Maureen Dwyer, one of the city’s leading land use and zoning attorneys, and four other attorneys from Pillsbury have joined Goulston & Storrs, the firm announced late Friday.
Making the move with Dwyer are John Epting, Phil Feola, Allison Prince and Paul Tummonds Jr.
Dwyer, the co-chair of the land use group at Pillsbury, said in a news release that Goulston’s size, scope of services and experiences better matched her clients, particularly universities. Dwyer’s clients include Georgetown, George Washington, American, Catholic, Trinity universities and the Consortium of Universities of the Washington Metropolitan Area.
“We are delighted to be joining a firm with such a stellar reputation and a deep historic commitment to real estate,” Dwyer said in the release.
Goulston, a Boston-based firm, opened its D.C. office in 2001 to support its national affordable housing practice and has since broadened its real estate practice. Not including Dwyer’s team, its D.C. office currently has 14 attorneys, accordimg to the firm’s Web site.
"We wish our colleagues good fortune at Goulston,” said Jim Rishwain, chair of Pillsbury, in the release from Goulston. “I am confident that we will continue to work with Maureen, Allison, John, Phil and Paul on joint projects and opportunities as we continue to serve our clients at the highest level.”
Before joining Pillsbury, Dwyer, a 1978 graduate of Catholic University’s law school, worked at Wilkes Artis.
Claims for U.S. jobless benefits dropped last week from a three-month high, pointing to an improvement in the labor market that is slow to develop.
Initial jobless applications fell by 29,000 to 469,000 in the week ended Feb. 27, in line with the median forecast of economists surveyed by Bloomberg News, Labor Department figures showed today in Washington. The number of people receiving unemployment insurance decreased to the lowest level in a year, while those receiving extended benefits climbed.
Some companies are still trimming payrolls to contain costs amid weak sales as the U.S. emerges from the worst recession since the 1930s. An unemployment rate that’s forecast to average 9.8 percent this year may restrain consumer spending, which accounts for about 70 percent of the economy.
“We are in this limbo state where it is not clear if job growth has started yet,” Ethan Harris, head of economics for North America at Bank of America Merrill Lynch Global Research in New York, said in a Bloomberg Television interview. “Many companies say they over-reacted and fired a lot of people, more than they needed to, with the news of the recession. So, we’re expecting broad-based re-hiring.”
Economists forecast weekly claims would fall to 470,000, from a previously estimated 496,000 for the week ended Feb. 20, according to the median of 42 projections in a Bloomberg News survey. Estimates ranged from 440,000 to 515,000.
Stock-index futures rose after the report. Futures on the Standard & Poor’s 500 Index expiring this month increased 0.2 percent to 1,120.4 at 9:03 a.m. in New York.
Productivity Surging
Another Labor Department report today showed the productivity of U.S. workers kept surging in the fourth quarter as companies squeezed more work out of employees to boost earnings.
A measure of employee output per hour rose at a 6.9 percent annual rate, capping the biggest one-year gain since 2002. Labor costs dropped at a 5.9 percent pace, more than anticipated, and fell 1.7 percent for all of 2009, the biggest drop since records began six decades ago.
The four-week moving average of claims, a less volatile measure than the weekly figure, decreased to 470,750 last week from 474,250 the prior week, the report showed freecreditscore.
Continuing claims decreased by 134,000 to 4.5 million in the week ended Feb. 20, the fewest since January 2009. The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs.
Extended Benefits
Today’s report showed the number of people who’ve used up their traditional benefits and are now collecting extended payments increased by about 198,000 to 5.87 million in the week ended Feb. 13.
The unemployment rate among people eligible for benefits, which tends to track the jobless rate, decreased to 3.5 percent in the week ended Feb. 20 from 3.6 percent the prior week, today’s report showed. Sixteen states and territories had an increase in claims for that same week, while 37 had a decrease.
Unemployment in the U.S. dropped to 9.7 percent in January, while payrolls declined by 20,000, Labor Department figures showed last month. A government report tomorrow is forecast to show the U.S. lost 65,000 jobs in February and the unemployment rate increased to 9.8 percent, according to the survey median.
Some companies continue to cut staff. International Business Machines Corp., the world’s largest computer-services provider, fired about 2,400 workers, mostly in the U.S., according to an employee advocacy group. The cuts this week occurred around the country and across several divisions, said Lee Conrad, national director of Alliance@IBM, which represents some employees.
Recalling Workers
Other businesses are recalling workers. General Motors Co. may fill most of the 5,500 jobs created by its $1.4 billion retooling of 18 U.S. factories with laid-off workers, Diana Tremblay, the automaker’s manufacturing and labor chief, said in an interview Feb. 23.
The company’s 5,000 to 6,000 workers on indefinite layoff have first rights to any openings from the factory upgrades, including a third shift in Lordstown, Ohio, announced last week.
Fixing millions of gas pedals and brakes and convincing customers their vehicles are safe could end up being the least of Toyota’s challenges. Some experts think the price tag from legal settlements could end up topping the company’s estimate of $2 billion in recall costs.
There are already more than 30 U.S. lawsuits filed against Toyota involving the problems with its gas pedals alone, according to Craig Hutson, senior investment grade analyst at Gimme Credit, a bond research service firm. And there are more lawsuits are in the works.
"Lawyers are champing at the bit to get at these guys, and the company has come out and largely admitted mistakes in respect to these issues," said Hutson. "It’s hard to put a dollar amount on it, but multi-billion dollar costs are not out of the realm of possibility."
Hutson isn’t alone in worrying about how much lawsuits could hurt Toyota. Credit rating agency Moody’s cited the litigation risks when it warned Tuesday that it might downgrade Toyota’s credit ratings.
The company also faces at least one class action suit involving problems with the brakes on 2010 models of the Prius and other hybrid vehicles. Toyota announced a recall for those hybrids Tuesday.
New reports of problems with the steering of its Corolla could mean more lawsuits against Toyota.
Safety experts estimate official complaints involving Toyota gas pedals show there have been 19 fatalities involving the recalled vehicles.
But Gary Robb, an attorney in Kansas City who is looking at filing cases, says he believes that number will increase significantly as people look more deeply into accidents for which no cause was ever determined.
"We’ve had so many calls from so many people now that this news has come out," he said. "Accidents that were heretofore attributed to driver error are very likely due to a malfunction of the gas pedal. There’s going to be dozens of those incidents arising."
Cases involving death or serious injury will likely be handled in individual lawsuits.
Suing to reclaim lost value. Robb said he’s also looking at a class action case to try to recover billions of dollars he claims were lost in the resale value of the recalled vehicles. He said his experts estimate total losses could be in the $6 billion to $8 billion range paydayloans. "For many people their car is their second largest investment," he said.
Other experts suggest that the loss in resale value is not as high as Robb’s figure, but that it is still likely in the billions.
Kelley Blue Book, a leading used-car value service, is lowering its estimated prices for the recalled models this Friday by 2.5% to 3.5%. That’s enough to lower the value of each vehicle by between $250 and $800.
The National Highway Transportation Safety Administration estimates that more than 6 million U.S. vehicles are affected by the recall. So based on Kelley Blue Book’s estimates, the overall loss in resale value is likely to be at least $2 billion.
Toyota wouldn’t comment on its legal exposure from the recalls. As to the reduction in resale value by Kelley Blue Book it said, "Historically Toyota and Lexus vehicles have held their value very well relative to other vehicles. We expect that to be true in the future as well."
It’s not clear whether courts will allow plaintiffs to collect that much money. James Henderson, a law professor at Cornell University, said legal precedent is against them.
But Henderson does think the recall opens Toyota for a rash of new personal injury cases. He added that if it is determined that Toyota knew of problems with the gas pedals and did not warn a driver involved in an accident, the company could be hit with punitive damages.
Hutson said beyond the cost of any jury verdicts or settlements, the lawsuits have the potential of causing continued damage to Toyota’s reputation, keeping the problems and company’s failures in the news. That could cost the company additional sales going forward.
He said if any documents come out which prove Toyota engineers knew something needed to be fixed, it will be difficult for Toyota to ever regain consumers’ trust.
"When your image is one that has been largely built on quality and dependability, you can’t afford that kind of smoking gun," Hutson said.
The St. Louis area, which has a soft spot for mostaccioli and ravioli, has been one of the top-performing markets for Fazoli’s, the Italian quick-service restaurant chain based in Lexington, Ky.
That’s why Carl Howard, Fazoli’s chief executive, picked this region for the chain’s first new store in more than 3 years.
The new outlet, which opened this week in Edwardsville, is also the first to debut the chain’s new prototype. The new design is smaller than the old model, located in strip centers instead of a stand-alone building, and has a brighter, more modern decor.
"This is a fresh look for us," Howard said in an interview during a visit to the new store. "Our old facility is a little bit stale. We wanted to juice it up and have some fun."
Fazoli’s has undergone more than just a face-lift. In the last year, it has also overhauled about 80 percent of its menu, adding new items such as baked pasta dishes. It has also started using fresher ingredients and revamped everything, from the submarino sandwiches to the marinara sauce.
Fazoli’s had become quiet over the years, Howard acknowledged. Its menu hadn’t kept up with the growing sophistication of the public’s palate. And the previous leaders of the chain let the brand grow stagnant as they sought a buyer for the company, he said.
In 2006, Fazoli’s was finally sold to Sun Capital Partners. Howard came in as CEO two years later. When he took over, the chain had been grappling with declining customer counts for several years at its 280-plus locations. One of his first major decisions was to shut down dozens of underperforming stores. Fazoli’s now has closer to 240 outlets and does $239 million in sales.
"You get rid of your dogs and stick with your stars and all of a sudden your numbers and performance begins to improve," said Darren Tristano, executive vice president of Technomic, a Chicago-based food consultant group.
Now customer visits have been consistently rising since January 2009, Howard said, though he declined to say by how much.
The new Edwardsville site will be followed by six to eight other new Fazoli’s in the next year or so in other strong markets for the company such as Kansas City, and Dayton and
Columbus, Ohio, Howard said.
"We have a Midwest appeal." Howard said. "We have real comfort food."
St. Louis, which now has nine Fazoli’s locations, is the chain’s third-largest market in terms of number of stores, behind only Indianapolis and Lexington.
Kim Tucci, president of St. Louis-based The Pasta House Co., isn’t sweating it as Fazoli’s angles for a larger local presence.
The Pasta House has a very similar logo to Fazoli’s — a fat, red tomato — and has about 20 locations in the metro area and another dozen outside the region. Tucci said his competitors are more along the lines of Macaroni Grill — and not Fazoli’s, which he equated to a fast-food chain like McDonald’s.
"This is like apples and watermelons," he said. "You can’t compare it to what we have — nothing against them."
Tucci added that it makes sense for Fazoli’s to be aggressive in this economy because of their lower price points. The average bill per person at Fazoli’s is just under $6.
Like most other restaurants, Pasta House has been feeling the pinch of the recession as people eat out less. Tucci has responded by lowering his prices. In late December, Pasta House started a promotion offering six pastas for under $6.
"We’re hanging in there," Tucci said. "We’re hustling everyday, 24-7."
As a whole, fast food and fast-casual outlets have done well during the recession — better than the traditional, sit-down restaurants, Tristano said.
The prototype for the new Fazoli’s is about 2,100 square feet — roughly a quarter smaller than their older locations of between 2,700 and 3,100 square feet, Howard said.
"It’s a lot more efficient," Howard said.
By having these smaller stores in strip malls, Howard hopes this will be more attractive to franchises. The start-up costs associated with a new location will be closer to $500,000 compared with as much as $1.7 million for land and the building of the older standalone stores.
"It’s going to be easier to replicate," he said. "There’re a lot of shopping strips for us to go rather than fighting for the last great piece of real estate in a market."
Fazoli’s is also testing out some other innovations at the Edwardsville store — slightly lower prices on some items, a new line of pizzas and bringing back the "breadstick person" who goes table to table.
When it opens its new stores in Dayton in the next several weeks, Fazoli’s will try out other new ideas, such as having real tableware and silverware.
If the innovations do well in these new stores, Fazoli’s hopes to roll out the changes to its other company-owned stores. As for the franchises, Howard hopes that the new elements will be such a hit that they will be motivated to follow suit.
The reactor would have command-and-control systems and passive safety features, and be buried in an underground containment building and monitored 24-7 with sensors. It wouldn’t need water for cooling. The fuel would be loaded in the factory prior to delivery and there would be enough to operate nearly 20 years. After that, its uranium fuel cartridge would be switched out with a new cartridge. About 95 per cent of the fuel waste from the old cartridges would be recycled into new fuel.
Sandia isn’t the only group thinking this way. Power-plant equipment maker Babcock & Wilcox has entered the small nuclear market, and a number of start-ups – Hyperion Power and NuScale Power among them – are also blazing a trail.
The U.S. manufacturing sector grew in November for the fourth consecutive month, but at a slower pace than anticipated, according to an industry report released on Tuesday.
The Institute for Supply Management said its index of national factory activity decelerated to 53.6 in November from 55.7 in October. The median forecast of 70 economists surveyed by Reuters was for a reading of 55.0 in November.
Readings above 50 indicate expansion in the manufacturing sector, while numbers below 50 show contraction.
The ISM report was “a bit less-than-expected but overall still a strong number when added to the previous monthly levels that were greater than 50,” said Tom Sowanick, chief investment officer with the Omnivest Group in Princeton, New Jersey.
“Note that China ISM was also up last night which confirms that we are in a global recovery,” Sowanick added.
The ISM report also said its employment index for the manufacturing industry slipped to 50.8 in November from 53.1 in October, which had been the strongest showing since April 2006.
The U.S. dollar trimmed gains against the yen after the manufacturing report.
Prices paid slipped to 55.0 in November from 65.0 in October.
New orders rose to 60.3 in November from a 58.5 reading in October.
Some economists warn that although the brisk rebound of new orders hints that capital spending will recover, because industrial output is so depressed, companies may not ramp up spending much, if at all.
(Reporting by John Parry; Editing by Chizu Nomiyama)
Midland States Bank hired Jason M. Ramthun as vice president for commercial relationship management at its Chesterfield office.
He is responsible for overseeing the office’s commercial banking business, establishing long-term partnerships and providing financial advice to the bank and its commercial customers.
Ramthun joined Midland States Bank from First Bank, where he was a vice president for commercial lending.
He also has been a bank examiner for the Federal Reserve Bank of Chicago advance payday loans.
He is on the finance committee of Voices for Children and is a member of the St. Louis Sports Commission Associates, a group of local young professionals who volunteer to help the commission.
The number of first-time filers for unemployment insurance was unchanged last week, holding at the lowest level since January, said a government report released Thursday.
There were 505,000 initial jobless claims filed in the week ended Nov. 14, the same as the revised figure the previous week, the Labor Department said in a weekly report.
A consensus estimate of economists surveyed by Briefing.com expected 504,000 new claims.
The 4-week moving average of initial claims was 514,000, down 6,500 from the previous week’s revised average of 520,500.
"After two hefty declines, claims were due a pause this week," said Ian Shepherdson, economist at High Frequency Economics, in a research note.
"Even when the underlying trend is clear, claims tend not to run in the same direction week after week," Shepherdson added.
Claims are "heading in the right direction," Shepherdson said, and he believes employment will level off in the first half of next year — possibly as soon as the end of the first quarter.
Continuing claims: The government said 5,611,000 people filed continuing claims in the week ended Nov. 7, the most recent data available. That’s down 39,000 from the preceding week’s ongoing claims.
The 4-week moving average for ongoing claims fell by 83,500 to 5,711,500.
But the slide in continuing claims may signal that more filers are falling off those rolls and into extended benefits.
Continuing claims reflect people filing each week after their initial claim until the end of their standard benefits, which usually last 26 weeks. The figures do not include those who have moved to state or federal extensions, nor people who have exhausted their benefits.
State-by-state data: Only one state reported a decline in initial claims of more than 1,000 for the week ended Nov. 7, the most recent data available.
Claims in Florida fell by 1,915, which a state-supplied comment attributed to fewer layoffs in the construction, trade, service, manufacturing and agriculture sectors.
Eighteen states said that claims increased by more than 1,000. Michigan reported the most new claims with 6,001; New Jersey’s rose by 4,153; Pennsylvania saw a jump of 3,552; New York had 3,508 new claims; and Ohio’s increased by 3,292.
First Banks Inc., parent of First Bank and the eighth largest bank in St. Louis, lost another $91 million in the third quarter as bad loans kept piling up.
The quarterly loss brought losses for the year to date to $274 million, following a $287 million loss for 2008.
As of September, 8.8 percent of the bank’s loans had gone sour, up from 5.1 percent at the beginning of the year. The September bad-loan percentage was roughly double the number at banks that regulators consider First Bank’s peers.
The Clayton-based bank continued to suffer from its foray into the financing of housing development in California. The bank reported $402 million in troubled loans and foreclosed property in California and $109 million in Chicago. By contrast, bad loans in St. Louis were only $47 million.
St. Louis’ comparatively good record may be short-lived. The bank listed $198 million in "potential" problem loans in St. Louis, higher than its other regions. The count included two real estate construction loans worth $60 million, along with general business loans and real estate loans.
In phone interview, CEO Terrance McCarthy said there are a "couple of quarters to go" before the bank can stop putting aside large amounts of money to cover loans that won’t be repaid payday loan companies. The bank put aside $107 million to cover bad loans in the latest quarter. Such money comes directly from profits.
Losses continued to eat into capital. The parent company’s capital slipped below the level that regulators deem "well capitalized" into the "adequately capitalized" bracket. The First Bank subsidiary remained "well capitalized," but just barely.
First Banks raised more than $400 million in new capital as its troubles mounted last year and in January. That included $295 million from the federal government’s bank bailout fund and more than $100 million from the bank’s owner, Jim Dierberg and family.
The bank has been trying to shrink its way to greater soundness, selling off its banks in Chicago and Texas, the Adrian N. Baker & Co. insurance firm, and bank branches in Lawrenceville and Springfield, Ill. It has generally made a profit on those sales, which boosts capital.
Capital is measured as a percentage of a bank’s assets. By selling off assets, the bank improves its capital ratio, the key measure of soundness.
First Banks has $10.6 billion in assets.
U.S. private equity firm Bain Capital is finalizing a roughly 100 billion yen ($1.1 billion) deal to buy Japanese telemarketer Bellsystem24 from Citigroup Inc, three sources familiar with the matter said.
It would be the largest buyout by a foreign private equity firm in Japan in nearly two years.
Bain has beaten off rivals Permira PERM.UL and a team of CVC Capital and Blackstone, which had also made offers in the final round of bidding for Bellsystem24, the sources said, speaking on condition of anonymity because the talks are not public.
Bain is working on final details and an official announcement could be made within the next few days, the sources told Reuters.
“A deal is imminent,” one of the sources said.
Bain had been tipped as the likely buyer when it secured exclusive negotiating rights earlier this month.
But the door was thought to be still open to the other bidders after the deadline for Bain’s exclusive rights passed on November 6 with no deal announced.
Talks had been ongoing with the CVC and Blackstone team after the exclusivity period ended, and that team had improved its bid, one source familiar with the move told Reuters.
Citigroup put Bellsystem24 up for sale as part of a global effort to raise cash and replenish its capital. It has already raised more than $7 billion by selling other assets in Japan including a broker, a trust bank and a fund management arm same day payday loans.
The sale of Bellsystem24 initially drew strong interest from a number of private equity firms including Kohlberg Kravis Roberts & Co KKR.UL, which teamed up with trading house Itochu Corp before dropping out of the race.
The deal will likely reach or exceed 100 billion yen, sources said, making it Japan’s largest buyout by a foreign private equity firm since March 2008, when Permira bought agrichemical company Arysta LifeScience Corp for more than $2 billion.
Bellsystem24 is Japan’s largest telemarketing firm. It competes against Moshi Moshi Hotline Inc and Transcosmos Inc in Japan.
Bellsystem24 is now owned by Citigroup Capital Partners, which was known as Nikko Principal Investments, a private equity arm of brokerage group Nikko Cordial, which was bought by Citigroup in 2007.
Nikko Principal paid 220 billion yen to buy Bellsystem24 in 2004. The sale price would be lower than the purchase price but Citigroup had made returns from the investment by restructuring the company’s debt to take some cash out, a method known as recapitalization.
Bain’s financing will be supported by banking units of Mitsubishi UFJ Financial Group Inc, Mizuho Financial Group Inc and Sumitomo Mitsui Financial Group Inc, according to sources familiar with matter.
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