STRICTLY BUSINESS: INVESTING IN CAPE GIRARDEAU

The majority of Cape Girardeau banks are investing in the city's downtown.

Eight banks have indicated they are donating between $1,500 and $2,500 each to the new Missouri Main Street program within the local downtown area.

The banks include Bank of America, Bank of Missouri, Capaha, Commerce, Firstar, First National Bank, Union Planters and Wood and Huston Bank.

Cape Girardeau was accepted into the Missouri Main Street program in February 2000.

Old Town Cape, the name selected for a local Main Street program that covers a wide area of downtown Cape Girardeau, is dedicated to revitalizing the business area through promotion, improving the aesthetic qualities of the area, retaining, recruiting and helping businesses expand and educating the public about its benefits.

The program encompasses an area from Water Street along Broadway to West End Boulevard to Highway 74 and to Morgan Oak, which leads to the Mississippi River bridge.

The square includes the primary downtown business area, the Haarig area, upper Broadway and old St. Vincent's Seminary, the proposed River Campus of Southeast Missouri State University.

"We are very excited to have these banks taking an interest and being some of first stakeholders," said Judith Anne Lang, a downtown merchant who heads the Old Town Cape Board. Other officers are Ted Coalter, president of the Haarig Area Development Corp., vice chairman; Greg Williams, executive director of the Regional Commerce and Growth Association, secretary; and Tom Higgins, an accountant, treasurer.

Other elected members of the board: Steve Hoffman, historic preservation, Southeast Missouri State University; John Mehner, president and chief executive officer, Cape Girardeau Chamber of Commerce; Tom Howard of the Arts Council; Skip Smallwood of AmerenUE; B. Ray Owen, business editor, Southeast Missourian; Fred Shivelbine of Shivelbine Music; Leola Twiggs of East Missouri Action Agency; Jerrie Wyman of Mollie's and Royal N'Orleans restaurants; Michael Miller Cape Girardeau city manager; and John Layton, an attorney.

The board has one vacancy.

Heading the four required committees for Main Street are Mehner, economic; Hoffman, design; Marsha Toll, promotion; and Coalter, organization.

Main Street programs are more successful than ever. In more than 1,400 communities across the United States, downtown area revitalization is booming. The Main Street National Trust, headquartered in Washington, D.C., reports that the program, created in 1977 with three communities, has since helped reinvest more than $8.2 billion in neighborhood commercial districts.

Fourteen communities have Main Street programs in Missouri. Since the state program started, participating downtown organizations have witnessed the creation of more than 650 new businesses and 1,900 new jobs with more than 650 building renovations and $66,800 in reinvestment.

Catching up

* Schlotzsky's Deli has closed at 276 Mount Auburn Road.

The restaurant facilities will remain intact for a while, and the Cape Girardeau franchise is open. Anyone interested may contact Tom Kelsey, broker with Lorimont Place, Ltd., at 334-5200.

* We understand that Denny's Restaurant is on hold for a while. Denny's earlier announced it would locate to Cape Girardeau in the area vacated by Shoney's Restaurant.

* Albertson's Grocery is expected to open late February or early March. Construction is continuing on the new Albertson store near the intersection of Independence and Kingshighway.

Q: Have you started a new business during the past six months?

A: Let the readers of the Southeast Missourian Business pages know. Submit new business information via e-mail to rowen@semissourian.com.

A slowing economy

A slowing economy and some extreme early winter weather took a toll on the consumer spending holiday shopping season. Some call it the weakest holiday period in a decade.

Wal-Mart Stores Inc., the world's largest retailer, reported same-store sales up 0.03 percent, far lower than last year's 9.1 percent increase, but still better than some.

Dillard's Inc. reported that same-store sales were down 4 percent.

Holiday sales were disappointing in nearly all Federal Reserve Bank districts, according to the Federal Reserve's Beige Book for January.

The Beige Book, issued eight times a year, is a collection of anecdotal information compiled from various business and community leaders. Although the Beige Book is not an in-depth report, the Federal Reserve uses it as one of many tools to help determine the direction of monetary policy.

Despite heavy discounting, retails sales were down from items found in stores to automobiles. The slow sales left many retailers with overstocked inventories. However, the declines have helped to ease labor market tightness somewhat.

Many businesses profits are being squeezed by high fuel costs. Although new housing construction continues to slow, home sales have recently picked up in some areas. Loan demand has softened somewhat, while loan growth has been very mild. The weather did spur strong sales of seasonal products, such as winter coats, clothing and boots. Contacts at several major department stores report that electronics and small appliances have also been popular sellers.

Manufacturing update

Contacts in a variety of industries are experiencing a noticeable slowdown in demand. Slowing demand has helped ease labor markets somewhat, which has enabled firms to fill vacant positions.

The local steel industry continues to weaken, with some producers going out of business in the past few months because of lower demand and foreign competition.

Employment growth has been boosted by several firms expanding and relocating to the Federal Reserve district. Memphis, Tenn., for example, is increasing its status as a regional distribution hub, as a food distributor constructs a new warehouse and distribution center that will create 600 new jobs. A contact at a credit card company notes that it will employ more than 1,000 new workers at its global technology center in the St. Louis area during 2001. The district's high-tech sector continues to be volatile: companies moving to the Louisville, Ky., Memphis and northwest Arkansas areas will create nearly 1,000 jobs in the coming months.

Announcements of new cements companies in Ste. Genevieve County will boost employment totals, with as many as 1,200 to 1,500 jobs during construction of two plants and a total of about 300 employment on completion of the plants.

Real estate, construction

Real estate agents report that home sales have recently picked up in some areas, especially Memphis and Little Rock, where year-to-date sales are above last year's levels. Median home prices in many district areas are currently down from their year-earlier levels.

Residential construction continues to slow, with permits down from their month- and year-earlier levels in all district metropolitan areas. Builders, however, have expressed optimism about construction activity in 2001 because of expectations of lower mortgage rates. Nonresidential construction has been mixed, with pockets of activity in some areas and substantial slowing of the market in other places, like St. Louis. As a result of the slower residential and nonresidential construction, fewer contractors are experiencing backlogs.

Agriculture

The Beige Book reports that nitrogen fertilizer prices have increased substantially over the past year, particularly during the fall, because the price of natural gas -- a major cost-component of nitrogen-based fertilizer products -- has more than quadrupled. In fact, some manufacturers have begun selling off natural gas stocks rather than producing fertilizer because this strategy is currently more profitable for them.

Low water levels and ice on the Mississippi River have made travel difficult for barges and tugboats, hampering cargo shipments of commodities such as corn, soybeans and wheat. These conditions have also caused some barges to run aground -- much earlier in the season than usual.