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Friday, April 19, 2024

Regional spotlight: Southeast N.C., 20 counties offer unique mix of resources, opportunities

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••• SPONSORED SECTION •••

The public-private economic development organization known as North Carolina’s Southeast is proving collaboration across 20 counties works.


 

Shaped by vast geography, diverse demography and a vivid patchwork of communities and industries, North Carolina lends itself well to regional collaboration for economic development. Yet, political lines of demarcation among counties and municipalities can challenge such efforts.  A strategic consensus must first be built and then sustained tactically by ongoing and careful, even painstaking, give and take. 

Few are more aware of what it takes to nurture successful regional economic development than Steve Yost. As president and CEO of North Carolina’s Southeast, he oversees a public-private partnership that markets the state’s southeast region. The organization pulls together 20 counties from the Atlantic Ocean to the Uwharrie Mountains.  

It may be surprising that a region carrying the moniker of “Southeast” includes an ancient mountain range as well as Anson and Montgomery counties of the Piedmont and Moore and Richmond of the Sandhills. Thus are the lines of regional collaboration.

“Our population is now larger than that of 13 U.S. states,” says Yost, a veteran economic developer who has worked at the county, state and regional levels across his 30-year career. “The total GDP of our top five metro areas is greater than either Vermont or Wyoming.”

STRONGER TOGETHER

Yost’s organization succeeds through focus. Instead of chasing after today’s crowded stable of corporate unicorns, the Southeast targets a small handful of industry clusters for outreach. It includes traditional sectors like metalworks and agribusiness and newer targets like aerospace and advanced textiles. 

The region’s vast footprint encompasses the state’s major military installations — Fort Bragg, Camp Lejeune and Seymour Johnson Air Force Base among them. This enhances appeal to defense contractors and military suppliers. Anchored by the Port of Wilmington and supported by recent improvements in railroads and highways, the Southeast has become a choice destination for global logistics and retail distribution operations.

“There may be some economic development programs that still emphasize a ‘shoot anything that flies and claim everything that falls’ mission,” Yost says. “That’s not us. It never has been. We focus tightly on our competitive strengths as a region and on the activities we excel at as an organization.” 

With a staff of just four, Yost and his team generate leads for the region’s counties by reaching out to growing companies whose business strategies could benefit from an expansion or relocation to southeastern North Carolina. Utilizing digital marketing tools, face-to-face outreach, and a network of relationships with allies, corporate real estate brokers and location advisers, the organization funnels qualified opportunities to its local partners. 

“We also provide technical support in the form of research and project management to those counties that lack such specialized expertise in-house,” says Yost, noting that 14 of the Southeast’s 20 counties are classified by the N.C. Department of Commerce as “Tier One,” the highest level of economic distress.

The organization’s roots go back to the mid-1990s, when the N.C. General Assembly created regional economic development commissions to ensure each of the state’s 100 counties had access to impactful job creation strategies. When legislators dismantled the network in 2014, the Southeast shifted to a public-private model that leveraged resources and leadership from member counties and private investors. The move has shown impressive results. Since then, the organization has grown from 11 counties to 20. Earlier this year, Jones and Richmond counties joined the fold. 

“We’ve had inquiries from counties we’ve had to turn away because they just weren’t the right fit,” Yost says. “But nothing speaks more compellingly to our success than the fact that counties and private investors know our model, like our model and want to join us.”

It was during Gene McLaurin’s 15 years as mayor of Rockingham that he came to understand what all it takes to bring new companies and jobs to southeastern North Carolina. The town partnered with Richmond County to expand water and wastewater capacity and create new industrial parks. Later, as a Democratic state senator representing Anson, Richmond, Scotland and Stanly counties, McLaurin worked with Gov. Pat McCrory and his administration officials to establish a state supported non-profit to lead economic development service delivery.

 “I was a businessperson, so it made perfect sense,” says McLaurin, who now chairs the board of the Economic Development Partnership of North Carolina (EDPNC), the statewide entity he helped champion. 

“Economic development is a team sport and it’s regional, not just within county silos,” says McLaurin. “Criss-crossing the state, I see many examples of cooperation among counties.” When not traveling on behalf of EDPNC, McLaurin heads Quality Oil Co., part of the venture firm ZV Pate, Inc., an early, influential private investor in North Carolina’s Southeast. Based in the Scotland County community of Laurel Hill, ZV Pate has interests in agribusiness, forestry, restaurant services and other enterprises. McLaurin’s encouragement led several counties along the region’s western rim to become part of Yost’s regional marketing partnership. 

The warehouse of Coastal Beverage in Pender County

“These are rural counties for the most part, and rural communities have only so much ability to market themselves,” McLaurin says. “That’s where NC’s Southeast is a tremendous help.”

Despite the economic upheaval that accompanied COVID-19, the past two and a half years have been the most productive in the economic development organization’s 27-year history. Since July 2020, its lead-generation and project management assistance have supported more than $627 million in announced investments by 29 companies. The commitments include the creation of nearly 2,800 new jobs. 

Robert Van Geons, president and CEO of the Fayetteville – Cumberland County Economic Development Corp., calls the region’s recent run “a wave that’s really reaching its zenith.” 

A WORKFORCE READY FOR AEROSPACE AND BEYOND 

The tide began to turn for the region’s economy about 10 years ago, Van Geons explains, as its affordability, unique talent assets and accessible Mid-Atlantic location began gathering attention from executives and site-selection consultants. 

As for workforce readiness, Fort Bragg alone channels more than 7,000 well-trained soldiers into the civilian job market each year, Van Geons says, about two-thirds of whom indicate a desire to remain in North Carolina should the appropriate career opportunity arise. A similar story is told in Onslow and Wayne counties with steady cohorts of Marines and Air Force personnel mustering out of Lejeune and Seymour Johnson. Skill-sets range “from cyber-security and drone operation to truck drivers,” according to Van Geons. Exiting military labor is also adept with international diversity, including foreign language expertise. About 80 native languages are spoken in the Cumberland County public school system, he notes. 

Pentagon contracts crank some $1.8 billion into the economy surrounding Fort Bragg. and defense industry names with outposts there include General Dynamics, Boeing, Raytheon Technologies and CACI. The Southeast’s appeal as a military business destination extends across the region. At the N.C. Global TransPark near Kinston, Draken International has grown an 80-person workforce over the last three years that includes retired fighter pilots from strategically important air bases like Langley, Shaw and Seymour Johnson. The Texas company owns several Douglas A-4 Skyhawks and sub-sonic F1 fighter jets used in aerial combat simulations for active-duty pilots. Seasoned Draken flyers, freshly departed from their military service, perform the role of “enemy” combatants. 

The 2,400-acre Global TransPark has been a catalyst for the region’s aerospace industry, playing host to Spirit AeroSystems’ massive components plant and taking on overflow work from Fleet Readiness Center East, the U.S. Navy’s huge aviation maintenance and repair depot in neighboring Craven County. With space constraints complicating potential growth, FRC East is said to be North Carolina’s largest industrial employer east of Interstate 95, and Global TransPark leaders hope to see their facility, just 58 miles away, accommodate more aviation jobs and operations. 

“We have a very credible regional vision for growing aerospace manufacturing, maintenance and repair operations, aviation services, and defense and homeland security industries – and it’s starting to really get traction,” says Mark Pope, senior vice president of the NC Global TransPark Economic Development Region. In 2015, as Lenoir County’s economic develop-ment director, Pope led that county’s entry into North Carolina’s Southeast and was soon working with Yost and others to inventory their collective aviation
and aerospace assets before crafting a strategy for growing the cluster. 

The result has been the packaging of an aerospace “corridor” stretching from Seymour Johnson in Wayne County down U.S. 70 through the Global TransPark, FRC East and terminating at Camp Lejeune.

“I give Steve and the Southeast a lot of credit for understanding the potential that was here and the opportunity we have for bringing in more jobs and investment dollars,” Pope says. “One of the major reasons our micro-region is seeing these solid results right now is that we have such strong partners, and I count the Southeast high on that list.” 

In 2021, Pope’s collaboration with regional partners also helped land Grupporeco, an Italian maker of kitchen appliance components. The firm selected Lenoir County for the site of its first U.S. manufacturing operation, a move that brought 100 new jobs and $28 million in capital investment to the Southeast. In unveiling the company’s choice, Grupporeco CEO Vincenzo Locatelli credited assistance received from local and regional leaders. 

“The COVID pandemic made this a challenging and time-consuming process, but the support of the authorities and community has been outstanding, and we’re excited to have the project start very soon,” Locatelli said. Manufacturing accounts for a majority of recent announcements in the Southeast, and international companies seeking a cost-effective East Coast destination have been among them. 

MAXIMIZING THE PORT OF WILMINGTON 

Excellent multi-modal transportation systems make the Southeast a similarly popular choice for logistics and distribution companies. News broke last summer that leading third-party logistics provider Port City Logistics plans to build a $16 million facility at the Port of Wilmington. This validated the belief of Southeast leaders that Greater Wilmington and surrounding counties are poised to benefit from the fundamental realignment of global supply chains many economists predict. The Savannah, Georgia.-based company will employ 75 people once its 150,000-square-foot transload warehouse opens in 2024. 

Eric Howell, chief executive officer at Port City Logistics, says quick turn-around times at the Port of Wilmington will add value for his company and its customers.

“In the post-pandemic supply-chain landscape, customers need flexibility and optionality,” Howell says. “Wilmington gives us that.” Howell is bullish on the port’s future, believing the facility is roughly where the Port of Savannah was two decades ago in terms of harnessing its true potential.

“Wilmington can take market share and be a significant player on the East Coast,” he says. Continued improvements to the region’s highways – especially the completion of Interstate 74, could change the economic game for Southeast communities within close reach of the port. “We see it as all positive,” says Howell, whose 22-year-old company currently operates 14 distribution centers around the U.S. “It can meet the needs of a lot of customers on a speed-to-market play.” 

Port City Logistics’ announcement followed on the heels of another big third party logistics expansion in Wilmington. Plans by homegrown MegaCorp Logistics to add 300 jobs to its workforce there provide additional evidence that the region’s distribution cluster has turned a corner. 

“This is the latest evidence that our region is on the winning side of the post-pandemic economy,” Wilmington Mayor Bill Saffo said last year upon announcing the news. “Wilmington has the assets, infrastructure and workforce growing companies like MegaCorp need, but we also have an unbeatable leadership network businesses look for when assessing destinations,” he added. 

Founded in Wilmington in 2009, the company also considered Jacksonville, Florida, and Cincinnati, Ohio, where it operates large facilities, for the expansion.

Scott Satterfield, who has led Wilmington Business Development for the better part of three decades, says the excitement now surrounding the region’s logistics sector can be traced to a vision North Carolina’s Southeast began piecing together10 years ago after it examined the assets that had driven Savannah’s port-centered regional development strategy. 

“Steve and his team are always looking around the next corner, and they realized we had many of the same basic advantages that communities around Savannah had,” says Satterfield, whose organization provides economic development services to the New Hanover and Pender counties and the city of Wilmington. The key would be creating an inventory of quality properties that logistics companies could lease or purchase. 

“The potential around the port was obvious, but the model also means lucrative possibilities for rural communities in surrounding counties – assuming they are prepared to make the product development investments,” says Satterfield.

Opportunities quickly spread across Pender Commerce Park. Just 10 minutes from Interstate 40, the 330-acre property is home to several food and beverage distributors, as well as a FedEx Freight mini-hub and an Amazon delivery station currently under construction. Another welcomed newcomer, Atlanta-based RL Cold’s is building a 300,000-square-foot cold storage facility, which is expected to be an export-oriented supply-chain asset for the Southeast’s massive pork and poultry industry.

International Logistics Park

MEGA-SITE STRENGTHENS THE MIX 

Farther away, the International Logistics Park of North Carolina straddles the line between Brunswick and Columbus counties. Its readiness for development is validated by a Certified Mega-Site designation from the state. The 1,000-plus acre property benefits from a multi-jurisdictional state statute that allows local governments to pool land and share tax revenues derived from it. Better still, the entire property and  the companies that locate anywhere on it, enjoy the benefits of Columbus County’s Tier 3 status, which is more generous than Brunswick County’s Tier 1 designation.  This is a key consideration when it comes to state infrastructure grants and financial incentives.

“NC’s Southeast was a key player in getting the counties to talk and work together,” recalls Gary Lanier, director of the Columbus County Economic Development Commission for the past 14 years. Early on, the property was considered by both Continental Tire and Caterpillar in high-profile site searches. It didn’t make the cut either time. Today, with full water and wastewater resources and other infrastructure in place, ILP is again drawing serious looks, Lanier says. 

“That park is in a great location, and it’s getting ready to explode,” Lanier says. Well before it was completed in January 2022, for example, a 150,000-square-foot speculative building known as the International Commerce Center was fully leased. Tenants quickly began asking about more space, and a plan for nearly doubling the building’s size is under discussion by its private owners. Among its tenants is Precision Swiss Products Inc., a California-based aerospace parts manufacturer that relocated its headquarters to the region two years ago with assistance from NC’s Southeast.

PROVEN RELATIONSHIPS 

Lanier says the tactical guidance he gets from his regional partners has become more sophisticated in recent years. Recruitment is more data driven. Prospects are thoroughly vetted. Marketing resources are pinpointed on companies eager to learn about the Southeast’s enviable economic and business resources. Yost and his colleagues also receive high marks for effectively administering federal COVID-19 recovery funds for digital infrastructure development in 2020. North Carolina’s Southeast is also praised for obtaining and distributing $5 million in state funds for site readiness, master planning and infrastructure development over the past 15 months. 

“Southeastern North Carolina has a lot to offer,” says state Sen. Bill Rabon, whose district includes Brunswick, Columbus and part of New Hanover counties. 

“Public-private partnerships like NC’s Southeast are imperative to promote the region and land new businesses. NC’s Southeast plays an important role in establishing those long-term relationships,” says Rabon, who is now championing additional state funds for spec-building development across the region.  

Chris Chung is also impressed with the organization’s  work. As CEO of the Economic Development Partnership of North Carolina, Chung engineered a unique arrangement whereby his organization refers project leads to NC’s Southeast. In frequent instances when corporate site searches are time-sensitive, working with a single entity— instead of 20 counties — can speed the state’s response to incoming opportunities. 

“That’s an efficiency for us and for the client company,” says Chung. It’s
a collaborative model that boils down to trust. “Steve and his team have earned the trust and the vote of confidence from his communities to
be an honest broker.

Investments in the region’s digital infrastructure, as well as its industrial properties, put the Southeast in a firm position for more success downrange. The work-from-anywhere era offers fresh opportunities for affordable but remote rural communities now that last-mile broadband is connecting quiet country residences with global markets and modern learning networks.

“Connectivity is hugely important in this new world,” says Chung. Pooling resources to market globally also helps less populous places be seen on the national stage. Plus, with historically tight labor markets, growing businesses carefully consider regional labor sheds, not municipal boundaries.

“It’s a good idea to think regionally,” he says, “because companies think regionally.”

— Lawrence Bivins writes about business and the economy. He lives in Raleigh.

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