Welcome to The Closing Bell. This is your last stop for biz scoops and big news before the weekend — a roundup of stories that can’t wait till Monday.
The part of the Omni block no one’s talking about
Today is Metro government’s latest deadline for proposals from private investors to move and/or repurpose the historic former headquarters of the Louisville Water Company, which will either be moved or dismantled and stored to make way for a 30-story, $289 million Omni Hotel & Residences downtown.
And while the outcome of that process isn’t yet clear, Omni has indicated what it plans to do with another historic building on its block — at least for now.
In their development agreement with Omni, Metro officials promised to clear most of the block bound by Second, Third and Liberty streets, and Muhammad Ali Boulevard — including two buildings that already have been demolished and the Water Company building. That agreement divides the block into two pieces, the second of which is not part of the hotel development but was deeded to Omni for future use. It’s also where the Odd Fellows Hall, built in 1880 and currently home to PARC, is situated.
The future of that building, which preservationists also have sought to save, has been overshadowed by the dispute over the former Water Company headquarters. But it remains in question, as the city’s agreement with Omni also strips all official historical designations from the buildings on the block. And it allows Omni to sell the land and the building should it choose to do so.
During a meeting with planning officials last week, Omni Chief Financial Officer Mike Garcia sought to reassure the public and members of the Downtown Development Review Overlay committee that his company wouldn’t let the building or that parcel of land — which will be used as a staging area during the hotel’s construction — fall into disrepair.
“It’s not going to be a dust bowl next to our hotel,” Garcia said, adding that the company isn’t likely to sell the land because it doesn’t want to lose control of property so close to its development.
According to the most recent design documents provided to Metro government, the south side of the Omni will feature an alley entrance to a speakeasy, massive mural-style signage, and a resident and valet garage entryway. Some members of the committee last week pushed Omni to consider moving its service docks from the Third Street side of the building to the new alley, an idea that appeared to land with a thud on Omni’s side of the table. —Stephen George
Stocks: Tegna (aka Gannett digital) nosedives while Papa John’s climbs
1. Tegna (ticker: TGNA): Though the name Tegna may not be familiar, the product is: Tegna is the spun-off high-tech division of Gannett. Prior to the split, which commenced at the start of the third quarter, Gannett owned Louisville-based media properties including WHAS-11 and The Courier-Journal. After the split, Tegna owns WHAS-11, while the spun-off publishing company, creatively called “new Gannett,” owns the C-J.
Tegna just released its earnings for the second quarter, and investors didn’t like what they saw, dropping the stock 6.7 percent on Tuesday, the day they came out, and continuing the slow ride down. It’s down 8.5 percent over the past three trading days, while markets are only down a touch. The earnings, incidentally, are the last hurrah for the former Gannett, and included both the digital and online properties now belonging to TGNA, and the print properties that have been handed off to “new Gannett,” which sounds a lot like “new Coke.”
Why were investors so upset? After all, TGNA had total revenues of $1.5 billion, up 4.2 percent versus the same period the year before. By Wall Street logic this wasn’t good enough, as quarterly earnings came in at $0.65 per share, a 3 percent drop from last year’s $0.67.
Still, there’s good news buried within this dropping share price. First, in the next quarter TGNA will no longer have the legacy print biz on its ledgers. Which is good, as classified advertising for TGNA dropped 7 percent in the quarter, year-over-year. Second, TGNA is a cheap stock with a price-to-earnings ratio of 6.2, and it pays a dividend of 2.7 percent annually. So it’s down but likely not out.
2. Papa John’s (ticker: PZZA): Whatever you may think about PZZA’s pizza, it’s been a great stock: up 80.3 percent in the past year with a P/E ratio that’s gotten pretty doughy in the process (it currently sits at 41.3). This means the stock of this discount piemonger is trading at a premium. By contrast, PZZA’s biggest competitor, Domino’s, has a P/E ratio of 38.
Whenever a stock gets pricey, as PZZA has, there are short-sellers betting it will fall. And the number of short-sellers stalking PZZA has recently ramped up a great deal. According to data from July 21, the percent of PZZA shares short ramped up close to 30 percent from June 15-30. The current total shares short are 8.3 percent. A long time ago, a professional trader told me that when the percentage of shares short hits 10 percent, it’s a big red flag. PZZA is almost there. This doesn’t mean there’s anything wrong with PZZA as a company, only that a lot of traders think the stock is too expensive. And in lieu of clipping coupons, they’re selling short. —David Serchuk
Doe-Anderson adds two digital designers, lets two digital developers go
Louisville ad and marketing firm Doe-Anderson is changing its digital focus, according to ad industry insiders. The firm has hired two new digital designers and let its two-person digital development team go, following a local trend away from in-house web and app development. IL called Doe-Anderson and confirmed that both digital developers are no longer with the firm as of the past two weeks. We are not disclosing the names of the developers, as the larger story is about where Doe is heading.
“Most agencies in Louisville who say they ‘do digital’ really only ‘do design,’” one ad industry insider said. “Then they pass off their designs to Leap or one of the digital-only shops to actually do the site or app or whatever … So Doe hiring designers but letting go developers … is par for the course.” The insider added this strategy may save money in the short-term but is not a permanent solution. “We don’t believe an agency will be able to survive in the next decade without deep, in-house digital expertise,” this person said.
Another ad industry source was more charitable to Doe: “It’s not like Doe-Anderson is bailing on digital … more like they may be improving the team.”
Dan Burgess, director of public relations at Doe-Anderson, declined to directly address the exact personnel changes at the firm: “We don’t think it’s appropriate to talk publicly about internal personnel matters. What we can say is that there’s no change in our commitment to digital development for our clients at the highest level.”
Burgess added the new talent at Doe will both do some design work and development work, and will be “hybrid types.” He added there will be “no change” to how Doe will run its digital business. IL followed up with a question: If there will be no change, why hire new staff? Burgess declined comment. —David Serchuk
New B&B proposed on Saint James Court: The owner of a triplex on Saint James Court is proposing to convert it into at bed and breakfast called The Inn at Saint James Court, according to a recent filing with Metro government. Patricia Mahaun owns the home at 1440 Saint James Court, which was built in 1900. In a letter to neighbors required as part of the city’s planning process, Mahaun said she is seeking to address concerns or recommendations for “how a B and B might better fit into our beautiful Saint James Court and Old Louisville neighborhood.” If the project is approved, The Inn at Saint James Court would be the 12th B&B in the neighborhood and the first on the Court, per IL’s count. —Stephen George
Art and Soul opens on Frankfort: Art and Soul Beads has moved from the Mellwood Arts Center to Crescent Hill. Owner Emily Kaniasty opened the new storefront at 2640 Frankfort Ave. earlier this month. Art and Soul Beads offers jewelry-making supplies, beads and one-of-a-kind jewelry made by local artists. Kaniasty also offers jewelry-making classes. “The bead store and jewelry gallery are set up to be one cohesive idea.” Kaniasty says. “Our exposed showroom makes for a fun, fashion-driven, and interactive learning experience.” Kaniasty launched Art and Soul with her mother, Kelly Hempton, in 2002. The store is open from 11 a.m.-6 p.m. Tuesday through Saturday. The store also has an online supply and jewelry retail presence. —Melissa Chipman
Gearing up for acquisition at the next Venture Connectors: Indatus CEO David Durik and President Phil Hawkins are the speakers at the next Venture Connectors Luncheon at the Muhammad Ali Museum on Aug. 5. Indatus has had a momentous year: President Obama visited the company during his Louisville stop in April, and the company was acquired by Texas-based RealPage Inc. for $49 million in June. Indatus provides a cloud-based solution for handling maintenance calls for more than 11,000 apartment complexes. Durik and Hawkins will talk about what it’s like to grow a company for a major acquisition. The event begins at 11:30 a.m., and the meeting runs from noon-1:15 p.m. Registration is required at www.ventureconnectors.org. Members attend free; associate members pay $30. Guests who register online by noon the day before the lunch pay $40. —Melissa Chipman
Uber ice cream delivery: It’s a nationwide publicity stunt… but it’s a sweet one. Starting at 11 a.m. today, you can open up your Uber app and have an Uber driver deliver Graeter’s ice cream right to your door. For 20 bucks — if you can get connected — you’ll get five orders of a Graeter’s frozen treat.
Better still, if you’re a Capital One customer and use your Capital One card as your payment method — it’s free! Just enter promo code SWEETDEAL.
Uber, the app-driven car-on-demand service, has been in Louisville since early 2014.
The promotion stresses that availability will be limited, so you might want to designate one of your officemates the “official Uber-checker” for the day. —Melissa Chipman