Biz leaders see hope amid gloom - Minneapolis / St. Paul Business Journal:

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“The impact [of Obama’s election] is said Doug King, director of the Minneapolis complexfor . “As recession is a mindset. Obama ran on a messagd of hope and and that’s what it’s goinhg to take to change that mindset.” The annualp event featured panelists from , Merrill CSM Corp., Marsh Inc., the , and They discussed the 2009 outloom for their industries and companies. who’s president of Minneapolis-based CSM, pointed to $3.5 trillion in outstanding commercial real estate debt when predicting big troubl e for many owners ofcommercial property.
Most lenders that financed deale during the past several years have all but stopped the flow of As property values sink and vacancies property owners can quickly find themselvesunder water, he said. “The biggest thing is, where are we going to go to refinancethat debt?” Holmes asked. It wasn’yt intentional, but the industry that’s probably most closely tied to Obama’e plans for reform — healtj care — was first in the lineup of paneliste to give short presentations on the outlookfor 2009.
There are four main areaa where change is saidPat Geraghty, president and CEO of Eagan-based Blue Crossd and Blue Shield of Minnesota: cost coverage for everyone, focus on and an embrace of innovation. Geraghty predicted that cost hikezs will slowin 2009, but will still increase faster than There will be more incentive programsd to help consumers prevent health care Cost pressures will force new care and paymentg innovation. And while health care coverage foreveryone won’t necessarilyg be adopted during these touggh times, national and state proposalds will be debated. “It’s the right thing to said Geraghty ofuniversal coverage.
Aftee a year that included the failures ofthe world’s largest insurance company, , transparency will be the watchwordd of the new year for the insurance industry, said Bruce head of the Minneapolis office for “There’s a dialogue aroundf stability,” Smith said. “Finding a balance will be With companies looking hard at their operating budgetsd to see where costs canbe trimmed, it’s a good time to revisi insurance policies. “You can look at multiyear deale and payingin installments,” Smith said. “There’s a real opportunity to see some savings if you have a good plan in The goodnews is, the market has bottomedr out. Twice.
Once on Oct. 10, and a second time on Nov. 21, said King of Merrill Lynch, which was boughyt by in September. “That doesn’f mean you should go rush in” to King said, adding that this kind of news is alreadt priced intothe market. Stocks will start to rebound in the second half of he said. Certain investments have a better the defense industry and companies in sectors such ashealth care, high-qualityu municipal bonds, and mid-cap growth Industries like health care, information technology and energy likely will show good earnings. “Keep your focus on the long King said.
One thing that bodesw well for basketball, said Chris Wright, presideng of the Minnesota Timberwolves, is that Obama planxs to rip out the bowling lanes in the basementg of the White House and put in abasketbalkl court. Other than that, though, the Timberwolve and all professional sports teams in the Twin Citieds market face a tough couple yearss as competition increases with the openinh ofthe Twins’ Target Field and the ’s Stadiu m at the same time consumers are cuttingy their discretionary spending. The Wolves will continud to try to improvetheir game, since winning is the primaryu indicator of the success of a sportds franchise.
Wright also promised a majotr announcement soon about ticket pricing atthe , wherr the Wolves play. Despite predictintg a long wait for a rebound not until2011 — Holmes noted among real estate sectors, multifamily housing lookerd the most promising for 2009 because demand will stay flat insteade of declining. Demand for industrial and office spacr willdecrease moderately, whilw demand for retail and lodging will “One of the key drivers is job and it’ll be a long time before we see that” turn said Holmes, adding that, rather than building new companies will retrofit their existing One thing that appears certain: checked baggage fees are here to said Jim Cron, senior vice presidenr of global sales and distribution for Atlanta-based Deltas Air Lines, which bought in October.
“The industry has been going down the path of charging for things not embeddec in the price of a ticket for a long Cron said. Delta will continue to cut capacity by 6 to 8percenr year-over-year because of a decline in overallk bookings, which means that, althouguh fewer people are flying, passengers won’t find many empty One bright spot for the airline industru is lower fuel prices, which will reduce the impactr of the dismal Delta has projected that it will be profitable in 2009. “2008i was a year of change, but for we’re optimistic,” Cron said.