Build it and they will come. The "Field of Dreams" business plan worked superbly when the goal was to create a venue for ghostly baseball greats to once again play their game. But when it comes to successful economic development initiatives, the opposite philosophy is more often the rule. Most economic development professionals agree, the name of the growth game is "get them to come and build it."

The task of spearheading and insuring the growth of communities throughout the Southeast falls to privately and publicly funded organizations whose main business objective is to create jobs by attracting new businesses and supporting the growth of existing businesses. The key to success in this game is strategically targeted marketing, perseverance and a healthy bit of matchmaking. Throughout the region, the primary climate is pro-growth and pro-development, and local governments offer a variety of initiatives to pull companies eastward and southward. Even in a down-turning economy, companies continue to make the Southeast their new home.

Alexandria

Spearheaded by the Alexandria Economic Development Partnership, the City of Alexandria is benefiting from a number of developments currently underway. Deputy Director Eric Dobson says the largest of these is the 2.5 million square feet of office space that will be built to house the U.S. Patent and Trademark Office, which is relocating to the city from Arlington. It is expected this will bring $6 million or $7 million in annual taxes to the area and it is anticipated that over 1 million square feet of associated uses will follow.

"Alexandria has a strong economy with an unemployment rate of only 1.3 percent as of December 2000," Dobson notes. "Our primary selling point is the quality of life and the broad range of residential product we offer. Commutes to surrounding business centers are easy via mass transit and a good road system. These, combined with a waterfront view of Washington, D.C., make Alexandria very attractive to executives and other workers as well."

Kentucky

Terri Bradshaw, director of marketing and communication for the Kentucky Cabinet of Economic Development, says a primary catalyst of growth in Kentucky is the state's location in "automobile alley." "UPS and DHS both have cargo hubs here and we offer the benefits of a good, integrated transportation system which puts us within one days drive of 66 percent of the U.S. population," she says. One of Bradshaw's current goals is to promote Kentucky as a business-friendly state. "Although manufacturing jobs are decreasing nationally, they are increasing in Kentucky due to the well-trained workforce. We are ranked 12th nationally in value-added per worker and we have the eighth lowest overall business cost in the U.S."

Mid-Florida Region

The Mid-Florida region, which includes the Orlando area, has successfully attracted a large number of projects through partnerships formed with private real estate developers, according to Ray Gilley, Mike Bobroff and Bryan Douglas of the Economic Development Commission of Mid-Florida, Inc. "One of our jobs is to facilitate the deal-making process," says Gilley. Bobroff continues, "Economic development requires a community effort, and real estate developers are a significant part of that community."

The Commission has recently begun to focus on developing a new, more expanded image for Mid-Florida, typically synonymous with Disney. "Central Florida has an $8.8 billion high-tech industry in addition to its well-known tourist industry," says Bobroff. "We plan to marry the ideas of high tourism and high-tech and to capitalize on the labor available in the area at a reasonable cost and the rapid permitting and tax incentives offered by our local governments."

Even in a slowing economy, there are a number of new projects that should bring significant financial benefits to the area. Ginn Company recently broke ground on the $2 billion Reunion Resort. This project is designed to include two golf courses, hotel and residential components, and when completed, almost 500,000 square feet of Class A office space.

Charleston

The Charleston Regional Development Alliance is organized to market a three-county area, which includes the City of Charleston. According to David Ginn, president and CEO, there are several residential, Class A office and Class A industrial projects under development in the area. Palmetto Commerce Park and Mount Holly Commerce Park are two of the largest, housing over 1 million square feet of industrial space. Daniel Island, a 4,500-acre site, is being developed with office, retail and resort facilities.

"Charleston offers a unique combination of attractive amenities to businesses," says Ginn. "Among them are the strength of our medical and university systems, our world class container port, a beautiful, historic downtown area, the spendable dollars brought in by tourists and a unique quality of life."

Fulton County (Atlanta)

Eugene Merriday, executive director of the Economic Development Corporation (EDC) of Fulton County, talks about a lesser-known area of resources that is providing a vital economic base for the growth of Atlanta and its surrounding areas. "Our organization focuses on supporting the growth and expansion of small businesses," he explains. "Economies need small businesses to survive. A strong small business base supports big business growth." The EDC supports small businesses by offering loans for the purchase of land, buildings and equipment. "With current lower interest rates, we have seen an increase in the number of businesses we can help," Merriday adds. The EDC offers a viable alternative to smaller businesses that are poised for growth.

Alabama

"The primary focus of The Economic Development Partnership of Alabama is to provide additional resources to meet economic development goals,"says Steve Sewell, director of marketing. "We do this by attracting business and industry to the State and assisting companies in site selection and offering other kinds of support support."

In Alabama, ¹success' and ¹automotive' are often spoken in the same sentence. Honda is completing a $440 million plant in Talledega County and Mercedes has broken ground on a $600 million expansion of its existing facility in Tuscaloosa. Toyota has begun construction on a $220 million facility in Huntsville. Other suppliers and service companies have followed job-creating leaders and Alabama has also recently seen growth in the industrial, distribution and call center segments of the market. "Alabama is very aggressive in terms of economic development," says Sewell. "We are pro-growth and pro-business and we offer incentives, both economic and practical, for employers."

North Carolina's Research Triangle

The Research Triangle Regional Partnership focuses on marketing a 13-county area that includes Raleigh-Durham, Chapel Hill and Pinehurst. According to Ted Abernathy, executive vice president, one of the goals of the Partnership is to provide tenants for buildings and sites and to work as an adjunct marketing arm for developers. "Our basic job is to increase jobs through development. We are currently involved in a ¹smart growth' movement -- one that supports growth in patterns that are positive for communities. We have a long-term view and participate in shared planning for infrastructure needs," he explains.

Several companies have recently chosen this area as their new home. AW North Carolina, a company that makes parts for Toyota, has recently opened a $200 million plant in North Durham. This plant should add over 250 jobs to the market. Two regional malls have also opened in the area. The $200 million Streets at Southpoint houses over 1.3 million square feet of retail. Triangle Town Center in North Raleigh has also added over 1 million square feet to the market. According to Abernathy, in 2000 Midway Airlines invested over $300 million in the region. "Another long term project, Centennial Campus, has been under development for the past 10 years and will continue to expand and house new businesses in the future," adds Abernathy.

Current Trends

"We have begun seeing more activity in our submarkets because of the efforts of new developers," Bobroff of the Mid-Florida Alliance notes. According to Ginn, "In the Charleston area overall, developers have continued to build quality space that is (absorbed) as it is completed. This has encouraged private investment to continue (at a healthy pace) over the last three years."

Says Sewell of Alabama, "We are seeing more and more domestic and international companies looking to establish operations in the Southeast in order to have access to our large consumer base. There has been some slowdown, but companies are still continuing with their plans."

According to Abernathy of the Research Triangle Partnership, "We are seeing more interest from overseas companies and we have opened an office in Frankfurt to recruit more business from Europe."

What Lies Ahead?

Although most experts agree there has been an overall slowdown in interest from new businesses in the past year, they consistently anticipate bright futures. Bradshaw from Kentucky notes that a year ago, they were looking at approximately 60 projects a week and that, with changes in the economy, they are now reviewing only about 50 projects per month. "Assuming the cause is the depressed economy, this should rebound as the economy rebounds," she says.

Representatives of the Mid-Florida area say that, although they are currently seeing a slowdown in interest in new development projects, there is still a relatively strong interest in the expansion of existing businesses.

"We have seen a slowdown over the past months," notes Ginn of the Charleston Alliance. "As a result, we are being more proactive than we were in the last 2 to 3 years and we are taking more marketing trips (to increase our reach)."

Abernathy reports that overall vacancy in all market segments of the Triangle area remains in single digits. The expected trend is that growth in this region will continue at a steady pace and 15,000 to 25,000 new jobs per year will be added over the next 3 to 5 years.

Sewell of Alabama voices a sentiment common to economic development professionals in the region. For all practical purposes, "the Southeast is still a region ripe for growth and investment."

The Southeast offers a wealth of options to choose from when a company is considering a move south of the Mason-Dixon Line. Although there has been a decrease in the overall number of new developments, the general consensus is that the slowdown will be short-lived and that a variety of incentives and sound marketing will continue to attract new businesses and jobs to the Southeast.

Karen Stone, CCIM, president of Stone Consulting Group, is a commercial real estate consultant and freelance writer based in Atlanta. She provides transaction management, due diligence and marketing services to the commercial real estate industry.

Jerry Monash, CCIM, President of Lancet Realty Advisors, Inc., is a commercial real estate consultant based in Atlanta. He is also president of the Real Estate Investment Advisory Council (REIAC), a national, "principal only" trade association.


©2001 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.