Real Estate Daily News Buzz is designed to give news snippets to readers that our (yet to be award winning) editors thought you could use to start your day. They come from various business perspectives, real estate, government, the Fed, local news, and the stock markets to save you time. Here you will find the headlines and what the news buzz for the day will be. The U.S. stock market finished slightly lower on Wednesday, adding to its losses so far this year. A survey on hiring did little to ease uncertainty about the health of the economy.
The S&P 500 index added 0.57 points, or 0.03%, to close at 1,868.20. The Dow Jones industrial average lost 11.17 points, or 0.1%, to 16,340.08. The NASDAQ composite rebounded in the early afternoon, gaining 16.14 points, or 0.4%, to 4,323.33. Benchmark U.S. crude for April delivery fell $2.04, or 2%, to close at $97.99 a barrel in New York.
STAPLES TO CLOSE 225 STORED BY 2015
Framingham, Mass. -- Staples on Thursday said it will close 225 stores by the end of 2015 amid falling fourth-quarter revenue, increased competition, and a shift to online sales. The big-box office-supply category, which was battered by the recession, has come under increased competition from Walmart and other discounters and online retailers such as Amazon. Most recently, Staples’ rivals Office Depot and OfficeMax completed a $1.2 billion merger. The retailer said the closings, which will impact about 12% of Staples’ 1,500 U.S. outlets, are part of a plan to save $500 million in costs by the end of next year. Additional savings are expected to come from supply chain, labor optimization, non-product related costs, IT hardware and services, marketing, sales force, and customer service.
A&G REALTY TO DISPOSE OF 1,100 RADIO SHACK STORES
Following RadioShack’s surprise announcement that it will close 1,100 stores in an attempt to staunch the flow of red ink, the company has retained Melville, N.Y.-based A&G Realty Partners to manage the disposition. “In the coming weeks we’ll be working with our landlords to find an efficient and cost-effective means to exit these unprofitable locations, and as such, we’ve engaged A&G Realty to assist us in this process,” said John W. Feray, RadioShack’s CFO, during a March 4 earnings conference call. What will A&G Realty do? “We expect this may involve a negotiated lease termination payment in some cases,” continued Feray. While lease termination payments may require relatively large cash outlays, Feray went on to say that those costs would be more than offset by cash generated from the liquidation of the inventory in those stores when they closed.
DOTS TO CLOSE ALL STORES; GORDON BROS HANDLING LIQUIDATION
New York -- After over 25 years in business, Dots, an Ohio-based women’s fashion discount retailer, is closing its doors. Store-closing sales will begin on Friday, March 1, with discounts on all merchandise, as well as store furniture, fixtures and equipment. Dots filed for Chapter 11 protection on January 20, 2014. Dots selected Gordon Brothers Group’s Retail Division to oversee the chain’s going-out-of-business sales in all of its 360 locations. Stores will remain open until all merchandise has been sold. All inventory will be on sale and discounts will begin at 20%. Dots officials contacted 268 potential buyers but weren't able to find any offers that would have kept the chain alive, according to a report in the Wall Street Journal.
McDONALD’S U.S. SAME STORE SALES DROP 1.4% IN FEBRUARY
Oak Brook, Ill.– U.S. same-store sales dropped 1.4% at McDonald’s Corp. during February 2014, with global same-store sales declining 0.3%. Other segment same-store results for McDonald’s during the month included a 0.6% increase in Europe and a 2.6% decrease in Asia-Pacific/Middle East/Africa (APMEA). The company cited severe weather and challenging industry dynamics in affecting its U.S. same-store sales performance. "McDonald's global growth priorities - optimizing our menu, modernizing the customer experience and broadening accessibility to brand McDonald's - are the foundation of our customer-centric approach to building our business for the long term," said McDonald's president and CEO Don Thompson. "We are intent on improving our business performance by thoughtfully evolving our approach to ensure that we are delivering the most compelling value, service and convenience to each of the approximately 70 million customers who choose McDonald's each day."
LOW-WAGE JOBS UNEXPECTEDLY A WAY OF LIFE FOR MANY
WASHINGTON (AP) -- For years, many Americans followed a simple career path: Land an entry-level job. Accept a modest wage. Gain skills. Leave for a better-paying job. The workers benefited, and the U.S. economy gained —better pay led to increased consumer spending, fueling growth. But that path has narrowed as many of the next-tier jobs no longer exist. That means more lower-wage workers have to stay put. The resulting bottleneck is widening a gap between the richest Americans and everyone else. It's part of why average inflation-adjusted income has declined 9% for the bottom 40% of households since 2007, even as incomes for the top 5 percent now exceed where they were when the recession began, according to the Census Bureau.
OBAMA TO PUSH FOR MORE OVERTIME PAY
WASHINGTON (AP) -- President Barack Obama will direct the Labor Department to strengthen overtime pay protections for millions of workers, a White House official said. The directive is meant to help salaried workers, such as fast-food shift supervisors or convenience store managers, who may be expected to work more than 40 hours a week without receiving overtime pay. The proposed change is part of Obama's effort to focus on closing the gap between the wealthy and the poor. Under the new changes Obama is seeking, the Labor Department could raise the pay threshold for workers covered by overtime rules. Currently, salaried workers who make more than $455 per week are exempt from overtime.
50 CENTS, $1 OR $2? STARBUCKS ADDING DIGITAL TIPS
NEW YORK (AP) -- Starbucks will soon let customers leave tips with its mobile payment app. The coffee chain says the mobile tipping option will be available on its updated app for iPhones starting March 19. The rollout comes as the company's app has surged in popularity, with roughly one out of every 10 purchases now made with a mobile device. After paying with the app, Starbucks says customers will be able to leave a tip of 50 cents, $1 or $2 anytime within two hours of the transaction. The tipping option will only be available at the 7,000 of the roughly 11,000 Starbucks locations in the U.S. that are owned by the company.
NY COMPTROLLER: AVERAGE WALL STREET BONUS OVER $164K
ALBANY, N.Y. (AP) -- The average bonus paid to securities industry employees in New York City grew 15 percent last year to more than $164,000, the largest average Wall Street bonus since the 2008 financial crisis and the third highest on record, New York's state comptroller reported Wednesday. The securities industry has been profitable for five consecutive years, Comptroller Thomas DiNapoli said. It had 165,200 workers in New York City as of December, or 12.6 percent fewer than before the crisis. Profits for broker/dealer operations of some 200 New York Stock Exchange members — the traditional measure of profitability for the securities industry — totaled nearly $16.7 billion last year, down 30 percent from a year earlier.
ENERGY XXI BUYING EPL OIL & GAS FOR ABOUT $1.53 BILLION
HOUSTON (AP) -- Energy XXI is buying EPL Oil & Gas Inc. for about $1.53 billion in a cash-and-stock deal that the companies say will create the biggest publicly-owned independent oil producer on the Gulf of Mexico shelf. Once the deal closes, Energy XXI says the combined company will own and operate 10 oil fields on the shelf with cumulative production each exceeding 80 million barrels of oil. The combined company will be based in Houston where EPL has headquarters.
EASTMAN KODAK NAMES CLARKE AS NEW CEO
ROCHESTER, N.Y. (AP) -- Eastman Kodak has tapped Orbitz Chairman Jeffrey Clarke as its new CEO, taking over from Antonio Perez. The photography and film pioneer, which emerged from bankruptcy in September, said Wednesday that Perez will remain as a special adviser to its board. Perez, 68, had served as CEO since 2005. Clarke, 52, will continue as chairman of online travel company Orbitz Worldwide Inc. He is also the co-founder of private investment firm Augusta Columbia Capital and served as a managing partner there.
VOLVO EARNINGS HIT BY NEW PRODUCT LAUNCHES, COSTS
HELSINKI (AP) -- Swedish truck maker AB Volvo enjoyed strong sales in the fourth quarter, but its earnings were hurt by extra costs linked to the launch of new products, write-downs and restructuring charges. Net profit in the last three months of 2013 fell to 548 million kronor ($86 million), from 869 million kronor in the same period a year earlier. Sales rose to 76.6 billion kronor, from 70.8 billion kronor in 2012. The company said Wednesday it would continue cost-cutting measures during 2014, including 4,400 layoffs it had already announced, and will review its products portfolio. Volvo said it expects a slight growth in overall demand, driven mainly by China and Europe, but added that 2014 will see a reduction in costs.
MAKER OF "Candy Crush" SEES $613 MILLION IN IPO
NEW YORK (AP) -- The company behind the blockbuster game "Candy Crush Saga" believes it could raise nearly $613 million in an initial public offering. In a regulatory filing Wednesday, King Digital Entertainment PLC said that it plans to sell 15.3 million shares in the offering. Existing shareholders will sell an additional 6.7 million shares. "Candy Crush" was the most downloaded free app on iPhones and iPads in 2013, beating Facebook, Google Maps and YouTube. The shares are expected to be priced between $21 and $24. Shares would be listed on the New York Stock Exchange under the symbol "KING."
FACEBOOK HEADQUARTERS CLEARED AFTER FALSE THREAT
MENLO PARK, Calif. (AP) -- Police flooded Facebook's headquarters in Northern California to investigate a threat they later found wasn't credible. Menlo Park police Commander Dave Bertini says Facebook's campus was locked down Tuesday night after San Francisco police passed along a report of a threat shortly after 7 p.m. Bertini says the threat was found to be unsubstantiated and not credible. He would not give further details. The area was declared safe, and employees were allowed to leave at about 8:30 p.m. More than 6,000 people work for the social media giant, but it wasn't clear how many were at the headquarters at that hour.
PFIZER STOCK TRADES HALTED OVER CELEBREX PATENT RULING
TRENTON, N.J. (AP) -- A federal court on Wednesday invalidated the key patent for one of Pfizer's most lucrative medicines, potentially opening the door for cheaper generic versions 18 months sooner than expected and cutting into the drugmaker's profit. Pfizer Inc., still trying to make up for billions in lost sales since generic versions of Lipitor hit, could lose a couple billion more if the court decision on the Celebrex patent stands. The world's second-biggest drugmaker said it disagrees with the ruling and will "pursue all available remedies" to fight it, including an appeal. Celebrex, Pfizer's fourth-bestselling product, brought in $2.9 billion in worldwide sales last year. The anti-inflammatory pill is widely used for arthritis and acute pain.