Friday, September 29, 2023

Regional Report Charlotte September 2010


Region feels Charlotte’s pain 

Charlotte lost more than its swagger and one of its two megabanks in the financial meltdown of 2008. It also shed lots of well-paying jobs. In Mecklenburg County alone, the number of financial-sector jobs fell 7% to 48,158 in 2009, according to the state Employment Security Commission. The average weekly wage in that sector dropped 10.8% to $1,715.61. “We lost, with the merger of Wachovia and Wells Fargo, 215 to 300 high-salaried individuals,” says Tony Crumbley, vice president for research at the Charlotte Chamber of Commerce. “These are million-dollar-a-year jobs.”

Trouble at the banks had a ripple effect on professional firms that work with them, says Mike Walden, an economics professor at N.C. State University. All of that helped decrease the average weekly wage in Mecklenburg County 2.6% in 2009 to $997.36, while the statewide average rose slightly to $766.08. But Mecklenburg didn’t suffer alone. Wages dropped in every county of the Charlotte region — the only region in the state so affected — and Mecklenburg wasn’t even the worst of it. The average wage in neighboring Cabarrus County fell 3.3%. Another of Mecklenburg’s neighbors, Union County, fell 2.6%.

In each county of the region, national and local circumstances contributed to the wage declines. Recession has dealt a big blow to manufacturing nationwide, and several counties suffered layoffs by big manufacturing employers. In Cabarrus, 1,100 jobs went up in smoke when Richmond, Va.-based Philip Morris USA Inc closed its cigarette plant in Concord last year. That accounted for 18% of the nearly 6,000 jobs the county lost in 2009. Cabarrus also suffered from the woes of NASCAR racing teams based there. “A lot of those companies that were sponsoring them have had to cut funding, so as a result they’ve had to cut staff,” says Vanessa Goeschl, vice president of research at the Charlotte Regional Partnership, an economic-development nonprofit. “Those are $70,000-a-year jobs.”

But it’s more than just isolated cases of bad luck or random effects of recession that caused wages to drop throughout the region. With the biggest and best-paid work force, Mecklenburg impacts economies in neighboring counties. “A lot of the people that were making money here, they lived in the outlying counties,” Goeschl says. “They bought large homes. They spent their money on luxury items, and that’s been scaled back.”

The reduction in spending resulted in wage cuts and layoffs in surrounding counties. “That income that was circulating in the region has declined. With that, the purchasing power has declined. The number of goods and services being bought has declined.”

The Epicentre cannot hold

It’s a hub of entertainment and shopping in downtown Charlotte, but since opening two years ago the 300,000-square-foot EpiCentre also has been the focal point of disputes between its developers and contractors (Regional Report, September 2009). Now it’s a battleground fought over by the developers and their lender. In July, Birmingham, Ala.-based Regions Financial Corp. began foreclosure proceedings against Pacific Avenue LLC and Pacific Avenue II LLC, Charlotte companies managed by Afshin Ghazi, which the bank says have defaulted on a $90 million debt. Ghazi’s companies moved to prevent foreclosure on the property — just a block from Bank of America Corp. headquarters and the home court of the Charlotte Bobcats — by filing for Chapter 11 bankruptcy.


CHARLOTTELance plans to merge with fellow snack maker Snyder’s of Hanover this fall. The new company will be based here and known as Snyder’s-Lance. The companies had combined sales of nearly $1.6 billion in the 12 months ended June 26. Lance employment, estimated at 4,800, likely won’t be affected.

CHARLOTTENorth American Financial Holdings, started by former Bank of America executives, bought three failed banks: Miami-based MetroBank of Dade County, Turnberry Bank of Aventura, Fla., and First National Bank of the South in Spartanburg, S.C. Terms weren’t disclosed. North American will assume $1.2 billion in deposits and most of the banks’ $1.4 billion in assets.

CLEVELANDDaimler Trucks North America recalled 540 laid-off workers to its three North Carolina plants. The factory here gained 280, bringing employment to more than 1,100. Roughly 150 went back to the Mount Holly plant, boosting total jobs to about 290, while 110 returnees increased employment at the Gastonia parts plant to more than 780. The Portland, Ore.-based company cited increased demand.

CHARLOTTEBoxer Property bought the main section of Eastland Mall (cover story, October) from Miami Beach, Fla.-based LNR for $2 million. The Houston-based developer plans to raze it and replace it with a mix of stores, offices and homes. No timetable was announced. Boxer still doesn’t own four anchor stores. The mall closed in late June.

CHARLOTTE — City officials stepped up their pursuit of the 2012 Democratic National Convention, hiring two consultants, launching a website and laying out a plan to house up to 35,000 delegates. Cleveland, St. Louis and Minneapolis are also in the running. A decision could be made by the end of the year.

CHARLOTTE — Lawrence Corson replaced Andrew Hede as CEO of developer Crescent Resources. He came from Dallas-based Hunt Realty Investment. Hede, a partner at New York turnaround specialist Alvarez & Marsal, led Crescent through a bankruptcy that ended in June.

CHARLOTTE — The city received a $25 million federal grant to help build the 1.5-mile initial stretch of a 10-mile streetcar line. The first leg could be operational by 2014, with the city contributing $12 million.

CHARLOTTE — A J.D. Power and Associates survey ranks Duke Energy Carolinas tops in the South for customer satisfaction, up from second last year. Raleigh-based Progress Energy Carolinas was fourth. The survey measures satisfaction in power quality and reliability, price, customer service and other categories.

SHELBY — The Better Business Bureau of Southern Piedmont says Patriot Waste Systems, a garbage-collection service, had 50 unanswered complaints in the first half of 2010, the most in the BBB’s 20-county service area. Many concerned prepayments not refunded when it went out of business.

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