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Good morning! Today is Monday, March 18, 2019. Here are today’s big stories in Charlotte-area business news:
Ch-ch-changes at Charlotte airport:
Tired of all the unsightly construction inside Charlotte-Douglas International Airport? The good news is that the renovations on Concourse B are expected to be wrapped up by the end of the month.
But don’t think for a minute that the airport is anywhere close to completing construction, which seems to have been going strong for the last decade. Anybody out there remember when “Long-Term 1” was called “Satellite 1”? Or when everybody was buzzing about what a smart idea it was to designate a cell phone lot where you could wait to pick up friends flying in?
On the night shift: The airport’s chief operating officer, Jack Christine, tells me that construction crews, who work only at night, are just about finished on Concourse B putting in new ceilings, terrazzo flooring, signs, gate seating, and oh yes, plenty of outlets to charge phones and computers. Here’s how it looked a couple weeks ago: bright, modern, with only a few ceiling tiles missing.
CLT Concourse B: brighter, more modern, almost no pipes and wires hanging from ceiling
“Once it is all done, I think it really does brighten up the space and makes it feel a lot more open,” Christine says. “It feels bigger, brighter, and that changes the customer experience.”
He acknowledges that it is not actually bigger — there will still be crowds of people changing planes at peak times. But it feels bigger. American Airlines also re-opened its Admirals Club on Concourse B late last month.
The city’s work on Concourse B is just part of a $70 million project to overhaul the airport’s five concourses, which date to 1982. Work has now started to update Concourse C, and there’s plenty more afoot:
Concourse C: Work started in mid-February here, making the same changes as on Concourse B. Estimated completion: June 2020.
Concourse A: You might have noticed that the airport opened a new wing of Concourse A last summer, but it is still using part of the old A, which is under renovation. Estimated completion: January 2020.
Concourses D and E: Minor work, such as adding a new food court. Note that American Express has also started construction here on its luxury Centurion Lounge.(Video) National watchdog rates Charlotte hospitals for patient safety
But the granddaddy project of them all is expected to start by the end of the year, with the major renovation of the airport’s lobby. Ugh. But it looks pretty sweet. Check out this rendering video, which looks like Sims: Charlotte Airport Expansion Pack set to the instrumental version of Adele’s “Someone Like You” (the good stuff starts around the :30 mark):
All these airport changes are necessitated by the huge surge in passengers, especially connecting passengers, as American has continued building Charlotte as a major East Coast hub:
The big question: Is the airport’s building spree raising its costs to airlines so much that at some point American will be tempted to move operations elsewhere?
High costs can doom airline hubs. So can a low volume of originating passengers. Just ask Pittsburgh or Cincinnati. Airport officials here, though, say costs are still lower than those at other airports — many of which are also renovating because they, too, are experiencing more passengers. And American executives have long praised Charlotte as a low-cost base of operations.
Ballantyne hospital battle: It. Is. On.
A hospital battle is brewing in south Charlotte, following the news (broken here) Friday that Novant Health has closed on a site in Ballantyne — the site of the Hall Family Farm and its pumpkin patch and pick-your-own strawberry field. Register of deeds records indicate the 38-acre site sold for $21M.
On Sunday, Novant confirmed that it plans to build a 36-bed, $154M hospital there, complete with two operating rooms and a dedicated c-section operating room. It clocks in at 161,000 square feet and would open in 2023. It’s on the corner of Johnston Road and Providence Road West. That’s in hospital territory that’s close to rival Atrium Health’s ever-growing medical complex in Pineville.
As far as hospitals go, Novant’s wouldn’t be a big one. It would be dwarfed by Atrium Health Pineville, which last year announced plans to increase to 300 beds. Novant Health Matthews has 157 beds. State regulators would still have to approve the Ballantyne plan, which is also subject to rezoning.
Trend: Instead of bulking up big central hospitals, hospital systems have been opening smaller facilities throughout the Charlotte region. Novant Health Mint Hill, for instance, opened last year with 46 beds.
Meanwhile, Charlotte Agenda’s Andrew Dunn delivers the goods on what will become of Hall Family Farm:
2019 is likely to be the last season for farm activities. Hall Family Farm has leased the property back from Novant for this year, and they plan to have a normal strawberry and pumpkin season, [owner Kevin] Hall said. …
Hall Family Farm is relocating to Lancaster, South Carolina. The family has purchased a new property roughly 14 miles to the south, and has been readying it since 2017. They expect to have their first strawberry crop ready for picking in 2021, Hall said.(Video) Atrium, Novant hospitals lose federal dollars for health problems that originated in hospital
Lots of ‘first looks’ at Duke skyscraper, but are they accurate?
At 8:42 a.m. Friday, an anonymous user named dxartist went onto an online discussion forum called UrbanPlanet, where users discuss the latest in real-estate development. On the 44th page of a thread called “509 South Tryon / Possible Duke Energy Tower,” he wrote, “hot off the presses! From the company website!” with this image:
With that post, dxartist set off a scramble among the city’s reporters to confirm that the image does, in fact, depict the 39-story tower Duke Energy announced in December. Within minutes, two other users — CLT_King and Flat4nrc, both apparently Duke employees — shared additional details, such as the supposed name (“Charlotte Metro Tower”) and the observation that it apparently has solar panels on top.
At 10:09 a.m., the Twitter account CLT Development tweeted the image, writing: “First look at Duke’s newest skyscraper!!” The account has about 1,500 followers, including many business and media types. An Observer reporter replied at 10:42: “Where did you find this? Would love to get the rendering for the Observer.”
At about 11:30, the Business Journal weighed in with a story — “A first look at Duke Energy’s planned 39-story uptown tower” — that confirmed that Duke had indeed put an image of the tower on the company intranet. But Duke wouldn’t share it with the media. Nonetheless, the publication ran the rendering of the tower, describing it as an image “circulating on the internet”:
[A Duke spokesman] says the rendering and more information will be available as early as Monday, as soon as Duke makes its filings with the city. In the meantime, what appears to be a copy of the image on the employee website is circulating on the internet. The image shared with employees is replicated above.
It seems weird to run with an image plucked from the internet that is apparently unconfirmed. But at least the Biz Journal is honest about the origin of the photo. Maybe not as honest as, for instance: “An internet user named dxartist, who is apparently a Duke Energy employee, posted a plausible-looking photo of a new skyscraper in an online chat group on Friday.”
Takeaway: Many people have the ability to share their knowledge anonymously online. It’s also easy to post hoaxes. It’s tough for news organizations these days to be certain what’s accurate and what’s not.
Is that really the new Duke tower? I think we would all say “probably.” Is that good enough?
UPDATE 3/18/19, 12:48pm: The Observer says it has confirmed the rendering with Duke Energy. Construction expected to start in late April and last until 2022. The article promises at least the third “first look”: “Newly released rendering gives a first look at Duke Energy’s new uptown tower”
Bonus: If you want more predictions from UrbanPlanet users, they do an annual Charlotte business predictions thread here.
Legacy Union, the new 33-story office tower on the corner of Stonewall and Tryon streets, could get a new top, according to images circulating on the internet, probably.
Home prices zooming up:
There have been a couple local pieces out in the last few days looking at Charlotte’s housing market, which is failing to keep pace with the city’s growth. If you paid attention in econ class, you’ll remember low supply + high demand = higher prices. Construction costs are rising, and developers can make more money on pricier homes.
Good news if you’re trying to sell. But if you’re buying, you might have to dig a little deeper. Or move to, say, Albemarle. Danielle Chemtob breaks it down in the Observer:
Until 2014, homes priced at or under $150,000 made up at least 35 percent of the total homes sold, according to the UNCC study. Last year, that figure was less than 15 percent.
“The Baby Boomers are having sticker shock,” said Kim Trouten, a Realtor and senior partner with the Bovender team at Allen Tate. “They’ve lived in their house for 25 years. They’re like, ‘What do you mean this is what I have to pay to downsize?’”
An analysis of the MLS data found that the number of homes under $250,000 declined by a quarter in the past year.
Even renters are feeling the pinch, writes Susan Shackelford in the Biz Journal:
The report shows that in 2010 rents were mostly between $400 and $800 per month in the region. By 2017, the dominant range had risen dramatically to $800 to $1,500, with nearly onein five (18 percent) in the $1,000 to $1,249 range. In contrast, less than 10 percent of rents were in the $1,000 to $1,249 range in 2010.
Geek out: The full UNCC report mentioned in each piece is available here.
This business about the admissions scandals at elite universities is endlessly fascinating. It’s quite a cast of characters, from the mastermind to the Harvard grad who aced the tests to the University of Southern California “influencer,” Olivia Jade.
Closer to home, Wake Forest played a bit role in the scandal. It suspended its volleyball coach, who is accused of taking a bribe to prevail on the admissions office to admit a student who had been placed on the wait list.
In recent days, though, Wake Forest has gone full Warren Commission and is convinced that the volleyball coach acted absolutely, positively alone and that there is no larger problem. Move along, nothing to see here. From a Q&A on the university’s website:
Q: Does this scandal suggest a bigger problem with Wake Forest’s admissions office?
A: No. The review completed to date by outside legal counsel underscores that Bill Ferguson acted independently and was the only person at Wake Forest with knowledge of, and involvement with, the alleged misconduct. No other university employees, including admissions officers or other athletics staff, have been implicated in the investigation.
This is probably a convenient legal and public-relations posture. Can it possibly be true? We don’t know all the details, but is there no way to verify the representations made to the admissions office by a coach? Are there no changes that would prevent something like this in the future? A shrug and a “well what are you going to do?” attitude seems unworthy of a great university.
And some universities aren’t content with the coach-did-it defense. The Wall Street Journal today reported:
On Friday, Yale President Peter Salovey said the school—whose former longtime women’s soccer coach, Rudy Meredith, was charged in the case—will ask outside advisers to recommend changes to “help us detect and prevent efforts to defraud our admissions process.”(Video) Coronavirus tents outside Charlotte hospital
But at Wake Forest? Let’s hope somebody is asking the tough questions.
Meanwhile, Wake Forest seems disinclined to take any action against the student who benefited from the alleged bribe:
Q: What is going to happen to the one Wake Forest student mentioned in the indictment who had been waitlisted prior to admission?
A: The student was admitted and is currently enrolled. We have no reason to believe the student was aware of the alleged financial transaction.
Wake was also named in the inevitable lawsuits filed last week.
Lyft’s IPO is expected in the next couple weeks. The company said Monday morning it expects to raise $2.1B with a valuation of up to $18.5B. It still hasn’t turned a profit.
A big deal in the payments sector, with Fidelity National Information Services, aka FIS, agreeing to buy Worldpay for $34B. The combined company would be the biggest in the processing and payments industry, according to Bloomberg.
Unless you are a day trader, checking your stocks daily is unhealthy. So how about weekly? How local stocks of note fared last week (through Friday’s close), and year to date:
“No, it’s too inexpensive. I don’t want you to sell. And if it comes down to it, buy some more. I just think it’s too good a company to let loose at these prices.”
— Jim Cramer, on “Mad Money” lighting round last week, on Bank of America stock. Caller Walter from North Carolina asked whether he should sell.
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The Charlotte Ledger is published by Tony Mecia, an award-winning former Charlotte Observer business reporter and editor. He lives in Charlotte with his wife and three children.