• News
  • Real Estate
Industry Briefs

Tackling Vegas again

(Bloomberg) -- Crown Resorts Ltd., the gambling company controlled by billionaire James Packer, plans to open a casino on the Las Vegas Strip after paying $280 million for a site formerly occupied by the New Frontier casino.

Crown will partner with Andrew Pascal, former president of Wynn Las Vegas, to open a resort on the 34.6 acre site by 2018, the Melbourne-based company said in a regulatory statement Monday.

Packer had been in talks with companies whose loans backed the property including Oaktree Capital Group LLC, people with knowledge of the matter said Aug. 1.

The development will be Crown's third try in Las Vegas after Fontainebleau Resorts LLC and Cannery Casino Resorts LLC. failed to prosper.

The resort will diversify Crown's global earnings from casinos in Melbourne, Perth and London, planned developments in Sydney, Brisbane and Sri Lanka, and stakes in Macau’s City of Dreams resort and potential investments in the Philippines and Japan via its 34 percent share of Melco Crown Entertainment Ltd.

The site is about a mile from the Flamingo Las Vegas towards the northern end of the Strip, at a location flanked by the Wynn and the Trump International Hotel.

Pollutant lawsuit settled

PORTLAND, Ore. (AP) -- The U.S. Army Corps of Engineers has settled a lawsuit that will force it to disclose the amount of pollutants its dams are sending into U.S. waterways for the first time in the agency's history.

The groundbreaking legal settlement could have broad implications for the Corps' hundreds of dams nationwide.

The Corps said in the settlement on Monday that it will immediately notify the conservation group Columbia Riverkeeper of any oil spills among its eight dams in Oregon and Washington.

The Corps also will apply to the EPA for pollution permits, something it has never done for the dams on the Columbia and Snake rivers.

The settlement was filed in U.S. District Court in Portland, Oregon.

Columbia Riverkeeper says in the lawsuit that the Corps violated the Clean Water Act.

Realogy decline

(AP) -- Realogy Holdings Corp., owner of brokerage brands Coldwell Banker and Century 21, on Monday reported earnings that declined by 19 percent in its second quarter.

The Madison, N.J.-based company said net income dropped to $68 million, or 46 cents per share, from $84 million, or 57 cents per share, in the same quarter a year earlier.

Earnings, adjusted for one-time gains and costs, came to 59 cents per share.

The company said revenue declined 1.4 percent to $1.51 billion from $1.53 billion in the same quarter a year ago.

Realogy Holdings (NYSE: RLGY) shares have dropped $13.37, or 27 percent, to $36.10 since the beginning of the year. The stock has decreased $8.50, or 19 percent, in the last 12 months.

Detroit airport bonds

(Bloomberg) -- The agency that runs the main airport serving bankrupt Detroit is set to offer $107 million of debt as airport bonds extend an unprecedented winning streak relative to the $3.7 trillion municipal market.

The Wayne County Airport Authority will use proceeds from this week's borrowing to rehabilitate airfields and improve roadways and terminals at the Detroit Metropolitan Wayne County Airport, offering documents show.

It will be the first deal for the facility, a Delta Air Lines Inc. (NYSE: DAL) hub about 22 miles southwest of downtown Detroit, since the Motor City filed a record municipal bankruptcy in July 2013.

The issue may avoid the stigma attached to the city.

Airport bonds are rallying as a rebounding economy encourages travel. The debt has gained 7.9 percent this year through July. It would be the fourth straight year of outperformance, a record since the data begin in 1993.

“Airport debt is trading on the moon right now,” said Lyle Fitterer, who helps oversee $34 billion of munis at Wells Capital Management in Menomonee Falls, Wis.

Moving a Utah arch

(AP) -- A towering arch that is one of the most recognizable symbols left from the 2002 Winter Olympics is being moved off the University of Utah campus and back into Salt Lake City.

The city will become the new owner of the arch after it is disassembled over the next few weeks into 4,000 pieces by the University of Utah at a cost of $116,000.

Salt Lake City will house the pieces in storage until it settles on a new home, a process that could take more than a year, said city spokesman Art Raymond. The arch is 36-feet tall and 72-feet wide.

The arch had stood the last 11 years outside Rice-Eccles Stadium after being downtown during the Olympic games.

The Olympic visitor center and theater was moved from the same spot last year to Park City. The Olympic cauldron will remain there, O'Mara said.

NY regulator inquiring

(Bloomberg) -- New York's banking regulator asked Ocwen Financial Corp. for information about an insurance agreement that it says may be designed to funnel fees to an Ocwen affiliate for minimal work.

Benjamin Lawsky, the superintendent of the Department of Financial Services, is reviewing Ocwen's (NYSE: OCN) force-placed insurance arrangement with Altisource Portfolio Solutions, which he described as “troubling,” according to a letter dated Monday obtained by Bloomberg News.

“Altisource will generate significant revenue from Ocwen's new force-placed arrangement while apparently doing very little work,” Lawsky said in the letter.

Documents suggest “Ocwen hired Altisource to design Ocwen's new force-placed program with the expectation and intent that Altisource would use this opportunity to steer profits to itself.”

Lawsky is probing possible conflicts of interest at Ocwen, which has grown in recent years by acquiring the mortgage-servicing rights to distressed loans from large banks.

Bond investors want more

(Bloomberg) -- Bond investors are demanding to be paid more to potentially bear losses on mortgages guaranteed by Freddie Mac as risk-sharing notes that were sold earlier by the firm and competitor Fannie Mae slump.

Underwriters are offering yields relative to benchmark rates as much 0.7 percentage point higher than in the government-backed mortgage giant's last deal as it plans to sell $1.1 billion of the securities this week, according to a person with knowledge of the sale.

The most junior portion of the April transaction tumbled to a low of 99.1 cents on the dollar Monday from 107.6 cents at the start of last month, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

The plunge may show the difficulty of finding enough investor demand without higher costs in a market seen as a model for the future of the $9.4 trillion U.S. home-finance system under bipartisan legislation introduced this year and endorsed by the Obama administration.

Federal Housing Finance Agency Director Melvin L. Watt, who oversees the firms' conservatorships, said in May he wants such transactions before broader reforms are chosen to keep “taxpayers from bearing all of the potential losses.”

The slump partly reflects increased stress across markets and growing supply, according to Barclays Plc analyst Harkaran Talwar.

McLean, Va.-based Freddie Mac and Washington-based Fannie Mae have issued $8.2 billion of the risk-sharing securities since starting sales a year ago, along with seeking similar insurance policies.

“Macroeconomic concerns, weak housing data, and increased supply affected investors confidence, and thin trading volumes in these bonds exaggerated the widening,” Talwar wrote in the Aug. 1 report.

Freddie Mac may pay a floating rate between 2.15 percentage points and 2.35 percentage points more than a borrowing benchmark on two sets of middle-ranked notes being offered this week, according to the person, who asked not to be identified because they're not authorized to speak publicly.

That compares with a spread above the one-month London interbank offered rate of 1.65 percentage points on a similar portion of its April deal.

The senior-most classes may pay a spread between 1.35 percentage points to 1.50 percentage points, compared with 0.85 percentage point in Freddie Mac's last deal.

The junior slice is being marketed at a spread of 3.5 percentage points to 3.75 percentage points, compared with 3.6 percentage points.

Part of the offering is tied to mortgages with loan-to- value ratios higher than 80 percent, a first for the company, the person said.

Fannie Mae began offering risk-sharing bonds tied to such loans, which carry separate mortgage insurance, earlier this year.

Solar loans in India

(Bloomberg) -- India will provide low-cost loans and grants to set up solar power parks across the country to host as much as 20 gigawatts of capacity, about 10 times what it has built to date.

“We're preparing a scheme for solar parks and it will be out after cabinet approval in about one month,” said Tarun Kapoor, joint-secretary at the Ministry of New and Renewable Energy.

India is planning some of the world's largest photovoltaic plants as it seeks to scale down costs and boost generation.

It targets producing power from at least four so-called ultra-mega projects at a maximum of 5,500 rupees a megawatt-hour, about 32 percent below the global average, according to data compiled by Bloomberg.

The parks will host large plants ranging between 500 megawatts to 1,000 megawatts that will be connected to the grid.

Government subsidies will keep the price of land within the parks low to contain project costs, Kapoor said.

State utilities will be expected to purchase at least 20 percent of the power generated at the parks. Project owners will be free to export the remainder to consumers elsewhere in the country.

UK homebuilding

(Bloomberg) -- U.K. homebuilding expanded at the fastest pace in more than a decade in July as record-low interest rates and government stimulus measures helped construction grow for a 15th month.

Markit Economics said its Purchasing Managers' Index for the industry declined to 62.4 from 62.6 in June.

A gauge of residential building rose to 68, the highest level since 2003, and job creation increased at the fastest since the survey began in April 1997.

The data add to evidence that the economy is strengthening in the third quarter and signal a rebound for construction after official data showed a 0.5 percent contraction in the three months through June.

“Construction companies have performed impressively so far this summer,” which may counter the weakness seen in the official data, said Tim Moore, an economist at Markit in London.

Linking 76 rivers

(Bloomberg) -- India is considering 76 river-linking projects to address water scarcity in some parts of the world's second-most populous nation, according to the government.

India's National Water Development Authority has completed reports to connect the Ken and Betwa rivers in north India and the Damanganga and Pinjal in the west, Santosh Kumar Gangwar, junior water minister, said in parliament Monday.

The authority is working on 30 inter-state and 46 intra-state plans to link rivers and help transfer water to deficit areas, the minister said. India uses 15 percent of the 1.44 billion acre feet of surface water available in its rivers, according to the authority.

The country seeks to create 150 million acre feet of water storages through linking its rivers to help increase irrigated land areas and improve hydropower capacities.

India's water demand may exceed supply by 50 percent by 2030, according to the government.

Panel duty opposition

(Bloomberg) -- Vikram Solar Pvt., an Indian panel maker, has opposed a government recommendation to impose dumping duties intended to protect local manufacturers.

“Anti-dumping duties will be disastrous for the country,” Kolkata-based Vikram, which has 150 megawatts of annual panel-making capacity, said.

The proposed levies would make it unviable to import Chinese solar cells, forcing Indian panel makers “to source poor efficiency and low reliability domestic solar cells,” it said.

Tariffs to protect cell manufacturers could end up causing module makers to idle plants, according to the statement.

The Ministry of Commerce & Industry in May recommended anti-dumping duties from 11 cents to 81 cents a watt on U.S., Chinese, Malaysian and Taiwanese panels.

The Finance Ministry has until Aug. 22 to decide whether to implement the recommendation.

Expanding solar capacity

(Bloomberg) -- D.S. Kulkarni Developers Ltd., an Indian real-estate company, plans to build 100 megawatts of solar capacity by 2019 to lock in rising electricity costs.

The Pune-based company will invest 9 billion rupees ($148 million) in the project, which will be built in the central Madhya Pradesh state, Chairman and Managing Director D.S. Kulkarni said Monday.

Kulkarni expects to generate electricity at about 5.5 rupees a kilowatt-hour on average during the 25-year lifetime of the project. That's as little as half the commercial power tariff that the property developer pays now.

The company has acquired 125 acres of land and will begin construction on the first 24-megawatts this year, he said.

User Response
0 UserComments