medtronic in March agreed to pay $85 million to resolve a federal class-action lawsuit brought by a shareholder, the Minneapolis Firefighters Relief Association, which alleged Medtronic did not disclose how much of the company’s revenue from InFuse came from uses not approved by regulators, did not disclose side effects patients were suffering, and did not disclose what the plaintiffs described as illegal marketing.

Medtronic said it did not make any misrepresentation.

– Aisling Maki

RVC Outdoor to Sponsor Wounded Warrior Project

RVC Outdoor Destinations – a Memphis-based owner and operator of upscale, resort-like campgrounds – has announced the launch of its Wounded Warrior Fishing sponsorship.

RVC Outdoor Destinations has partnered with retired U.S. Air Force Staff Sgt. and current U.S. Coast Guard Capt. Mark McDuffie to offer the program, which is designed to help soldiers injured physically or mentally in Iraq or Afghanistan relax and enjoy the outdoors with their families.

The Wounded Warrior Fishing program, headquartered at the company’s Live Oak Landing property in Freeport, Fla., will host an injured soldier and his or her family one night each week to enjoy the outdoors through activities such as fishing trips, river tours, on-site recreation activities and a cookout – all free of charge.

McDuffie first started the program a year ago as a nonprofit called Wounded Warrior Fishing. Injured while fighting in Iraq and now fully recovered, McDuffie operates at the Live Oak Landing property and will head up the new partnership sponsored by RVC.

Wounded Warrior Fishing and RVC will officially kick off the program on Memorial Day weekend to coincide with the unofficial start of the summer travel season.

– Sarah Baker

Tenn. Jobless Rate Drops for 9th Straight Month

Tennessee’s unemployment dropped slightly in April, marking the ninth straight month of decreases in the state’s unemployment rate.

The 7.8 percent unemployment rate is down from 7.9 percent in March and the lowest it’s been since November 2008.

Labor and Workforce Development Commissioner Karla Davis said in a release that the decrease in the jobless rate is largely caused by fewer people seeking work.

State manufacturing jobs saw the biggest increase compared with last month, at a growth rate of 1.8 percent. Next were jobs in trade, transportation and utilities at 1.6 percent and positions in the leisure and hospitality sector at 1.5 percent.

Nationally, unemployment rates fell in two-thirds of U.S. states last month, evidence that modest economic growth is boosting hiring in most areas of the country. And in many states, unemployment has fallen well below the national average, which was 8.1 percent last month. Rates were lower than 7 percent in 22 states in April. That compares to only 13 states in April 2011.

The Labor Department said Friday that unemployment rates dropped in 37 states in April, the most in three months. Unemployment rose in 5 states and was unchanged in eight.

– The Associated Press

PROPERTY SALES 0 133 1,342
MORTGAGES 0 131 1,047