First decade of century marked by buyouts and bubbles

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Year In Review

It started with a bursting bubble and ended with a bursting bubble. In between, the decade witnessed a massive terrorist attack, two wars, and a building-and-buyout boom fueled by easy credit.

The city skyline added an airport terminal, a football stadium, a library expansion, a massive downtown hotel, three shopping malls, four hospitals and myriad medical buildings, as well as countless condos and housing developments. It also watched two downtown stadiums come down.

Homebuilders soared and then swooned when Wall Street’s bundling of subprime mortgages created a credit crisis throughout the world. C.P. Morgan and Davis Homes went the way of Bear Stearns and Lehman Brothers. A deluge of debt created a similar boom-bust cycle at local commercial developers Premier Properties (gone) and Lauth Property Group (bankrupt).

The midfield terminal at Indianapolis International Airport was the biggest of a slew of new building projects to rise on the local skyline. (IBJ File Photo)

Acquisitions and sales reshaped the corporate landscape. Anthem became WellPoint Inc. as it rolled up one health plan after another until it covered more people than any other health insurer in the country. Mall owner Simon Property Group Inc., which built a new headquarters downtown, failed in a hostile bid for one rival but snagged three outlet operators and is grappling for more.

Insurer Conseco Inc. succumbed to its debt and limped out of bankruptcy, then chased down Steve Hilbert and other former brass for unpaid loans. Medical-device maker Guidant Corp. called off its purchase of Bloomington’s Cook Group only to become the prize in a bidding war ultimately won by Massachusetts-based Boston Scientific Inc.

Guidant’s was one of several prominent corporate names to disappear, along with Bindley Western, First Indiana, Union Federal and ATA. Marsh Supermarkets Inc. sold itself to a private equity firm but retained its local presence and name—so far.

The buyout game took local financier Tim Durham to new heights, the top of the Bank One—er, Chase—Tower, but then to deep lows. The FBI raided his offices to probe his use of investor money to give loans to himself and his friends.

Eli Lilly and Co. continued to pooh-pooh the mega-merger chase, even under new CEO John Lechleiter, but then spent $6.5 billion on ImClone Systems—its largest acquisition ever. The company had its star drug Prozac taken away early by a surprising court decision, but survived by launching a raft of new drugs. It needs a similar performance now as it faces patent expirations on five blockbusters in the next five years.

While Lilly has shed jobs to cut costs, a local life sciences initiative has attracted millions in out-of-state venture capital to feed startup companies. Indiana and Purdue universities refashioned themselves as economic development engines capable of turning science into business.

Former Lilly executive Mitch Daniels became governor—the first Republican in 16 years. He brought with him a bevy of business honchos to run state government, pushing Indiana into daylight-saving time and pulling in new investments from Toyota and Honda.

The domestic automakers fared far worse, however, as soaring gas prices ended the boom in SUVs, and retiree health care costs sapped the competitiveness of General Motors Corp. and Ford Co. Both decided to close major plants in Indianapolis.

The city’s professional sports teams traded fortunes, with the Indianapolis Colts soaring to a Super Bowl win in 2007 while the Indiana Pacers fell from a runner-up finish in the NBA Finals in 2000 to a perennially losing team known best for fighting with fans in Detroit.

Indianapolis Motor Speedway chief Tony George finally won the bitter battle between rival IndyCar leagues, but lost the Formula One race and ultimately lost his CEO job. His little-known successor is counting on female sensation Danica Patrick and new league sponsor Izod to help regain the Speedway’s cachet.

Local leaders are struggling to maintain the sports venues that were the foundation of Indianapolis’ downtown rebirth. The tennis, track and swim stadiums are stressing IUPUI, just as Lucas Oil Stadium and Conseco Fieldhouse are straining city government. Mayor Greg Ballard—who ousted Bart Peterson in a shocking upset fueled by voter ire over rising taxes—is still searching for a solution.

The new decade dawns on an economic downbeat: One in 10 Hoosiers is searching for work.•




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  1. So much for Eric Holder's conversation about race. If white people have got something to say, they get sued over it. Bottom line: white people have un-freer speech than others as a consequence of the misnamed "Civil rights laws."

  2. I agree, having seen three shows, that I was less than wowed. Disappointing!!

  3. Start drilling, start fracking, and start using our own energy. Other states have enriched their citizens and nearly elminated unemployment by using these resources that are on private land. If you are against the 'low prices' of discount stores, the best way to allow shoppers more choice is to empower them with better earnings. NOT through manipulated gov mandated min wage hikes, but better jobs and higher competitive pay. This would be direct result of using our own energy resources, yet Obama knows that Americans who arent dependent of gov welfare are much less likely to vote Dem, so he looks for ways to ensure America's decline and keep its citizens dependent of gov.

  4. Say It Loud, I'm Black and Ashamed: It's too bad that with certain "black" entertainment events, it seems violence and thuggery follows and the collateral damage that it leaves behinds continues to be a strain on the city in terms of people getting hurt, killed or becoming victims of crimes and/or stretching city resources. I remember shopping in the Meadows area years ago until violence and crime ended make most of the business pack you and leave as did with Lafayette Square and Washington Square. Over the past 10 to 12 years, I remember going to the Indiana Black Expo Soul Picnic in Washington Park. Violence, gang fights and homicides ended that. My great grandmother still bears the scares on her leg from when she was trampled by a group of thugs running from gun fire from a rival gang. With hundreds of police offices downtown still multiple shootings, people getting shot downtown during Black Expo. A number of people getting shots or murdered at black clubs around the city like Club Six on the west side, The Industry downtown, Jamal Tinsley's shot out in front of the Conrad, multiple fights and shootings at the skating rinks, shootings at Circle Center Mall and shooting and robberies and car jackings at Lafayette Mall. Shootings and gang violence and the State Fair. I can go on and on and on. Now Broad Ripple. (Shaking head side to side) Say It Loud, I'm Black and I'm Ashamed.

  5. Ballard Administration. Too funny. This is the least fiscally responsive administration I have ever seen. One thing this article failed to mention, is that the Hoosier State line delivers rail cars to the Amtrak Beech Grove maintenance facility for refurbishment. That's an economic development issue. And the jobs there are high-paying. That alone is worth the City's investment.