First, I want to wish you a happy 2007.

Quotes of the Month:
-- "One of the surest ways to achieve your own success is by helping others attain theirs." Napoleon Hill

--"Idealism increases in direct proportion to one's distance from the problem." John Galsworthy

--"I'm a great believer in luck, and I find the harder I work the more of it I have." Thomas Jefferson

Interest Rates:
10 year Treasuries were 4.71% as of 12/29/06, compared to 4.61% on 10/31/06, 4.73% on 8/31/06, 5.07% on 4/28/06, 4.56% on 3/30/05, and 4.62% on 6/30/04.

Top Stories and Observations from News Reports:

1. 100 Oaks Mall sells for $49 million and is to be revitalized with upstairs converted to offices.
2. Economy slowing but soft landing predicted.
3. Fed funds rate expected to be cut to 4.75% by mid-2007 (a 50 basis point cut) and 10 year T's at 4.88% by end of 2007.
4. Middle Tennessee consumers are twice as optimistic at U.S. consumers.
5. Fifth Third Center downtown sells for $62 million.
6. GM commits to keep Spring Hill plant open.
7. 3000 unit Del Webb residential announced for Mt. Juliet area.
8. Super Target to anchor 450,000 SF Spring Hill retail project.

Headlines For November 2006 (listed by date)

1. Oldest Baby Boomers Turn 60, Retail Traffic, 11/1/06 (78 million Americans born between 1946 and 1964 with tremendous buying power)
2. Work Begins On Belle Meade Town Center, Business Journal, 11/2/06 (Converting Belle Meade Theater to Harris Teeter, AmSouth, shops).
3. Productivity Slowdown And Rising Wages Cause Inflation Fears, AP, 11/2/06
4. Two Nashville Auto Dealers Moving To Mt. Juliet, Business Journal, 11/3/06 (Two Rivers Ford and Carl Black Chevrolet)
5. 235,000 SF Mt. Juliet Warehouse Sells For $7.8 Million, Business Journal, 11/3/06
6. Michigan Movie Chain Building 10-Screen Theater In Gallatin, Business Journal, 11/3/06
7. Will Housing Bust Lead To A Recession?, Fortune, 11/7/06 (8 of the last 10 housing busts were followed by a recession)
8. Occupancy Growth Hits A Wall, National Real Estate Investor, 11/7/06 (report from Property and Portfolio Research predicts that vacancies in all classes of real estate except office will be higher by 2011)
9. Nashville Area Adds 11 Million SF Of Warehouse In 3 years; Now Recognized As A "Hub", Tennessean, 11/8/06
10. September Consumer Borrowing Takes Largest Drop In 10 Years, USA Today, 11/8/06 (Huge drop in auto loans)
11. Large U.S. Home Builders Profits Down 40% vs. 2005, AP, 11/8/06
12. Indigo Hotel To Go In American Trust Downtown, Tennessean, 11/10/06
13. A Burrito Isn't A Sandwich, Yahoo Finance, 11/10/06 (Panera Bread sued a landlord who rented to Qdoba claiming it violated their "sandwich" exclusive. Court ruled a burrito isn't a sandwich)
14. Super Target Anchors 465,000 SF Devlopment In Spring Hill, Tennessean, 11/12/06 (Congratulation to GBT)
15. 218,000 SF Harding Place Warehouse Sells For $5.9 Million, Tennessean, 11/14/06 (Congratulations Jim Crossman and David Rawlings)
16. Inflation, Retail Sales Drop in October, AP, 11/14/06
17. Costco Opens At New Nashville West, Tennessean, 11/17/06 (Part of 700,000 SF retail center to include Target, Best Buy, Dick's, Old Navy, Marshall's, Staples, PetSmart, Ross. Brilliant leasing. Congratulations to N.O.M. and Parkes)
18. Metro Planning Wants To Ban Future Surface Parking Lots Downtown, Business Journal, 11/17/06
19. 21 of Tennessee's 30 Most Congested Interstate Sections Are In Middle Tennessee, Tennessean, 11/19/06 (No. 1 is I-65 toward Rivergate)
20. Boston Investors Pay $10.2 Million For 107,939 SF MetroCenter Office Building, Business Journal, 11/24/06
21. Two Office Buildings At Metropolitan Airport Center Sell For $12.3 Million, Tennessean, 11/23/06
22. Disparity In U.S. Wealth Increasing, USA Today, 11/24/06
23. Cashout Home Refinancing At All Time High, Tennessean, 11/26/06 (May reach $300 billion for 2006)
24. Nashville Named 5th Most Technology-Advanced City In U.S., Business Journal, 11/28/06 (By Center for Digital Government)
25. International Think Tank Says U.S. Growth Is Slowing and Predicts Fed Funds Rate at 4.75% by 2008 (Currently 5.25%), AP, 11/28/06 (OECD Report)
26. Fed Chairman Says Economy Slowing As Expected, AP, 11/28/06
27. Bellsouth Tower Expected To Bring At Least $125 Million, Tennessean, 11/28/06 (633,000 SF Downtown)
28. Commerce Dept. Report Indicates "Soft Landing" For U.S. Economy, AP, 11/29/06
29. Amount Of Private Equity Flooding Into Commercial Real Estate Funds Astounds Analysts , CoStar News, 11/29/06
30. REIT Buys 70,000 SF Call Center In Grassmere For $15.5 Million, Tennessean, 11/30/06
31. Dollar General To Close 400 Stores, Tennessean, 11/30/06

Headlines For December 2006 (listed by date)

1. More Top Rankings For Nashville: No. 2 in U.S. For Economic Strength, 8th Best City For Entrepreneurs, Rutherford and Wilson Counties Were In Top 100 Fastest Growing, Nashville Chamber "Nashville Notes", 12/1/06
2. Retail Concentrations: Brentwood - Cool Springs - Franklin Has 10.7 Million SF, Murfreesboro - Smyrna has 9.3 Million SF, Rivergate - Hendersonville - Gallatin Has 7.6 Million SF, CoStar Retail Report, 12/1/06
3. Commodity Prices And Leading Indicators For OECD Countries Indicate Recession Not Coming In Next 6 Months, Complete Investor, 12/1/06
4. 2 Inescapable Trends With Big Economic Implications: Aging Of The Population and Massive U.S. Government Debt, Complete Investor, 12/1/06 (The only time U.S. government debt was a higher % of GDP was during WWII)
5. Gaylord Considering Opryland Expansion And New Theme Park, Tennessean, 12/2/06
6. Cable Networks Moving To Nashville, Tennessean, 12/3/06 (Documentary Channel, Gospel Music, RFD TV, etc.)
7. Insider Stock Sales Ratio Highest in 20 Years,Indicates Concerns About Economy, Bloomberg.com, 12/6/06 (In November insiders sold $63 for every $1 bought)
8. 100 Oaks Mall Sells, To Be Revitalized, 2nd Floor To Be Offices, Tennessean, 12/7/06 (750,000 SF on 57 acres)
9. Slowing Economy Could Stress Some Overleveraged Investors, Global Real Estate Monitor, 12/8/06
10. Duke To Build 334,000 SF Office At Cool Springs, Business Journal, 12/13/06 (Bought 18 acres for $8.6 million - $11 psf)
11. Midstate Economic Growth Continues, Tennessean, 12/11/06
12. GM Commits To Spring Hill Plant, Tennessean, 12/12/06 ($225 million renovation)
13. Area Home Sales Fall 9% In November, Tennessean, 12/12/06 (We're doing much better than most of the U.S.)
14. Area Employers To Hire Fewer People In First Quarter, Tennessean, 12/12/06
15. Top Three Healthiest Counties In TN Are Williamson, Sumner, Rutherford, Tennessean, 12/13/06
16. Oreck Adds 400 Jobs In Cookeville, Tennessean, 12/13/06
17. Fifth Third Center Sells For $62 Million, Tennessean, 12/16/06 ($130 psf)
18. 100 Oaks Mall Sells For $49.2 Million, CoStar News, 12/19/06 (750,000 SF, great real estate)
19. 283-room Embassy Suites To Open in 2008 In Murfreesboro, CoStar News, 12/19/06
20. Economic Growth Slows to 2 Percent, AP, 12/21/06
21. Fed Funds Futures Indicate 62% Chance Of Rate Cut By Mid 2007, S&P U.S. Financial Notes, 12/22/06
22. 3000 Unit Del Webb Residential Announced For Mt. Juliet Area, Business Journal, 12/22/06
23. Consensus Is 10 Year T's At 4.88% By End Of 2007, Business Week, 12/25/06 (Survey of 58 forcasters)
24. Manufacturers Association Predicts Slowdown But Soft Landing and Fed Rate Cut By Mid-2007, AP, 12/26/06 (National Assoc. of Manufacturers)
25. Consumer Confidence Reaches 8 Month High, AP, 12/28/06
26. Middle TN Consumers Twice as Optimistic as U.S. Consumers, Business Journal, 12/29/06 (MTSU survey of consumers)
27. 2007 Retail Sales Projected To Be Similar to 2006, Retail Traffic, 12/31/06

David Huddleston
(615) 310-2547