Saturday, October 25, 2014
Inquirer Daily News

POSTED: Thursday, October 23, 2014, 3:02 PM

Vanguard Group, the Malvern mutual fund giant, has responded to a New York whistleblower lawsuit by former Vanguard tax lawyer David Danon with accusations of betrayal, theft and ethics violations the company says should bar him or his lawyers from bringing the complaint.

The company also offers a defense of Vanguard's "unique" legal structure, noting company officials have testified about its practices before Congress, and widely publicized its arrangements since its founding by John C. Bogle 40 years ago.

In documents made public after New York state court Judge Joan A. Madden declined Vanguard requests to keep them sealed away, the $3 trillion-asset company argues Danon "grossly betrayed" his former employer, violated confidentiality arguments and broke state bar association ethics rules when he illegally "stole hundred of privileged and confidential documents" related to Vanguard's income tax and financial arrangements.

POSTED: Thursday, October 23, 2014, 11:21 AM
(PennDOT)

A decision on the winning bid from a group of rival corporate "public-private partnerships" hoping to rebuild 558 aging PennDOT bridges, at financing rates the Corbett administration has said may be a percentage point higher than public bonding, on a much faster construction timetable than the state usually manages, is due this month.

UPDATE: PennDOT Secretary Barry J. Schoch plans to name the winning team at 11 a.m. Friday at a bridge spanning a state boat ramp near Harrisburg, his spokeswoman Erin Waters-Trasatt confirms. Gov. Tom Corbett won't be there, she added, when I asked. This is a project and a concept Corbett has long supported.

The state has agreed to raise up to $1.2 billion to design an efficient standard bridge-building system and replace the worn spans. The Corbett administration has announced a string of (mostly smaller) crowd-pleasing jobs-producing business-supporting taxpayer expenditures in the weeks leading up to the Pennsylvania governor's race Nov. 4., see for example here.

POSTED: Thursday, October 23, 2014, 10:12 AM
2.0 University Place, the year-old 98,000-square-foot office building at 30 N. 41st St. that's home to Philadelphia's federal immigration offices and other tenants, is for sale.

2.0 University Place, the year-old 98,000-square-foot office building at 30 N. 41st St. that's home to Philadelphia's federal immigration offices and other tenants, is For Sale by developers Scott Mazo and James Levin, of University City redeveloper Neighborhood Restorations Inc./Prime Property Management; and Thomas A. Leonard, partner at law firm Obermayer Rebmann Maxwell & Hippel and longtime Democratic fundraiser.

Asking price: $46 million, which at around $469/sf could make this the highest-priced office space sale to date in Philadelphia and a hopeful sign for future developers of similar projects. (Dominant Center City/UCity landlord Brandywine Realty Trust was paying well under $200/sf for Center City Class A towers a few years back.) That price is $15 million above developers' announced $31 million construction price for the five-story building, which is double-LEED Platinum-rated (inside and out) by U.S. Green Building Council standards, with a green roof and medical-grade filtered air. 

The building, with its "exceptional and unique" environmental rating (for a multi-tenant building) and its location in a Keystone Opportunity state-and-local tax-break zone (easing tenant costs through 2018), has attracted interest from institutional investors, says David Dolan, broker on the sale with colleague Michael Margolis at NGKF Capital Markets. Immigration's lease has 15 years to run; the agency occupies the lower three floors. Top floor is vacant.

POSTED: Wednesday, October 22, 2014, 5:50 PM

The relentless consolidation of the cable TV and Internet industry has also brought consolidation and business failure for local outfits that used to wire customers for Comcast, Time Warner Cable and their many predecessor companies, according to a lawsuit winding its way through Philadelphia Common Pleas Court by two Pennsylvania firms that blame Comcast for putting them out of business.

In the suit, filed in March by Skippack lawyer Charles Mandracchia, his clients Cable Line Inc. and McLaughlin Communications Inc. accuse Comcast Cable Communications of Pennsylvania Inc. of inducing them "to start and finance work in new markets, only to abandon those firms once they had been induced to create the infrastructure necessary for Comcast's expansion."

Based on Comcast's promises, the firms say they hired and trained scores of workers, opened new offices, and borrowed to buy trucks and equipment -- only to have their work agreements arbitrarily cancelled by the cable company and their workers hired away by larger firms Comcast favored.

POSTED: Wednesday, October 22, 2014, 5:04 PM

(UPDATE) Thursday p.m., NJ ban on campaign donations by state investment contractors to national political action committees and order that the state start reporting fees to private managers (S-2430) approved by NJ Senate, 25-8, see below.

EARLIER:  Wednesday, over the opposition of Mayor Michael Nutter's appointees, a majority of the trustees of Philadelphia's $4.8 billion city pension plan have agreed to "request" dozens of private firms that are paid to manage city money -- from giants like KKR and Barclays to local investors like Ted Aronson's AJO Partners -- to "disclose their political spending," and will send current and future managers campaign finance disclosure requests, starting Jan. 1.

The move was cheered by city controller Alan Butkovitz, who had recommended this disclosure, noting the city has previously urged similar disclosures by the publicly-traded companies it invests in. "We will be asking for all donations from everybody," including federal and state as well as city contributions, Butkovitz told me in a statement. Read the resolution here. 

POSTED: Wednesday, October 22, 2014, 11:41 AM
Gov. Tom Corbett (ALEJANDRO A. ALVAREZ / STAFF PHOTOGRAPHER/FILE)

In the weeks before this fall's election for Governor of Pennsylvania, incumbent Tom Corbett is scattering millions of taxpayer dollars to big businesses through his Economic Growth Initative, a downsized version of the Redevelopment Assistance Capital Program (RACP) matching grants that enriched developers under Gov. Rendell.

1) Yesterday Oct. 21, Corbett gave $3.5 million to help the developer (revised) of a new U.S. headquarters for French-owned building-materials maker St.-Gobain Co. move to a long-vacant office center East Whiteland Township. Corbett says these taxpayer dollars will be "supporting 2,600 good paying jobs," including temporary and secondary service jobs. St.-Gobain earned more than $600 million, after taxes, last year.

(How do we get to 2,600 jobs? As I reported in April, St-Gobain is moving 680 people to the site when it vacates locations in King of Prussia and Blue Bell, and might add 100 more over the next five years. Corbett spokesman Jay Pagni says the company is also moving 70 jobs up from Florida, expects hundreds of temporary construction jobs, and hopes for additional neighborhood jobs at restaurants and other supporting businesses. Developer Eli Kahn tells me he hopes to attract other companies and more jobs to the complex as well.)  

POSTED: Wednesday, October 22, 2014, 10:51 AM
The newly expanded Pennsylvania Convention Center is seen in view of City Hall in Philadelphia, Friday, March 4, 2011. (AP)

(See Update below, with skeptical comment from A.C. convention center managers) Trade magazine and show producer National Business Media says it has changed plans and will again hold its 2015 NBM show (which this year drew 4,700+ accredited visitors) at the Pennsylvania Convention Center, instead of moving to Atlantic City as it had proposed.

The group credited the new work agreements with the Laborers, Electricians and other unions, replacing an old arrangement including the Carpenters and Teamsters, for changing its mind in Philly's favor.  It made the decision after its three-day September show at the center proved "a complete reversal" of the group's experiences in Philadelphia in prior years, the group said in a statement.

"The professional approach long shown by the Convention Center staff has finally been embraced by labor and others within the state and city," said Susan Hueg, vp at Colorado-based NBM Events, which manages the show. New center manager SMG of West Conshohocken and new center work rules and labor agreements, which for example allow more exhibitors to set up their own booths, show "a greater understanding of the value of trade shows and the business we bring to the area," Hueg added.

POSTED: Wednesday, October 22, 2014, 10:23 AM
Unisys' headquarters in Blue Bell, Pa. (Photo from Unisys.com)

Shares of Unisys jumped as much as 25% in early trading today, regaining half their loss year to date, after the Blue Bell computer and services company reported higher-than-expected sales of both services and ClearPath server hardware, and tripled pre-tax profits.  Statement and financial results here.

Unisys sales rose 6% in the three months ended Sept. 30, vs. last year, thanks to higher government cloud-computing sales and a boost in server sales, according to analyst Elitsa Bakalova at TBR in New York. "Despite the progress Unisys has made in becoming a next generation IT focused provider, it faces significant challenges scaling its cloud capabilities to match peers which are years ahead and are spending hundreds of millions more per year," she added.

The planned departure of CEO Ed Coleman signals Unisys' hope "to become a more product and business development-focused company similar to its peers CSC and IBM," Bakalova wrote. While Coleman scored for turning around the declining company he turned over in 2008, "his inability to jump start revenue growth after restructuring ultimately resulted in his departure," she added. "We expect Unisys will scale its analytics portfolio through investments in R&D" and deals with major players in target sectors.

About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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