Week of December 30, 2002
  Special Report

Has Atlanta Turned the Corner?
New Projects Indicate Positive Shift

by RON STARNER, Director of Publications, Site Selection and Conway Data
COMING OUT OF THE DARK: Corporate projects seem to be flocking back to Atlanta (pictured), helping lower the state's unemployment rate.

ATLANTA – It may not be the boom years of the 1990s anymore in metro Atlanta, but a growing number of high-tech manufacturers and other knowledge-based firms are once again making their way to Georgia's capital city.
        According to the Metro Atlanta Chamber of Commerce's "New Business Report" for the third quarter of 2002, 37 companies either relocated or expanded operations in metro Atlanta in the third quarter, accounting for 919 new jobs and US$51.8 million in new real estate investment.
        That project total is greater than the same quarter of 2001, "supporting forecasters' belief that the worst is over for the area, with 2004 bringing a full economic recovery," the report stated.
        The largest job creators in metro Atlanta were manufacturing plants and distribution centers, accelerating a trend spotted earlier in 2002 when several major companies announced large-scale projects in the metro area.
Georgia's New Economy Scorecard
Where Georgia ranks on key technology-related benchmarks:
Aggregated knowledge jobs32nd
Info-technology jobs15th
Gazelle jobs22nd
Initial public offerings15th
Venture capital11th
Aggregated digital economy38th
Online population41st
Internet domain names17th
Technology in schools33rd
Digital government31st
Broadband telecommunications26th
Aggregated innovation25th
High-tech jobs 20th
Scientists and engineers43rd
Source: American Electronics Association, 2002

        Among the largest deals of the year was Aero Plastics Inc., a 33-year-old Leominster, Mass.-based maker of plastic house wares and storage products, which announced it would invest $15 million into a 455,000-sq.-ft. (40,950-sq.-m.) plant at the Greenwood Industrial Park in suburban McDonough, Ga.
        The Henry County plant will have a permanent work force of 150 employees and is working with First Industrial Realty Trust Inc. of Chicago to take over the vacant Building 9 at the industrial site on the south side of Atlanta.

Internap Relocates HQ from Seattle

The positive third-quarter report also follows a strong second quarter in which the Metro Atlanta Chamber landed one of its biggest deals of 2002 - the relocation of the corporate headquarters of Internap Network Services Corp. from Seattle to downtown Atlanta.
        Greg Peters, president and CEO of Internap, said he chose Atlanta for his 130-job high-tech operation over competing locations in Denver and Tysons Corner, Va. "With the availability of industry-specific professionals, as well as a business-friendly environment, Atlanta provides an ideal location for Internap's continued and long-term growth and development," said Peters. What's happening at Aero Plastics and Internap is indicative of metro Atlanta's economic resurgence. The projects may not be high-profile - at least not as high profile as the layoffs taking place at such local corporate giants as Delta and BellSouth - but they are representative of the kind of advanced knowledge jobs the city is targeting.
        "Talent is what drives company relocation decisions, and right now Atlanta has the talent to compete with any city in America," said Hans Gant, senior vice president of economic development for the Metro Atlanta Chamber of Commerce.
        Gant should know. Over the past 24 months, he has seen a lot of that high-tech talent displaced from such places as BellSouth, Lucent, AT&T and WorldCom. But Gant also knows this - for every action, there is an equal and opposite reaction.

Biotech, Pharmaceuticals Growing

The same talent that contributed to the robust growth of Atlanta's major telecommunications companies in the late 1990s is giving rise to a new era of biotechnology and pharmaceutical firms in the early 2000s.
        One of the rising stars in this new market for Atlanta is Merial, which in 2001 brought its North American headquarters from New Jersey to Duluth. The leading animal-health pharmaceutical company, which currently employs 400 people in metro Atlanta, is projected to grow to 1,000 jobs over the next few years.
        That same talent also attracted GE Power Systems to Atlanta, relocating from New York and investing an estimated $238 million into its move. "Atlanta offers better airport connections, better access to customers and more opportunity to recruit workers," said John Rice, CEO and president of GE Power Systems.
        Projects like these aren't just pumping new capital into the market; they are lowering the area's jobless rate. On Dec. 26, Georgia reported the largest decrease in unemployment claims in the nation.

Cyberstates 2002 AEA Rankings: Georgia
174,216 high-tech workers11th
59,600 tech jobs created 1995-018th
Tech firms employ 53 of every 1,000 workers17th
High-tech payroll of $11.5 billion 11th
7,900 high-tech companies10th
High-tech exports of $2.5 billion14th
24,500 jobs in data and information services6th
40,400 jobs in software services9th
72,900 jobs in communications services5th
R&D expenditures of $3.0 billion20th
Home computer use at 53 percent39th
Home Internet access at 47 percent37th
Source: American Electronics Association, 2002
Success Reflects
New Strategy

That's no mere coincidence, say the area's economic development leaders. Rather, the decline in joblessness is indicative of a new, long-term strategy - one that focuses on growing the number of brainpower-fueled jobs, advanced manufacturing plants and logistics centers and less on the softer, information-technology-driven jobs that are dwindling in numbers for northern Georgia. Atlanta's economic landscape may still be dominated by the likes of Coca-Cola, Home Depot and UPS, but the fastest-growing job sector is coming from a roster that now includes Merial, GE Power Systems, Aero Plastics, Internap, Glenayre Technologies, Indus International, Domtar, World Airways and ORIX Financial Services.
        Russell M. Medford, president and CEO of Atlanta-based AtheroGenics Inc., speaks for many in Atlanta's new "New Economy" when he says, "Atlanta is an internationally recognized city with a dynamic technology-oriented business environment that is building an attractive infrastructure for emerging and established biotechnology companies."

Atlanta's Rankings Rising

The proof is not only in the new corporate real estate projects rapidly filling up the landscape around Atlanta's perimeter. The proof is also in the numbers showing where Atlanta ranks compared to its competition. Consider the following:
       • Atlanta ranks fourth as the best technology job creator nationwide, according to the American Electronics Association Cybercity Report.
       • Georgia surpasses some of the top 10 biotech states in the country in number of university licenses executed, university patents issued, science and engineering degrees granted and recent biotech investments.
       • The area boasts the nation's seventh-largest employment market at more than 2.2 million workers and has added 42,000 technology workers since 1997.
       • Genex, an e-business professional services firm, selected Atlanta for its East Coast headquarters and found that "Genex is more talented and more profitable with our strong Atlanta presence," said Seth Lynn, managing director for the company's Atlanta facility.
       • Atlanta recently ranked No. 9 in the World Knowledge Competitive Index for 2002. The study ranks the world's best cities according to overall performance in knowledge capacity, capability and sustainability. Robert Huggins Associates of the United Kingdom conducted the study.

Relocations by Chico's, RDM
Technologies Part of Third-Quarter Surge

The metro Atlanta area should only improve its standing in these and other rankings, if the projects landed in the third quarter of 2002 prove to be a trend. Most involve capital investment into high technology.
        A&E Products/FRM Re-Use opened a plastics recycling and manufacturing facility in Lawrenceville in rapidly growing Gwinnett County, bringing 150 jobs. RDM Technologies relocated its manufacturing operations from Illinois to Cobb County in order to be closer to Coke. The firm will create 80 jobs at its new 52,000-sq.-ft. location.
        Komatsu America Corp. of Japan opened an international training and demonstration center in Cartersville in Bartow County, creating 30 jobs. The company also plans to expand on its 520-acre (280-hectare) site there.
        Finally, Chico's FAS invested $12 million in the relocation of its Fort Myers, Fla., distribution center to Barrow County. The firm will employ 100 workers at the facility in Winder.

sp1230bsp1230b?GROUP=SPON_SSInsider" ©2002 Conway Data, Inc. All rights reserved. Data is from many sources and is not warranted to be accurate or current.