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 Dow Jones Industrial Average fell 54.33 points to close at 15,413.33. The Standard & Poor’s 500 index fell 8.29 points to 1,746.38. The NASDAQ composite fell 22.49 points to close at 3,907.07 on Wednesday, Oct. 23rd.
Benchmark U.S. crude for December delivery fell $1.44 to $96.86 a barrel in New York.
CONSTRUCTION UNEMPLOYMENT DECLINES TO 8.5% LOW
Construction employment rose by 20,000 in September and the industry’s unemployment rate fell to a six-year low of 8.5%, while construction spending increased for the fifth consecutive month in August, according to an analysis of new government data by the Associated General Contractors of America. Association officials cautioned that the data does not address any potential impacts from the recent federal government shutdown. (Full report to be published tomorrow)
TUCSON APPROVES CHANGES TO PRIMARY JOBS INCENTIVE PROGRAM
TUCSON - The mayor and City Council unanimously approved changes to its Primary Jobs Incentive Program to make it easier for more businesses to qualify for building-fee exemptions and to temporarily retain sales taxes for their own benefit at Tuesday’s meeting. The program was launched in August 2011 to encourage businesses in the primary sector to expand, and in doing so, boost the economy. "A primary job is one that exports a product and imports dollars into the economy versus retail, which just re-circulates dollars," said Chris Kaselemis, Economic Initiatives Program director. "The average wage is a little lower and more in line with what we pay here in the Tucson area," Kaselemis said. "By lowering the threshold, it will make more firms eligible.” Since it began, only two companies, American Tire Distributors and B/E Aerospace have successfully applied for the program. The changes lower the minimum wage businesses must pay some workers in order to get the incentive.
WEYERHAEUSER TO USE REVERSE MORRIS TRUST VALUED AT $2.7 Billion
NEW YORK (Reuters) - Tri Pointe Homes Inc (TPH.N), a homebuilder backed by Barry Sternlicht's Starwood Capital Group LLC, is in advanced talks to buy Weyerhaeuser Co's (WY.N) homebuilding division for about $2.7 billion, according to people familiar with the matter. Taylor Morrison, which went public in April and Alberta, Canada-based Brookfield Residential Properties are among those prospective buyers, but the most serious are between Tri Pointe Homes (NASDAQ:TPH). Weyerhaeuser announced in June it was reviewing strategic options for the homebuilding and real estate development unit, is trying to finalize a sale to Tri Pointe as soon as in the next two weeks, sources told Reuters this week. Under the proposed terms of a deal, the two companies are using a structure known as Reverse Morris Trust - a transaction that allows a parent company to sell its subsidiary in a tax-efficient manner, the people said.
ASIA’S RICHEST MAN SCRAPS PLAN TO SELL PARKnSHOPS
Oct 18 (Reuters) - Hutchison Whampoa, controlled by Asia's richest man, Li Ka-shing, has scrapped a plan to sell its Hong Kong supermarkets business, ParknShop and will instead focus on expanding in China, it said on Friday. The sale of ParknShop, which operates 345 stores in Hong Kong, China and Macau, had been expected to fetch between $3 billion and $4 billion, with prospective bidders including prominent retailers, such as state-owned China Resources Enterprises, Japan's Aeon Co Ltd and Australia's Woolworths Ltd.
BLACKSTONE PREPARING BRIXMOR IPO
As Blackstone Group LP prepares an initial public offering for shopping-center landlord Brixmor Property Group Inc., investors and analysts are watching the deal to see what tone it sets for other Blackstone-led IPOs waiting in the wings. Blackstone is expected to take as many as four real-estate companies public over the next year; three of them were purchased by the private-equity firm before the real-estate downturn. First up, shopping-center landlord Brixmor could raise up to $905 million. The company said late last week in a regulatory filing that it expects to offer up to 43 million shares of common stock for between $19 and $21 a share, potentially raising up to $905 million.
INVESTMENT CROWDFUNDING ABOUT TO GO BIG TIME
WASHINGTON (AP) — For years, filmmakers, artists and charities have used the power of the Internet to generate money for projects. But in the coming year, with the blessing of Congress, startups will be allowed to raise money this way by selling stock to small-time investors. For those investors, it’s a chance to make a small profit and possibly get in early on the next Twitter or Facebook. But it’s also extremely risky, given that a majority of startups fail. And critics warn that investment crowdfunding is ripe for fraud. The Securities and Exchange Commission on Wednesday took a step toward implementing the law by proposing how much people could invest and how much companies must divulge. The SEC voted 5-0 to send the proposal out for public comment. Final rules could be approved next year.
EUROZONE DEBT BURDEN ROSE AGAIN Q2
BRUSSELS (AP) — The eurozone’s debt burden rose further in the second quarter, official figures showed Wednesday, despite years of austerity that one prominent European Union economist says intensified the financial crisis. Eurostat, the EU’s statistics office, said debt across the 17 countries that use the euro rose to 93.4% of the eurozone’s annual gross domestic product from 92.3% the previous quarter. Though countries across the region, such as Greece and Spain, have made great strides in reducing their borrowing through spending cuts and tax increases, they’re still running budget deficits that add to their stockpile of debt. The eurozone’s economy also isn’t growing fast enough to help lower the debt figures measured relative to total GDP — a sustained period of strong growth would help reduce the debt burden figures.
FEDEX EXPECTS HOLIDAY DELIVERIES TO INCREASE
MEMPHIS, Tenn. (AP) — FedEx expects that holiday shoppers will be more nice than naughty this year, with shipments rising from 2012. The company said Wednesday that it expects to carry more than 22 million shipments on the busiest day of the season, which it believes will be Monday, Dec. 2. FedEx predicts that shipments in the first week of December will rise 13 per cent over last year’s peak week, to more than 85 million shipments, driven by online shopping and retailers stocking up on electronics, apparel and other goods.
STARBUCKS OPENING ‘TEA BAR’ IN NYC
NEW YORK (AP) — Starbucks is trying to make tea trendy, with plans to open its first “tea bar” in New York City. The Seattle-based company says Teavana Fine Teas + Teavana Tea Bar will serve sweets and other food including flatbreads, salads and small plates ranging in price from about $3 to $15. Drink prices will range from $3 to $6, and include novelties such as a Spiced Mandarin Oolong tea and carbonated teas. The menu of food and freshly made drinks is a switch for Teavana, a chain of about 300 stores that sell boxed and loose tea and accessories. Teavana stores are mainly in shopping malls, but Starbucks CEO Howard Schultz said he plans to expand the footprint to include more locations in urban areas. The company plans to add brewed tea and food to more Teavana stores. The opening of the New York City store on Thursday comes after Starbucks bought Teavana last year. The company has said it plans to use the acquisition to make tea a bigger part of American culture, as it has with coffee.
700 IRS CONTRACT WORKERS OWE $5.4MILLION BACK TAXES
WASHINGTON (AP) — Nearly 700 employees of Internal Revenue Service contractors owe $5.4 million in back taxes, said a report Wednesday by the agency’s inspector general. More than half of those workers are supposed to be ineligible to do work for the IRS because they are not enrolled in installment plans to pay the taxes they owe. Unlike other federal agencies, the IRS requires employees and those who work on agency contracts to comply with federal tax laws. That means they have to file returns on time and either pay all the taxes they owe or enroll in a payment plan.
TRIAL STARTS; IS DETROIT ELIGIBLE FOR BANKRUPTCY?
DETROIT (AP) — An attorney representing Detroit urged a judge Wednesday to allow the city to fix staggering financial problems through bankruptcy, arguing that without it nearly 65 cents of every tax dollar eventually would be gobbled up by debts and other obligations. The extraordinary trial, expected to last days, brings the bankruptcy case to its most crucial stage since Detroit in July made the largest public filing in U.S. history. If a judge finds certain legal requirements were met, the city would get the green light to restructure $18 billion in debt and possibly slash pensions for thousands of people, the most controversial target so far. Hundreds of protesters walked in a circle outside the courthouse with signs that said, “Bail out people not banks.”