Reno Gazette-Journal from Reno, Nevada • Page 29

BUSINESS POLL Share your views. Flirting: With Valentine's Day approaching, some workplace lovers may be thinking of expressing their heart's desires to a fellow co-worker but you may want to think first. Business Question: Owners of the Kazaa file-sharing network accused the entertainment industry of promoting piracy by failing to work with the company to create a legal alternative. In defending a copyright infringement suit, Kazaa accused several movie studios and recording labels of antitrust violations. Whose stance do you agree with? To vote: rgj.combusiness.

E-mail views: businessrgj.com. Results: Saturday Business section. SECTION FRIDAY, FEBRUARY 7, 2003 RENO Productivity drops 0.2 in Q4 0n the decline Here is a look at non-farm business productivity, percent change from previous quarter. Seasonally ad justed TODAY Stocks 2-3D Market watch Feb. 6.

2003 7,929.30 1,301.73 For 2002: Rate grows 4.7, the strongest showing since 1950. ByJeannineAversa ASSOCIATED PRESS WASHINGTON The productivity of U.S. companies dipped at an annual rate of 0.2 percent in the final quarter of 2002, the worst showing in more than a year, as the nation's economic re- covery faltered. The decline came after productivity the amount of output per hour of work went up a strong 5.5 percent annual rate in the third quarter, the Labor Department said Thursday. The fourth quarter's performance weaker than the 0.7 percent rise economists were predicting marked the biggest decline in productivity since the first quarter of 2001, when the economy was heading into its first recession in a decade.

Still, even with the fourth-quar ter decline, productivity for all of 2002 grew by a stellar 4.7 percent, the strongest showing since 1950, and a marked improvement over the 1.1 percent increased posted in 200 1 Economists called 2002's performance impressive. Analysts predicted a slowdown in fourth-quarter growth because the economy shifted into a lower gear during the period. The economy grew at a rate of 0.7 percent in the fourth quarter, a big slowdown form the brisk 4 percent rate registered in the third quarter. "We had a rollercoaster year in the economy and productivity followed closely," said Joel Naroff of Naroff Economic Advisers. "With minimal growth, it would have been difficult for businesses to adjust rapidly and they didn't." Naroff predicted productivity would rebound this quarter.

In a second report, new claims for unemployment benefits fell last week by a seasonally adjusted 11,000 to 391,000. That marked a turnaround from the previous week when claims rose by 1 9,000. I 1 I II III IV I III IV 2001 2002 Dow Industrial! Nasdaq composite Standard Poor's 500 Russell 2000 838.15 364.74 NYSE Source: Bureau of Labor Statistics 1 172 Nw highs 40 Dtcliiwd: Unchanged: 170 92 Consolidated votunw: 1,768,777,210 Nasdaq Vacancy rate The submarkets faring the best were Meadowood and downtown. Activity in South Meadows was at a standstill. Net absorption Most of Reno's net absorption was in the Meadowood submarket and a renewed interest is expected in South Meadows for 2003.

New constuction The total new construction for 2002 was a six-year low at only 225,000 square feet. In 2003, several new buildings should break ground in Mountain View, Plumbgate and the First Independent Bank center. Advsncsd: 1,289 Nawhlflha 39 Pcllnd: New lows Unchangsd: 668 85 Volums: 1,204,426,858 Discounts, weather aid retail sales 1442.85- 10.86 10.30 i 443,000 t'' 500,000 400,000 335,988 Fill 12 10 8 6 4 2 0 300,000 i 500,000 looo 1 inn nnn I 380,000 400,000 343 300,000 1 I 11 I 1 225,000 200.000 4 14 f-f j- 100.000 1 I-l i 200,000 '-4 i I TODAY i 113,000 1999 2000 2001 2002 100.000 I 4 S. Raid Reno Gazette-Journa Source: Colliers International 1999 2000 2001 2002 1999 2000 2001 2002 By Anne D'lnnocenzlo ASSOCIATED PRESS NEW YORK The nation's retailers reported sluggish January sales Thursday, though bitter coldand deep discounts helped some of them sell winter clothing. "January was marginally better than the prior month.

But we are still locked in the same perspective," said Michael Niemira, vice president of Bank of Tokvo-Mitsubishi adding a war with Iraq "makes for an iffy environment. The big question is how will consumers react." The bank's same- Oram real mW. ran Ind a sttniii mr odd 'I Mixed results Here is a look at the percent change in major retailers' sales from the same month last year. January 2003 Wal-Mart 2.3 J.C. Penney Co.

Inc. 3.8 f. TJX Cos. 2.0 Limited Brands Inc. 2.0 9 Target Corp.

04 I store sales tally of 81 retailers was up 1 .7 percent for January, compared with a 1 percent increase in December. January's performance was slightly higher thanNiemira's forecast of 1.5 percent among those stores open at least a year. In January 2002, same-store sales rose 5.1 percent from the year-ago period. The good news was many retailers reported healthy profit margins because of lean inventories. In fact, Wal-Mart Stores Inc.

and J.C. Penney Co. Inc. raised their profit Gap Inc. 16.0 Dillard's Inc.

5.0 Saks Inc. 2.1 Federated Department -Stores Inc. 4.4 May Department Stores Co. Sears, Roebuck and Co. 1.0 Nota: Salaa Induda thoaa from Mora opan at laast a yaar.

Reporting partoda wary afigritly and not tM ratators hava tw Mandalay Group updates Q4 EPS Mandalay Resort Group issued an improved expected fourth-quarter results estimate Thursday. The company had announced on Jan. 7 that it expected earnings per share would be "closer to $.10 than to the prevalent analysts' estimates near $.20." While demand at the company's Las Vegas Strip resorts (apart from Mandalay Bay) was slow in the first part of January, operating results were better than expected in the latter part of the month. As a result, the company anticipates that its Q4 EPS, excluding nonrecurring items, will exceed prevalent analysts' estimates of $.12. Because the company's fiscal year ended Jan.

31, results will not be final until the fiscal 2003 audit is completed. The company also announced that it has obtained the requisite consent of its lenders to an amendment of the covenants under the company's revolving credit and term loan facilities. This amendment modifies the definition of adjusted EBITDA with respect to the company's 53.5 percent ownership in MotorCity Casino in Detroit. As previously defined under the credit facilities, adjusted EBITDA included only the cash distributions actually received from MotorCity Casino. Under the amended definition, adjusted EBITDA will include the company's share, regardless of whether it's distributed.

The amendment also provides for a more liberal test for total debt coverage in fiscal 2004. During the fourth quarter, the company purchased 4.4 million shares of common stock. ap outlook despite dis Sourca: Aaaoctatad Praat IJ 4" dU, tj -pgaU i appointing results. "Stores were effective in getting rid of the overhang of merchandise to the benefit of consumers who saw very low prices," said Kurt Barnard, president of Barnard's Retail Trend Report, based in Montclair, N.J. January is the least important month for retailers as stores seek to clear out holiday inventory.

While low temperatures helped many merchants like Wal-Mart clear out winter merchandise, they were a negative for some like TJX which said cold weather in the Southeast and mid-Atlantic regions hurt sales. Tin BsMReno Gazette-Journal MOUNTAIN VIEW CORPORATE CENTER: Sun West Bank Building is one of two structures larger than 1 0,000 square feet. Office construction fell; '03 looks good 1 1 percent, but the only large office froject to open up was Magnolia Vil-age, according to Colliers International's Office Market Report. Total office construction was at a six-year low at 225,000 square feet, according to Colliers. In addition to Magnolia Village, major construction projects include Intuit's new building in Sierra Corporate Center and Quail Corners South at South McCarran Boulevard and Talbot Lane.

"Developers have been pretty judicious with the level of develop- See REAL on 80 eal estate Dayton: Commercial project starts. 40 Locally: Northern Nevada tidbits. 40 Ron Deal: New leader for AGC. 5D Mortgage rates: Interest declines. 50 but during the third quarter things really began to pick up, said John Pinjuv, presidencfco-owncr of Grubb Ellis Nevada Commercial Group.

The overall vacancy rate finished down from 12.7 percent to less than By Ryan Randano RENO GAZETTE-JOURNAL Last year was marked by some strong sales and filled vacancies in the regional commercial real estate industry, but office construction hit a six-year low, according to reports from northern Nevada companies. With 170 sales or leases valued at more than $96 million, Grubb Ellis Nevada Commercial group had its best year since opening in 1 996, according to its 2002 report. "As was the case with most businesses, the start of 2002 was slow, Record state construction defect case ends ASSOCIATED PRESS LAS VEGAS The longest construction defect trial in southern Nevada history is wrapping up, with a jury being asked to decide whether a homebuilder should pay 200 homeowners about $25 million in class-action damages. Lawyers defending Beazer Homes of Nevada concede that construction problems exist at Craig Ranch Village in North Las Vegas, but blame soil conditions and say damages are only $3.3 million. Trial began Nov.

6 in Clark County District Court, and jurors toured nine affected homes on Jan. 22 to look at cracks allegedly caused when Ferris wheel-hotel comes to Vegas soils get wet and ex- pand, lifting and cracking slab home founda- l' fi I tions. Jury deliberations FEATURES Sunday: Business in Perspective and Work It! Tuesday: Small Business Wednesday: Information Bank Bankruptcies, Calendar and Watch. Thursday: Information Bank Conventions, Gaming, Job Fairs and Licenses. Friday: Real Estate.

Saturday: Spotlight information 24 hours a day: rgj.com.'newiTiusiness A company annual report filed in January with the Securities and Exchange Commission refers to ownership of the Strip property, but makes no mention of the Voyager project. No details have been provided about financing, although Voyager Entertainment announced in November that it had an interim line of credit. The interim line of credit helped Voyager secure a loan through Residential Resources an Anaheim, investment banking firm, to build what was billed as the world's largest and tallest observation wheel. Douglas Crowthet, CEO of Residential Resources, said financing had several tiers, but did not provide details. He said Thursday that the loan transaction was "moving along well." ASSOCIATED PRESS LAS VEGAS Developers have won approval to build a 50-story hotel and a 1 2-story Ferris wheel around a man-made lake with 20 yachts on the Las Vegas Strip.

The $650 million project, proposed by Sahara Las Vegas Corp. and Voyager Entertainment International would include 3,250 hotel rooms and timeshare units, plus 78 suites on boats moored on the lake. Itwould be called the Voyagers hotel-casino, and be built on a sire occupied today by the Wet Wild water park south of the Sahara hotel-casino. The dark County Commission approved the plan Wednesday. Sahara Las Vegas Corp.

owns the parceL The company is operated by Paul 'UJ A could last three or four i in days. 'Li-il'w Va During closing argu-iE' r-' ments, homeowners' attorney Robert Maddox recalled testimony of working people in despair over their crumbling homes. One was Jacquelyn Montalvan, a banquet server at the Paris Las Vegas hotel-casino. "I had patched and patched, but the cracks kept coming back," Montalvan testified. "I just stopped patching.

I don't know what else to do." Maddox on Wednesday revised repair costs to $23.7 million, quoting a range of estimates between $19 million and $28 million. He said that if each home needs foundation repairs, it could cost more than $35 million. Robert Carlson, attorney for the builder, pleaded with jurors to base their decision on reason, not sympathy. "What you have to do is listen to evidence, not listen to hyperbole," he said. ITS A BIGGIE: A rendering of the new 50-story hotel and 1 2-story Ferris wheel.

Contact Us Business editor Edward H. Shur. (775) 788-6428 E-mail: businessSrgj.com Fax (775) 788-6458 OrwrtatJo (775) 786-8744 Classified: (775)343-7355 Lowden, who could not be reached for comment, is CEO of Archon Las Vegas, which owns Laugh-Iin's Pioneer hotel-casino. Lowden, the former owner of the Sahara hotel-casino and the developer of the Santa Fe hotel-casino in northwest Las Vegas..