Home prices still expected to fall

Nashville home prices dropped 3.9 percent in the third quarter of 2009 compared to one year ago, according to data released today by Fiserv and its Case-Shiller Index.

Nationally, home prices dropped 8.9 percent in the same time period.

However, Fiserv said national home prices increased 2 percent in the third quarter, on top of another 2 percent increase in the second quarter. According to Fiserv, it’s “the first back-to-back quarterly price gains the U.S. housing market has seen since 2005.”

However, Fiserv said “the housing market will continue to be buffeted by strong headwinds in 2010 due to large supplies of distressed properties, rising interest rates and high unemployment rates.”

Fiserv Case-Shiller reaffirmed its estimate that home prices will decline 11.5 percent in 2010.

“It appears that most of the housing demand from first-time buyers was pushed forward to 2009 in anticipation of the November expiration of the homebuyer tax credit,” said David Stiff, Fiserv’s chief economist. “So, it seems unlikely that the extension and expanded eligibility of the credit through April 2010 will substantially boost demand this year.”

The median home price nationally currently sits at $178,200. The median monthly mortgage payment in the 2009 third-quarter jumped to 15 percent of median family income, an increase of 1 percent over the second quarter.

According to data released today by RealtyTrac, foreclosure rates slowed in the Nashville-Davidson-Murfreesboro-Franklin area in 2009, dropping 1.92 percent compared to 2008. However, the 9.253 properties with foreclosure filings in 2009 were 75 percent more than in 2007.

Nashville Business Journal - by Eric Snyder Staff Writer

Restaurant Wednesday

South Street is a Nashville tradition since 1991, South Street offers Pit BBQ Ribs, Oysters, Crab Cakes, Pumped Chicken,Crawfish and Shrimp Enchiladas, Jack Daniel's Strip or steamed New Orlean's Bread Pudding-to name just a few of the Southern Urban Cuisine choices. When weather permits, the restaurant offers open-air seating.

Location:
907 20th Avenue South
Nashville

615.320.5555
pansouth.net/southstreet

REALTORS® Support Haiti Earthquake Relief Efforts

In the wake of a devastating earthquake in Haiti on Jan. 12, 2010, NAR quickly mobilized its resources to support the more than three million people affected by this tragedy. The REALTORS® Relief Foundation of the National Association of Realtors® is contributing $550,000 to provide relief to Haiti earthquake victims, and NAR is calling upon its 1.2 million members to help.

“REALTORS® help build communities, and there is no better time than now to do that in Haiti,” said NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz.

NAR encourages all members to contribute through the REALTORS® Relief Foundation, a 501(c)(3) organization established to provide housing-related assistance to victims of disasters and for other charitable purposes permitted under Section 501(c)(3) of the Internal Revenue Code.

Please offer your support and donate today, joining REALTORS® across the nation and around the globe. Together, we can make a difference.

Mortgage News

Mortgage bond prices rose last week pushing mortgage interest rates lower. The bond market rallied following crumbling stocks as the DOW fell 213 points Thursday. Weekly jobless claims came in higher than expected causing unemployment fears to cast a shadow over the state of the economy. In a consumer based economy it is difficult for people to spend money without a job. The producer price index was mixed as the headline figure was higher than expected but the core was lower than expected. For the week interest rates fell by about 1/4 of a discount point.

The Fed meeting Wednesday will be the most important event this week. The Treasury will continue the record auctions with 2-year notes on Tuesday, 5-year notes on Wednesday, and 7-year notes on Thursday. If foreign demand remains decent rates should hold near current levels. However, a drop in foreign demand will likely cause rates to head higher.


--------------------------------------------------------------------------------
Economic Factors
Economic Indicator Release Date Time Consensus Estimate Analysis
Existing Home Sales Monday, Jan. 25, 2010 Down 8.3% Low importance. An indication of mortgage credit demand. A significant decrease may lead to lower rates.
Consumer Confidence Tuesday, Jan. 26, 2010 52.9 Important. An indication of consumers' willingness to spend. Weakness may lead to lower mortgage rates.
New Home Sales Wednesday, Jan. 27, 2010 Up 1.9% Important. An indication of economic strength and credit demand. A decrease may lead to lower rates.
Fed Meeting Adjourns Wednesday, Jan. 27, 2010 No rate adjustment Important. Few expect the Fed to change rates, but some volatility may surround the adjournment of this meeting.
Durable Goods Orders Thursday, Jan. 28, 2010 Up 2.0% Important. An indication of the demand for "big ticket" items. Weakness may lead to lower rates.
Q4 Advance GDP Friday, Jan. 29, 2010 Up 4.5% Very important. The aggregate measure of US economic production. Weakness may lead to lower rates.
Q4 Employment Cost Index Friday, Jan. 29, 2010 Up 0.4% Very important. A measure of wage inflation. Weakness may lead to lower rates.
U of Michigan Consumer Sentiment Friday, Jan. 29, 2010 73.0 Important. An indication of consumers' willingness to spend. Weakness may lead to lower mortgage rates.


Fed Focus

The United States central bank, the Federal Reserve, coordinates the borrowing and lending activities of federally chartered banks. The principal reason the Federal Reserve was created was to reduce severe financial crises. One way of accomplishing this goal is to control the amount of money that flows through the economy. By manipulating the US money supply, the Fed influences inflation, unemployment, and the level of US economic activity. The Fed has a variety of tools that it uses to control the money supply, but its chief policy tool is the manipulation of short-term interest rates.

All eyes will be focused on the Federal Open Market Committee meeting Wednesday. No rate changes are expected. However, many analysts and traders believe rate hikes are on the horizon. Futures contracts show traders are pricing in a 77% chance the Fed will raise rates by November. Others argue those positions will be wrong because the economy isn't strong enough for the Fed to change rates.

A cautious approach to float/lock decisions is prudent heading into the Fed meeting this week. Be prepared for potential market volatility.

WR Starkey Mortgage

Carothers Crossing faces financial troubles, but developers determined

The prognosis for Carothers Crossing, a traditional neighborhood development underway in Nolensville, looks grim.

A fraction of the planned homes have been built; two banks have foreclosed on portions of the 700-acre project and a third bank planned to do the same on the day developers filed for bankruptcy; no lots have been sold since mid-2008 and a lender says the developers lack the necessary cash to go forward.

But developer Don Smithson said going forward is exactly what the project will do, though two of his companies — Wood Ridge Development and Wood Ridge Investments — filed for Chapter 11 bankruptcy protection Jan. 15, the same day GreenBank was poised to conduct a foreclosure sale on 111 lots and more than 190 acres of unplotted land. Cadence Bank and Pinnacle National Bank have already assumed ownership of more than 200 acres at the development, located in southern Davidson County.

Smithson originally planned for Carothers Crossing to be a traditional neighborhood development, or TND, where a variety of housing options are offered in dense clusters while also providing commercial and communal town centers. Completed TNDs are essentially new towns, complete with tree-lined streets, parks, places of worship and retail shops.

“None of the vision has changed at all,” Smithson said. “Like any new community, we needed momentum, and we just got started at a rough time.”

Smithson and Mike Delvizis, the project’s engineer, said they have several investors ready to step up and resume activity — even forecasting they could start a five-unit condo building this spring.

The prediction is bold in its optimism. According to a motion filed by GreenBank in which it seeks to reclaim Wood Ridge’s property despite the bankruptcy proceedings, the developers haven’t sold a lot in Carothers Crossing since July 2008. The filing also claims that, in addition to owing GreenBank more than $7.3 million, developers are in default of both their 2008 and 2009 county ad valorem taxes.

The filing argues that the Carothers Crossing parcels aren’t integral to a reorganization by the Wood Ridge entities because their “ability to develop, market and sell the property is not viable as an on-going concern.”

“... The debtor has no operating capital to fund any improvements on the property, and the debtor lacks ability to obtain financing to fund such improvements.”

Smithson, however, said he has investors on the sidelines ready to get involved. Citing nondisclosure agreements, he declined to divulge how much they plan to invest, how many investors there are or where they are from. After investors come on board, though, Smithson said he was confident “that Mike and I will stay involved.”

Smithson said it could take 13 years to realize the original vision. Of the 3,400 units planned, 55 are completed or under construction. Thirty-four are occupied, including two occupied by Smithson and Delvizis.

David McGowan, president of Regent Homes — the developer behind Lenox Village, a TND along Nolensville Pike in southern Davidson County — said Carothers Crossing will be “a good community down the road,” but said it faced several hurdles out of the gate.

For one, McGowan said it doesn’t have high visibility from a main thoroughfare, which would allow an inquisitive public to monitor progress.

The land itself is attractive, McGowan said, but its rolling hills make it less accommodating of a TND without costly grating work. Rolling lots may not be a huge concern in a typical, cul-de-sac style neighborhood, but it can have dramatic impact on a TNDs streetscape — which is usually one of the prime selling points.

“What you are buying is front doors and front porches,” McGowan said.

Finally, McGowan said the project’s price points, with homes starting at $180,000, were “fairly high for the area.” For comparison, Lenox offered condos for $89,000 and townhomes for $129,000 as a starting point.

“Then you add on top of it that he opened at the beginning of a recession,” McGowan said.

Traditional neighborhood developments grew in prevalence in the 1980s, particularly in Florida, though they are a relatively recent phenomenon in the Nashville area. Though the cost-per-lot to a developer for TNDs can be cheaper because of the density of such projects, the additional infrastructure — having to pave both the streets and the alleys that give access to each home’s garage, for instance — makes the communities more expensive than a suburban neighborhood. The expenses also tend to be front-loaded, leaving developers on a limb for a time.

“You’ve got a ramp up period there where a lot of people are just circling,” said Jim Cheney, vice president of communications for Southern Land Co., the developer of Westhaven, a traditional neighborhood development in Franklin. Of 2,600 units planned in Westhaven, 800 have been built.

While the housing crunch has slowed sales, Cheney and McGowan said the TND model seems firmly entrenched. McGowan’s company, in fact, has negotiated to purchase all the townhome lots in Boyle Investment Co.’s Berry Farms, a TND in Franklin, where McGowan said dirt should begin moving late this year.

Seth Harry, the Maryland-based architect that designed Carothers Crossing, said he’s continuing to work with new TNDs across the country, though he said most are “waiting out the market” — getting their designs and permits ready while the housing and lending markets recover.

“Long-term prospects for Carothers are very good, if they can get through the immediate downturn,” he said.

He recalled a traditional neighborhood development in the Washington, D.C., area that was taken back by its primary lender in the 1990s, but the developer stayed on as its primary consultant, leading it to a successful build-out.

“It turned out to have a very happy ending,” he said.

Nashville Business Journal - by Eric Snyder Staff Writer

Medmart developers say Music City Center approval accelerates plans

The developers of the proposed 2-million-square-foot medical Nashville Medical Trade Center issued a news release this morning praising the approval of Music City Center.

The developers plan to reuse and vertically expand the existing Nashville Convention Center downtown.

“With the approval of the Music City Center, we are accelerating our reuse plan for the existing convention center as an open-daily trade center,” Bill Winsor, president and CEO of Market Center Management Co., said in the news release. “The new convention center is essential for attracting global health care trade events that will welcome tens of thousands of visitors to Nashville. And the trade center will offer both permanent and temporary exhibition space complementing the Music City Center. The synergy between the two facilities will create the most attractive health care exhibition option in the U.S.”

Nashville’s Metro Council approved the financing package for the $585 million Music City Center project, 29-9, yesterday. The project totals 545,000 square feet of exhibit, ballroom, meeting and retail space and also includes a 1,800-space parking garage. It will be built on 16 acres south of Broadway downtown.

After last night’s council vote, Mayor Karl Dean said Metro will begin more serious negotiations with Market Center Management Co. on government incentives and the terms of a master-lease of Nashville Convention Center and its underlying land.

Dean also said he expected the approval of Music City Center to add certainty to the developers plans for a medical mart and assist their efforts to pre-lease space in the facility.

As proposed, the $250 million Nashville Medical Trade Center would include up to 1,200 permanent showrooms for health care product manufacturers, distributors and information technology companies; 200,000 square feet of temporary trade show space; and conference facilities.

A study by University of Tennessee professor LeAnn Luna predicts the center, if it is built, would employ 2,760 people, generate $390 million in economic activity a year and produce $21 million a year in state and local taxes by 2019.


Nashville Business Journal - by Brandon Gee Staff Writer

Restaurant Wednesday

The Acorn features two floors of dining, private rooms, two full bars and a large outdoor patio. The Acorn offers Americdan cuisine with a global flavor. Independently owned and conveniently locatd in the West End District.

Location:
114 28th Ave North
Nashville

615.320.4399
theacornrestaurant.com

Luxury home sales rebound

Luxury homebuilder Rogan Allen hadn't sold a home in more than a year, until last November rolled around, and he sold three in two months.

Of course, it helped that he had lowered the prices.

One home, a five-bedroom Green Hills mansion with 360-degree views and 14-foot ceilings, was snapped up by Kings of Leon bassist Jared Followill for $1.85 million. That's about 20 percent less than the property was priced at just seven months earlier.

Two married Vanderbilt University medical doctors bought another upscale home for $1.52 million, more than $300,000 off the list price.

Reduced prices and sweeter returns on Wall Street for many investors may be melting a nearly frozen market for higher-priced homes, real estate agents say.

Fourth quarter 2009 saw the first year-over-year increase in home sales in the Nashville area for property priced above $750,000, according to an analysis by appraiser Richard Exton of Manier & Exton.

Sales of those higher-priced homes rose 29 percent to 89 homes in October-December, roughly the same percentage increase as the overall market experienced. Luxury homes are not a huge part of the overall real estate market, however.

Homes that sell for more than $750,000 make up less than 3 percent of total sales. Yet an increase could be a sign that more than just first-time home buyers are starting to get interested in buying homes again.

"I'm not going to say we're healed," said Allen, who celebrated his series of sales with a vacation to the Florida Keys last week. "I think everyone was looking for someone to stamp the economy OK, to say we're not going down the tubes in every single area. I feel like our government is moving things along in well-enough shape that people have some confidence."

The Dow Jones industrial average is up about 30 percent compared with this time last year, an important psychological marker for consumers who buy luxury homes. The still-lackluster jobs market — and its 10.3 percent unemployment rate in Tennessee — may not be that big of a concern to people who buy $1 million houses, real estate agents added.

It would be silly to say people who buy expensive houses aren't affected by the economy; they are. Many of them own businesses," said John Brittle Jr., an agent with Village Real Estate Services, who has sold five homes for more than $500,000 this year in Nashville, primarily in the Green Hills and Belmont neighborhoods. "But they might be more careful or they might want to sell their existing homes first," he said.


They also want a bargain. Foreclosures and strapped homeowners are affecting prices for high-priced homes just as they are for the less-opulent properties.

Prices pushed down

One buyer refused to look at any homes for sale that weren't foreclosures or on their way to foreclosure, said Steve Fridrich, the president and chief executive officer of Fridrich & Clark Realty.

He eventually sold the man a foreclosed $1.69 million home in Green Hills in July for $200,000 less than the financial institution, Pinnacle National Bank, had paid for it in October 2008.

"What's driving the market now is bank-owned property, short sales, foreclosures. … All of those are must-sell properties and you see the most price adjustment there," Fridrich said.

He still sees a lot of inventory in the high-end market. In some price ranges, it would take years to sell off all the homes at the current sales rate, he said.

"Our weak market will remain weak for awhile," Fridrich said.

"Real estate isn't something that just bounces back in six months, especially in the high end."

Nashville businesses rush to help Haiti

The devastating earthquake that hit Haiti on Jan. 12 has invited a wave of giving. In the first 48 hours hours after the crisis, the American Red Cross raised $5 million thanks to people texting “HAITI” to 90999, which results in a $10 donation that will show up on the donor’s phone bill. Nashville businesses are supporting the relief efforts in a variety of ways. Here are some of them:

HCA Inc.: The Nashville-based hospital operator said it will match employee contributions in order to make a total contribution of $1 million to organizations such as the Red Cross and Doctors Without Borders. Employees, physicians, facility volunteers or others affiliated with the company can give directly to a special relief fund, "The HCA Haiti Relief Fund," administered through the Community Foundation of Middle Tennessee. Tax-deductible donations to this fund may be made by either check or credit card at www.cfmt.org/HCAHaitiReliefFund. The company also is coordinating medical supply donations from its facilities across the country through its East Florida Division, based in Ft. Lauderdale. Working with Food for the Poor, a South Florida relief organization, facility supply officers are arranging for collection and delivery of supplies. HCA's temporary staffing agency, All About Staffing, is also accepting the names of HCA clinical staff and disaster-trained employees who are interested in volunteering, and will apprise them of opportunities once the situation in Haiti has stabilized. "The devastation in Haiti is almost incomprehensible," HCA Chairman and CEO Richard M. Bracken said in a statement, "and some members of the HCA family have been personally affected. We wanted to act quickly to provide assistance from the company and to establish an effective mechanism by which our people could fulfill their desire to help."

Dollar General: The Goodlettsville-based company has donated $100,000 to International Red Cross to aid in the recovery effort, and is encouraging employees to make donations at www.redcross.org.

Fifth Third Bank and United Way of Williamson County: The bank is working with the United Way of Williamson County to solicit relief supplies, which can be dropped off at the bank's branch at 5000 Maryland Way branch in Brentwood or at United Way's office at 207 Gothic Court Suite 107 in Franklin. Most needed are donations of water, baby formula, medical supplies and blankets. Pain relievers, flashlights and batteries, and personal hygiene products are also needed. You can reach the bank branch at (615) 377-5384 or the United Way office at (615) 771-2312.

Nissan: Franklin-based Nissan North America has donated $25,000 to the Red Cross and $52,000 to Habitat for Humanity. It is also offering to match employee contributions up to a total of $25,000. Nissan Canada Inc. donated another $5,000.

Soles4Souls: The Nashville-based charity is working with donors to send shoes and relief supplies.The charity already had 30 cases of shoes in shipment to Haiti when the earthquake struck. Now it is working with partners to deliver at least 1 million pairs of shoes, as well as an aid package of food, bottled water, medical supplies, tents, blankets, flashlights and baby products. Nashville's Hopepark Church and KIWI Shoe Care are assisting in the effort. On Sunday, Soles4Souls' Founder Wayne Elsey will be present at Hopepark to discuss the charity and raise money for relief efforts. Soles4Souls announced Friday that beginning today, Shoe Carnival customers will be invited to make a donation at checkout.

The Community Foundation of Middle Tennessee: The Community Foundation is establishing a Haiti Earthquake Response Fund. Grants from the fund will be made to nonprofits and aid groups for response, clean-up and restoration efforts in the aftermath of the disaster. Donations to the fund can be made online at www.cfmt.org or by mail to the Community Foundation.

Year-over-year home sales, prices up in December

For the third consecutive month, Nashville-area home sales were up in December when compared to the same period one year ago, according to sales data released today by the Greater Nashville Association of Realtors.

According to GNAR, there were 1,612 closings during December, up 13.3 percent from one year ago.

While residential sales were up significantly — from 1,422 in December 2008 to 1,612 last month — condo sales were essentially flat, going from 192 in 2008 to 195 last month.

The median price of both single-family homes and condos ticked up in December, when the average single-family home sold for $164,000 (compared to $163,750 in December 2008) and the average condo sold for $149,900 (compared to $134,062).

Fourth-quarter home sales in Nashville, which finished at 5,730, were up 29 percent compared to the fourth quarter of 2008.

However, home sales in 2009 finished well below 2008. Regional home sales totaled 21,183 in 2009, compared to 24,246 closings in 2008, a 12.6 percent difference.

“It bears noting that at mid-year of 2009 we were virtually 30 percent behind the previous year,” said Lucy Smith, 2010 president of the Greater Nashville Association of Realtors. “While no one is claiming that all the economic issues have been resolved, we have made some meaningful progress and this is certainly the kind of news we welcome as we begin a new year.”

“The significant increase in closings during December and the very positive trend for all of the fourth quarter are both encouraging signs for real estate in this region,” Smith said.

As with recent months, the positive momentum was attributed to the homebuyer tax credit for first-time buyers.

There were 1,339 pending sales at the end of December, compared to 1,250 pending sales at the end of 2008.

Nashville Business Journal - by Eric Snyder Staff Writer

Gwyneth Paltrow, Tim McGraw movie to begin filming in Nashville

An Academy Award-winning actress and a multi-platinum selling country hunk are teaming up on a project that is bringing an injection of cash to some Nashville-area businesses.

No, it’s not Nicole Kidman and Keith Urban.

Gwyneth Paltrow and Tim McGraw are starring in a $15 million movie that begins production this week in Nashville. The production company, Screen Gems, planned to hire local residents for 75 percent of the film’s crew and 90 percent of its cast (an open casting call was in December). The movie also stars Garrett Hedlund of Friday Night Lights (the movie, not the TV show), and Leighton Meester of Gossip Girl.

“I am thrilled the director and producers of 'Love Don’t Let Me Down' have chosen Nashville and its residents to help bring their story to life,” Perry Gibson, executive director of the Tennessee Film, Entertainment and Music Commission, said in a news release. “Having a production of this magnitude in our state will provide a significant number of jobs for our production community and the project’s spending will provide a real boost to the local economy.”

Photography is expected to last through the first week of March. Pre-production began in November and post-production is expected to end in April.

Screen Gems said it expects to spend $7 million to $8 million in Tennessee, which should qualify the company for a 32 percent refund on qualified expenses thanks to incentives offered by the film commission and the state Department of Revenue.

Writer and director Shana Feste describes the movie as “a rising young singer-songwriter (Hedlund) who becomes involved with a fallen country singer (Paltrow). As they embark on a career resurrection tour with her husband and manager (McGraw) and a beauty queen-turned-singer (Meester), romantic entanglements and old demons threaten to derail them all.”

Restaurant Wednesday

Midtown Cafe is known as the place for a power lunch as well as a favorite choice for couples wanting an intimate romantic evening. Midtown Cafe offers great, unpretentious food under the precise eye of Executive Chef Brian Uhl. Fifty wines by the glass and 150 by the bottle keep Midtown on the top of every "Best of" list. Free shuttle services for downtown hotel guests.

Location:
102 19th Avenue South
Nashville

615.320.7176
midtowncafe.com

Last chance to refinance below 5%

By Les Christie, staff writerJanuary 7, 2010: 11:26 AM ET


NEW YORK (CNNMoney.com) -- If you want to refinance your mortgage into a loan with a sub-5% interest rate, better hurry. Your window of opportunity is closing fast.

Lenders are still advertising rock-bottom interest rates, but for most borrowers, rates are rapidly rising into the 5%-plus category.

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During the week of Jan. 7, the average 30-year, fixed-rate loan closed at 5.09%, according to mortgage giant Freddie Mac. That is significantly higher than the 4.71% it averaged at the beginning of the month, and experts say rates will go higher yet.

"Interest rates are up and they're not going to go down below 5% again," said Mark Zandi, chief economist for Moody's Economy.com, not for a while at least.

While homebuyers are still excited about these low mortgage rates, people who already have a loan and want to lower their costs are scrambling to lock in.

Refinancers act when the difference between the rate they're currently paying and the new one is at least a point or two wide, otherwise the costs of going through the refinancing wipes out any savings. In fact as rates rose in December, refinancings plunged, down more than 30%, according to the Mortgage Bankers Association.

A big reason for the jump is that a government program that has kept rates very low is winding to a close. The Federal Reserve has been purchasing mortgage-backed securities since early 2009, scooping up as much as $1.25 trillion worth. That has dampened rate increases by providing a ready market for the securities.

But the Fed's program lapses on March 31, when it cedes the playing field to private investors, who will almost surely demand higher rates. The Fed has already been slowing its purchasing, and that has corresponded with the recent rate increases.

As Treasurys go . . .
Not just mortgage rates have turned north. Treasury yields have as well, another indication that mortgage rates are headed skyward.

The yield on the benchmark 10-year Treasury has grown steeply over the past few weeks. It stood at 3.2% at the beginning of December and has soared to 3.84% as of Tuesday, a 20% jump.

Mortgage interest does not track Treasury yields in lockstep, but the two tend to mirror each other's movements.

Mortgage securities rates are always higher than Treasury yields because investors demand a premium above practically risk-free Treasurys.

The difference between mortgage rates and Treasury yields is usually somewhere near 1.7 percentage points, according to Keith Gumbinger of HSH Associated, a publisher of mortgage information. The current spread of about 1.2 percentage points is quite narrow.

That's bound to change, according to David Crowe, chief economist for the National Association of Home Builders. He believes mortgage rates will go up to about 5.5% by late summer. But other factors could push them into a larger-than-expected jump.

Economy bouncing back
For example, as the economy improves (it's hoped), businesses will expand production, hire new workers and open new sales outlets. All that requires borrowing in capital markets and the demand for lending will expand interest rates of all kinds.

A recovering economy also boosts corporate profits, making stocks a better bet for investors.

"Stocks tend to do better when the economy improves," said Stuart Hoffman, chief economist for PNC Financial Services. "Mortgage rates will rise to attract investment."

Hoffman's forecast is for rates to stay quite constant the rest of the winter and then elevate gradually during the spring buying season, the busiest time of year for home sales. He said they should hit about 5.5% by the end of June.

After that, the increases will slow, according to Hoffman, but still approach 6% toward the end of the year. He believes they'll cap at around 5.75% and are not likely to fall back to the 5% level again.

Music City Center enters home stretch

As the proposed Music City Center convention hall enters a final week of debate, activists on both sides of the issue are fortifying their positions.

Also, Metro Council members continue to educate themselves on the $585 million project that would replace Nashville Convention Center with a new downtown venue.

Both the Music City Center Coalition and opposition group Nashville’s Priorities have sent e-mails in an effort to galvanize their troops. In a message this morning, the coalition urged supporters to attend a rally on the steps of the Metro Courthouse today “to show community wide support for the Music City Center.”

“The Music City Center will create thousands of new jobs and strengthen our local tax base at no cost to local taxpayers,” the e-mail states.

The latest study of Music City Center predicts the proposed new downtown convention hall would generate $134.9 million in new annual spending in Nashville by 2017 and support 1,524 jobs.

In a Friday evening e-mail, Nashville’s Priorities President Kevin Sharp seized on the results of a public opinion poll commissioned by WSMV-TV. The poll of 401 Davidson County registered voters found that 26 percent support the project, 50 percent oppose it, 21 percent are undecided and 3 percent are unfamiliar with the proposal.

In addition to noting the poll results, Sharp encouraged Music City Center opponents to sign a petition urging a public vote on the proposal, contact their council members and attend a public hearing tonight to voice their concerns.

Related upcoming events:
Today, 3 p.m.: The Nashville Area Chamber of Commerce and the Nashville Convention & Visitors Bureau are holding a briefing for their members at the DoubleTree Hotel downtown. Mayor Karl Dean and Metro Finance Director Rich Riebeling will speak and take questions.

Today, 4:45 p.m.: The Music City Center Coalition’s rally begins at 4:45 p.m. on the Metro Courthouse steps.

Today, 5 p.m.: A joint meeting of the budget and finance committee and convention, tourism and public entertainment facilities committee of the Metro Council at the Metro Courthouse. The meeting will begin with a question-and-answer session for council members. That will be followed by a public hearing on the project that is scheduled to begin at 6:30 p.m.

Tuesday, 6 p.m.: Souncil members Frank Harrison, Jamie Hollin, Mike Jameson, Erik Cole and Karen Bennett will host a community discussion of the project at the Metro Police Department East Precinct.

Tuesday, 7 p.m.: Council members Kristine LaLonde, Jason Holleman and Sean McGuire will hold a community discussion of the project at West End Middle School.

Thursday, 5 p.m.: at the Metro Courthouse, Metro Council’s budget and finance committee and convention, tourism and public entertainment facilities committee will deliberate the proposed financing package for Music City Center.

Jan. 19: A final vote on the financing package is scheduled for a full council meeting.

Nashville Business Journal - by Brandon Gee Staff Writer

Free wireless network planned for downtown

Businesses will be able to extend Tech Council's coverage beyond core
Email | Print By Erin Lawley


01-07-2010 2:32 PM —
The Nashville Technology Council is planning to create a free wireless Internet network in Nashville’s central business district that could eventually be expanded through the city.

Council President and CEO Tod Fetherling told NashvillePost.com today that the organization wants to implement a wireless mesh network from networking company Meraki. In its pilot phase, the system should provide a free outdoor signal within a 0.9-mile radius of the system’s main transmitter, which would be located at the Tech Council’s headquarters at Third Avenue and Commerce Street. That roughly encompasses the area between Interstate 65 in the east, Interstate 40 in the west, Bicentennial Mall to the north and past Korean Veterans Boulevard to the south.

Businesses on the outskirts of that coverage area then could buy smaller transmitters, or “nodes,” that would mesh with the network to extend the signal outward. Companies would connect the transmitter to their existing network and partition off as much bandwidth as they’d like to contribute to the public network, Fetherling said.

“So as we go out the corridors – West End Avenue, Gallatin Road, Murfreesboro Road – businesses every mile or so can put one of these units in and it extends the WiFi circuit out there,” Fetherling said.

Businesses stand to benefit from providing free connectivity to Nashville’s visitors, Fetherling said. For one, business travelers will be able to work remotely without having to search for a coffee shop, and all visitors will be able to find a coffee shop or any other business more easily when they’re out and about.

“We build streets to connect people to do commerce. It’s the same reason we need a WiFi network – to do commerce, to connect people and make it easier for them to get from point A to point B,” Fetherling said.

To start, the program will go through a month-long pilot period that will begin later this month or in early February. The launch will cost about $3,100, which covers a couple of main transmitters and a solar-powered unit that could be used for outdoor events. Participating businesses would pay a one-time fee of $200 for a node to connect to the network.

Weekend Fun!

If you're looking for something fun to do this weekend, check out the Nashville Scene Weekend Calendar of Events here!

DECEMBER HOME SALES INCREASE OVER 13 PERCENT

4th Quarter Shows Significant Increase; Year-end Status Improves Dramatically From Mid-Year Conditions

There were 1,612 home closings in Greater Nashville during December, representing a 13.3 percent increase from the 1,422 closings reported during December of 2008.

During the 4th quarter there were 5,730 closings in the region, which is a 29.8 percent increase over teh 4,413 closings in the 4th quarter of 2008.

And, there were 21,183 closings at year-end for 2009, which is 12.6 percent lower than the 24,246 closings for 2008.

The median residential price in December of this year was $164,000 and for a condominium the median price was $149,900. That compares with median prices of $163,750 and $132,062 respectively in December of last year. And, there were 1,339 sales pending at the end of December 2009, compared with 1,250 at the end of December of 2008.

Inventory is down to 20,774, compared with 21,274 in December of 2008. You can click here for a copy of the news release with more detail on home sales for December.

Restaurant Wednesday

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1800 21st Avenue South
Nashville
615.385.9968
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Arts: Nashville opens host of music, art venues

Music City broadens cultural offerings beyond the honky-tonks
Nashville Business Journal - by Linda Bryant Contributing Writer

At the turn of the millennium, Nashville’s downtown was known for its honky-tonks, but fine arts — or any other art form other than country music — weren’t part of the Music City brand.

Flip the calendar forward 10 years to Jan. 1, 2010, and there’s a different way of life percolating in the downtown core. The artistic and cultural choices have broadened. Downtown residents have increased from about 500 in 2000 to about 5,600 in 2009.

The expansion and addition of arts venues since 2000 include the $23 million Frist Center for the Visual Arts, which opened as Nashville’s first major visual arts museum in 2001. A wave of growth followed.

“We were not thought of as an arts town,” said Ken Roberts, former chairman of First American National Bank and president emeritus of the Frist Foundation. “But in the past 10 years, we have become a great arts town, far better than the community knows. I don’t think you can measure the amount of people who have come here because of it.”

Nashville-A Great Place to Live!

Corporate relocations, industry growth define decade of transformation for Middle Tennessee
Nashville Business Journal - by Brandon Gee Staff Writer

From an economic development perspective, the first decade of the 21st century in Middle Tennessee was marked by blue-collar losses and corporate relocations. Could the next 10 years be defined by solar energy and electric cars?

Recent years have been dominated by bad economic news. Middle Tennessee has lost jobs in nearly every occupational category. In this final year of the decade alone, the metropolitan area lost about 30,000 private sector jobs. The metro area’s unemployment rate, which stood at 3.4 percent when the decade began, now hovers above 9 percent.

But despite a gloomy close, local officials say the decade overall was a good one for the region and has left Nashville well positioned for the future.

“I think you would have to say, overall, Nashville’s story has been a very positive story,” Nashville Mayor Karl Dean said. “... There is a strong story to tell, and I love doing it.”

Proposals for a new convention center and a medical trade center downtown are being touted as boons to the existing health care and tourism industries going forward, and growth industries such as higher education, renewable energy and professional services have gained a foothold here as well.

Losses have centered around the manufacturing industry, including major downsizing at the General Motors Corp. plant in Spring Hill and the loss of Peterbilt’s truck assembly plant in Davidson County.

Those two losses alone represent about 9,000 jobs, but the long-term statistics back the positive assessment of the decade. From January 2000 to October 2009, the number of non-farm jobs in the metro area has increased from 683,700 to 727,500, a gain of 6.4 percent.

Manufacturing was the most glaring exception. Jobs in that category fell 33.4 percent, from 95,400 to 63,400. But manufacturing losses have been covered by gains in other sectors. Employment increased 39.4 percent in educational and health services, 20.4 percent in leisure and hospitality, and 9.8 percent in professional and business services.

By near consensus among officials interviewed by the Nashville Business Journal, the biggest economic development coup of the decade was the relocation of Nissan North America’s headquarters from California to Williamson County — if not in terms of jobs, then certainly in terms of notoriety.

“It’s marketing you could never pay enough for when a company makes that kind of decision,” said David Penn, director of the Business and Economic Research Center at Middle Tennessee State University.

The move was announced in 2005, and the relocation was completed in 2006. After working out of temporary facilities in downtown Nashville, the company opened its new Nissan Americas campus in Franklin in 2008.

Previously, in 2004, the Nashville area added 31 company headquarters and major facilities representing more than 11,000 new jobs. That list included two companies with annual revenue of more than $100 million: industrial filtration products maker Clarcor Inc. (NYSE: CLC) and Louisiana-Pacific Corp. (NYSE: LPX).

In the intervening years, Nashville twice was named the “hottest” city in the United States for business relocation or expansion by Expansion Management magazine, and the state ranked third on Site Selection magazine’s 2007 Governor’s Cup rankings.

Keith Herron, Mid-South region president for Regions Bank and co-chairman of the Nashville Area Chamber of Commerce’s Partnership 2010 economic development initiative, said the national attention was unprecedented.

“What’s happened is you have an economy that’s made up of really a bunch of industries across the board,” he said. “The city is attracting so many bright people with great ideas.”

Regional growth
Matt Largen, director of the Williamson County Office of Economic Development, said five corporate relocations alone — Nissan, Mars Pet Foods, Healthways, Community Health Systems and Verizon Wireless’ state headquarters — have created 5,700 jobs that didn’t exist in Williamson in 2000.

The county also has suffered some losses. Some examples include PlusMark, a wholly owned subsidiary of American Greetings Corp., closing a Franklin plant in 2004 that 750 people worked at; Worthington Precision Metals closing a manufacturing plant in 2006, idling 117 workers; and Plastech Engineered Products doing the same in 2008 at a plant that employed 220 people.

But overall, Largen said it was a great decade for Williamson County, and he agreed that Nissan’s move was the most important. In addition to the 1,300 high-paying jobs it brought to the county — which joined thousands more that already existed at the automaker’s Smyrna manufacturing plant — Largen said the high-profile move has put Williamson County on the lists of other companies evaluating relocations that it never could have attracted before.

Wilson County also experienced tremendous growth over the course of the decade. Its population grew from about 89,000 in 2000 to more than 110,000 today. The growth occurred despite the loss of 1,000 Dell Inc. jobs to Nashville and Toshiba America Consumer Products closing a 1978 plant that employed as many as 1,200 people at its height.

But losses have been offset by industrial announcements from the likes of Kenwal Steel, Leviton, TACLE Seating U.S.A. and Permobil Inc., and gains in other sectors.