Welcome to The Closing Bell. This is your last stop for biz scoops before the weekend — a roundup of real estate, retail, financial and other business news that can’t wait for Monday.
First up: Major League Baseball is super competitive — not just on the field, but in the bat business, as evidenced by a former Louisville Slugger star going to work for the company’s biggest rival. We also have news of a cleverly named Ventas spinoff, along with the realization that our bourbon obsession might finally have gone too far. And mark it down construction biz folks: The Omni hotel contractor wants to mix and mingle with potential subcontractors and vendors next week.
But first, some sad real estate news for all you bowlers out there…
Historic Vernon Lanes building is for sale
The historic building that houses Vernon Lanes and the Vernon Club is for sale, and along with it, a business that’s been running there in one way or another since 1898. Vernon General Manager Eric Widmayer tells IL he and the owner, Dale McCall, are ready to move on to other ventures.
“It’s been a great run, and we’ve really enjoyed our time,” Widmayer says, adding that they’ll continue operations as normal until they hand over the keys.
The main structure at 1575 Story Ave. in Butchertown was built in 1886 and served as a private residence for 12 years. In 1898, it became the Delmont Club, a business and recreation venue — and the place where bowling there began. But the club’s finances got tight, and St. Joseph’s Catholic Church bought it in 1918. The church moved the bowling lanes from the basement to the main floor and started up a league. It wasn’t until 1946 that the bowling alley formally opened to the public.
McCall bought the building in 2006 for $370,000 and made significant renovations, including adding the Vernon Club, a music venue that occupies the basement. He and Widmayer also added a bourbon bar with more than 365 varieties. The Vernon is on the Urban Bourbon Trail and does tastings every Thursday.
Broker Rhonda Karageorge of Commonwealth Commercial Real Estate is handling the listing. She and McCall are marketing the building for now but would sell the business if a buyer is interested. They’re presenting the 23,000-square-foot space — which has 75 parking spots — as ideal for a restaurant/bar and possibly distillery. It’s currently zoned C-2.
McCall is asking $1.3 million.
Ventas announces plans to spin off division, names it ‘SpinCo’
Ventas didn’t have to look far to find a CEO for its newest venture. The real estate investment trust, formerly headquartered in Louisville, has hired its president, Raymond J. Lewis, to head up its newest division, which it creatively called (for now, at least) “SpinCo.”
SpinCo is to be a publicly traded REIT, just like Ventas, and will consist of most of the parent firm’s post-acute/skilled nursing facilities. Ventas holds senior housing and health care properties in the U.S. and Canada. Ventas shareholders will receive, tax-free, a share of SpinCo for every four shares of Ventas they own. Ventas expects the spinoff to be completed by the second half of 2015.
Lewis signed up for an initial three-year term heading up SpinCo, with an annual base salary of $750,000, a target annual bonus of 200 percent of his base salary, and an inaugural grant of SpinCo stock valued at $2.5 million. The stock will vest in three equal annual installments, starting the first anniversary of the spinoff — assuming Lewis is still running the show at SpinCo. And, yes, we love that they called it SpinCo.
Ventas announced both the spinoff and Lewis’ new role on April 6. On the same day, it also announced an agreement to buy health care firm Ardent Medical Services for $1.75 billion in cash. Ventas will split off and sell Ardent’s hospital operations from its real estate.
And here comes the fun part: Ventas says it plans to sell Ardent’s hospital operations to “one or more” newly formed entities owned by the current management of Ardent, “other equity sources,” and up to 9.9 percent owned by Ventas itself. Then Ventas will enter into an agreement with Ardent to operate the newly acquired properties. Meaning it bought a property, plans to sell some of it, will likely buy some of what it’s selling, and plans to operate the property it bought, and then sold, to itself.
David White, writing for stock analysis site Seeking Alpha, likes the above moves, saying it makes Ventas an attractive stock. He believes the spinoff should boost the dividends held by Ventas shareholders from 4.28 percent annually to, he estimates, 4.71 percent. Stock traders also really liked the move, at least initially, giving Ventas a big jump on April 6, although shares have fallen steadily since then.