Houston to be ground zero for Reliant, Nissan deal

Houston to be ground zero for Reliant, Nissan deal: "Reliant Energy and Nissan Motor Co. have agreed to work together and make Houston the launch city for the two companies’ efforts to promote the use of electric vehicles. (NRG)

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Lack of Development

Well Ladies and Gentlemen,

Due to the recent economy, suffice to say, there hasn't been much to post on this blog.

So, I'd like your help. If you know of any developments in your area, please email me (alephew at gmail.com) so you can share the good news with everyone! Now since there is much un-development happening, let's report on that as well.

When I created this blog (my first), I did it to help out my previous employers (condo developers) find localized information. This was to aide them in making purchasing decisions, as well as create bank packages to apply for mezzanine funding. My first blog has stretched it's legs since then.

Let's pool our resources to help those who still want to open business in our communities. Anything that you think will help others succeed, or save them from making a poor choice, send it! Pictures, stories, articles, you send it, we'll post it, and of course provide the source (unless anonymity is requested).

Email alephew at gmail.com

Photographer: Unknown

Penn Turnpike plan could hike tolls 25%

Abertis-Citi Encounter
High Costs and Potholes
For Infrastructure Investors
May 21, 2008; Page C16

America is definitely becoming a mecca for deal-hungry infrastructure funds. Whether investors in this burgeoning asset class making the pilgrimage to these shores will find redemption, however, is far from certain.
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A consortium led by Spanish transportation and highway operator Abertis has offered $12.8 billion to operate the Pennsylvania Turnpike for 75 years, edging out local heavyweight Goldman Sachs Group in the process. Moreover, the final price was 20% more than Abertis, along with a Citigroup fund and a minor Spanish partner, had offered in the first round of bidding. From the looks of it, Abertis and Citi have stretched themselves to the limit.

Continue Reading

Highest-ever gasoline prices expected this Memorial Day

Houston Business Journal

Texans will be paying the highest prices ever for a gallon of gasoline during the Memorial Day holiday weekend, according to AAA Texas.

This week, the state recorded an average price of $3.68 for a gallon of self-serve gas after prices climbed 15 cents. Nationally, the average price shot up 13 cents to a new record of $3.78 per gallon.

"Record gas prices and tough economic times appear to be forcing some Americans to stay home this holiday," said AAA Texas spokeswoman Rose Rougeau.

Houston prices soared 13 cents this week to an average of $3.65 a gallon, while the Galveston-Texas City area saw a rise of nearly 11 cents to equal Houston at $3.65.

Utility bills in Houston highest in the nation, survey shows

Houston Business Journal - by Ford Gunter Reporter

Houston had the highest home utility bills in the nation last month, according to a survey released this week by the WhiteFence Index.

Houston's average monthly utility bill was $332.69 for the month of April. By comparison, average bills in Los Angeles were $206.44, putting it atop the "most affordable" list.

The national average for April dropped $33 from March, to $263.07.

"Houston is the most expensive because people there have bigger houses and tend to run their air conditioners just about every day, all day long," said Jeff Wagoner, chief operations officer of Houston-based WhiteFence.com, a Web-based comparison shopping forum.

The WhiteFence Index compiles average monthly home utility bills for phone, Internet, television, electricity and natural gas in 21 major U.S. cities.

Dallas, the only other Texas city listed, was the second-most expensive city, with an average utility bill of $330.89.

Colorado companies added 10,100 jobs in April

Denver Business Journal

Colorado businesses added 10,100 nonfarm wage and salary jobs in April, a slightly greater increase than usual for the month, the state Department of Labor and Employment said Friday.

Nonagricultural employment has grown 43,600, or 1.9 percent, over the past 12 months, rising to 2,357,300.

"Job growth is expanding at a pace similar to last year, but rising energy and food prices, combined with continued sluggishness in construction, are likely to dampen growth for the remainder of the year," Donald Mares, executive director of the Colorado Department of Labor and Employment, said in a statement.

The seasonally adjusted unemployment rate was unchanged at 4.4 percent in April. Although the jobless rate has remained steady for the past three months, it is eight-tenths of a percentage point higher than a year ago, and matches the highest rate since mid-2006. The national unemployment rate was 5 percent in April.

Colorado officials said that eight major industries added workers in April, while three cut jobs.

Professional and business services led the expanding industries, adding 7,200 positions, with stronger-than-usual hiring in administrative and business support services. Construction payrolls increased by 3,700.

Education and health services added 1,100 positions, all of them within the health care and social assistance subsector. Tax preparation activity probably helped financial activities add 700 positions.

Meanwhile, leisure and hospitality shed 3,000 jobs as the winter recreation season ended. Other services dipped 600, while manufacturing trimmed 300 jobs in April.

Greater Philadelphia Tourism Marketing spending $2M on ads

Philadelphia Business Journal

Greater Philadelphia Tourism Marketing Corp. said Thursday that it will launch a $2 million advertising campaign to promote the region.

The campaign will kick off June 1 and run through September, GPTMC said at its annual meeting Thursday.

Advertising will run in national magazines, as well as newspapers, online, on billboards, cable television, satellite radio and through search-engine optimization.

Areas targeted are within driving distance of Philadelphia, including Delaware, New Jersey, New York, Pennsylvania and Washington.

The campaigns will center around a Philly's More Fun theme as well as Historic Philadelphia, which promotes the historic district bounded by Front Street to the east, 7th Street to the west, Race Street to the north and Spruce Street to the south.

Advertising will include lines including, "The Liberty Bell is only the beginning," and feature a collage of photographs featuring daytime and nighttime activities.

Of the 27 million people that visit Philadelphia annually, a third visit in the summer months.

As an incentive, travelers who book two-night stays through GoPhila.com are eligible to receive a $50 American Express gift card.

NY's gas prices fourth highest in country

The Business Review (Albany)

New Yorkers pay more for gas than nearly everyone else in the country, according to AAA.

In New York, the average cost for a gallon of regular unleaded gas is $3.896. That compares with $3.95 in Alaska, $3.94 in Connecticut and $3.93 in California.

Rounding out the top five states with the highest gas prices are Illinois, at $3.894 a gallon, and Hawaii, at $3.891 a gallon.

Gas is cheapest in Arizona, where a gallon averages $3.50.

Despite concerns, feds encourage Chinese investment in Arizona

Phoenix Business Journal - by Mike Sunnucks Phoenix Business Journal

Is Phoenix prepared for the Chinese dragon?

Spurred by economic growth and increasing wealth, China is primed to expand its foreign investments into the U.S.

The U.S. Department of Commerce and the Bush administration are bullish on that notion. They want to attract more foreign direct investment into the U.S. from China and other emerging global markets, and they are aggressively promoting that idea among economic developers in Phoenix and other areas.

Greater Phoenix Economic Council CEO Barry Broome said a significant part of that effort focuses on China investing in U.S. real estate, businesses and facilities such as manufacturing plants and distribution centers.

China is a major exporter to the U.S., running a $256 billion trade deficit in 2007, according to the U.S. Commerce Department. China is Arizona's third-largest export market, behind Mexico and Canada.

China, Russia and India have burgeoning wealth, with a growing number of millionaires and private entities flush with cash to invest.

The weak dollar also is encouraging foreign investment in the U.S. because the British pound, euro and other currencies go a lot further here.

Broome said the Bush administration wants to attract more of those investments to the U.S. and is recruiting regional and state economic developers to be part of a new push for foreign direct investment.

"They are really licking their chops," Broome said.

He said GPEC has been focusing its efforts on Europe, Japan and Canada, and is figuring out whether to jump onto the China bandwagon.

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Boston again near the top in economic vitality index

Boston Business Journal - by Jesse Noyes Boston Business Journal

For the second consecutive year, Boston took a top spot in a list of the most competitive metro areas in the country.

Greater Boston ranked second in level of competitiveness, beat out by Salt Lake City, among 50 city regions in 2007, according to the annual "Metro Area Competitiveness Report" compiled by the Beacon Hill Institute at Suffolk University. It was the second year Boston held the position, beating other regions such as Denver, Portland, Ore., Seattle and San Jose, Calif.

The rankings are put together by measuring various factors, such as technology, infrastructure and human resources, and then providing an overall index of each region's overall competitiveness.

For 2007, the Boston area received an index of 7.38, behind Salt Lake City's 7.57. Each year since the report began being compiled in 2001 Boston has managed to stay "fairly systematically at or near the top," said Jonathan Haughton, a professor of economics at Suffolk University and an author of the report.

What pushes Boston to a top spot in the rankings are its competitiveness in the technology field, where it ranked first, and human resources, for which it ranked second behind Minneapolis. Technology rankings are configured by looking at research funding, patents issued and the number scientists located in the area, while human resources largely looks for a skilled workforce that is not abundantly expensive.

Where the region lags is in areas like infrastructure, which includes issues like commuting time, energy costs and affordable housing. Boston falls near the bottom of the list in the infrastructure category with a ranking of 47.

Brian Gilmore, a spokesman for the Associated Industries of Massachusetts, called the Suffolk University report "good news" and "bad news." Problems, such as high rents and taxes, could drag on Boston's rankings, especially as regions off the West and East Coasts position themselves as competitors for large businesses outside traditional technology centers, he said.

"All regions of the country are trying to reinvent themselves," Gilmore added. "We haven't got the whole playpen to ourselves."

But despite Boston's old structure and struggle with major public transportation development such as the Big Dig, the area is going through a positive transformation, said Paul Guzzi, president and CEO of the Greater Boston Chamber of Commerce. "When you look at the link now that is being created between the downtown Financial District, the Greenway and the Seaport District, that opens up incredible opportunities," he said.

The strangest occurrence might be Boston's finishing behind Salt Lake City in terms of competitiveness. Haughton said despite Boston's higher ranking in human resources and technology, Salt Lake City does well across almost every category. Salt Lake City took the top ranking for infrastructure and bested Boston in the business incubation category.

"What Salt Lake City has done, though its strengths are quite different (from Boston's), is that it doesn't really do badly on anything," Haughton said.

Jesse Noyes can be reached at jnoyes@bizjournals.com.

Lenders giving yellow light to new construction

Houston Business Journal - by Nicole Bradford

Under the threat of an economic recession and with much of the country's real estate market near a grinding halt, financial underwriters in marginally affected Houston say they are now, more than ever, keeping an eye on unsold inventory.

Local commercial real estate experts say they expect Houston's market to slow down slightly from last year but are cautiously optimistic about 2008 (especially in industrial and warehouse projects). But a nationwide subprime mortgage crisis coupled with an economic downturn means even more caution for residential lenders, who are staying focused on move-ups, higher-end homes and the increasingly in-demand urban living projects inside Loop 610.

"We tend to finance custom builders who build 10 to 100 homes per year as opposed to those builders who build several thousand per year," says Joe M. Bailey, chairman of Texas Capital Bank, Houston. "Most of the slowdown I've seen is in the lower-priced housing, so the move-up homes really haven't been affected that much. The type of houses we finance are still selling. A really hot segment right now is older, mature neighborhoods such as Briargrove and West University where you have tear-down houses."

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Schools say inflation puts them at risk

To protect jobs, campuses, Texas' funding system needs to be revamped, educators say

By GARY SCHARRER
Copyright 2008 Houston Chronicle Austin Bureau

AUSTIN — The school funding system approved by Texas lawmakers two years ago provides no new money to cover rising costs — especially for fuel, utilities and health insurance — and officials warn the plan's tax revenue straightjacket will allow inflation to push some school districts into bankruptcy.

At-risk districts, generally, will find a way to make it for the next school year, but many face horror situations in a few years unless legislators dramatically change the school funding system again, and soon.

Take the Houston-area Spring Branch Independent School District. Its budget projections show the district's current $58 million reserve fund will slide $68 million into the red within four years.

Unless a fix is enacted during next year's legislative session, school districts will be faced with difficult choices, including closing campuses and firing teachers, said Mike Falick, president of the Spring Branch school board.

"It's an untenable system. No business in the world would be able to survive with fuel, health insurance and salary increases and a flat revenue source," Falick said. "It's not sustainable.

Some school districts eventually will face "insolvency, some in a shorter time than others," he said.

Humble Independent School District is about two years away from insolvency, Superintendent Guy Sconzo said. It will cover a $7 million budget deficit this year and a projected $23 million deficit next year by dipping into its $53 million reserve fund.

Humble ISD has cut spending by $17.5 million since 2002, Sconzo said, but is struggling with inflation and enrollment growth. Each new student costs the district about $6,800, but it gets only $4,937 from all sources to educate that student, he said.

"As we reduce more, we get on the road of becoming Minimum ISD. We will be able to comply and meet state laws and regulations, but we can't do anything more than that because we can't afford to," Sconzo said.

State leaders defend the current system but will consider.... Continue Reading

EarthLink to pull the plug on Wi-Fi in Philadelphia

By DEBORAH YAO
The Associaited Press
Published on: 05/13/08

EarthLink Inc. is pulling the plug on its troubled wireless high-speed Internet network in Philadelphia, once touted as a model for how big cities should deploy Wi-Fi.

EarthLink, which once pinned its future on municipal networks such as Philadelphia's following rapid declines in its dial-up Internet access business, said Tuesday that it could not find a buyer for the $17 million network and that talks to give it to either the city or a nonprofit organization had failed.

City officials have said it would cost taxpayers millions of dollars each year to operate the network.

"It's been an unfortunate situation," Chief Executive Officer Rolla Huff told The Associated Press. "It was a great idea a few years ago, ... but it's an idea that simply didn't make it."

A few weeks earlier, Atlanta-based Earthlink announced it would shut down a similar network in New Orleans. EarthLink has reached agreements with the cities of Corpus Christi, Texas, and Milpitas, Calif., which are taking over ownership of their networks. EarthLink also has been running a network in Anaheim, Calif.

EarthLink, which will give current customers until June 12 to switch to another provider, said it even offered to donate the Wi-Fi equipment to someone and give them an additional $1 million.

Meanwhile, EarthLink filed a federal suit Tuesday that seeks to remove its Wi-Fi equipment from city street lights and cap its potential liability at $1 million.

Four years ago, Philadelphia officials announced the EarthLink deal with great fanfare that attracted attention from cities in the United States and around the world.

But the technology itself proved to be difficult to deploy and, at times, unreliable. EarthLink later admitted that its Wi-Fi business model had not panned out. In Philadelphia, EarthLink built the network at no cost to the city. It also pledged to pay the city rent for use of its street lights from which Wi-Fi equipment would be hung.

At the time, EarthLink had wanted to have a direct Internet pipeline into the home so it would not have to buy capacity from phone companies.

Philadelphia officials recently said they want EarthLink to abide by the contract, but would rather not go to court to enforce it.

Councilman Frank Rizzo, an early opponent of the Wi-Fi network, said he hasn't heard of anyone interested in buying EarthLink's network.

"Comcast and Verizon, they haven't even sniffed around," he said of the companies that provide cable and phone-based Internet access in Philadelphia.

He said the city's Wi-Fi network has not been completed.

"EarthLink knows they are vulnerable to litigation," Rizzo said.

EarthLink reclassified its municipal Wi-Fi assets as discontinued operations in the third quarter of 2007. The company said the shutdown of the Philadelphia network should not materially affect its current financial outlook.

EarthLink shares fell 12 cents to $9.12 in midday trading Tuesday.

— Associated Press business writer Rachel Metz in New York contributed to this report.

Study shows San Antonio is a popular place for families who are relocating

San Antonio Business Journal

San Antonio has been named the fifth best large metropolitan city in America for relocating families by Worldwide ERC and Primacy Relocation.

The two companies examined several factors, including job growth figures for 2007, percentage of nearby top-ranked colleges, average in-state tuition for four-year public colleges, the amount of pediatricians per 100,000 population and taxes.

Worldwide ERC and Primacy announced the results of the survey at the National Relocation Conference in San Antonio.

The top ranked metropolitan areas with populations of 1.3 million and above are Pittsburgh, Indianapolis, Austin, Fort Worth and San Antonio.

Worldwide ERC serves as a network of workforce mobility professionals in the United States and global markets. It is based in Washington, D.C. Memphis-based Primacy Relation is a global third-party employee relocation company.

"Our members know that there are many factors that lead to a successful relocation," Worldwide ERC CEO Cris Collie says. "Quality of life issues are increasingly important to transferees, and the employers who move them are recognizing those requirements. Being able to meet the needs of the entire family will be increasingly critical as the labor market grows tighter."

Web site: www.primacy.com

Austin recession-proof?

Austin Business Journal

Austin was named third on the Forbes.com list of the top 10 "Recession-Proof Cities" in the United States.

To create the list, the magazine looked at the 50 largest U.S. metros, examining key measures, such as unemployment data, non-farm related job growth, median home prices and data from a 2007 report, "U.S. Metro Economies: The Mortgage Crisis" by the U.S. Conference of Mayors.

At number three, Austin was right behind San Antonio, which grabbed the second spot thanks to solid employment figures and affordable home prices that continue to rise.

Oklahoma City took the No. 1 spot because of its strong housing market and solid growth in agriculture, energy and manufacturing.

For its part, Austin was lauded for being a hip town with one of the lowest unemployment rates in the country.

Forbes magazine's list of recession-proof cities also included: Houston, Dallas, Charlotte, N.C., Raleigh, N.C., Salt Lake City, San Jose, Calif. and Seattle.

Forbes says that Texas cities such as San Antonio, Austin, Houston and Dallas-Fort Worth have benefitted from historically lower home prices, land availability and 'little zoning'.

All four Texas cities boast falling unemployment rates, according to Forbes, with Austin dropping from 3.8 percent to 3.6 percent.

Forbes.com

Texas economy is continuing to outpace the nation

San Antonio Business Journal - by Donna J. Tuttle

The Texas economy has been dragging its feet since January, but continues to outperform the nation, according to an update from the Federal Reserve Bank of Dallas.

"While signals remain mixed, there is increased sentiment that Texas economic activity will not rebound to its trend rate of growth until 2009," Fed senior economist Jason L. Saving notes.

Payroll employment rose in this region by more than 1 percent each month, but not with the same vigor it has in the past. Still, the growth is better than national payroll employment, which declined to negative figures starting in January.

What's more, Texas logged its best unemployment performance in almost 25 years in February -- falling to 4.1 percent.

Construction in Texas is stumbling. Employment in the construction industry fell at an annual rate of 3.8 percent in March, after a strong February.

"Construction contract values continued their January swoon, falling 4.4 percent in February and 5.2 percent in March," the Fed report reveals. "The decline was broad based across residential, non-residential and non-building construction."

The energy sector is the bright spot in the state's economy "providing what is perhaps the single most prominent sign of economic strength at this point," Saving wrote in his report.

Energy employment and Texas rig count hover near 20-year highs, and energy prices are skyrocketing to all-time highs.

Price pressures in the region are mounting all the way around. Texas manufacturers reported higher raw material prices in March and expect the trend to continue. Firms are raising their finished-good prices as fuel, metals and shipping materials become an increasing cost burden.

Texas export are growing, rising by 3.7 percent in January and 5.7 percent in February, outpacing national rates.

Republic Bank forecloses on part of Woodstock Downtown mixed-use project

Atlanta Business Chronicle

Republic Bank has foreclosed on a portion of the retail development of Hedgewood Commercial Properties' Woodstock Downtown project.

The foreclosure on Building B of the project happened May 6. Hedgewood said the bank asked the existing development, leasing and management team to stay aboard to keep the mixed-use project moving forward.

"Having an ongoing relationship with the existing development, management and leasing team is a little unusual, but we felt that this partnership would benefit all concerned," said Scott Reed, president of Republic Bank. "Woodstock Downtown is a great project, and the change in ownership of the retail space should not change its long-term potential. As the new owner, we are certainly motivated to do whatever we can to maximize the value of the project, and we feel that continuity in management of the property is one of the steps we can take to assure its success."

Woodstock Downtown is a re-development of 32 acres of historic Woodstock, Ga., that is slated to have 300 new residences, plus shops, restaurants services and executive office space.

Atlanta Business Chronicle recently reported liens filed against Hedgewood homebuilding unit Hedgewood Properties Inc. spiked sharply in the first quarter. Hedgewood Properties Inc., builder of EarthCraft homes in communities such as Vickery and Newgate at Windermere in Forsyth County, had 75 liens filed against it in the first quarter, compared with two in the first quarter of 2007 and 86 in all of 2007.

Fulton to increase water rates 15 percent

Conservation reduces county use by 30%
By D.L. BENNETT
The Atlanta Journal-Constitution
Published on: 05/08/08

Fulton County officials praised county water users Wednesday for their success at conservation — then socked them with a 15 percent rate increase for their effort.

The conservation penalty the County Commission adopted Wednesday 6-0 matches the increase Atlanta utility officials asked to impose earlier this year but which the City Council so far has resisted. The average water/sewer bill should increase nearly $9 per month to a total of about $68 per month, water officials said.

The county provides water and sewer service to some areas of north Fulton County. It provides sewer service only in Sandy Springs and south Fulton. The county also has some north Fulton customers who only get water.

All will get the 15 percent hike.

Utility managers said water use has dropped by as much as 30 percent since last year when Gov. Sonny Perdue asked each county to cut usage by at least 10 percent because of the lingering drought. That has Fulton facing potential default on its bonds, said Angela Parker, public works director.

"We just can't swallow this reduction in revenues," Parker said.

She said Fulton one day might roll back the rates if the drought ends and revenues return to pre-drought levels.

Commissioners said they felt Fulton had to raise rates despite the slumping economy.

"I'm deeply concerned about raising water rates, but we have no choice," Commissioner Emma Darnell said. "This is a minor range of situations where a rate increase can be justified."

Economy Jackson of Atlanta protested the action on behalf of Habitat for Humanity, which builds low-cost homes all over Fulton.

"Because people are saving money, they are being charged," she said. "We are doing what you asked us to do. We are opposed to this rate increase."

Atlanta's proposed conservation penalty continues to be stalled in the City Council's utilities committee and does not appear to be headed toward passage.

Atlanta water utility officials began pushing on Tuesday a four-year rate hike plan that includes the money the conservation penalty would have collected. It would bump up the average water/sewer bill 80 percent — from $84.60 a month to $151.92 — during the next four years.

Council members are expected to consider the rate increases in the next seven weeks as they consider the 2008-09 budget, which starts July 1 and has a projected $140 million shortfall.

Three Ga. companies land on Fortune's 'Best Companies to Work For' list

Atlanta Business Chronicle

Aflac Inc., Alston & Bird LLP and Children's Healthcare of Atlanta are among Fortune magazine's 100 Best Companies to Work For 2008.

Columbus, Ga.-based insurance company Aflac (NYSE: AFL) came in at No. 30. Fortune noted Aflac has a top comp package - pension, profit sharing, 401(k) match - and recently gave shareholders a rare say-on-pay vote. The company has 4,162 employees.

Atlanta law firm Alston & Bird was ranked just behind Aflac at No. 31. Fortune said, "Both the legal and nonlegal staff get super benefits, including 90 days of paid maternity leave, coverage of fertility treatments, and concierge services." The firm has 862 employees.

At No. 45 is Children's Healthcare of Atlanta, where "Employee referrals account for 46 percent of new hires, and more than 20 percent of current staff -- many citing 'idealism' -- have been here for more than 11 years." The hospital has 5,427 employees.

'I LOVE NY' gets first makeover in 31 years

The Business Review (Albany)

New York state has announced a revitalized marketing strategy for its venerable tourism brand promotion, "I LOVE NY."

The $17 million campaign was put together by Saatchi & Saatchi advertising agency and is geared to drive up the number of visitors by nearly a third to the Empire State -- to 200 million by 2020 from 155 million in 2006. State officials also hope to reap more dollars, jumping to $60 billion per year from the current level of $47 billion. In addition, the tourism industry is responsible for over 740,000 jobs in the state.

The ad effort, featuring enhancements to the promotion's logo, will focus on print publications, guerilla marketing and viral and digital marketing and incorporate sponsorships with airlines JetBlue and Virgin Atlantic and travel companies Orbitz and Travelocity.

State officials said this marks the first upgrade of the "I LOVE NY" campaign in 31 years.