Annual Conference Presenters Share Expertise, Insight and Advice
The 250+ attendees of NCEDA’s 2019 Annual Conference left Beaufort with a firm understanding of topics ranging from mixed-use real estate partnerships to the state of the economy and how North Carolina is viewed by global location consultants. The two-day gathering took place against the backdrop of one of North Carolina’s most historic coastal towns. While there, participants engaged in fishing, sailing, corn hole, ghost walks, Low Country cuisine, beach music and more.
“The slowdown in employment growth doesn’t bother me,” Wells Fargo economist Mark Vitner told attendees, as firms continue to struggle for qualified labor. “But the inverted yield curve does bother me,” he said, citing conditions that reflect long-range pessimism among investors about the country’s economy. Still, a recession isn’t likely until 2021, according to the latest Wells Fargo forecast. “I don’t think the next recession will be that bad, but the business cycle hasn’t been repealed,” Vitner said. Working to reduce a backlog of transportation projects due to adverse weather should sustain momentum in the southern US. The Charlotte-based bank is “looking for Federal Reserve rate cuts in July and September,” he added. US-China trade tensions have risen just as intellectual-property concerns have prompted global manufacturers to leave China. “China really needs to do a deal,” said Vitner. Meanwhile, US manufacturing growth is as strong as it’s been in 50 years. “Consumer confidence and small business confidence are both at all-time highs,” he added. North Carolina’s current 3% GDP growth is slightly outpacing that of the nation overall. Shifting tastes among consumers and workers are impacting real estate markets. “The move back to the city has created a lot of housing problems,” Vitner said, while sparking opportunities for residential builders. “Retail and suburban office space are the weakest components of commercial real estate right now.”
Development of Eastfield Crossing is expected to generate $2 million in annual tax revenues for the Town of Selma on top of the $3 million fiscal impact it will have on Johnston County. The mixed-use initiative by AdVenture Development will span retail, housing, hospitality and office space, in addition to an industrial component that includes plans for a spec building. “Selma is one of the poorest communities along I-95 from Maine to Miami,” said Chris Johnson, economic development director for Johnston County. “This [project] is going to be something that gets our I-95 corridor and eastern Johnston County back on the map.” Johnson’s comments were part of a panel discussion on mixed-use ventures in economic development. State statutes allow for county and municipal financial incentives provided conditions are met, Ernie Pearson explained. A consultant with Sanford Holshouser and attorney at Nexsen Pruet, Pearson said North Carolina’s Local Development Act indeed encompasses commercial real estate development. “If the local governments feel this is impactful for them, why not?” he said.
Amy Gerber, Managing Director at Cushman & Wakefield, told NCEDA members her firm’s workload is now trending toward smaller footprints. “We’ve definitely seen a drop in the size of the deals we’re doing – especially on the industrial side,” she said. In 2018, for instance, Cushman’s average project involved 250,000 square feet of space. “Everybody thinks you’ve got to have these big behemoth projects; that’s just not the case,” said Gerber, who is based in Atlanta. “There is still a lot to compete for on the smaller side.” Her comments came as part of a consultant panel discussion entitled “Issues, Assets and Answers: How North Carolina Stacks Up.” Gray Swoope, president of VisionFirst Advisors, said the state’s talent remains widely respected among his clients. “North Carolina is especially attractive to advanced manufacturers,” said Swoope, who once directed statewide economic development programs in Florida and Mississippi. Social issues are increasingly prominent in site selection discussions, but they can cut both ways, according to Kevin Spiegel. A Chicago-based Senior Manager at Crowe, Spiegel said “abortion and recreational marijuana are both issues impacting corporate location factors.” Nevada’s recent law banning employers from firing workers testing positive for drug use had generated relocation interests among some companies operating there, for example.
In terms of forging and maintaining good working relationships with site selectors, Gerber said technology tools now mean more of her work involves data analysis instead of face-to-face visits. “We’re spending less time in communities than we used to,” she said. “That makes relationships even more important.” Personal interaction at conferences and site selection events are a beneficial way economic developers can get to know consultants. “It’s more effective than attempting to organize a fam-tour,” Swoope said. He continues to read annual reports that arrive in the mail from communities. “I still like post cards, but I’m a little weird,” he said. LinkedIn and Twitter are his preferred social media channels for work-related news. Email and “drop-ins” are not the best way to communicate with Spiegel. “I like magazines,” he said. Spiegel is especially keen on “things that talk about coolness and hipness,” and said LinkedIn is a useful platform for staying in touch with economic development contacts as they change jobs and advance careers. “You should post about your wins and include any accolades regarding your schools,” he advised. “Those will get our attention.”