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On Friday, November 30, 2012, Director Tracey Nichols served on a panel at the National League of Cities Conference in Boston Massachussetts. The presentation was titled "Moving Past the Smokestack: A Discussion on Business Attraction." Joining Director Nichols were Greg LeRoy of Good Jobs First and Susan Liberty of McGuireWoods Consulting. Business attraction has been and continues to be a primary economic development focus for many communities. Yet, it can also be the most controversial, especially as the public calls for greater transparency and accountability with public funds. This workshop will discuss the trends and challenges and opportunities of business attraction, and explore strategies and accountability measures that can help your city. Director Nichols’ discussion includes information on using cost benefit analysis to determine the incentive for a company bringing jobs and incentives to your area, availability of shovel ready sites and working with partners to attract businesses.
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Moving Past the Smokestack: A Discussion on
Business AttractionNovember 30, 2012
The City of Cleveland
Department of Economic Development
A Presentation to National League of
Cities: Congress of Cities
and Exposition
Smokestack Industries
Cleveland still welcomes manufacturing and has a presence in the steel and metals industries for auto parts, aerospace and durable goods - to name a few
• Manufacturing jobs pay higher wages on average
• There is a multiplier effect for parts suppliers and end users - manufacturing brings other businesses
• These businesses are no longer polluters
What’s the first step to attraction?
Develop your strategy
Cluster analysis– Workforce
– Existing Businesses
– Suppliers
– Strategic Advantages
Helps determine who you can attract
Use a professional firm that site selectors recognize
Partners
Who can help you with attraction?
• Business owners - Who can give real life stories of why your community is a good place to do business
• Local leaders - Businesses want to know they will have access to local leaders should they need some assistance
• Funding partners - Your county, state, development authority, port authority, local foundations, etc.
Incentives
Decide in advance what these might be
Get legislative approval for programs to streamline the application process
Make sure your incentives are rooted in a cost-benefit analysis that is defensible
Are there high priority industries or locations for which you have special incentives? A Corridor or Industrial Park?
Work Together
If a company is looking at your region, it will likely have more than one site to consider
Negative comments about neighboring communities often backfire
Promote your region first, your community second, to be successful
Plan your tours to highlight the BEST of your community - not the fastest route
Attraction Strategy: Health Tech Corridor
Health Tech Corridor Anchor strategy to attract health technology
companies
Cleveland Clinic, University Hospitals, Case Western Reserve University and Cleveland Foundation are partners
There are 6 health technology incubators - but incubated companies moved to the suburbs
We built a 128,000 sf. speculative space to attract new companies and for post-incubator space
Midtown Technology Center
• 113,000 sf. leased in 18 months (128,000 sf)
• Building 2 - All 50,000 sf leased in 12 months
• Building 3 under construction -16,000 sf leased of 64,000 sf
• Xx New Jobs to the City
Midtown Technology Center
• $10,700,000 HUD 108 (EZ)• $ 240,000 City of Cleveland Vacant
Property Forgivable Loan
• $ 4,153,500 New Market Tax Credit Equity • $ 1,600,000 Equity • $16,693,500 Total Project
• Debt reserve funded by HUD 108 for HUD 108 is $321,000
• Spec Building - no bank funding available!!!
City of Cleveland
Tracey NicholsDirector Dept. of Economic Development(216) [email protected]
Flats East Bank Project - $272 million
