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VOL. 7 | NO. 48 | Saturday, November 22, 2014

Daily Digest

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$70M Building Permit Filed for Graceland Hotel

Elvis Presley Enterprises is ready to shake, rattle and roll on its planned hotel near Graceland.

EPE has applied for a $70 million building permit through the city-county Office of Construction Code Enforcement for the resort-style Guest House at Graceland, which will be located north of Presley’s Graceland mansion in Whitehaven.

Memphis-based architecture firm Hnedak Bobo Group is the architect for the project. Flintco Inc. is the general contractor.

The Guest House at Graceland, the largest hotel development in Memphis in decades, will include a grand stairwell connecting two floors in the lobby that harkens back to the main staircase at Graceland itself. The hotel, scheduled to open in fall 2015, also will include Jungle Room-inspired prints and accents, plus a sports bar and lounge that recalls the design of Graceland’s billiard room.

Other design touches include the separation of the hotel façade into three components to give it the feel of three separate residential-scale hotel buildings added over time.

AutoZone Ordered to Pay $185M Over Pregnant Bias

A federal jury in San Diego has hit AutoZone with $185 million in punitive damages after finding that the company retaliated against a pregnant manager, eventually demoting and firing her.

U-T San Diego reported Tuesday that the three-woman, five-man jury also awarded Rosario Juarez $872,000 in compensatory damages for lost wages and emotional stress.

The newspaper says it is believed to be one of the largest employment law verdicts for an individual in U.S. history.

AutoZone spokesman Ray Pohlman said in an email that the company plans to appeal.

The lawsuit claimed that when Juarez became pregnant in 2005, her boss continually suggested she step down because she couldn't handle the responsibilities of the job.

The auto-parts retailer operates about 4,000 stores across the U.S. and abroad.

Tenn. Unemployment Dips in October

Tennessee’s unemployment rate inched in the right direction in October but still remained above the national average.

The state preliminary unemployment rate was 7.1 percent in October, according to the Tennessee Department of Labor and Workforce Development, down just two-tenths of a percentage point from 7.3 percent in September. The U.S. preliminary rate for October was 5.8 percent, down from 5.9 percent in September.

Over the past year, Tennessee's unemployment rate decreased from 8.1 percent to 7.1 percent, while the national rate declined from 7.2 percent to 5.8 percent.

Total nonfarm employment increased by 7,900 jobs from September to October. The largest increases occurred in trade/transportation/utilities, which accounted for 3,500 jobs; professional/business services, which netted 2,900 jobs; and manufacturing, which recorded an increase of 1,300 jobs.

Over the year, nonfarm employment in Tennessee increased by 59,800 jobs. The largest increases occurred in professional/business services, trade/transportation/utilities and leisure/hospitality.

KPMG Signs Lease In East Memphis

After a year-long study of different options, audit, tax and advisory firm KPMG has made its move from Downtown to East Memphis official with its announcement today of the signing of a 10-year 3-month lease at Highwoods Properties’ Triad Centre III at 6070 Poplar Ave.

KPMG’s Memphis office, which is home to a staff of 60, plans to move out of its current space in the Raymond James Tower next month.

Features of the new space include collaborative workspaces and enhanced technology capabilities, as well as the firm’s plan to minimize its environmental footprint using sustainable construction practices and materials, natural lighting and other energy efficient measures. The firm also plans to get LEED certification for the office buildout.

KPMG worked with Pat Gamble of CBRE to negotiate the lease with Highwoods Properties.

Crye-Leike Leaving Downtown for Midtown

Crye-Leike Realtors will leave its Downtown Memphis location on Madison Avenue and head east for Midtown, a move that will pave the way for the company’s current building to be converted to a boutique hotel.

The Memphis-based real estate brokerage firm expects to soon leave leased space in the 44,000-square-foot building at 179 Madison Ave. to open its new office at 1715 Union Ave. in the second week of December, according to a press release.

Real Estate veteran Carol Lott will be the new managing broker in charge of the office, which will still cover the Downtown area.

Nike Inc. Applies For $2M Building Permit

Nike Inc. has applied for a $2 million building permit through the city-county Office of Construction Code Enforcement for additions to its distribution center at 3100 New Frayser Blvd.

Elk Grove, Ill.-based Wynright Corp. filed the applications, which calls for “engineering materials, mechanical and electrical” installation.

The latest permit is part of Nike’s $301 million expansion in Frayser. The company applied for a $1.9 million building permit in October and two permits totaling $691,600 in November. It also sought a $1.4 million permit in January and a $20 million permit in March.

In 2012, the board of the Memphis and Shelby County Economic Development Growth Engine approved a 15-year payment-in-lieu-of-taxes agreement with Nike for the expansion. According to the approved PILOT, the expansion would retain 1,600 jobs and add 250 more once the expanded facility opens.

In January 2013, Nike paid Belz Investco GP $2.2 million for about 200 acres of vacant land north of the company’s 1.1 million-square-foot facility in Frayser.

Medtronic Spine Sees Slight Q2 Revenue Growth

Medtronic Spine has reported a 1 percent increase in revenue for the second quarter of fiscal year 2015, reporting quarterly revenue of $746 million on a constant currency basis.

Core Spine revenue was flat, at $551 million. International Spine revenue dropped 5 percent, to $75 million.

BMP (bone morphogenetic protein) revenue was $120 million, up 9 percent.

“We’ve invested in a number of new products and procedural solutions in recent years to refresh our portfolio, and physicians continue to respond favorably,” said Doug King, senior vice president and president, Medtronic Spine. “Our growth was driven by our class-leading Biologics therapies, as well as strong demand in emerging markets.”

Overall, Minneapolis-based Medtronic reported earnings of $828 million in the fiscal second quarter, an 8 percent decrease from a year ago. Earnings adjusted for non-recurring costs and costs related to mergers and acquisitions were 96 cents per share.

Revenue was $4.4 billion, up 4 percent from the same period last year, driven in part by a revenue surge for Medtronic’s catheter-delivered aortic valve replacement, CoreValve.

"Our second-quarter performance was strong and well-balanced across our businesses and geographies," said Omar Ishrak, Medtronic chairman and chief executive officer, in a statement. "Revenue growth was at the upper end of our full-year revenue outlook and within our mid-single digit baseline goal, reflecting the strong execution of our global organization."

The company expects full-year earnings in the range of $4 to $4.10 per share.

Collierville Chamber CEO to Retire

Fran Persechini has decided to step down as president and CEO of the Collierville Chamber of Commerce after spending 20 years with the organization.

“I am so proud of the work our chamber has done to improve our business climate, cultivate leaders and strengthen our community,” said Persechini in an email. “The chamber is positioned well to do great things and impact Collierville even more, making this the ideal time for me to step aside and let a new leader carry the torch.”

Chamber board chairman Matt VanCleve said Persechini brought an unparalleled enthusiasm to the job, one that motivated staff, board members and volunteers.

“Leading the Collierville chamber for 20 years is no easy task, but one Fran has done with amazing enthusiasm,” he said.

Former board chairman Matt White is heading a search committee for Persechini’s replacement. No timeframe for Persechini’s departure or finding her successor has been announced yet.

“We are most thankful for to her for her years of service and for her willingness to help in any way she can with the transition process, ensuring her replacement enjoys a smooth transition,” said White.

Persechini, a Massachusetts native, and her husband, Fred, moved to Collierville in 1994 after he was assigned to the Memphis Army Depot. Persechini began her career at the chamber in December 1994.

Persechini’s tenure coincided with a period of immense growth for the Memphis suburb and the organization, which now has 750 businesses as members, an all-time high.

Magna Bank Hosts Series Of Thankfulness Initiatives

Magna Bank has launched a series of in-branch and social media initiatives called Magna Banksgiving, designed to show how thankful the bank is for its clients’ business.

Initiatives still to come as part of the effort include offering coffee, hot chocolate and a variety of treats at each Magna Bank location on Black Friday, Nov. 28.

On Facebook and Twitter from Monday, Nov. 24, through Dec. 19, Magna Bank is holding a gift card giveaway for Memphians who are doing good things for their communities. Individuals can use the hashtag #MagnaBanksgiving to nominate a friend or family member they feel deserves a gift card.

One winner per week will win a $100 gift card, and the type of gift card will be matched to the recipient’s good deed. For example, a nominee who delivers meals to the needy might receive a gift card for gas.

Auction of Elvis Items Set for January

More than 60 authentic artifacts related to late singer Elvis Presley are set to be auctioned in Memphis in January.

Elvis Presley Enterprises says the auction, scheduled for Jan. 8, will be part of the annual celebration of Presley's birthday at Graceland, his longtime Memphis home. Bidding will begin online two weeks prior to the live auction at Graceland.com/Auction.

All 68 of the items are from third-party collectors, and they have been researched by Graceland's authenticators.

Among the items being auctioned is an acetate of Presley's first-ever recording produced at Memphis Recording Service in June 1953. The recording features the songs "My Happiness" on side A and "That's When Your Heartaches Begin" on side B.

Presley was 42 when he died on Aug. 16, 1977, in Memphis.

Memphis Selected to Host 2017 NCAA Regional

The NCAA Tournament is returning to Memphis and FedExForum in 2017.

The University of Memphis has been selected to host the 2017 NCAA Men’s Basketball South Regional at FedExForum on March 24 and 26, 2017. The winner of the 2017 South Regional advances to the Final Four in Phoenix.

This will be the third NCAA Men’s Regional that Memphis has hosted at FedExForum. Memphis also hosted men’s regional events in 2009 and 2014. In all, this is the seventh time the University of Memphis will play host to an NCAA Division I Men’s Basketball Championship event. Memphis also hosted the 1984 Midwest First and Second Rounds in 1984 at the Mid-South Coliseum, as well as the 1995 and 1997 Southeast Regional First and Second Rounds and the 2001 South Regional First and Second Rounds at The Pyramid.

After hosting a men’s NCAA Regional event in 2009, the Tigers also hosted a women’s NCAA Regional at FedExForum in 2010.

The three other regional sites for 2017 will be Kansas City (host: Big 12), San Jose (host: Pac-12), and New York City (host: St. John’s and the Big East).

Archer-Malmo Named To ‘Best Places to Work’ List

Trade publication “Ad Age” has named Memphis-based archer-malmo to its “Best Places to Work” list.

This is the second time the agency has made the list, following its first appearance on the list in 2011.

“Ad Age” cited archer-malmo’s heavy investment in training, biweekly massages and frequent games and activities as reason for the inclusion. The agency was the only one in Tennessee to make the list and only one of two from the Southeast.

Collierville Daycares Sell for $4.4 Million

Two Collierville daycare centers have sold for a combined $4.4 million.

SDK Properties LLC sold the center at 105 Crescent Drive to Store Master Funding VII LLC for $2.5 million and the center at 1649 S. Shea Road to the same entity for $1.8 million, according to warranty deeds filed Nov. 14. The buyer, Store Master Funding VII LLC, is an affiliate of Scottsdale, Ariz.-based real estate investment trust STORE Capital. The centers operate as Kid Tech #1 and Kid Tech #2.

The 11,316-square-foot center on Crescent Drive, inside Boyle Investment Co.’s Schilling Farms development, was built in 1999. The Shelby County Assessor of Property’s 2014 appraisal is $1.2 million.

The 12,341-square-foot center on South Shea Road was built in 2009 on 1.6 acres near the intersection of Houston Levee Road and Tenn. 385. The assessor, which lists the property address as 0 Houston Levee Road, appraised it at $1.8 million this year.

Both purchases were financed with loans from Citibank NA.

Store Master Funding filed a $2.5 million loan on the Crescent Drive property and a $1.9 million loan on the Shea Road property, according to two deeds of trust filed Nov. 14,

Tiger Basketball Returns to WKNO

A 30-year community tradition returns to WKNO with the tape-delayed broadcast of 15 University of Memphis Tiger basketball home games.

The broadcasts will begin Tuesday, Dec. 2, at 10:30 p.m. on WKNO/Channel 10, featuring the Tigers’ game with Stephen F. Austin State University.

Greg Gaston, host of WKNO’s weekly series “Sports Files with Greg Gaston,” will offer play-by-play commentary. Greg has been involved in Memphis sports for nearly 20 years on television and is the current radio co-host on Sports 56 Middays on WHBQ-AM 560, 103.1 FM and FM 87.7.

The games are made possible on WKNO by Landers Auto Group, First Tennessee Bank, Hilton Worldwide, Memphis Goodwill, Methodist Le Bonheur Healthcare and WKNO members.

Most games will air at 10:30 p.m. on the same night the game is played live. The WKNO replays have a required four-hour delay from the live game, so for the games that must air at midnight, WKNO will offer Tiger fans a second replay opportunity. For the complete schedule, visit wkno.org.

Ark. Community College Considers Merger

The Board of Trustees at Mid-South Community College in West Memphis has agreed to discuss a possible merger with the Arkansas State University System.

Board Chair Mary Meux Toney said a merger could help the college do more for the city, county and region.

College President Glen Fenter said ASU would benefit from Mid-South's workforce training programs and the college would benefit from Arkansas State's support for funding workforce training programs.

Fenter said Mid-South Community College would retain autonomy if a merger occurs.

The name of the college would likely become Arkansas State University Mid-South. ASU's flagship campus is in Jonesboro with other campuses in Beebe, Mountain Home, Newport, Searcy, Marked Tree, Heber Springs, Paragould and the Little Rock Air Force Base.

Paragon Bank Launches Wealth Solutions Division

Paragon Bank has formed a wealth solutions division, a group of six led by president and managing director Dan Overbey, in a move beyond its traditional banking services to offer a new suite of products to customers.

The unit’s goal is to help customers with retirement and investment planning, as well as small-business strategies. It includes four wealth advisers: Staci Jackson, Mark Winburne, Kent “Brooks” Monypeny and Charles Hardee.

The division will focus its offerings on a range of strategic plans, including business investments, companywide retirement and individual retirement planning. Paragon also has teamed up with LPL Financial to provide equities, mutual funds and bonds annuities for businesses and individuals.

The announcement of Paragon’s new division comes about a month after the bank launched another expansion, with its Paragon Small Business Capital Group.

Education Commissioner Leaving for Private Sector

Education Department Commissioner Kevin Huffman said last week that the scrutiny he received during his nearly four turbulent years at the helm of the state's schools didn't influence his decision to leave for the private sector.

Huffman, whose departure was announced by Gov. Bill Haslam, has been a lightning rod whose policies and strong advocacy for Common Core standards made him a target for conservatives and teachers' groups.

Huffman told The Associated Press he knew what he was getting into when he took the job.

"The governor brought me here as a change agent," he said. "And I knew full well that coming here and having an agenda of changing some of the things that had always been done was going to create some noise and some controversy, it just sort of comes with the territory."

In June, a letter signed by 15 Republican lawmakers demanded Huffman's resignation, citing complaints from school administrators, teachers and students about his leadership style as his department implemented a series of changes in K-12 education.

The June letter followed a petition signed by nearly half of the state's superintendents last year who argued that Huffman had "no interest in a dialogue" with local school leaders as he made policy changes.

One of his proposals sought to tie teacher licensing to standardized test scores. The State Board of Education ultimately voted against the measure, and lawmakers passed a bill during the last legislative session to ban such a policy.

Bill Would Repeal Common Core in Tenn.

Two Republican state senators filed legislation Monday to repeal the state's Common Core standards even though Gov. Bill Haslam has called for a public review of the higher benchmarks in English and math.

The proposal would set up a Tennessee Standards Commission that would recommend to the State Board of Education new standards to be used in the state's K-12 public schools.

Senate Education Committee Chairwoman Dolores Gresham and Senate Government Operations Committee Chairman Mike Bell said the move is designed to ensure Tennessee students continue to improve by applying the highest standards while exerting state control over education.

"It is the next logical step that will take us into the future and ensure that we as Tennesseans have control over our education system," Gresham told The Associated Press.

Common Core is a set of English and math standards that spell out what students should know and when. The standards are intended to provide students with the critical thinking, problem solving and writing skills needed for college and the workforce.

Last month, Haslam, a Republican, announced the formation of panels to review the math and English components of the Common Core standards, and to report their recommendations at the end of next year. That's months after the state Legislature concludes its annual session. The next session starts in January.

The repeal legislation and Haslam's review both come amid mounting political pressure about the standards. Tea party groups have derided Common Core as government overreach, while some teachers groups have complained that the standards rely too heavily on student test scores. The scores are, in turn, used to evaluate teacher performance.

Cordova Goodwill Location Reopens

Memphis Goodwill Inc. has reopened its Berryhill Attended Donation Center in Cordova. The center is at 1890 Berryhill Road, suite 101, near the intersection of Berryhill & Chimneyrock Boulevard.

The donation center is open Monday through Saturday from 7 a.m. to 7 p.m., and Sunday from 11 a.m. to 7 p.m. It features a drive-thru drop-off for donor convenience. Donors can bring clothing, shoes, furniture, domestics, collectibles, books, housewares, electronics, accessories, jewelry and computers (working and nonworking).

“We hope our neighbors and loyal donors in the Berryhill/Countrywood area will continue to support this donation center as a great resource,” said Dave Leutwyler, executive vice president of Memphis Goodwill, in a statement.

UTHSC Marketing Wins 3 MarCom Awards

The communications and marketing department at the University of Tennessee Health Science Center has won honors for their three entries in the 2014 MarCom International Awards.

Two entries won Gold awards and one received an Honorable Mention in the competition, which drew more than 6,500 entries from throughout the United States, Canada and 15 other countries.

A Gold award went to the Memphis Crisis Center awareness campaign in the category titled Media Relations/Publicity/Publicity Campaign. Clear Channel Outdoor supported the initiative by donating select billboard, transit shelter and poster space in locations across the city.

Memphis Crisis Center executive director Mike LaBonte said after the campaign was started the Crisis Center had a 30 percent rise in call volume.

The second Gold award went to the winter 2014 issue of Dentistry alumni magazine, which won in the Magazine/Educational Institution category.

Artwork developed for the Colleges of Memphis earned an Honorable Mention in the Design (Print)/Graphic Design/Infographic category.

Homewood Suites Owner Files $2 Million Loan

The owner of a Homewood Suites by Hilton in Southeast Memphis has filed a $2 million loan on the property.

DBG Hotels LLC filed the loan with Arvest Bank of Arkansas for the hotel at 3583 Hacks Cross Road, near the intersection with Winchester Road, according to a Nov. 4 deed of trust.

The 80,000-square-foot hotel on 4.3 acres was built in 2002. The Shelby County Assessor of Property’s 2014 appraisal is $5.9 million.

DBG hotels acquired the hotel from an affiliate of Five Mile Capital Partners LLC in March for $8.4 million.

Tenn. Revenue Collections See Increase in October

Tennessee Finance Commissioner Larry Martin says the state's revenue collections for October were more than $15 million over what was expected.

Martin said in a news release on Thursday that the state's sales tax collections recorded the strongest first-quarter growth since 2011. They were more than $17 million above the estimate for October.

The state's general fund exceeded expectations by more than $10 million.

However, corporate franchise and excise taxes for October were $26.8 million, which is $19.2 million below the budgeted estimate of $46 million.

Southwest Memphis Apts. Sell for $1.9 Million

A southwest Memphis apartment complex has sold for $1.9 million.

An entity named AML 1003 LLC purchased the 64-unit Class D complex at 1952 Philsar St. from Longview Heights Partners, according to a Nov. 13 warranty deed. The seller is affiliated with The 1987 William Epstein Irrevocable Trust.

The property was built in 1950 and is situated on the southeastern corner of Philsar and Jacklyn Avenue. The Shelby County Assessor of Property’s 2014 appraisal is $414,300.

To finance the purchase, AML 1003 LLC secured a $2.2 million loan through Medley Opportunity Fund II LP, according to a Nov. 14 deed of trust. Daniel Jacobs signed the deed as secretary of AmveStar Holdings LLC, managing member of AML 1003 LLC.

Tenn. Grants to Promote Energy Efficiency

More grants are being offered to promote energy efficiency projects in Tennessee.

Gov. Bill Haslam and Environment and Conservation Commissioner Bob Martineau recently announced a fourth offering of the Clean Tennessee Energy grants, totaling $2 million.

The grants will be used to fund energy efficiency projects for municipal governments, county governments, utility districts and other similar entities across Tennessee.

Funding for the projects comes from an April 2011 Clean Air Act settlement with the Tennessee Valley Authority.

The maximum grant amount per project is $250,000 and requires a match from the applicant. Grant applications are available on the Tennessee Department of Environment and Conservation's website and will be accepted until January 30, 2015.

Recipients are expected to be announced in the summer of 2015.

30-Year Mortgage Rates Drop to 3.99 Percent

Average U.S. long-term mortgage rates continued to tick down this week, remaining close to yearlong lows.

Mortgage company Freddie Mac says the nationwide average for a 30-year mortgage slipped to 3.99 percent from 4.01 percent last week. Rates have stayed around 4 percent for roughly the past month, after having opened the year at 4.53 percent.

Long-term mortgage rates fell as low as 3.31 percent toward the end 2012, as the Federal Reserve rolled out a since-ended program to purchase bonds in order to lower rates. They plunged in recent weeks amid economic slowdowns in Europe and China and the start of a recession in Japan.

The average for a 15-year mortgage, a popular choice for people who are refinancing, fell to 3.17 percent from 3.20 percent.

US Consumer Prices Unchanged in October

U.S. consumer prices were unchanged in October as a fourth straight decline in gasoline costs helped to keep inflation at bay.

The steady reading for inflation last month followed a tiny 0.1 percent increase in September and a 0.2 percent drop in August, the Labor Department said Thursday. Energy prices fell 1.9 percent last month while food costs edged up a slim 0.1 percent.

Core inflation, which excludes volatile energy and food, rose 0.2 percent in October. For the past 12 months, overall inflation is up 1.7 percent while core inflation is up a similarly modest 1.8 percent.

Both gains are well below the Federal Reserve's 2 percent inflation target, giving the central bank leeway to keep interest rates low to boost the economy without worrying about inflation.

"Inflation remains very much in check despite the pickup in the economy over the past few quarters," said Jim Baird, chief investment officer for Plante Moran Financial Advisors. "Weaker global commodity demand, a stronger U.S. dollar and lackluster wage growth have all helped to keep inflationary pressures in check."

The 0.1 percent rise in food prices was the smallest monthly increase since June. Over the past 12 months, food prices are up 3.1 percent, one of the biggest gains for any category and a reflection of drought conditions in California and other adverse weather patterns which have affected crops.

Gasoline costs were down 3 percent in October and analysts are looking for further declines giving continued drops in global oil prices. The AAA reports that the nationwide average for gas is currently $2.86, down from $3.11 a month ago.

US Factory Output Increases 0.2 Percent

U.S. manufacturing output grew modestly in October, as autoworkers churned out fewer cars and trucks.

Output at manufacturing plants rose 0.2 percent in October, the Federal Reserve said Monday. Gains came from the rising demand for machinery, plastics, clothing and furniture. Factory output has risen 3.4 percent over the past 12 months.

But in October, the automotive sector tapped the brakes for the third straight month. Auto production fell 1.2 percent in October, after declines of 1.9 percent in September and 7.2 percent in August. Despite the slowdown, motor vehicle sales were strong last month.

Total industrial production dipped 0.1 percent last month, due to a sharp decline in output from the volatile mining and utility sectors.

PROPERTY SALES 51 223 1,152
MORTGAGES 55 189 861
BUILDING PERMITS 149 541 2,593