< Previous28 NOVEMBER 2024 SITE SELECTION NORTH AMERICAN REPORTS Renewable Data Arrives in the Sandhills M eta has announced its offi cial arrival in South Carolina with a planned $800 million data center. The Sage Mill Industrial Park, located in Aiken County, will soon be home to the 715,000-sq.-ft. data center which will run on 100% renewable energy. “We are excited to make Aiken County our new home and are committed to playing a positive role here and investing in the community’s long-term vitality,” said Meta Data Center Strategy Director Kevin Janda. “South Carolina stood out as an outstanding location for our newest data center thanks to its great access to infrastructure and energy, deep pool of talent, and amazing community partners.” The facility is anticipated to be operational by 2027, creating 100 new jobs. Billion-Dollar Drug Development A fresh $4.5 billion will go toward the establishment of the Eli Lilly Foundry in Lebanon, Indiana, by late 2027. The advanced manufacturing and drug development center will be housed in the state’s LEAP Research and Innovation District and focus on the production of diff erent molecular therapies. This activity will include producing drug substances for small molecules, biologics and nucleic acid therapies, according to a press release. This investment comes months after the company invested $5.3 billion in the expansion of its pharmaceutical manufacturing facility in Lebanon, solidifying more than $13 billion invested in the state in 2024. New developments made at the center will be integrated into the company’s various manufacturing facilities to move into full-scale production. Once complete, the center will look to create 400 new jobs. Meta’s 22nd U.S. data center will be its fi rst in South Carolina. Photo courtesy of Meta Eli Lilly’s Medicine Foundry aims to develop innovative solutions for clinical trial medicines. Rendering courtesy of Eli Lilly and Company Canada Cleans Up Carbon I reland-based chemicals company Linde has joined Dow’s Fort Saskatchewan Path2Zero Project in Alberta, Canada, with plans to construct largest clean hydrogen production facility in the province. Upon signing an agreement with Dow in August 2024, Linde will begin construction of the $2 billion production facility. The plant will use autothermal reforming in combination with Linde’s HISORP® carbon capture technology to produce hydrogen, while additionally recovering hydrogen contained in Dow’s ethylene cracker. The project is expected to begin production in 2028, capturing 2 million metric tons of carbon dioxide for sequestration annually. Linde joins Dow Canada’s Path2Zero project to aid in carbon capture. Photo courtesy of Linde by ALEXIS ELMORE alexis.elmore@siteselection.com SITE SELECTION NOVEMBER 2024 29 Austal Aids Deep Dives U pon receiving a $450 million contract award from General Dynamic Electric Boat, shipbuilding company Austal USA will look to expand production capacity and improve infrastructure at its Mobile, Alabama, shipyard. The company will also construct a new module fabrication and outfi tting facility as it aims to produce a Columbia-class and two Virginia-class submarines per year for the U.S. Navy. “General Dynamics Electric Boat has recognized that Austal USA is a solid partner to deliver high-quality components for Virginia- and Columbia-class submarines. This growing partnership demonstrates confi dence in Austal USA’s commitment to meet the needs of the U.S. maritime industrial base and support the most critical needs of the U.S. Navy,” said Austal Limited CEO Paddy Gregg. Construction on the site will begin in 2024 and wrap in 2026, creating 1,000 new jobs in the region. The new facility will provide the company space to fabricate, outfi t and transport new submarine components. Photo courtesy of Austal Limited A Sturdy Expansion M etals company Arzyz Metals will invest $650 million to expand its manufacturing facility located in Nuevo Leon, Mexico. The Mexico-based company has made the move in an eff ort to not only boost its workforce but to introduce a new R&D center on its Cienega de Flores site. “This park that we are going to build has a technical school for our people, a day care center for our people, a research and development center to improve our people, so much of our focus is investing in machines and people,” said Arzyz Metals General Manager Mario Sergio Ramírez-Zablah Limón. The project will grow the company’s status as the one of the country’s top recycled aluminum manufacturers. Nuevo Leon Governor Samuel García noted that the expansion project has the potential to create up to 1,300 new jobs in the region. A Test to New Charging Capabilities A $145 million battery cell prototype center will join General Motors Global Technical Center about 25 minutes outside of Detroit, Michigan. Construction of the new 165,000-sq.-ft. facility is set to begin before the end of 2024 in the city of Warren, with completion slated for 2027. The addition will help GM increase EV battery cell development while lowering costs and increasing manufacturing effi ciency. “This capability really sets GM apart from our competitors,” said GM Vice President of Battery Cell and Pack Kurt Kelty. “By adding production capability during battery cell development, we can take more manageable steps and more quickly streamline processes, understand costs and identify potential issues that may come up in production.” As operations begin, the site is anticipated to produce 3,600 battery cells annually for EV battery prototypes (not for mass production). A new expansion project takes a strategic focus to support the growth of Arzyz Metals’ workforce. Photo courtesy of Arzyz Metals Production issues with GM’s Ultium platform have sparked new investment for the battery cell manufacturing rebrand. Rendering courtesy of General Motors30 NOVEMBER 2024 SITE SELECTION I nnovation is more than a watchword in San Bernardino County. e application of creative thinking permeates an array of diverse industries throughout this ,-square- mile land of . million people in inland Southern California. From an old-world industry like winemaking to new-world sectors like electric motorbikes and space exploration, innovation serves as the linchpin for three entrepreneurial businesses that aim to upset the status quo and change the world. Ryvid, Fenix Space and Suveg Cellars call San Bernardino County home. Located about an hour east of Los Angeles, these upstart fi rms carve out niches in competitive industries while adding How Innovation Propels 3 Entrepreneurial Businesses in San Bernardino County by RON STARNER ron.starner@siteselection.com INVESTMENT PROFILE: SAN BERNARDINO COUNTY, CALIFORNIA Ryvid’s electric motorcycles are priced to make urban commuting attainable for almost anyone. Photo courtesy of Ryvid SITE SELECTION NOVEMBER 2024 31 When you consider the aggregation of aerospace companies in Los Angeles, El Segundo and Long Beach, the space industry concentration in the region is signifi cant. Our goal is to build a space technology company in San Bernardino and grow it here.” — Jason Lee , CEO, Fenix Space When you consider the aggregation economic diversity and quality jobs to their communities. Making Commuting Aff ordable No one understands the electric motorcycle landscape better than Dong Tran, Founder and CEO of Ryvid, a “light mobility” company that designs and manufactures electric motorcycles to make urban commuting both accessible and sustainable. “Our fl agship model, the Ryvid Anthem, featuring an aerospace-inspired frame and adjustable seat, along with other standout features, is competitively priced at $,, while the Outset is off ered at $,,” says Tran. “With most electric motorcycles in the urban commuter segment priced between $, and $,, Ryvid has positioned itself as the top choice for cost-conscious urban commuters, delivering both performance and style without the hefty price tag.” Tran explains that San Bernardino County was chosen strategically as Ryvid’s home for operations. “San Bernardino off ers a workforce with deep expertise in aerospace, manufacturing, and related industries—skills we can tap into as needed to support Ryvid’s evolving production goals,” he notes. “ is strong industry infrastructure and access to skilled labor provide the fl exibility we need to scale effi ciently and maintain high production standards as we navigate our growth trajectory.” He adds, “San Bernardino’s commitment to business growth has been a signifi cant advantage, with stakeholders like the Economic Development Agency and San Bernardino Community College District providing invaluable support. e county’s energy and collaborative spirit align perfectly with Ryvid’s values of sustainability and innovation, which also extends to the diversity of our operations.” “Diversity is central to Ryvid,” Tran continues. “Our workforce refl ects a rich 32 NOVEMBER 2024 SITE SELECTION blend of personal and professional backgrounds, and San Bernardino provides a strong talent pool that helps us advance a sustainable future for urban transportation.” A Space Odyssey with Towing Power Jason Lee agrees. As CEO of Fenix Space, Lee leads a team of engineers and technicians seeking to change the trajectory of space flight. “We are creating a true launch platform that enables a very rapid launch of spacecraft payloads to orbit,” he says. “We are an offshoot of another space company, and we are using that same tow-launch technology to address commercial space markets and hypersonic testing.” Fenix’s approach is to launch a rocket at an altitude of 60,000 feet from a winged booster, which is first towed to 40,000 feet behind a commercial aircraft. The system is designed to produce better performance at lower costs compared to traditional rocket-propelled space launches. Fenix is now under contract to develop the Pentagon’s hypersonic and high-cadence airborne testing capabilities. Other partners include NASA, the Air Force Research lab and the U.S. Space Force. Fenix is an independent offshoot of Kelly Space & Technology, which was the first commercial tenant at San Bernardino International Airport, a commercial airfield that was formerly known as Norton Air Force Base. “When Norton closed down, it created a lot of ramifications,” says Lee. “Kelly Space wanted to utilize the existing infrastructure at the air base. When they developed the old Air Force base into an international airport, some key Air Force facilities got upgraded into testing facilities. These expensive testing capabilities have been developed here since the early 2000s. Machining capability is here too.” Fenix is co-located with Kelly Space. “We have a core team of about 20 members,” Lee says. “Over the next 12 months, we expect to double our headcount. We are sitting on 20,000 square feet of facilities, but we need to expand to over 30,000 square feet. We are looking at potential locations around San Bernardino for extra space.” Lee says that “we are able to hire talent through referrals from our existing team members. We have had interns and new hires come from California State University-San Bernardino. We have technical employment training at the airport. When you consider the aggregation of aerospace companies in Los Angeles, El Segundo and Long Beach, the space industry concentration in the region is significant. Our goal is to build a space technology company in San Bernardino and grow it here.” The firm’s goal is to progress quickly. “We are going to be doing a flight demonstration of INVESTMENT PROFILE Testing of the Fenix Space launch system at San Bernardino International Airport. Photos courtesy of Fenix Space SITE SELECTION NOVEMBER 2024 33 autonomous technology at one-third scale at the end of the fi rst quarter of ,” adds Lee. “We will build a rocket engine and test it next year. We will do our fl ight test in . at will be our fi rst full- scale system. Our longer-term plans are to scale up successively with Fenix , and systems over the next decade.” A Field Day of Fermentation A little closer to the earth, Suveg Cellars is challenging the status quo of the vaunted California winemaking industry. Located in the Yucaipa Valley, -year-old Suveg was instrumental in the Yucaipa Valley Wine Alliance earning its fi rst-ever American Viticultural Area (AVA) designation. Devin Cohen, winery director at Suveg, says the AVA designation will enable the Yucaipa Valley to become a major player in the highly competitive wine business of Southern California. “Nestled in the foothills of the San Bernardino Mountains, Yucaipa is a unique setting in the county for the growth, harvesting, barreling and aging of fi ne wine,” he says. “An AVA designation is passed down by the federal government through the rules passed by the U.S. Department of Treasury. It is a fi ve- year process.” Only regions in California and just nationwide have earned the AVA designation. For Yucaipa, the award is game-changing, says Cohen. “It is instructive to look to our neighbors to the south in Temecula,” he says. “ ey got their AVA about years ago. Today, that region generates an estimated annual economic impact of $. billion. Over , wine-related jobs are in the Temecula Valley. More than $ billion in wages were paid there last year in the wine business.” Earning the AVA opens doors for Yucaipa to recruit and hire more cellar masters, tasting room managers and adjacent jobs tied to winemaking. “Adding jobs to the wine industry has an eff ect that creates a destination,” says Cohen. “People come to wine regions to taste wine and spend dollars.” How important is the California vineyard business? “Behind entertainment, it is the second- largest industry in the state,” says Cohen. “Increased visits to the area constitute an increased tax base. More money in public coff ers means more public services. People who own property here will see signifi cant increases in their property values.” e region is accessible too, notes Cohen. “We are miles directly east of LA and right off the I- freeway between Ontario and Palm Springs,” he adds. “I- runs through the valley. We are minutes from Redlands and Oak Glen. Riverside is minutes away; and it is minutes to Rancho Cucamonga, Corona or Palm Springs.” e goal of the alliance is to see more wineries open in the valley, Cohen says. “To make a small fortune in the wine region, you have to start with a very large one. We will work with primary investors and local governments to create incentive programs. If it works, we have a wine industry that will last hundreds of years.” From the grape fi elds of Yucaipa to outer space, the businesses of San Bernardino County are changing the fortunes of local residents and opening new frontiers of exploration. is Investment Profi le was prepared under the auspices of San Bernardino County. For more information, contact the County’s Economic Development Department at --. On the web, go to www. SelectSBCounty.com. SAN BERNARDINO COUNTY, CALIFORNIAW ith signifi cant tax provisions of the Tax Cuts and Jobs Act (TCJA) set to expire next year, is being called the “Super Bowl of tax.” e opportunity zones (OZ) incentive was enacted by TCJA and while the capital gains investment deadline through this incentive does not expire until , stakeholders are using the review of the TCJA to garner support for the extension of this deadline and other proposed enhancements. e OZ incentive was created to encourage the investment of capital gains in underserved communities. OZs are census tracts in low-income communities experiencing economic distress. ere are more than , OZs in the states, District of Columbia and U.S. territories. ere are three main tax benefi ts to investors. e incentive allows investors to defer the payment of taxes on capital gains up to nine years, if those gains are invested in qualifi ed opportunity funds (QOFs), the mechanism used to direct investment in economically distressed communities. For investments held for at least fi ve years, there is a % step-up in basis, eff ectively reducing the deferred tax liability by %. For investments held for at least seven years, the taxpayer’s basis is increased by an additional % of the original gain. After paying the deferred capital gains tax, taxpayers holding investments for a period of at least years are exempt from taxation on any additional gains. e ability to invest capital gains in a QOF ends in , but legislation introduced earlier in the th Congress would provide a two-year extension. Billions of Investment Dollars Qualifi ed opportunity funds (QOFs) tracked by Novogradac reported nearly a half-billion dollars in equity raised during the second quarter of , putting total equity raised since the start of the OZ incentive at $. billion. e , QOFs tracked by Novogradac that report a specifi c amount of equity raised (Novogradac tracks another QOFs that report no equity) accounted for an additional $. million in equity raised in the period from April -June . QOF data reported by Novogradac OPPORTUNITY ZONES 34 NOVEMBER 2024 SITE SELECTION OZs: Is a Sequel in the Works? Updated insights from Novogradac off er evidence of the OZ incentive’s success. e following analysis, published by special arrangement, is an adaptation of several August posts by Jason Watkins, CPA, a partner in the metro Atlanta offi ce of Novogradac, with contributions from Novogradac Director of Public Policy and Government Relations Peter Lawrence. For more information, visit www.novoco.com.doesn’t include proprietary or private funds owned and operated by their principal investors. It is estimated that actual OZ investment is up to three times greater than the Novogradac total. Novogradac breaks QOF investment into five categories: residential, commercial, hospitality, renewable energy and operating businesses. The first two categories receive the overwhelming majority of investment, with QOFs focused on residential development only reporting $7.87 billion in equity raised, while QOFs with at least some focus on residential reporting $31.46 billion in equity. Novogradac can account for 185,436 homes built with tracked QOF funding — it is estimated that this total likely exceeds 500,000 homes. Nashville, Tennessee, is the leader in homes built by funding from QOFs tracked by Novogradac, with 7,529 homes. Six other cities — Washington, D.C.; Phoenix; Austin, Texas; Cleveland; Los Angeles; and Charlotte, North Carolina — have seen more than 5,000 homes built with investment from QOFs tracked by Novogradac. Commercial-only QOFs report $2.22 billion in equity, while QOFs with some focus on commercial have raised $25.71 billion. QOFs with at least some focus on hospitality have raised $4.12 billion, those with some focus on renewable energy have raised $2.23 billion and those with some focus on operating businesses have raised $1.14 billion. Each of those overall categories saw between $20 million and $50 million in new investment in the first six months of 2024. California remains the state with the most planned QOF investment, with an additional $878.7 million added in the first half of 2024, more than six times than in Nevada, the only other state that received more than $100 million during the same period. California has $4.95 billion in planned investment, more than double any other state. The top nine states for planned investment remained unchanged since the end of 2023. Maryland moved past Tennessee into the 10th spot at midyear 2024. Among other states on the list of the top 20 states for investment, North Carolina moved from 13th to 11th and Nevada moved from 18th to 16th. Novogradac tracks planned QOF investments in 49 states, as well as the District of Columbia and Puerto Rico. Los Angeles received $217 million in planned investment in the first half of 2024 (constituting 24.7% of California’s overall planned investment) to remain the city with the most planned QOF investment at $1.75 billion. Washington, D.C., and New York City rank second and third, ahead of rural Fresno and Kings counties in California, an unincorporated area that has seen $1.2 billion in QOF investment in solar power. Those three cities (and one area) are the only specific locations with more than $1 billion in planned QOF investment. Among the rest of the top 50 cities on Novogradac’s list, the cities that moved up the most in the first six months of 2024 were Tempe, Arizona, (13th to 11th), Las Vegas (31st to 20th) and Richmond, Virginia (39th to 32nd). Novogradac tracks planned QOF investments in 335 cities. SITE SELECTION NOVEMBER 2024 35 Works? by ADAM BRUNS adam.bruns@siteselection.com The Bridge District in Washington, D.C. — located near Joint Base Anacostia- Bolling and designed to be the home of the National Campus for Cyber Leadership — is an approximately $1 billion community revitalization project made possible in part by Opportunity Zone legislation. Photo-rendering courtesy of ZGF Architects Top 10 States for Planned QOF Investment36 NOVEMBER 2024 SITE SELECTION Where Are Semiconductor Investments Going? How Asian countries’ strategies compare to the off erings from other global regions. T he semiconductor industry expects annual growth of -% through , spurred by rapid technological development and increased demand for the chips that power the world. Meanwhile, governments around the globe are trying to invent the most attractive incentives packages in the hopes of luring investors in this strategic industry. In the last two years, the six largest global semiconductor companies have pledged over US$ billion in global investments in Germany, Italy, Taiwan, Malaysia and the United States due to their commitments to labor, generous incentives and legacy manufacturing ecosystems. e U.S. CHIPS and Science Act is making available roughly $ billion in funding for incentives, workforce development and strengthening American manufacturing and has incentivized projects from Taiwan Semiconductor Manufacturing Company (TSMC), Micron, Intel, Texas Instruments and Samsung, among others. e $. billion Texas CHIPS Act is doing its part at the state level, as is Arizona’s National Semiconductor Economic Roadmap. e European Union’s $ billion European Chips Act addresses skills shortages and aims to increase production capacity to % of the global market by . Italy’s multi- billion-dollar Chips Fund has driven the development of the $ million Integrated Circuits design center focused on upskilling Italian labor and chip technologies. is plan has also helped to attract foreign investors such as Silicon Box’s $. billion chip plant project. Silicon Box Head of Business Mike Han said Italy was chosen “due to their commitment to infrastructure, building a strong talent base, and the government’s initiative to streamline the business environment.” Germany, meanwhile, is home to of the microchip plants in the EU and is seeing more than $ billion in investments from Intel (Magdeburg), TSMC (Dresden), Infi neon (Dresden) and Wolfspeed (Saarland) alone. Germany’s investment of $ billion has taken a more direct focus on upskilling and increasing labor participation. by HUGH GOLDSTEIN & MICHAEL HIROU editor@conway.com ASIA TSMC’s Asia portfolio includes Fab 15 (above) in Central Taiwan Science Park, located in Taichung in the company’s home country of Taiwan. Photo courtesy of Taiwan Semiconductor Manufacturing Co., Ltd. WINNING THE GLOBAL RACE SITE SELECTION NOVEMBER 2024 37 Europe’s largest economy is also reforming its immigration laws, making it easier for MNCs to set up operations with direct access to the global market. Taiwan Leads in Wafers, India’s On the Rise Asia strategically positioned itself along the semiconductor supply chain by offering competitive labor prices and technical manufacturing. A prime example is Taiwan, which ranks number one in global OEM wafer production. Taiwan has created the 5+2 Innovative Industries Plan exploring nominal semiconductor technologies through domestically and internationally incentivized R&D, making companies such as TSMC a powerhouse and highly coveted investor overseas. Malaysia’s National Semiconductor Strategy has committed $5.3 billion in fiscal support and targeted incentives for foreign investors while upskilling 60,000 high-skilled Malaysian engineers. Penang alone received $12.8 billion in semiconductor investments in 2023. In August 2024, Vietnam established a Semiconductor Steering Committee aimed at positioning the country higher on the semiconductor value chain. Beyond the nation’s commitment to training 50,000 chip design engineers and hundreds of thousands of technical workers by 2030, Vietnam is in an ideal geographic location with 70% of the world’s semiconductor industry accessible within a 4- to 5-hour flight. While Southeast Asia is attracting significant foreign investment, China has shifted its focus inward. Through its “Made in China 2025” initiative, the country aims to reduce reliance on foreign technology by fostering domestic innovation, boosting R&D and enhancing export competitiveness for essential components and the final semiconductor product. China is rapidly advancing this goal by distributing subsidies, low-interest loans and bonds. Recently, the Chinese government announced it largest-ever semiconductor state investment fund worth $47.5 billion. Unlike efforts in other world regions, China’s initiatives are not primarily aimed at attracting foreign direct investment. Multinationals’ regionalization strategies have started to shift toward India, as the nation’s semiconductor market reached a value of $22.7 billion in 2019 and is expected to quadruple to US$110 billion by 2030. This growth is fueled by the country’s robust, technology-driven market and its deep talent pool. Like China, India aims to reduce its dependency on imports to enhance domestic competitiveness while also still keeping the door open for foreign investors. India’s “Semicon India” program and the “Semiconductor Mission” align with broader national initiatives such as “Make in India” and “Atmanirbhar Bharat,” which focus on boosting domestic manufacturing for both national and global markets. Semicon India, valued at $10 billion, seeks to incentivize manufacturers to establish semiconductor and display fabrication units and invest in R&D and design capabilities. Moreover, the government’s recent announcement to modernize the Semiconductor Laboratory in the State of Punjab through an investment of $1.2 billion, along with its vision of 5G deployment across the country, a semiconductor Production-Linked Incentive (PLI) scheme and 100% FDI in the sector, will boost growth and take India one step closer to being a major player in the industry. Furthermore, companies and joint ventures planning to establish semiconductor fabs in India, at any stage of development (including mature nodes), are eligible for a fiscal incentive covering 50% of the project cost. Similarly, a fiscal incentive of 50% of the project cost is available for setting up display fabs utilizing specified technologies within India. Among recent projects is an $825 million, 5,000-job assembly and test complex from Micron in Gujarat. Beyond traditional tax and infrastructure incentives, India is adopting a strategic partnership approach, including agreements with the EU and Japan. These collaborations offer tactical advantages in areas such as manufacturing, equipment research, design, talent development and supply chain management. Moreover, they position India as a confident and capable partner on the global stage. Hugh Goldstein is a research analyst based in Bangkok, Thailand, and Michael Hirou is USA country manager for Tractus. Tractus is here to assist your company in navigating the complexities of Asian expansion. Visit tractus-asia.com. India’s semiconductor market is expected to quadruple to $110 billion by 2030.Next >