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Local small business group gets grant money

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The Inland Empire Small Business Development Center will be part of a federal grant that will allow the agency to assist local companies, especially those seeking to produce goods for export.

The total of $957,229 will be shared by three Southern California agencies. The Inland center's share is about $150,000, said Vincent McCoy, executive director of the center, which has its offices in San Bernardino. The grant is part of the Small Business Jobs Act signed by President Obama last September.

McCoy said the money will pay for a consultant and some marketing, training and technology help.

--Jack Katzanek
jkatzanek@PE.com


Temp hiring creeps up during slack season

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Hiring at temporary agencies across the country is up this month, but not by very much.

The American Staffing Association's index for February was 90, up one point from 89 in January. The first part of each year is usually fairly muted as far as hiring temporary workers goes. Most employers tend to make the start of a year sort of a taking-stock period. The decisions to pick up the phone and hire tend to come a little later.

The good news comes from comparisons to last February. This month's index is 13 percent higher than February 2010, which suggests the economy is improving. To give this a little more context, the index was as low as 69 roughly two years ago, during the worst part of the recession.

And, the index has been as high as 110, late in 2007.

The association represents roughly 85 percent of all the temporary agency offices in the country.

--Jack Katzanek
jkatzanek@PE.com

Homeowner association liens block loan mods

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A homeowner seeking a mortgage modification in an effort to avoid foreclosure can hit a deadend if a homeowner association has placed a lien on the house for nonpayment of assessments.

That's a message the Center for California Homeowner Association Law wants to get out, as well as information about how to get such a lien removed. The challenge of dealing with association liens was the subject of a public workshop that the center conducted last week in Riverside and which more than 60 homeowners attended.

"Big lenders like Chase and Bank of America are telling homeowners that unless they get the assessment lien removed, they can't even get in line to request a loan modification," according to the center's report on the workshop.

"A key tool for getting the lien removed can be an affordable payment plan," negotiated between the homeowner and the homeowner association, said the report. "But one HUD counselor reported (at the workshop) that she couldn't get the association lawyer to respond to her multiple requests for a payment plan, much less to give the homeowner an affordable one."

Homeowners also learned that if they don't pay their past due homeowner association assessments, it could haunt them financially even after their homes are sold in foreclosure. Workshop trainer and attorney Dan Mulligan explained that, if left unpaid, the assessment debt remains the personal obligation of the homeowner.

The center reported about a homeowner who was sued for $11,000 to cover overdue assessments and collection costs on a home that she lost to foreclosure.

--Leslie Berkman
lberkman@PE.com

NAI Capital adds apartment, retail specialist

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Kemal Ozkarahan, a commercial real estate veteran in Inland Southern California, veteran, has joined the staff of NAI Capital as senior vice president of the Ontario office, the Encino-based company said in a statement.

Ozkarahan specializes in acquiring and finding a disposition for apartments and mobile home parks and selling and leasing shopping centers in the Inland area.

Most recently Ozkarahan was a senior vice president with Sperry Van Ness, where was one of the firm's top brokers. He was broker of the year five times in seven years from 1994 to 2001. He also worked for Marcus and Millichap and has engineered more than $800 million in transactions over his 20-year career.

--Jack Katzanek
jkatzanek@PE.com

Hansen share price gyrated after earnings report

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When Hansen Natural Corp.'s fourth quarter earnings were announced after the close of the market yesterday afternoon, the shares, which had slipped about 2 percent during the trading day to $54.69, plummeted in after-market trading to $48.35 a share. That was a total breathtaking fall of 13 percent.

However, by early evening the stock of the Corona beverage company had popped back to $53.40.

What happened? I asked Hansen Chief Executive Rodney Sacks about this when he called me after the deadline for submitting stories for publication in today's business section. He said he believes that investors needed a little time to digest and understand the earnings report.

Analysts on average had anticipated that Hansen in the fourth quarter of 2010 would earn 62 cents a share in the fourth quarter and instead earnings came in at $49.1 million, or 53 cents a share.

Sacks in a late afternoon conference call with analysts noted that the beverage company's sales in the fourth quarter were very good, hitting record levels. In the fourth quarter Hansen's Monster Energy drinks continued to gain market share in the U.S. and the brand was introduced to a wider international market. Moreover he said it looks as if sales in the first two months of 2011 will be much stronger than in the same period of 2010.

Bottom line, Sacks told me, he does not bother so much with the day to day or even hour to hour fluctuations of the stock market. His purpose, he reminded me, is to build a business.

--Leslie Berkman
lberkman@Pe.com

SNL report on lending shows real estate's "slow struggle"

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Lending by community banks was down 0.5 percent in the fourth quarter of 2010 from the same quarter of 2009, dragged down by a beleaguered real estate market in the West, according to a report by SNL Financial.

Although several regions saw a decline in lending for the quarter, the Western U.S. took the biggest hit, with total loans town nearly 5 percent year-over-year. The next-highest drop was in the Southeast (think Florida), where lending was down nearly 2 percent.

Two regions saw loan growth: Lending increased 6.5 percent in the Mid-Atlantic, and by 4 percent in New England.

By loan type, consumer loans for home construction saw the biggest declines nationally, down 27.5 percent year-over-year. In the West, they were down nearly 44 percent. Nonresidential construction loans were down 19 percent nationally and nearly 31 percent in the western region.

Some loan types saw modest increases. Loans for multifamily properties increased 7 percent across the U.S., and 4 percent in the West. Commercial real estate loans were up 3 percent nationally and 1.4 percent in the West.

Farms, buoyed by higher crop prices, also were a bright spot for bankers, with farm loans up 6 percent in the U.S. and 3 percent in the West.

The survey by SNL Financial examined domestic loan growth among commercial banks with less than $10 billion in assets.

In the report, SNL Financial's Kevin Dobbs and Tyler Hall said many bankers expect the tepid lending environment to continue through much of 2011 as "most banks are grappling with modest consumer demand, at best, and a steep drop-off in construction and land development demand, expected results of the latest recession's long hangover and the U.S. real estate market's slow struggle to climb out of the downturn."

--Tiffany Ray
tray@PE.com


Survey: Consumers plan to spend and save tax refunds

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Most consumers won't be rushing out to the nearest mall with their income tax refunds this year, but fewer will rely on them to pay down debt, according to a recent survey by the National Retail Federation.

In the survey, 42 percent of consumers said they would use their refunds this year to pay down debt. That's down from 44 percent last year and 48 percent in 2009.

At the same time, more said they'd put the money into savings: 42 percent this year compared with 40 percent last year and 39 percent in 2009.

There is an upside for retailers, too: although the percentage of people who said they would use their refund for fun stuff like televisions, cars or vacations is small, it is higher than it was in the two previous years.

About 13 percent said they would make major purchases like televisions or cars with their refunds this year, up from 12.5 percent lat year and 11 percent in 2009. And about 12 percent said they would take a vacation, up from 10 percent last year and 11 percent before that.

Offsetting those improvements, perhaps, is the 30 percent who listed "everyday expenses" as a use for their refunds. That number is higher than the 29 percent from 2010 and 27 percent in 2009.

About two-thirds of people surveyed said they expected a refund. Only 41 percent said they would use an accountant or tax preparer; the rest said they'd handle it themselves or call on a friend or relative. People making less than $50,000 a year were far more likely to have already filed.

--Tiffany Ray
tray@PE.com

Hiding assists for aging boomers a possible key to home sales

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With the leading edge of the baby boom generation turning 65 this year, Boyce Thompson, editorial director of the Builder group of magazines published by Hanley Wood. LLC, figures that they could be getting frail or worry about physical impairments in their future.

So builders trying to cater to this huge potential market might do well designing homes for aging in place, Thompson says in a blog. The caveat, he adds, is that the features intended for boomers must look cool, not like something intended to give a helping hand to people who are less than physically fit.

"No one wants to be confronted at any age with institutional-looking grab bars, ramps or high-profile alarms that remind them of their less-than-perfect health," he writes.

So he suggests home builders could sneak into their product "levered handlesets that today look more like a design statement than a response to arthritis. A strategically placed, reinforced towel bar not only makes drying off easier, but it provides a way to steady yourself in the shower. A pull-out shelf under the microwave is a godsend when you are ready to drop a hot dish."

Other features that may become more common because boomers will want them, Thompson wrote, is he elimination of threshholds wherever possible, including in the master bathroom. With the tiled floor of the shower designed to slop to a drain, thresholds could be eliminated and you could enter the shower from the bathroom or bedroom. "Pretty cool--especially if you are using a wheelchair," he points out.

--Leslie Berkman
lberkman@PE.com


More car lease-seekers have better credit

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Last week, LeaseTrader.com., an online marketer of vehicle leases, reported that people who lease cars for one year and 12,000 miles are actually getting closer to using all 12,000 miles. The Web site called that a positive economic signal.

Now the Web site likes what it sees in terms of credit applications. Since October, credit application approvals are up 4.5 percent, meaning people are probably working more and, if nothing else, have been able to repair their credit a little.

A credit report is mandatory for anyone taking over a lease. LeaseTrader restricted its study of who qualified and who didn't to would-be first-time lease-holders.

--Jack Katzanek
jkatzanek@PE.com

Turner name change reflects investment management direction

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Turner Development Corp. has moved its focus away from development and more towards managing commercial real estate investments. The shift began more than two years ago when it created its first real estate investment fund.

Now the company that is responsible for most of the newer projects in Riverside's La Sierra area has announced a name change to reflect that shift. The Newport Beach-based company will now be known as Turner Real Estate Investments, according to a recent statement.

The company's focus is on troubled assets in California, Arizona and Nevada that are currently less-than-popular to investment shoppers. These are properties that Turner's executives believe are "not easily understood" by the other real estate investment firms.

But Turner believes they do understand the office and industrial markets in these areas -- and Riverside and San Bernardino county probably qualify by these descriptions -- and the company believes it has the financial strength and liquidity to use that understanding to their advantage.

In the past month the firm has moved to buy a 12-building business park in Sparks, Nev., and it also acquired the note for a property in Scottsdale, Ariz.

--Jack Katzanek
jkatzanek@PE.com

State-of-Ontario meeting free to NAIOP members

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As state of the city gatherings go, Ontario's tends to attract more attention than most. Some say it gets more attention than any other city in Inland Southern California.

This year, Ontario's state of the city event is March 16 at the Ontario Convention Center. And, since just about all the major commercial real estate firms have their offices in Ontario, members of the Inland NAIOP chapter, the industry's trade group, can get in for free.

NAIOP members can register by mail by e-mailing Stephanie Vondersaar at svondersaar@ci.ontario.ca.us and giving her contact information.

--Jack Katzanek
jkatzanek@PE.com

Lewis and Van Daele buy land in Fontana for up to 150 homes

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Lewis Investment Company, a member of the Upland-based Lewis Group of Companies, said it joined with Van Daele Development of Riverside in purchasing 35 acres in north Fontana for the development of between 100 and 150 single family homes. The homes are expected to be available for sale in 2012 at prices ranging from the low $300,000s to the mid $400,000s. Van Daele will be the home builder on the project.

The seller of the land was TC-Met Fontana, LLC, an affiliate of Trammell Crow Company and Met Life. Lewis and Van Daele did not disclose the price they paid for the acreage, which is located west of the I-15 freeway and north of Duncan Canyon Road.

"The market is rapidly improving and we're aggressively looking for additional residential and retail land opportunities throughout the Inland Empire," Randall Lewis, executive vice president at Lewis, said in a prepared statement. He said Lewis recently purchased another 76 acres residential site in Fontana and it is negotiating several other land transactions.

Mike Van Daele, chief executive of Van Daele, said north Fontana is a desirable area for home building because of its mountain and valley views and because it offers convenient freeway access and lies close to shopping areas including Victoria Gardens.

--Leslie Berkman
lberkman@PE.com

Economy is improving, but how many workers are taking risks?

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Yes the economy is improving, but how many people in the work force are willing to take a gamble that involves hiring a moving van and renting a place in another state?

Also, when it comes to starting your own business, is the economy strong enough to convince a lot of people to make such a bold step?

The answer to the first question is "not many," and to the second, it's "not strong enough." That's according to the national outplacement firm Challenger Gray & Christmas. The percentage of job seekers willing to relocate and the number of those who run their own businesses were both very weak in 2010, the Chicago-based firm reported.

Last year just 7.6 percent of job-seekers relocated for new positions. The firm said that was the lowest since it began tracking those numbers and was down from 13.3 percent in 2009 and 11.6 percent the year before that. CG&C computes these numbers quarterly and uses an average of all four quarters as the annual total.

There are multiple reasons. Many people with good jobs are homeowners who are reticent to put a home on the market if they're upside down on the mortgage. Also, in better times employers were willing to pay for relocation costs. But these times are not that much better.

Also, there's a decline in start-ups. CG&C reports that, according to U.S. Bureau of Labor Statistics data there were 9 million self-employed Americans in the fourth quarter of 2009. That dropped to 8.8 million in the fourth quarter last year.

CEO John Challenger admits in a statement that "it sounds counterintuitive" but he does see the self-employment numbers going back up, and many experts in the job market agree. When the economy finally does recover it will probably include a lot of contract workers who move from firm to firm for specific jobs.

--Jack Katzanek
jkatzanek@PE.com

Record portion of California homes bought with cash

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The share of California homes purchased for cash hit a record level in January, with almost 31 percent of homes statewide bought with cash. That's because investors and others jumped into the market to take advantage of lower prices and less competition during the winter market doldrums, according to San Diego-based DataQuick Information Systems, whose statistics go back to 1988.

DataQuick said January's high point for all-cash home buying in California follows a record year for cash deals in the state. Last year cash buyers purchased 27.8 percent of all homes sold, up from 26 percent in 2009, which was the previous annual record.

Cash purchases accounted for 35.8 percent of homes sold in Riverside County in January, which was slightly down from 36.3 percent in January, 2009. In San Bernardino County cash deals represented 38.6 percent of transactions in January, up from 36.1 percent a year earlier. By contrast on average since 1988 all-cash purchases have represented 16.7 percent of monthly home sales in Riverside County and 15.9 percent in San Bernardino County.

--Leslie Berkman
lberkman@PE.com

Inland factory index rises again

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The pace of manufacturing continues to grow in San Bernardino and
Riverside counties, a report released this morning indicates. The Purchasing Managers Index rose to 58.8 in February, economists from Cal State San Bernardino reported.

However, the panel of Inland factory executives reported that it was getting more expensive to keep that pace up. An increasing number said they were facing more inflationary pressures.

The Inland index has now been above 50, the level that suggests the sector is expanding, for 17 consecutive months.

Nationally, the Associated Press is reporting this:

U.S. manufacturers expanded at the fastest pace in nearly seven years last month, but a sudden rise in the price of raw materials could threaten their profits.


The Institute for Supply Management said Tuesday that its index of manufacturing activity rose to 61.4 in February, up from 60.8 the previous month. That's the highest reading since it reached 61.4 in May 2004. The ISM's index bottomed out at 33.3 in December 2008, its lowest point in nearly 30 years.

Any reading above 50 indicates expansion. The manufacturing sector has now expanded for the past 19 months.

"The recovery in the sector is both robust and on track," said Ian Shepherdson, an economist at High Frequency Economics.

A gauge measuring orders rose and an employment index topped 60 for only the third time in a decade. But prices paid for steel, plastics, rubber and other raw materials rose for a third straight month, a sign that increasing production costs could spark higher inflation.

"While there are many positive indicators, there is also concern as industries related to housing continue to struggle and the prices index indicates significant inflation of raw material costs across many commodities," said Norbert Ore, chair of the ISM's survey committee.

The price of materials is another challenge for the struggling construction industry. The Commerce Department said Tuesday that spending by builders fell in January to a seasonally adjusted annual rate of $791.8 billion.

That's slightly above the decade low of $791.5 billion hit in August, and about half of the $1.5 trillion level that economists believe would signal a healthy construction sector. It could be another four years before construction recovers to that level, economists say.

Factories have rebounded at a healthy clip since the recession ended in June 2009. Americans have resumed spending on cars, appliances and other big-ticket items and businesses are investing in more industrial machinery and other heavy equipment.

Solid growth overseas, particularly in developing countries such as China, Brazil and India, has also helped by boosting exports for U.S. manufacturers.


--Jack Katzanek
jkatzanek@PE.com,


Court rules corporations don't have FOIA protections

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Corporations do not have the same kind of privacy protections as people, at least where public disclosure is concerned, according to the United States Supreme Court.

Tuesday's high court ruling stemmed from an effort by telecommunications giant AT&T Inc. to block the release of public documents through the Freedom of Information Act. The justices unanimously ruled that corporations do not have the same kind of "personal privacy" protections individuals have.

The case stemmed from a 2004 Federal Communications Commission investigation into some of AT&T's billing practices. Bloomberg News reported that CompTel, a trade organization made up of AT&T competitors, filed a Freedom of Information Act request in 2005, hoping to get a look at the paperwork of the investigation.

The FCC said it would release those documents, saying that the "personal privacy" provision that blocks some FOIA requests does not apply to corporations, only individuals. AT&T sued, saying that allowing competitors a peek at these papers would give away what the firm considers trade secrets.

An appeals court sided with AT&T, but the Supreme Court disagreed. Chief Justice John Roberts, who delivered the court's opinion, said it's called "personal privacy" for a good reason: it's about a person and not a company.

--Jack Katzanek
jkatzanek@PE.com

Extended interview: Eric Garner, managing partner of BB&K

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Uncut and unedited, my interview with Eric Garner would have amounted to more than 100 column inches.

And Garner, the managing partner of Best Best & Krieger based in Riverside, didn't make it easy for me to cut it down. He had plenty to say and if I could, I would have published it in it's entirety. Trying to pick and choose what to ultimately cut for the print story was a challenge, to say the least.

2009
Eric Garner

Read the edited version in today's edition of The Press-Enterprise business section and online (with video!).

And for more from the interview that didn't appear in print, follow the link below.

Q: The situation with the City of Bell (a BB&K attorney was the city's attorney before the scandal broke). BB&K's name was brought up, but it seems as if you haven't lost a lot of public agency clients. What do you attribute that to?
A: We have one public agency client that we lost. I think, a couple things. One, at the more global level, I think our clients know we're the premier public agency firm in California and we do excellent work and we're a highly ethical law firm. And I think clients who understand that situation realized that attorneys don't set salaries and, for starters, we provide legal advice not fiscal advice. And then secondly, as I think is becoming clear in some of the current hearings, it's very clear as we knew and suspected from the moment this story broke, and we really looked into that, a lot of stuff was concealed and people were working actively to conceal information from anyone and everyone, including the city attorney, and I think our clients recognized those things up front. At an internal level, the biggest shift we've made as a result of that is to make sure our attorneys talk to each other more, increase the communication and collaboration. Even if something is being concealed, occasionally there can be yellow or red flags. Honestly I'm not really sure there were here because I think the folks that were involved there were certainly not representative of most public agency employees, thank goodness, let's put it that way. But nonetheless, we're saying well, what else could we have possibly done to suspect something like that might be going on behind the scenes, behind closed doors, under the table.

Survey: Restaurant sales down, but outlook still up

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Bad weather kept a lid on restaurant sales in January, according to the latest data from the National Restaurant Association, but the industry remained optimistic anyway.

The Restaurant Performance Index, which gauges the health and outlook of the U.S. restaurant industry based on monthly surveys of restaurant operators, dropped to 100.2 in January. That's down from 101 in December, but it remains above the 100-mark that signals expansion.

January was the fourth month out of the last five in which the index rose above 100.

Overall, sales were down in January, along with customer traffic, the association reported. Capital spending plans, which had stagnated in recent months despite an improved business climate, remain unchanged.

Expectations for future business were dampened somewhat from December but remained in positive territory.

--Tiffany Ray
tray@PE.com

YRC has new financial backing

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YRC Worldwide Inc. appears to be close to a solution to its two-year financial struggle.

YRC, one of trucking industry's biggest players and a major employer in Inland Southern California, has a deal in principal with lenders that will provide an infusion of new capital and reduce the company's debt, the firm announced late Monday. YRC operates the Yellow Freight and USF Holland brands, among others.

The deal, according to documents filed Tuesday with the Securities and Exchange Commission, would mostly be financed by the issuance of new stock. The firm's stock fell more than 21 percent Monday when word got out; it is down 3 cents at $2.25 per share early today.

Few other details were released. The proposed deal pushes back the deadlines to get financing in place by about two months. July 22 is now the deadline for finalizing the deal.

--Jack Katzanek
jkatzanek@PE.com

List: Riverside among worst cities for work

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Riverside is among the six hardest places in the U.S. to find a good-paying job, according to a new ranking by Forbes. The metro area tied with Louisville, Ky., for fifth place on the Forbes list of Hardest Cities for Finding a Job.

Of course, that's hardly news for most of us in the Inland region, where the current 13.9 percent unemployment rate is actually an improvement from recent years, and where more foreclosure homes are being sold than nonforeclosures. But it offers a glimpse of other cities where residents are having a tough time.

New Orleans, still suffering from the impact of Hurricane Katrina in 2005, was the hardest place to find good-paying work.

The Forbes list, compiled by Indeed.com using Bureau of Labor Statistics data, counted the number of job listings for every 1,000 people in major metro areas during the fourth quarter of 2010 with salaries of $50,000 or more. For example, New Orleans had 10 such listings for every 1,000 people.

Buffalo and Rochester, N.Y., tied for second place with 11 jobs per 1,000 people. Miami ranked No. 3 with 14 job postings.

Riverside and Louisville each had 16 job postings per 1,000 people.

By contrast, San Jose had 126 job postings per 1,000 people, making it the easiest city for finding a good-paying job, although you might need to know a thing or two about computers. Washington, D.C. was No. 2 with 116, followed by Baltimore with 78, San Francisco with 67, and Seattle with 55.

--Tiffany Ray
tray@PE.com


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