The Transylvania Times -

County Facing 'Product' Challenges - Brevard NC

 


Having available sites and buildings in Transylvania County for existing local businesses to expand and new businesses to move into is crucial to improve the economy and to bring in more jobs.

That fact has been voiced repeatedly the past few years, and for the past few months the Transylvania Economic Alliance (Alliance), the public/private organization largely funded by the county, has been working on identifying those potential locations.

During last week’s Board of Commissioners meeting, Josh Hallingse, the Alliance’s executive director, gave an update on the work. He was joined by Robin Spinks, with Greenfield, an economic and community development company, which is based out of Wilmington, N.C.

Greenfields’s role has been to identify and evaluate sites, while Benchmark, a Charlotte planning company, has been hired to collect, organize and analyze GIS data.

All their findings will be issued in a final report, which is scheduled to be completed by the end of this month or in early April.

The report, Hallingse said, is a “starting point,” a “strategic plan that guides our activities on product development sites.”

Identifying and getting these buildings and/or sites ready can be expensive and time consuming. It requires a strategic and targeted approach, Hallingse said.

Bringing in Greenfield, Hallingse said, provides an “outside perspective,” and helps identify what a private business wants when looking for a location.

Along with the consultants, Hallingse and Alliance board members have been studying maps, visiting properties along the county’s major transportation corridors, meeting with commissioners and other elected officials and utility providers.

Spinks said they have created a mapping tool that includes specific parcel data, with overlay information, such as floodplains, slopes, street maps and infrastructure.

After that tool was in place, they then looked at developed sites and their impediments, if any.

Hallingse said they believe they now have a good understanding about the county’s major transportation corridors and a comprehensive itinerary of the land and buildings that are potentially available.

What The County Has

“This inventory that we created will last you forever,” Spinks told commissioners.

There are challenges, however.

The county, for example, currently has only one empty building that is more than 10,000 square feet in size — the 40,000-square-foot building on the Old Rosman Highway formerly owned by Peter Vitalie, whose company built high-end billiard tables. A few years ago, the Board of Commissioners decided not to buy the building. In 2011, it was sold to a Hendersonville company for roughly $300,000.

Spinks said the building has a fairly low ceiling and needs some repairs.

Spinks said they have identified, without being specific, 78 potential areas in the county. In most cases, these areas include multiple tracts, which, if packaged together, could create a large enough tract that the Alliance could market as a viable business park with an achievable return on investment for public and private partners. In addition to identifying future opportunities, the Alliance has inventoried existing real estate options. There are about 27 unoccupied commercial or industrial buildings within the local market, or almost 111,000 square feet worth of space. Only three buildings, or roughly 51,000 square feet of this space, is classified as light industrial space and 44,000 of the square footage is attributed to a single property. There are only about nine potential properties that are ready to be built on, or about 65 acres of land.

During the site identification process, Hallingse noted after the meeting, the former Ecusta and DuPont properties were identified as opportunities. However, neither property is for sale, with a confirmed sales price, nor is there a defined timeline by the private ownership to bring these properties to market. This significantly limits the Alliance’s ability to effectively market these sites to prospective clients, Hallingse said.

The strategy, like other identified properties during this search, is to work with their landowners to encourage the development of a sales price and timeline.

Spinks said it would ultimately be Hallingse’s job to work strategically with those landowners who own the 78 sites and develop outreach and opportunities for interested landowners to partner with the Alliance to help fill an identified need and market these properties to target markets. Of the major transportation corridors evaluated during the search, 78 site areas were identified, that are either on or have easy access to the county’s main transportation corridors, are out of the floodplain and have no significant physical barriers, such as steep slopes or floodplain issues.

The county already has a “good supply” of small sites for retail and mixed-uses, Spinks said, that are undeveloped and have or are near the necessary infrastructure. Again, the next step on these smaller sites would be to see if they are available.

The search, Spinks said, has been primarily for light industrial sites but has also included looking at commercial possibilities for hotels and other tourism-related assets and amenities.

There are not many light industrial sites on the market right now, Spinks said, while there are a number of existing businesses that are looking to expand. One danger is those existing businesses relocating to another location.

“Opportunities have been missed because (the county doesn’t) have the product,” Spinks said. “There is no product (available) that matches the current demand.”

Sierra Nevada Brewing Co., for example, was believed to have looked at Transylvania before eventually deciding to go to Mills River. Hallingse, when contacted later, said he can’t substantiate this because he was not here during that time.

“From what I know about Sierra Nevada’s project, their site selection firm may have included the Davidson River Village property in their Western North Carolina evaluation but was likely ruled out due to a lack of a confirmed sales prices along with other project specific limitations,” Hallingse said.

Spinks said the county needs some “diligent focus and planning” because there are “no quick answers.”

Other counties provide more options to businesses and industries, while Transylvania, particularly because of physical obstacles, such as public land, floodplains, steep slopes and insufficient infrastructure, is limited.

Land is also “very expensive compared to other places,” Spinks said, while the few highway corridors the county has face competition for use, including retail.

Spinks and Hallingse also talked about short-term and long-term options.

In the short term, Spinks said, the county should concentrate on several smaller sites that have utilities and find out if they are available and to try and get them on the market and explore a community spec building program.

For the longer term, the county needs to work on creating an industrial park, which should include a “shell building” and have at least 10 sites that will improve the tax base and, hopefully, provide a return on the county’s investment.

The final report, Spinks said, will provide specific information, rankings and recommendations to the Alliance on what to do on each site and where the organization’s priorities should be focused.

Spinks also talked about the need for site development agreements with the county, Alliance and the City of Brevard that could help facilitate possible joint ventures and or cost-sharing opportunities to develop sites and share in future revenues.

Another possibility, Spinks said, is the landowner may want to participate in his or her property’s development, sharing in the cost and revenues and lowering the public’s financial input.

The Alliance may also be able to come up with private investment, she said, allowing it to act as a property manager.

Funding from the county could come from a designated sales tax or property taxes, federal and state grant/loan programs, infrastructure bonds or be a long-term budget item from general funds.

Commissioner Comments

Commission Chairman Mike Hawkins asked about time frames.

Spinks said it could take several months to find out what properties are actually available, several more months to have lawyers draw up the required legal agreements, several more months for engineering the site and possibly a couple of years for the site’s development and construction. A time frame of between three to five years is possible from start to finish, Spinks said.

Hallingse, who is a Brevard native, suggested the report’s findings are a “sobering reality.”

“You have to have a pro-active plan to be successful in this business,” he said. “What we’ve got now is a road map to that product development equation, (which) is so important to economic development. Without the product development question being answered, it makes it very difficult to compete — not just with our neighbors but compete on a state and regional basis.

“We are very confident in the route of this analysis, understanding where our priorities need to be as an organization, where I need to spend my time with landowners, and what properties present the best return on investment for both our private and public partners.”

Hawkins said it’s important not just to bring in new businesses but to help existing businesses expand.

Spinks agreed and said that the existing businesses’ needs should be part of the short-term strategy.

Commissioner Page Lemel asked for more information on government’s role in the process. Spinks said it is financial. At every level, she said, government has the “responsibility” to promote quality of life and that includes job creation.

Across the state, Spinks said, manufacturing jobs are considerably higher paying than retail/service industry jobs, which are at the “bottom of the list and are barely living wage.”

The county’s highway corridors, she said, have so much competition on them, and it’s “really important to set aside (property) for better paying jobs, if you don’t want the children to be leaving the area.”

“You need a piece of property where the job creators can go,” Sparks said.

Commissioner Larry Chapman asked how many “details” are needed before sitting down with a property owner.

It depends on the property owner, Spinks said, but he or she should be told if it’s for an industrial park, for example, the types of industries the county is targeting and that it’s for higher wage jobs.

The county’s stated target businesses include sports and outdoor products; beverages; food and organics; creative services; advanced/niche manufacturing; and tourism.

Chapman asked if it would be better for the county to buy the property. Spinks said the less money the county has to spend, the better. Some landowners, she said, will want the “money upfront,” while others will want it over a period of time and others may be interested in being a developer.

Hawkins is a member of the board of directors that oversees the Economic Development Partnership of North Carolina.

He said he’s heard that a government entity that has to build or just have an option on property has “no chance.”

Hawkins asked if Spinks agreed.

She said 75 percent of the projects “out there” are looking for existing buildings.

Hawkins asked whether the county should reserve funds in the upcoming budget.

“The sooner, the better,” Spinks replied. Hallingse said they feel “confident” about the properties that have been identified.

Chapman asked if there is a specific amount that Hallingse recommends the county set aside.

Hallingse said budget numbers would be provided in the final report, along with a “mechanism” to help approach budget questions, similar to what has been done in other communities. The report will also have options to consider on utilities.

Hallingse reiterated that their approach has been to evaluate the sites based on what private businesses and industries want, including proximity to transportation corridors and utilities.

Development costs change if a site is 500 feet from necessary infrastructure and another site is 1,500 feet away, he said.

Prior Meeting

Prior to the presentation to the Board of Commissioners last week, Josh Hallingse, the Transylvania Economic Alliance’s (Alliance) executive director, gave a sneak peek of the report during a county Tourism Development Authority luncheon.

Not only did Hallingse break down what was available in the county, he outlined the Alliance’s plan in how it markets those properties to potential businesses looking to move to the area.

“You’ve got to be prepared with a portfolio of properties if you want to compete in this world,” Hallingse said.

Brevard Mayor Jimmy Harris was among those who attended the luncheon.

“We need to have the inventory available,” Harris said in an interview after the presentation.

Harris said Hallingse and the Alliance are doing a great job at providing potential businesses with a list of available spaces.

Harris said businesses take less risk than they used to and want a readily available building with utilities and infrastructure before making a choice on a location.

“I think the face of economic development has changed,” Harris said.

Hallingse and the Alliance board have identified target markets, or business sectors, to generate leads of potential businesses to recruit.

They have been broken down into six different categories: beverages; outdoor gear and manufacturing; food and organic; creative services; advanced and niche manufacturing; and tourism.

Of the sectors, advanced and niche manufacturing have had the most leads generated, which was nine. Food and organics generated six potential leads.

Most of the leads generated were from existing businesses in North Carolina.

But, surprisingly, the second highest amount of leads came from California.

Other points of data reported by Hallingse on potential business recruitment included the source of the lead.

About 55 percent of the leads generated were directly from the Alliance. Almost 19 percent of the leads came from local stakeholders and 16 percent came from a regional ally.

About 74 percent of those leads were businesses looking for existing buildings. Of the 34 leads generated, thus far, Hallingse said the Alliance was in active recruitment conversations with about 75 percent of them.

“There are some trends where we are seeing activity,” Hallingse said.

County Manager Jaime Laughter attended the meeting and was contacted for comment later.

“My experience with economic development projects in our region has taught me two things,” she said. “The first is that companies looking to locate or expand are trying to do so within a tight time frame in order to take advantage of timing in their industry. The second is that companies looking to locate here are not purely interested in the bottom line but have another driving factor, as well, such as quality of life that they are using to make their decision.

“With both of those lessons, it has proven time and again that having sites and buildings that have been vetted remove as many questions a potential company may have up front (and) helps our community remain competitive in an intensely competitive economic development process. Those questions could be as simple as cost and time to get infrastructure to a site to whether a building has the necessary specs to meet their needs. Minimizing the work to answer those questions up front can mean the difference of staying in consideration or being taken off the table.

“In my previous community (Mills River), we were successful with economic development and having an inventory was a key element to that success because when a project call comes out there is a list of what is needed and a list of what is desired for the ideal site.

“The county economic development agency there had invested in developing this type of information over a 10-year period, including working with landowners of those properties, that kept them in the running, and scored some major investments by being able to respond quickly with all sites and buildings that met those specs.

“It is similar to when you go to buy a house in a community but with an expanded list of information needs beyond a real estate listing. You know what you are looking for and what your budget for purchasing looks like. If there wasn’t an inventory that answered those questions up front, it would be a challenge to find your house and may even make you decide to look elsewhere.”

 
 

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