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VOL. 7 | NO. 46 | Saturday, November 8, 2014

Daily Digest

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FedEx Freight CEO Retiring at End of Year

William J. Logue, the chief executive and president of FedEx Freight, will retire at the end of the year due to health concerns, the company announced Wednesday, Nov. 5.

On Jan. 1, Michael L. Ducker, a 40-year company veteran and current chief operating officer of FedEx Express, will replace Logue as the head of FedEx Freight, Memphis-based FedEx’s less-than-truckload freight transportation arm.

FedEx founder, chairman and CEO Fred Smith said Logue led FedEx Freight to “significant growth, success and a leading position” in the LTL sector.

“He navigated some of the worst economic conditions the industry has ever seen and delivered outstanding results while positioning FedEx Freight for long-term success,” Smith said in a statement. “He has established himself as an all-time great leader during his 25 years at FedEx, and while we are sorry to see (Logue) retire, he has our gratitude, support and best wishes.”

CCRFC Considers Bonds for Crosstown Conservation

The Sears Crosstown redevelopment project could get an infusion of funds for energy conservation efforts.

The Center City Revenue Finance Corp., the financial arm of the Downtown Memphis Commission, is considering issuing $14.5 million in Qualified Energy Conservation Bonds on Tuesday, Nov.. 11, and the $180 million Crosstown project could claim some of those funds.

A Qualified Energy Conservation Bond is a bond that enables qualified state, tribal and local government issuers to borrow money at attractive rates to fund energy conservation projects, according to the U.S. Department of Energy.

The Crosstown team is seeking to redevelop the vacant Crosstown building, constructed in 1927, through arts, education and health care.

The Possible funds from the bond issuance would be part of the city’s $15 million commitment to the project.

In other news, the CCRFC also will consider at next week’s meeting a payment-in-lieu-of-taxes request from Filament LLC for new construction to include six apartments at 705 S. Main St. The board also will consider a PILOT request from Cendown LLC for an adaptive reuse project to include 16 apartments and ground-floor commercial space at 85, 87 and 91 S. Second St.

The CCRFC board meets Tuesday, Nov. 11, at 9 a.m. at 114 N. Main St.

International Paper Posts Third-Quarter Profit

Memphis-based International Paper reported third-quarter net earnings of $355 million, $27 million less than the quarter a year ago but $194 million more than the second quarter of 2014.

In the Tuesday, Nov. 4, earnings report, International Paper executives also reported net sales for the quarter of $6.1 billion compared to $6 billion a year ago and $5.9 billion in the previous quarter.

The global packing and paper company’s Ilim joint venture in Russia, meanwhile, posted a $70 million equity loss compared to equity earnings of $43 million for the second quarter.

Courtyard Memphis East Sells for $11.7 Million

Another East Memphis hotel has been sold, this one fetching $11.7 million.

The sale was part of a larger $1.1 billion deal New York City-based NorthStar Realty Finance Corp. announced in September to acquire 52 hotels across the country.

CBM One Hotels LP, which is affiliated with Courtyard by Marriott LP, sold the Courtyard Memphis East/Park Avenue at 6015 Park Ave., at the southeast corner of Primacy Parkway across from St. Francis Hospital, to CMP 1 Memphis Owner LLC, according to a special warranty deed recorded Nov. 4.

Charles R. Latham, managing director of hospitality sector investments for New York City-based investment firm Clarion Partners LLC, signed the deed for the seller.

The buyer, CMP I Memphis Owner, is affiliated with the NorthStar Realty Finance real estate investment trust and filed a $23.3 million loan through JPMorgan Chase Bank NA, according a deed of trust recorded Nov. 4. The $23.3 million loan is part of a much larger $415 million mortgage through JPMorgan Chase that helped fund the purchase of the 52 upscale extended-stay and select-services hotels.

The 76,722-square-foot Courtyard Memphis East was built in 1987 has 146 rooms. The Shelby County Assessor of Property’s 2014 appraisal is $6.1 million.

This is the second major East Memphis hotel to change hands in the past week. The Hotel Memphis at 2625 Thousand Oaks Blvd. was purchased by Jubilee Hotels Group LLC in an Oct. 29 warranty deed.

Former Marriott Hotel Sells for $5.1 Million

An East Memphis hotel has been sold for $5.1 million.

JPMCC 2007 CIBC19 Lodging 2625 LLC sold The Hotel Memphis at 2625 Thousand Oaks Blvd., near Perkins Road and Interstate 240, to Jubilee Hotels Group LLC, according to an Oct. 29 warranty deed.

The purchase was financed with a $7.5 million loan through Texas Capital Bank NA, according to a deed of trust filed the same day. Abdul Aziz Rupani of Dallas is listed as the manager of Jubilee Hotels Group.

JPMCC 2007-CIBC19 Lodging 2625 LLC, an affiliate of Miami Beach, Fla.-based special servicer LNR Partners LLC, bought the former Memphis Marriott out of foreclosure in 2013 for $12.4 million after its previous owner, Kentucky-based CP Memphis Properties LLC, defaulted on a $38 million loan.

The 320-room, 218,000-square-foot hotel was built in 1987 and is situated on about 10 acres on the west side of Thousand Oaks north of Showcase Boulevard. The Shelby County Assessor of Property’s 2014 appraisal is $13.4 million.

The hotel sold for $15.3 million in 2004 to NSHE Paris LLC, an entity that merged with CP Memphis Properties the next year. CP took out the $38 million loan through CIBC Inc. in April 2007.

Orpheum to Install New Sound System

The Orpheum Theatre has partnered with the world-renowned sound engineering company Meyer Sound to install a new sound system. The collaboration will provide audiences with the most advanced listening experience in Orpheum history, and it completes Phase I of several planned improvements to the theater.

The system, which was design jointly by Meyer Sound and Memphis Audio, features the Meyer Sound MINA line array loudspeaker and the 1100-LFC low-frequency control element.

“This is the first major upgrade to our audio equipment since the 1983 renovation, and until now sound quality has been an issue for our patrons,” said Orpheum President and CEO Pat Halloran in a statement. “With the help of Meyer Sound and Memphis Audio, we have met and even exceeded the need for an advanced system that will let audiences fully enjoy our productions.”

When the Orpheum was built in 1928, it was designed for unamplified performances. To provide the clarity and sound levels to support events ranging from Broadway productions to concerts and speech performances, choosing the right loudspeaker configuration was key. It was also important that the Orpheum’s historic architecture was protected by minimizing the loudspeakers’ visual impact while ensuring balanced audio coverage for all seats, including the upper-balcony sections.

UTHSC Doctor Receives Endowed Professorship

Dr. Karen C. Johnson, who has brought more than $40 million in research dollars to the University of Tennessee Health Science Center and is the principal investigator on five currently funded research grants or contracts, has been awarded the UTHSC College of Medicine Endowed Professorship in Women’s Health.

The professorship, conferred because of her excellence in research, her national reputation and her history as a strong collaborator at UTHSC, is supported by the Kathryn Sullivan Bowld Endowment Fund.

In August, Johnson, a professor in the Department of Preventive Medicine, was named to the Thomson Reuters list of “The World’s Most Influential Scientific Minds: 2014.” The distinction is based on the significant number of articles she has published and the frequency of which they are cited by fellow researchers

Johnson is the principal investigator for the UTHSC location of the Women’s Health Initiative, a 40-site clinical trial and cohort study of more than 161,000 women that began in 1993 to look at diseases that affect women and how to help them stay healthier. UTHSC has enrolled more than 4,200 women from Memphis and the surrounding area in the study.

Memphis Tops List as Most Affordable Big City

The Kiplinger media company has compiled data on the biggest cities in the U.S. with the lowest cost of living and found that Memphis is at the top of the list.

Kiplinger was trying to identify the 10 U.S. cities with populations of more than 250,000 that have the lowest living costs. The ranking says Memphis’ cost of living is 14.6 percent below the national average.

While the list tagged the city with a 9.9 percent unemployment rate, it added that a “saving grace for Memphis is the super-low cost of housing,” with median home values 46 percent below the national median and the average apartment rent of $709 being 21 percent below the U.S. average.

St. Jude Appoints New Scientific Director

St. Jude Children’s Research Hospital has named Dr. Richard Gilbertson scientific director for the institution.

The position is in addition to his current leadership responsibilities as St. Jude Comprehensive Cancer Center director and executive vice president. Gilbertson takes over the scientific director position from Dr. James R. Downing, who was appointed St. Jude president and chief executive officer earlier this year.

In the newly combined role, Gilbertson will oversee strategy for research efforts across the institution, develop and support new programs and shared resources, plan and manage research space and systems, and direct the cancer center’s programs.

Gilbertson earned his medical degree and trained as a pediatric oncologist at the Newcastle University – formally University of Newcastle upon Tyne – in England. After becoming a member of the Royal College of Physicians and completing his Ph.D., Gilbertson left England to join St. Jude, holding positions in the Developmental Neurobiology and Oncology departments.

Prior to his appointment as cancer center director, Gilbertson served as the founding director of the hospital’s Molecular Clinical Trials Core and co-leader of the Neurobiology and Brain Tumor Program. He also chairs the Cancer Center Advisory Committee, serves as principal investigator of St. Jude’s Cancer Center Support Grant from the National Cancer Institute, is co-principal investigator of the Collaborative Ependymoma Research Network and holds the Lillian R. Cannon endowed chair.

Holiday Cards to Benefit Overton Park

To celebrate and benefit Overton Park in Midtown, Overton Park Conservancy is offering four exclusive holiday card designs with illustrations of some of the park’s signature spaces.

Designs feature the Overton Bark dog park, the Bike Gate plaza, the Greensward, and the Old Forest trails. Illustrated by 2014 Memphis College of Art graduate Iryna Kurylo, each card depicts the park as a winter wonderland.

Proceeds from every card purchased benefit the Conservancy’s work to maintain and enhance the park, including landscaping, grass cutting, trash removal, repairs and management of the Old Forest.

Each 5-by-7-inch folded card is blank inside, with a message on the back letting recipients know that the sender has made a donation to Overton Park Conservancy in their honor.

Cards may be purchased in packs of 10 per design, and each card comes with a blank white envelope. Packs are $20 each, with a flat $6 shipping and handling rate for the entire order. Cards will be mailed in late November and can be purchased at overtonpark.org/holidays or by calling 214-5450.

Visible Music College Prepares to Turn 15

Visible Music College is preparing to celebrate its 15th anniversary in 2015.

The college was launched in Memphis in 2000 and now reaches students through two U.S. teaching sites, in Memphis and the Chicago metro area. The college has a sister campus in Germany, and plans are in the works to expand to Dallas in 2015.

The college’s focus is on creating small artist communities throughout the world that emphasize growth in spiritual, professional and academic areas.

Tennessee Education Board Names Heyburn Director

Sara Heyburn, the assistant state commissioner of education, becomes the new executive director of the Tennessee State Board of Education with the new year.

Heyburn’s selection by the board was announced Monday, Nov. 3.

She succeeds Gary Nixon, who is retiring at the end of 2014.

Heyburn has been assistant commissioner for teachers and leaders since 2011, overseeing the state’s work in the effectiveness of teachers, principals and other schools administrators.

Before the state post, she was a policy analyst at Vanderbilt University’s National Center on Performance Incentives.

She began her career as a high school English teacher in Kentucky and Tennessee.

Park Avenue Professional Building Sells for $1.3M

An affiliate of Memphis-based Belz Enterprises has sold an East Memphis office building for $1.3 million.

Belz Investco GP sold the Park Avenue Professional Building at 930 S. White Station Road, at the northeast corner of White Station and Park Avenue, to Mem1 RE LLC, according to an Oct. 31 warranty deed. The buyer is affiliated with Dallas-based real estate investment company Pro Domo LLC.

The 19,313-square-foot Class B office building was built in 1987 and features a unique three-level design. The Shelby County Assessor of Property’s 2014 appraisal is $1.3 million.

Lipscomb & Pitts Earns Industry Designation

Lipscomb & Pitts Insurance has been named one of the “Best Agencies to Work For” in the U.S., as recognized by the publication “Insurance Journal.”

The list on which Lipscomb & Pitts was included was released in the publication’s October issue. The agency placed “Silver” for the Southeast in the ranking.

The agency’s chief manager, Johnny Pitts, said the agency felt honored to have been recognized as one of the best places to work in the country.

Veterans Town Hall Set for Memphis

A town hall meeting for veterans and their families is set to be held in Memphis in November.

The Memphis VA Medical Center Executive Leadership Team is hosting the meeting Nov. 17 from 1 p.m. to 2:30 p.m. in the conference center at the Benjamin L. Hooks Central Library, 3030 Poplar Ave.

Veterans and their families, congressional office representatives, representatives from veteran service organizations and community partners are invited to attend.

Information regarding VA health care access and benefits will be provided. VA officials will use this meeting and future sessions as an opportunity to hear from veterans.

Representatives from the Nashville VA Regional Office will be in attendance to provide information on benefits and offer claims assistance.

New Photo Exhibit Coming to Stax Museum

The Stax Museum of American Soul Music is preparing to host a photography exhibit of Memphis-related soul music artists as well as behind-the-scenes songwriters, engineers, musicians, producers and others involved in the musical genre.

“Soul: Memphis’ Original Sound – Photographs by Thom Gilbert” will be on display from Nov. 14 through June 30, 2015, and will include about 80 photo portraits taken over the past 18 months. A new 256-page book also accompanies the exhibit and will be released simultaneously.

The book includes 180 color photos and 20 black-and-white images of artists, their personal possessions and some of the studios where soul music was born.

Gilbert is donating some of the proceeds from the book’s sale to the Stax Music Academy.

Stamos to Flip Switch on Graceland Lights

Actor John Stamos will flip the ceremonial switch on holiday decorations at Graceland.

The annual lighting ceremony is Nov. 21 at 6 p.m. with patients from Le Bonheur Children’s Hospital as part of the ceremony, which is free and open to the public.

The ceremony can also be seen live on graceland.com.

The lights and the life-size nativity display date back to a Christmas tradition set by Elvis Presley shortly after he and his family moved to the Whitehaven mansion.

The Presley family’s Christmas decor within the mansion will also be featured on tours starting Nov. 21.

Nike Applies for Building Permits

Nike Inc. has applied for two building permits totaling $691,600 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. applied for the applications, which calls for engineering materials and installation.

The latest permits are part of Nike’s $301 million expansion in Frayser.

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.

Germantown Parkway Land Sells for $485,000

A rare vacant outparcel on Germantown Parkway in Cordova has been sold for $485,000.

GATA LLC and FTBD LLC sold the lot to BAL Gopal LLC, according to an Oct. 28 warranty deed. John H. Lamberson Jr. is listed in the deed as the sole member of FTBD LLC.

The 1.1-acre site is located on Germantown Parkway between Rockcreek Parkway and Chimney Rock Boulevard. The Shelby County Assessor of Property’s 2014 appraisal is $338,500.

TDOT Delays Lamar, I-55 Interchange Projects

Tennessee Transportation Commissioner John Schroer has delayed the construction of an Interstate 55 roundabout on E.H. Crump Boulevard that was to go to bid for construction in December.

And Schroer has delayed right of way acquisition for improvements on Lamar Avenue between Shelby Drive and the Mississippi state line.

The $32.4 million Interstate 55 project is one of a dozen across the state delayed by Schroer until fiscal year 2016 because of partial federal funding for such projects that runs only through the end of May.

The partial funding is because the federal highway trust fund is short of the money to fund spending authorized by Congress.

“Since we do not have a full fiscal year’s funding, the department has had to scale back on future contracts and re-prioritize which projects we let to contract in our December letting and through May of 2015,” Schroer said in a letter to Tennessee legislators.

The construction projects delayed total $177 million.

The Lamar Avenue project is one of another 21 projects totaling $217 million that were ready for right of way acquisition.

The Lamar project is a $34 million line item to improve what is the city’s major freight corridor.

USPS Adds Sunday Delivery for Holidays

The U.S. Postal Service will deliver packages on Sundays in major cities and high-volume areas during the holiday season.

Seven-day delivery will run from Nov. 17 through Christmas Day in response to anticipated growing demands.

The agency expects 12 percent growth in its package business this holiday season, or in the range of about 450 to 470 million packages.

The Postal Service says demand for package services has grown as online retailers ship more products to their customers.

"Football has its season. But the holidays? That's our season. That's crunch time for us," Postmaster General Patrick Donahoe said, in a statement. "E-commerce package business continues to be a big player now more than ever, so we've enhanced our network to ensure America that we'll deliver their cards, gifts and letters in time for the holidays."

Central Defense Security Promotes 2 Employees

Central Defense Security has promoted two employees to area managers.

Marion Malone previously served as an armed officer and Kim Perry had been a site supervisor at one of CDS' client accounts.

In their new roles for CDS, which is a leading provider of business, retail and warehouse security, Malone and Perry will mostly be responsible for managing their respective accounts throughout the area. They'll also be charged with ensuring job performance from officers at several different posts.

Haslam Administration Pays $1M in Settlements

Republican Gov. Bill Haslam's administration has paid out $1 million in secret settlements related to moving state employees around downtown Nashville.

WTVF-TV reports that it obtained the confidential settlement agreements with the owner of an office building and moving service through state open records laws.

The records show that the state agreed to pay the owner of the L&C Tower $900,000 after it canceled a lease there, and $100,000 to Sanders Moving after the state decided to shift work to another moving company.

According to emails obtained by WTVF, state employee Kurt Herron raised concerns that "we've already broken several laws" related to the moving company switch. Haslam administration officials told lawmakers last year the claim was not true.

The agreements were marked "confidential" and barred either side from talking about the deal.

Local Hospitals Get Scores Ranging from A to F

The Leapfrog Group, a nonprofit organization that describes itself as being “committed to driving quality, safety and transparency in the U.S. health system,” has released its fall update scores and Memphis-area hospitals are all over the scale.

Regional One Health received an “F” from The Leapfrog Group, which issues overall grades and individual grades in 28 categories. Of the 2,520 hospitals issued a safety score, only 26 earned an “F.”

Receiving “A’s” were Methodist University Hospital, Methodist South Hospital, Methodist North Hospital, Methodist Le Bonheur Germantown Hospital, Saint Francis Hospital-Memphis, and Saint Francis Hospital-Bartlett. They were among 790 hospitals to earn “A’s.”

Baptist Memorial Hospital-Memphis and Baptist Memorial Hospital-DeSoto each received a “C” grade. They were among 868 hospitals to receive a “C.”

Leapfrog’s scoring system is based on a hospital’s ability to prevent errors, injuries and infections.

“While the data tells us that hospitals are improving their safe practices, it’s concerning to see them moving backwards on any measure,” said Leah Binder, president and CEO of Leapfrog. “Patients enter a hospital trusting they’re in a safe place, but with 41 percent of hospitals receiving a ‘C,’ ‘D’ or ‘F’ grade, it’s clear that some hospitals are safer than others.”

Analyst Expects $89B in Online Holiday Sales

This year more Americans than ever are expected to make their lists, check them twice, and then click the "add to cart" button.

Forrester Research said Monday that it expects U.S. consumers to spend $89 billion by Christmas. That's up 13 percent, or about $10 billion, from a year ago.

Analyst Sucharita Mulpuru said she thinks online shopping will make up 14 percent of total retail spending over that period. She estimated that 3.4 million Americans will try holiday shopping online for the first time this year.

Mulpuru said her estimate would be higher if Thanksgiving were occurring earlier. The holiday always falls between Nov. 22 and 28, and it will be on Nov. 27 this year. That means the gap between Thanksgiving and Christmas is shorter than in most years. In 2013, Thanksgiving was on Nov. 28.

Mulpuru said shipping networks could suffer from delays again because of the high volume of online sales. In 2013 UPS and FedEx both reported delays because of overloaded systems, poor weather and the shortened holiday period.

TVA Taking Closer Look at Energy Efficiency

The Tennessee Valley Authority is taking a closer look at energy efficiency as it works on a long-range energy resources plan.

The Knoxville News Sentinel reports the federal utility is using advanced computer modeling to determine how valuable energy efficiency will be in meeting its long-term power needs.

The agency's Integrated Resource Plan is being revised to determine how much electricity will be needed over a 20-year period and what resources are needed to provide it.

The updated plan will address changes in the economy and the electric utility industry since the existing energy plan was completed in 2011.

TVA is the nation's largest public utility, serving 9 million people in parts of Tennessee, Alabama, Mississippi, Kentucky, Georgia, North Carolina and Virginia.

C Spire Opens $23M Starkville Data Center

Telecommunications firm C Spire say it has opened its $23 million Starkville data center.

The company announced Monday that the center, part of its strategy to sell more services to businesses, was operational.

Ridgeland-based C Spire says it believes companies will be attracted to the center because it's distant from hurricane and earthquake zones and because it's the only facility in a 250-mile radius with its capabilities. The company says only 15 other commercial data centers nationwide have equivalent offerings.

"Our customers can rest easy knowing their data is safe and secure and that business continuity is safeguarded," Brian Caraway, C Spire's senior vice president of enterprise markets, said in a statement.

The city of Starkville and Oktibbeha County waived non-school property taxes for 10 years to support the 22,400 square-foot project, built in Mississippi State University's Thad Cochran Research Park.

Construction work began last November.

C Spire operates two other data centers in Mississippi - one in Ridgeland and the other in downtown Jackson.

US Construction Spending Down for Second Month

U.S. construction spending fell for a second straight month in September as a slight rebound in housing was offset by further declines in nonresidential building and in government projects.

Construction spending dropped 0.4 percent in September compared to August when spending fell 0.5 percent, the Commerce Department reported Monday.

After four straight monthly declines, housing construction edged up 0.4 percent in September but nonresidential building fell 0.6 percent with weakness in construction of hospitals, power plants and factories. Government construction was also down, falling 1.3 percent as spending on projects at the federal and state and local levels declined.

The overall declines in the past two months were disappointing, but economists say the weakness will be temporary. They are looking for construction activity to support economic growth in coming months.

The September drop pushed construction spending down to $950.9 billion at a seasonally adjusted annual rate, still a modest 2.9 percent higher than the level a year ago.

State Attorney General: Local Caucuses Subject to Open Meetings

Attorney General Herbert Slatery says local legislative bodies like county commissions can establish partisan caucuses but that they would likely be subject to Tennessee's open meetings law.

Slatery said in a legal opinion released this week that nothing in state law prevents county commissioners from forming partisan caucuses even if they gain office through nonpartisan elections.

But Slatery added that as long as more than one member of a governing body attends the caucus meeting to deliberate about official business, the meeting would have to be open to the public and subject to notice requirements.

Several efforts to water down the state's open meetings law have been turned back in recent years amid opposition from top Republicans like Gov. Bill Haslam and House Speaker Beth Harwell.

Wal-Mart Ups Ante on Holiday Shopping

Wal-Mart is doing whatever it takes to rope in holiday shoppers however they want to buy.

For the first time, Wal-Mart Stores Inc. is offering free shipping on what it considers the season's top 100 hottest gifts, from board games to items related to Disney's hit film "Frozen" items, starting Saturday. The move comes as rival Target Corp. began offering free shipping on all items, a program that started late October and will last through Dec. 20.

Wal-Mart is also planning to offer discounts, or what it refers to as "rollbacks," on more than 20,000 items on a broad range of products, from groceries to TVs, starting Saturday. The timing is similar to last year, but the discounter said the assortment is broader. It's also pulling forward by nearly a month 15 24-hour online deals originally reserved for the Thanksgiving weekend and so-called Cyber Monday, about double from last year. For the first time, Wal-Mart will allow shoppers to pick up those 24-hour online specials at the store.

PROPERTY SALES 62 288 2,619
MORTGAGES 52 197 1,783