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The Time Is Right

Market access and corporate networking build on
Southeast's longstanding labor and utility advantages.



his just in. A pattern of phenomena is revealing itself across the American South.
        GREENVILLE, GA. — This county seat of Meriwether Co. is on the very short list of sites that Ford Motor Co. is scrutinizing for a major assembly, stamping and supplier park. Even if it goes to fellow Georgia county Morgan instead, a 1,900-acre (769-hectare) site will be ready and waiting for the right industrial occupant.
        GREENVILLE, ALA. — Korean auto parts manufacturer Hwashin Co. has chosen a 62-acre (25-hectare) site to build a $70-million plant that will employ 400 people in the manufacture of chassis and body parts for Hyundai. The county, which has seen its unemployment rate dip from 18 percent in 1999 to just over nine percent today, is also the home of operations for West Point Stevens, CorStone and Image Entry.
        GREENVILLE, S.C. — Having already established its identity in industrial and manufacturing real estate circles, in November 2003 this city will boast the presence of London-based GlaxoSmithKline Consumer Healthcare. The GSK division will open a 260,000-sq.-ft. (24,154-sq.-m.) distribution center in Liberty Property Trust's 550-acre (223-hectare) SouthChase Industrial Park, which also counts Bic, Caterpillar and Rexroth among its international clientele. "The visibility, labor pool and access to amenities and the distribution corridor will serve us well in the coming years as we grow," says Joyce Ables, regional distribution manager for GSK Consumer Healthcare. The $11-million build-to-suit project is backed by Liberty, which will then lease it back to GSK through a long-term agreement.
        GREENVILE, N.C. — Named as one of the 50 best places for manufacturing by IndustryWeek in 1997 and 1998, the home of the East Carolina University Pirates is well-situated between the waters of Pamlico Sound and the commerce of I-95. Of the 3,000 manufacturing jobs created in Pitt County over the past five years, half came from expansions by existing industries. The latest expansion is coming from Dutch company DSM, which is investing more than $100 million in a new plant to make Dyneema fibers and $30 million to expand the company's sterile products operation. Both subsidiaries operate facilities on the same 600-acre (243-hectare) campus in the Greenville Industrial Park.
        GREENVILLE, MISS. — E.O.H. Energy is investing $58 million in an ethanol production facility near the city's port terminal, overlooking the Mississippi River at the Arkansas border. The facility is expected to start up in late 2004 with up to 40 employees. Gov. Ron Musgrove cited the Rural Economic Impact Authority, an educational initiative passed by the Mississippi legislature in April, as a potential driver for further growth in this mostly rural area.
        To those who wonder why corporate executives continue to look south, there is one obvious answer:
        It's green-ville, baby.
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On May 27, 2003, Nissan launched operations at this new plant in Canton, Mississippi — one of several automotive OEMs that are reshaping economic development in the Southeast.

Holding All the Cards

It's all about the green, after all. And down South, a convergence of gravitational forces continues to draw those who would be lured by plenty of greenfields and the prospect of greenback savings.
        Demographics? Of the 100 fastest-growing counties with 10,000 or more residents, 63 are in the South. What's more, of the estimated 39 new metropolitan areas expected to be created in 2004 by the Office of Management and Budget's new standards, 16 are in Southern states.
        Market access? Companies are increasingly citing locations in southeastern hub cities and ports as key to reaching both a growing U.S. population and a potential growth market in Latin and South America. In fact, both Miami and Atlanta are vying to be the home of the Secretariat of the Free Trade Area of the Americas.
        Costs? Driven by the age-old economic development presence of utility players like Southern Corp. and the Tennessee Valley Authority, electric power continues to be more affordable here than any other region of the country. The area's traditional bias toward a non-union work force has only been supplemented by worker education programs that continue to raise the bar — and continue to draw automotive plants and personnel from the industrial north that not so long ago lured Southern workers away.
        For examples in both areas, look no further than Mississippi, where electricity prices are 13 percent lower than the U.S. average, natural gas prices are 20-percent lower and labor costs are 29-percent lower.
        Taxation? Southern states are struggling just like the rest with budget constraints, but that hasn't stopped them from both maintaining low business tax rates and ponying up sizable incentive packages, highlighted by tax holidays and job creation credits.
        "What's most attractive is that for the most part in the Southeast, specifically Georgia and Jacksonville, you'll find these municipalities and counties are willing to enter into partnerships to attract business," says Steve Labovitz, an attorney with Atlanta-based McKenna Long & Aldridge and an expert on public/private partnerships. He also lauds the general speed of permitting. "In order to attract business, you have to provide different incentives," he says, "and in this economy, you have to be creative in what kind of things you can utilize."
        Transportation? By rail or Interstate, the region is criss-crossed by an ever-more-developed network of fast connections. Major cargo corporations maintain both headquarters and hubs in the South, and ports of every size are growing in traffic and capabilities.
        Land? The ultimate site selection question is readily answered by the region's available property. The Southeast has the most large-scale sites of any U.S. area and a considerable amount of remaining greenfield space. Even high-vacancy areas like Atlanta are seeing the tide turn their way in the form of major corporate locations by such prominent companies as New York Life and Newell Rubbermaid.
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