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| SLCEC Media Center |
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| Welcome to the SLCEC Online Media Center |
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The following articles represent SLCEC news coverage.
The articles appear by date in order of most recently published. |
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Economic expansion increases in Missouri
The Missouri Business Conditions Index was 66.2 in May, up from 62.5 in April and 59 in May 2006, Creighton University said Friday.
An index number higher than 50 indicates and expanding economy.
"Despite weakness in Missouri's large durable goods manufacturing sector, especially auto and auto-related production and furniture production, the state's economy continues to improve," Creighton University Economics Professor Ernie Goss said in the release. "Our survey points to solid growth in the months ahead with the unemployment rate stabilizing slightly above its current low of 4.5 percent."
The index for the Mid-America region was 58.3 in May, down from 62 in April and 65.7 in May 2006.
The Creighton Economic Forecasting Group, of which Goss also is director, has conducted the monthly survey of supply managers in nine states since 1994 to produce leading economic indicators of the Mid-America economy. States surveyed are Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota. |
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Business development fund revival being led by Volpe
by Greg Edwards
The St. Louis Business Development Fund is something of a well-kept secret, and that's the last thing it wants to be.
"In its 13 years, I think it's safe to say the fund has been undermarketed. It's been sitting here largely unused," said Vince Volpe, who was hired as business development liaison five months ago to change that.
Founded by Rick Palank in 1994 and based in Clayton, the fund invests in businesses that need bridge loans of $50,000 to $500,000 to grow but don't qualify for loans with conventional lenders, such as banks, and don't want to sell equity in their businesses.
"Our target market is privately held, family-owned companies," said Volpe, who also teaches business law and entrepreneurial studies at Saint Louis University's John Cook School of Business. "They're growing companies, but they can't get the money they need to grow further."
Despite its bureaucratic-sounding name, the fund is a business run for profit, though there hasn't been a lot so far. It's owned by 23 banks, ranging from Bank of America to St. Johns Bank and Trust, and by the St. Louis Development Corp., the St. Louis County Economic Council and the Economic Development Center of St. Charles County. The banks provide the funds to make the loans, and the shareholders split the profits.
The shareholders take no ownership interest in the companies. "Our slogan is 'investment without ownership,'" said Palank, president and chief executive. "There's nothing like this in the marketplace."
The fund charges interest at the prime rate plus 3 percent or 4 percent and what it calls a success fee, payable at the end of the five-year loan period. Typically, that fee is 10 percent a year and is based on the original amount of the loan. So if you borrow $500,000 and pay off the loan after five years, you pay the fund $250,000 on top of the interest rate. If you pay off the loan in less than five years, you pay proportionately less. There is no prepayment penalty.
"It sounds expensive, doesn't it?" Palank said. "But suppose you raise that $500,000 by selling off 20 percent of your company to an investor and your company grows and that 20 percent increases in value to $2 million in five years.
"You not only gave up 20 percent of your company; you also gave up the difference between $2 million and $500,000."
When the fund started, its loan limit was $50,000. That was later upped to $200,000, and now it's $500,000. The average loan was $342,000 in 2006, up from $214,000 in 2005 and $133,000 in 2004.
The fund made six loans totaling $800,000 in 2004, eight loans totaling $1.7 million in 2005 and seven loans totaling $2 million in 2006. While the loans are amortized over five years, the average loan is paid off in half that time.
The fund's profit was $172,695 on revenue of $821,405 in 2006, up from a profit of $52,940 on revenue of $481,008 in 2005.
Stan Morrison, a former Rawlings Corp. executive, worked with the fund after he bought a closed Rawlings plant in Licking, Mo., and started TAG Team Uniforms. The business grew so fast that he needed capital to continue its growth.
Heartland Bank provided a $1.5 million line of credit, and the development fund invested $500,000, which "allowed TAG to secure much-needed capital without diluting its ownership," Morrison said. TAG's sales increased to $5.5 million in 2006 from $1.4 million in 2004, the year the company started.
The 26 shareholders in the fund are in it for more than their share of the profits. For the banks, the companies the fund invests in don't fit in their loan ranges now but might if they grow. The three economic development agencies and their communities benefit from job growth and increased taxes.
The fund, which currently has 30 companies in its portfolio and $3.8 million in loans, is ready and able to make more loans, Palank said, but many companies don't know it exists. Fifty percent of applications are approved, and the fund has had no delinquencies.
To increase the fund's visibility, Volpe is talking with professionals who work with growing businesses, such as bankers, attorneys, accountants, business brokers and financial advisers.
gedwards@bizjournals.com |
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Missouri won't insist on tolls for new bridge
By Ken Leiser
Missouri has proposed a scaled-down Mississippi River bridge north of the Edward Jones Dome that could be built without tolls.
The proposal was outlined in an April 10 letter from Missouri's top highway official to his Illinois counterpart at a time when talks between the two states had intensified, according to a source familiar with the document.
The two states have talked for years about building a new river span to alleviate traffic congestion across the Mississippi. Another bridge would also provide another crossing during repairs or incidents on the Poplar Street Bridge, transportation officials say.
Illinois and Missouri officials have been at a stalemate for months over how to pay for the crossing. Illinois proposed a four-lane companion to the Martin Luther King Bridge and Missouri proposed a larger bridge funded partially with tolls.
In a letter by Missouri Transportation Director Pete Rahn, the state proposed building the bridge north of the Dome, at the location originally eyed for an eight-lane crossing.
The bridge, according to a source familiar with the letter, could be built at roughly the same cost as the four-lane companion to the Martin Luther King Bridge that Illinois officials had sought.
Congress approved $239 million for the bridge two years ago, and congressional leaders have warned that the funding would be in jeopardy if the states don't come up with a funding plan.
Mike Jones, senior policy adviser to St. Louis County Executive Charlie Dooley, agreed the "clock is ticking" on Missouri and Illinois to reach agreement before Congress considers redirecting the money elsewhere.
"That is the pressure point," he said.
Missouri leaders said previously that they don't have enough money for the state's share of a $1 billion, eight-lane span. The latest bridge proposal would cost roughly $575 million.
The bridge would be four traffic lanes — two in each direction — and wouldn't require collecting tolls from motorists.
Illinois officials oppose tolls that would fall heavily on Metro East commuters.
Under the proposal, Missouri also would ensure Illinois that its contribution to the project would be no more than what it would have paid under the King Bridge companion. Missouri would likely have to borrow to come up with its $69 million share.
Rahn declined to comment on the contents of the letter. Mike Claffey, a spokesman for the Illinois Department of Transportation, said Wednesday that it is "positive news" that Missouri was no longer pushing tolls.
Despite the apparent breakthrough, transportation officials in both states say there is still no agreement on the bridge.
"We are aware the two states have been talking, which is good," said Les Sterman, executive director of the East-West Gateway Council of Governments. "Missouri has seemingly backed off tolls, which is good. Until we see a real proposal and have a chance to evaluate it, I think it is hard for anyone to come to any real judgment." |
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8 area high schools make 'best' list
By Harry Levins
Eight public high schools in the St. Louis area crop up on Newsweek magazine's list of the best public high schools in the nation.
In all, Newsweek cites 1,257 public high schools as the best. The local schools, by ranking, are:
139: Metro Academic and Classical, in St. Louis.
263: Ladue-Horton Watkins.
321: Clayton.
601: Lafayette, in Wildwood.
625: Marquette, in Chesterfield
675: Rockwood Summit, in Fenton.
705: Eureka.
759: Lindbergh, in south St. Louis County.
The list includes two other high schools in Missouri -- Kansas City's Park Hill (No. 541) and Columbia's Hickman (No. 1,252).
No schools from the Metro East area made the list.
Newsweek compiled its list by listing the number of Advanced Placement or International Baccalaureate tests taken by seniors last year, divided by the number of graduating seniors.
The 1,257 schools finished in the top 5 per cent of more than 25,000 public high schools across America. |
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NorthPark Partners, county officials make sales pitch for development. Project could create 12,000 jobs
By Brian Flinchpaugh
What's being called the "greatest reinvestment project in St. Louis County" was unveiled last week to the people who may be doing the investing.
The NorthPark Partners held an "economic summit" May 16 at the University of Missouri-St. Louis to showcase NorthPark, a proposed $400 million real estate development.
NorthPark is on 550 acres at the northeast corner of Interstates 70 and 170 in the cities of Kinloch, Berkeley and Ferguson.
The daylong event amounted to the first public sales pitch for the project, which St. Louis County officials and developers say could have a $7 billion impact on the community and create 12,000 new jobs.
"It is the future of St. Louis County, period," said St. Louis County Executive Charles Dooley, to about 132 business and real estate representatives and developers, as well as local elected and regional officials.
Dooley and NorthPark Partners representatives stressed that the development is designed to generate jobs and new opportunities for business. They offered bus tours of the site that afternoon.
"Our goal is to create as much development and new jobs as possible to pay off the TIFs (tax increment financing) and other inducements," said Larry Chapman, principal of Clayco.
Clayco and McEagle Properties, another real estate development firm, form NorthPark Partners, which was awarded the project in 2005. NorthPark was created from property buyouts for noise abatement as part of the Lambert International Airport expansion over the last several decades.
Chapman said site planning and infrastructure work is already completed, allowing for quick development. He added that the partnership initially wanted to work closely with new developers to guarantee the quality and continuity of new projects with development plans.
But Chapman, Dooley and Chris McKee, president of McEagle, said they would listen to proposals.
"Bring us the deals; let's talk about them," McKee said.
The partners also announced plans Wednesday for a three-story, 150,000-square-foot office building. The building will be adjacent to the Vatterott College headquarters currently under construction.
The Vatterott headquarters joins the new Express Scripts headquarters, which is the first building completed in NorthPark.
NorthPark eventually could accommodate more than 5 million square feet of office, retail and light-industrial space.
Larry Salci, president and chief executive officer of Metro, who participated in a panel discussion at the summit meeting, said a MetroLink station might be constructed between the existing Hanley Road and airport stations. Bus service also might be developed within the tract.
Completion of NorthPark could take eight or nine years, Chapman said. |
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150,000 sq. ft. of office space . . .
By Riddhi Trivedi-St. Clair
The developers of NorthPark announced a 150,000-square-foot speculative office building in the mixed-use development at Interstates 70 and 170.
The new building should give relief to St. Louis County's tight commercial-space market, and it signals an expansion of planned office space at the NorthPark project.
The announcement was made Wednesday at an economic summit organized by partners St. Louis-based Clayco and McEagle Properties of O'Fallon, Mo., to talk about the 550-acre NorthPark development and amenities.
Because of construction costs and a relatively soft leasing market for office space in recent years, there has been little or no speculative building recently. The three-story building will be a welcome addition to a tight market, according to industry experts.
Not having available space can be a deterrent for potential tenants looking to move into the area, said St. Louis County Executive Charlie Dooley.
"When people come here, they don't have anywhere to move in," Dooley said. "It is exciting that (Clayco and McEagle) are willing to make something happen rather than sit and wait for something to happen."
In recent years, the only speculative construction in the St. Louis area was in Clayton, said Peter Krombach, senior managing director for CB Richard Ellis. And since those buildings were leased, available space has been difficult to find, he said.
NorthPark includes retail and light industrial space, and plans called for about 600,000 to 700,000 square feet of office space, said Larry Chapman, principal at Clayco.
"Right now we are projecting we will be more than double that amount," Chapman said.
Its location at the intersection of two major interstate highways and proximity to Lambert Field draw strong interest from corporate office clients, developers say. The NorthPark plan is changing and might include an office campus at the southern end of the development along I-70.
"We have been pleasantly surprised by the interest in NorthPark and the quality of prospects," said Chris McKee, president of McEagle Properties.
Dooley called NorthPark the largest redevelopment in St. Louis County history. "It is going to have all new infrastructure and cutting-edge technology."
"NorthPark's tenants can market to other tenants," Krombach said.
The developers now plan to build a million square feet of office space. And there are proposals for 600,000 to 700,000 square feet of light industrial space.
"It's a pretty significant gamble. But this is my 28th year in real estate," Chapman said. "If you set up your development with good control over quality and good amenities, you attract good institutional-level investors, owners and occupants."
The companies have $100 million invested in infrastructure and land costs and expect total investment to be $400 million to $500 million. NorthPark is expected to generate up to 12,000 jobs.
The new office building will be adjacent to the already announced national headquarters and St. Louis campus of Vatterott College and the corporate headquarters of Express Scripts Inc. |
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Irish food maker to buy former Nestle Affton plant
Ireland's Kerry Group plc said Thursday that it plans to spend $10 million to buy and upgrade the former Nestle facility in Affton, Mo.
In a release, the food and food ingredient manufacturer said it plans to install new equipment and upgrade the facility, which is on New Hampshire Avenue in Affton.
Nestle USA announced in March 2005 that it would close three of its St. Louis-area candy plants, including the Affton facilities.
Tax incentives and permitting assistance provided by St. Louis County and negotiated by the St. Louis County Economic Council (SLCEC) helped the company to set up the manufacturing site in Affton, adding 40 jobs and increasing tax revenue, according to a SLCEC release.
The Kerry Group chose St. Louis County after a nationwide site search. SLCEC collaborated with the St. Louis Regional Chamber & Growth Association (RCGA) and a Chicago consulting firm to attract the Kerry Group.
Kerry Group supplies more than 10,000 food, food ingredients and flavor products to customers in more than 140 countries worldwide.
In April, Kerry bought St. Louis-based Custom Industries, a specialty food ingredient maker, from Royal Cosun of the Netherlands. The buy included production facilities in Ste. Genevive, Mo., and Toronto, Ontario.
The St. Louis County Economic Council offers business development, financing programs, business incubator opportunities, real estate and community development programs, and international expertise through the World Trade Center St. Louis. |
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NorthPark breaks ground on $15 million Vatterott project
by Lisa R. Brown
Construction is under way at Vatterott College's new $15 million facility in NorthPark. The building is the first to occupy the 550-acre NorthPark development in North St. Louis County that is planned to include nearly 5 million square feet of office, commercial retail and industrial space by 2020.
Vatterott announced earlier this month that it planned to move to NorthPark.
Paric Corp. is the general contractor on Vatterott College's 90,000-square-foot two-story building that replaces a campus in St. Ann. The NorthPark building will house Vatterott College's national headquarters and trades programs, including HVAC, welding, plumbing and electrical, IT/computing and allied health.
Construction is scheduled to be completed by October 2007. NorthPark is located just east of Lambert-St. Louis International Airport and is located in Berkeley, Kinloch and Ferguson.
O'Fallon, Mo.-based Paric Corp. is one of the largest privately held companies in St. Louis with 2004 revenue of $221.7 million. |
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GM Parts Facility Gets a New Life
By Christopher Boyce
Duke Realty Corp. said Monday that it has started demolishing the former General Motors Corp. parts facility in Hazelwood to build a 528,000-square-foot industrial distribution center.
Indianapolis-based Duke bought the 25-acre site for $5 million in April from GM, which closed the facility in May.
Construction on the new $30 million building at 5801 North Lindbergh Boulevard is expected to be complete by June 2007, said Jon Hinds, vice president of industrial leasing for Duke.
Hinds said the building could be divided among four tenants but is more likely to attract one or two. The project is being developed without tenants signed, but Hinds said some inquiries from companies have begun.
The one-story building will feature a 32-foot ceiling, trailer docks on two sides of the building and parking for 70 trailers and 160 cars. Hinds said Duke will adjust specifications for trailer docks and other needs per client request.
Hinds was unconcerned about developing the building on a speculative basis, because he said there are no other facilities of the same scale being developed to create competition.
North St. Louis County, he said, "has traditionally been the hub for distribution in the St. Louis metro area," Hinds said. "There are very few Class A modern facilities."
While the Gateway Commerce Center in Madison County has become a popular local choice for distribution centers, Hinds said companies would be attracted to Missouri to draw from its large employee base.
But what may be more important is the location and flexibility of the new facility, said Ik-whan Kwon, director of the Consortium for Supply Chain Management Studies at the Cook School of Business at St. Louis University.
Kwon said the demand exists for a large distribution center as long as it has easy access to interstate highways and adaptability for information technology needs.
The Duke facility is about a mile south of Interstate 270.
"Logistics costs are increasing rapidly due to truck driver shortages and gas prices increasing, so companies are looking for the best locations," said Kwon.
Hinds said Duke has also been keeping watch on the Ford facility in Hazelwood, as are many developers, since it closed in March. Like those developers, Hinds said Duke is waiting to hear what Ford will do with the plant.
cboyce@post-dispatch.com | 314-340-8345 |
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St. Louis County Executive Charlie Dooley Rolls Out New Program
to Promote Joint Economic Development
ST. LOUIS, (SLFP.com), May 19, 2006 - St. Louis County Executive Charlie Dooley has announced the formation of the St. Louis County Economic Development Collaborative.
At a press conference, following the 2006 Annual Meeting of the St. Louis County Economic Council (SLCEC) at the Ritz in Clayton, Dooley outlined how the St. Louis County Economic Development Collaborative will improve communication and cooperation among the county's 91 municipalities and unincorporated areas. Dooley said the new program will lead to enhanced job attraction, retention, creation and expansion.
"This collaborative will create a unified strategic vision that respects the individual communities, yet enhances the county as well," said Dooley. "It's a forward-thinking effort dedicated to improving the quality of life for everyone who works or lives in the county, and we need input and collaboration from all our municipalities and communities to achieve that goal."
Leezer, formerly with St. Charles County, plans to meet with municipal and chamber leadership in St. Louis County to introduce the Collaborative during the first 90 days of his tenure, which began May 15. He will work to market the major assets of St. Louis County, including those within and created by municipalities, and establish regular communications among the County and the municipalities on economic development opportunities and activities.
Leezer stated, "This collaborative's strategic plan will be based on each leader's input. My goal in meeting with each leader individually is to gain the perspective of each community and help mold that into a winning plan for the entire county."
Earlier at the breakfast meeting in the ballroom, Dooley told a packed house in the ballroom that he was pleased to report that the news is very, very good. "It is fair to say that in St. Louis County, business is booming," he said proudly. "It's a team effort to provide quality service in St. Louis County. We are all about customer satisfaction. There are innumerable facts and figures that support our contention that St. Louis County is as business-friendly as any county in the United States," stated Dooley.
Among the highlights presented in the meeting:
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St. Louis County is fifth among American suburban counties in number of jobs;
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The county is ninth among American suburban counties in annual payroll;
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More than $2 billion was invested in St. Louis County in 2005;
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Over 25,000 jobs were attracted or retained in the county;
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St. Louis County accounts for nearly a quarter of the entire state of Missouri's sales tax revenue and one-third of the state's household income tax revenue; and
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The number of new businesses started in St. Louis County totaled 2,600, more than 1,000 more than the next closest county.
At the meeting, several local businesses were presented with awards for their dedication to St. Louis County economic development including:
- Outstanding Entrepreneur: Suzanne Magee Joyce, CEO of TechGuard Security;
- Dr. William D. Phillips Technology Advancement Award: Robert J. Calcaterra, president and CEO of Nidus Center for Scientific Advancement;
- Business Expansion Award: Express Scripts, with new corporate headquarters on the campus of University of Missouri-St. Louis;
- Buzz Westfall Regional Cooperation Award: NorthPark Partners, consisting of Clayco, McEagle and TRiSTAR, set to create the largest reinvestment project in St. Louis County history; and
- Community Partnership Award: Pinnacle Entertainment, building the $375 million River City casino, hotel and entertainment complex in Lemay.
"The St. Louis County Economic Council is successful because of the entrepreneurial spirit in St. Louis County," said SLCEC President and CEO Denny Coleman. "From the leadership of County Executive Charlie Dooley, through each staff person at the Economic Council, we work every day to enhance the quality of life for everyone who lives and works in St. Louis County, especially through strong leadership and economic development."
http://www.slfp.com/stl-news.htm
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Leezer leads new municipal collaborative
The formation of the St. Louis County Economic Development Collaborative was announced Thursday by St. Louis County Executive Charlie Dooley. David Leezer, the former director of business development for St. Charles County, was named to lead the new group.
The new collaborative is funded by $100,000 in seed money, according to a release.
The St. Louis County Economic Development Collaborative will bring together the mayors of all county municipalities, as well as the leaders of all chambers representing areas of unincorporated St. Louis County, to enhance and promote the county's economic development dominance in the region and state.
Leezer plans to meet with municipal and chamber leadership in St. Louis County to introduce the collaborative during the first 90 days of his tenure, according to a release.
Leezer said in a statement, "This collaborative's strategic plan will be based on each leader's input. My goal in meeting with each leader individually is to gain the perspective of each community and help mold that into a winning plan for the entire county."
Dooley and Leezer expect the first meeting of the collaborative to take place as soon as possible after Leezer meets individually with each mayor and chamber leader. Leezer officially began work at the SLCEC May 15.
All contents of this site © American City Business Journals Inc. All rights reserved.
http://stlouis.bizjournals.com
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Chrysler signs off on deal; Automaker has said it wants to invest up to $1 billion at plants. Fenton is willing to kick in up to $46 million in tax abatements. Missouri announces it will provide $32 million in additional incentives
By Gregory Cancelada
Company hasn't said what other models will be built here.
Union agrees to work on team system, based on Toyota model.
Chrysler Group of DaimlerChrysler AG will transform its South assembly plant in Fenton into one of its most modern, flexible facilities, allowing workers to assemble as many as four different models there.
And Missouri appears to have clinched the major investment with a modest $32 million in state incentives.
Chrysler announced Monday, as expected, that it would invest up to $1 billion in its North and South assembly plants in Fenton, with the bulk of the money going to modernize the South plant, which was built in 1959.
"This is not only a capital infusion, but it represents a huge vote of confidence in the men and women who today are building products in two great sites, " Frank Ewasyshyn, Chrysler Group's executive vice president for manufacturing, said Monday during a press conference at the South plant.
But the biggest immediate change for those employees may be in the way their work is organized.
Chrysler will move to a team concept, where employees work in groups and perform multiple jobs. United Auto Workers members have been wary of this idea, a key part of the Toyota production system, because workers feel it weakens job security and erodes a job-classification system that traditionally assigns the best jobs to people with the most seniority.
However, UAW Locals 136 and 110, which represent North and South plant workers, respectively, already have agreed to accept the team concept.
"It's going to be a long-term process, and it's going to mean some major changes, " Local 110 President Glenn Woemmel said after the press conference. "From the union side, we're going to address it in a fashion that supports the worker."
In addition to the state incentives, Fenton already had committed to abate Chrysler's local property taxes, generating a $46 million savings over the next 15 years if the automaker invests the full $1 billion.
Chrysler said the local tax-abatement package was critical to its proposal.
St. Louis County has offered to repave roads and make other infrastructure improvements. However, the county hasn't yet finalized any deal, since it is waiting for Chrysler to identify its exact needs.
Missouri's incentives will come in the form of $16 million in tax credits through its Build program and another $16 million to train local employees. The funding will be done over several years.
By comparison, Illinois offered $36 million in incentives in January to lure a $419 million investment to Chrysler's plant in Belvidere, a facility that had been running a single shift since 2001. Those incentives require the company to create about 1,000 new jobs.
Two months later, Michigan gave $19 million to attract a $506 million investment to upgrade assembly and stamping plants in Sterling Heights.
Chrysler has declined to say whether the plan for Fenton would create new plant jobs, but it told city officials that the two facilities would be at risk of closure without new investment.
After the press conference, Missouri Gov. Matt Blunt said the biggest incentive for the automaker was the state's improved business climate.
"Workers' compensation reform, tort reform really do help those companies make the decision to stay in, come to or grow in Missouri, " Blunt said. "Those are the most significant things that we've done to help people who want to create good jobs in our state."
Just as critical to Chrysler's decision is the Fenton work force, almost all represented by the UAW.
Last year, the South plant became the industry's most productive minivan plant in North America, displacing Chrysler's Windsor, Ontario, minivan plant for the first time, according to the prestigious Harbour report.
Meanwhile, the North plant has been steadily boosting productivity, rising to No. 7 last year from ninth, among 13 full-size pickup plants that Harbour ranked.
Chrysler declined to provide details about its plan, saying only that the investment would start next year. Earlier, the automaker called for an initial $531 million during the next four years, then a possible $500 million in the next five to seven years.
The company also wouldn't indicate what vehicles the facilities would build in the future, only saying that the two plants would continue next year to build their current lineup.
The South plant, which employs about 3,200 people, builds the Dodge Caravan, Grand Caravan and Chrysler Town & Country minivans. The North plant's 2,300 employees assemble Dodge Ram pickups.
The North plant, built in 1966, is expected to continue producing Ram pickups.
However, Volkswagen AG and DaimlerChrysler have been discussing the possibility of Chrysler building VW-branded minivans. And two weeks ago, Ward's Automotive Reports said Chrysler would make them at the South plant and also would transfer the Chrysler Pacifica sports wagon here from Windsor.
After the press conference, Ewasyshyn indicated the big changes at the South plant would come after 2006. Next year, the automaker will focus on preparing the facility for the future, he said.
Creating a more flexible work force is part of Chrysler's move to a production system that could make multiple models in a single plant and shorten the product life cycle.
Flexible manufacturing
Historically, automakers built plants to assemble a particular model or type of vehicle, dedicating much of the tooling to a specific design. When introducing a new model or vehicle, a lot of the plant's equipment must be replaced.
In contrast, Japanese automakers Toyota Motor Corp. and Honda Motor Co. developed flexible manufacturing systems that rely heavily on programmable robots. Such plants can make several different models on a single production line, which means a company can nimbly change its mix to meet consumer demand. Toyota and Honda also can quickly tweak models without a massive retooling.
To improve their competitiveness, the Big Three -- Chrysler, Ford Motor Co. and General Motors Corp. -- now are pushing aggressively for flexible manufacturing.
The South plant will become Chrysler's third assembly plant slated for a massive overhaul as part of the company's flexible manufacturing investment program. Chrysler already plans to convert the Belvidere and Sterling Heights plants into flexible manufacturing facilities.
The initial investment will allow the South plant to assemble more models than ever before.
During "town hall" meetings Friday and Monday, Chrysler told Fenton workers that a new body shop will allow the South plant to build as many as four different models on a single production line.
Fenton's good news comes as General Motors and Ford announce plans to close plants and slash their work forces. GM already has slated its Hazelwood parts distribution facility for closure.
Ford's assembly plant in Hazelwood, where about 1,450 people work, faces an uncertain future. The company plans to announce a restructuring next month that is expected to include closure of several assembly plants.
Though acknowledging that the challenges are significant, Blunt said he would continue to lobby Ford to keep the Hazelwood plant open.
"We've certainly not given up, " Blunt said.
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CLOSING THE DEAL
Missouri will offer $16 million in tax credits through its Build incentive program and $16 million in job training funds, all disbursed over several years. St. Louis County is offering to repave roads and make other infrastructure improvements; a final deal is pending.
Fenton will provide a 70 percent property tax abatement on new equipment and machinery that Chrysler installs over 10 years.
A jury decides in favor of DaimlerChrysler in a lawsuit over a fatal minivan accident in 2002. Metro | B |
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Stern, St. Louis County launch new bond program
Companies can save up to $1 million on a $5 million, 20-year loan
By Bonita L. Tillman
Small and medium businesses in St. Louis County have a new funding source to help expand their companies.
The St. Louis County Economic Council and Stern Bros. & Co. have introduced a new Growth Bond Program that offers low-cost taxable bonds to companies with capital improvement projects valued at more than $2 million.
"Traditionally, companies interested in expanding go to the bank to borrow funds through a conventional loan program," says Don Estell, president of Stern Bros. "This program costs them less because of a floating interest rate."
Under the Growth Bond Program, bonds are issued at the taxable bond rate, currently 2.6 percent. With additional fees, the final rate usually runs about 1.25 percent to 1.5 percent less than standard bank loans available now.
Although the taxable bond rate can change in the Growth Bond Program, the spread between traditional bank loans and those in the program remains fairly consistent, said Ron Braun, senior vice president of Stern Bros.
Companies also can convert the floating bond rate to a fixed rate for all or part of the debt and for any period of time, making it flexible as the company's financial status changes.
The Growth Bond Program requires the borrowing company to secure a letter of credit from a participating bank. All banks are eligible to participate in the program. Banks partnering in the program benefit by helping a client save money and earning a fee for providing the letter of credit.
"It could be very attractive for banks, because they don't have to use their cash on-hand to issue bonds for businesses," Braun said.
Up until a few years ago, almost all companies could issue tax-exempt bonds for industrial development, Estell said. However, when federal laws tightened, manufacturing companies were unable to access the tax-exempt bonds.
While large companies can issue their own low-cost taxable bonds for projects, most small and medium-size companies don't have the resources to do the same. But the new Growth Bond Program is another option, Stern Bros. officials said.
"Some companies aren't even aware they can still issue bonds on a taxable basis," Estell said.
A company could save $600,000 on a $2.5 million loan or $1 million on a $5 million loan over 20 years through the Growth Bond Program, Braun said.
"That's a very significant number if you put it in terms of a small or medium company's budget," he said. "Basically, the biggest deterrent to companies doing this is the knowledge that it's an option."
Stern Bros., a Clayton-based investment banking firm, aids the process by:
* Structuring the transaction to meet the company's goals,
* Acting as quarterback in the transaction by overseeing the process, and
* Purchasing the bond and later selling it to institutional investors, such as mutual funds, money market funds, insurance companies and pension funds.
"This approach doesn't replace a company's relationship with existing banks, but it works in a slightly different way," Braun said.
Rick Palank, senior vice president of business finance for the St. Louis County Economic Council, called the program "a great product" that eventually could expand around the country.
He and Estell began working on the concept about six months ago after realizing that the interest rate on taxable bonds was so reasonable. Shortly afterward, two local projects came to their attention that could have benefited from such a program in St. Louis County.
"I can't understand why no one has done this before now, but we felt there was a real need for it," Palank said. "I'm on the national Council of Development Finance Agencies and no one even talks about it there."
Although several local companies have expressed interest in participating in the program, none of their projects have been completed since the program initially launched a few months ago. However, Palank estimated that 20 to 50 capital improvement projects in the $2 million to $10 million range in St. Louis County could have benefited from the program in 2004 alone.
"I think this will snowball once a few projects are done," Palank said. "If we can help companies in St. Louis County save money, that's great. Who's not for that?"
To initiate a loan through the Growth Bond Program, St. Louis County-based companies should contact the St. Louis County Economic Council. Additional information also is available on the council's Web site at www.slcec.com.
In addition to Clayton, Stern Bros., which employs 35 people, also has offices in Kansas City, Chicago and Sarasota, Fla.
Bonita L. Tillman is a St. Louis freelance writer.
© 2005 American City Business Journals Inc.
http://stlouis.bizjournals.com |
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St. Louis County to take off with airport project
By Patrick L. Thimangu
If all goes according to schedule, a proposal to develop 600 acres east of Lambert-St. Louis International Airport will be one of the biggest economic development projects to break ground in St. Louis County in 2005.
The development is expected to create up to 12,000 jobs, generate $320 million in property and income tax revenue, and a have a total economic impact of $7 billion in the St. Louis area, according to St. Louis County Executive Charlie Dooley.
Dooley said the proposed project is the culmination of months of negotiations that led to cooperation between officials of Berkeley, Kinloch, Ferguson, St. Louis County and the state. The officials formed the 11-member Airport Area Redevelopment Intergovernmental Commission earlier this year to oversee the project. Last month the commission selected North Park Partners as the front-runner for the redevelopment. North Park, a partnership comprising developers TRiSTAR Business Communities LLC, McEagle Properties LLC and Clayco Construction Co., beat out other local developers that had submitted proposals for the project.
Dooley said North Park has not submitted final plans for the project, which is scheduled to begin in early 2005. The idea, though, is that North Park will fine-tune the plan it submitted to the commission to create a park with a mix of office and light industrial development.
Larry Chapman, a partner at North Park, said the partnership is in the early stages of negotiating and is figuring out the final design, costs and financing of the big project. He declined to give estimates on costs for the project, but said the financing would come from many sources that might include a mix of private debt equity financing and public funding through bond issues.
Chapman said he is optimistic that the Airport Area Redevelopment Intergovernmental Commission will approve North Park's final plan.
"I would imagine this spring we will have gone through all the negotiations," Chapman said.
The 600-acre property proposed for development is currently designated a state Enterprise Zone and a federal historically underutilized business (HUB). The property, which is the largest area of land not in a flood plain available for development in St. Louis County, was a residential community that the city of St. Louis bought and razed to create space for the airport's noise zone in the 1980s.
Dooley said other significant projects on the drawing board for St. Louis County next year include Pinnacle Entertainment's $300 million proposal for a mixed-use gaming and retail development in south St. Louis County. The Missouri Gaming Commission approved Pinnacle's proposals in September.
The county government also will continue to promote the county as a hub of the life sciences industry, he said.
The St. Louis County Economic Development Council is moving forward with plans to develop a new post-incubator, multitenant lab/office facility on eight acres adjacent to the Donald Danforth Plant Science Center campus. The council is funding the facility in part with a $2 million grant it received from the U.S. Department of Commerce's Economic Development Administration and is still seeking additional funding for the project, Dooley said.
© 2004 American City Business Journals Inc.
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Panel gives local team head start in business park deal
By Eric Heisler of the St. Louis Post-Dispatch
In the race to develop a prized business park near Lambert Field, a team of
local developers with deep ties to the troubled site has taken an early lead.
St. Louis County officials on Thursday announced the front-runner to develop
the 600-acre park: NorthPark Partners, a team made up of McEagle Development,
TriStar Business Communities and Claycorp.
Meeting behind closed doors, a selection committee opted for that group over
four others, including two teams that involved out-of-town developers with deep
pockets.
NorthPark will begin negotiations with county officials for rights to build a
business park that’s expected to draw as many as 13,000 jobs to north St. Louis
County.
“That’s exciting, and I’m happy. But it means I have a lot of work to do,” said
Larry Chapman, senior vice president for TriStar. “We think we’ll be able to
get this done, but I’m told this is just the beginning, and I know this is just
the beginning.”
The park will rise east of Lambert on land that stretches into three cities:
Kinloch, Ferguson and Berkeley. Until the early 1980s, the site was filled
mostly with hundreds of modest houses.
Over the last 20 years, most of the houses were cleared in an airport noise
buyout, and St. Louis-area leaders began looking at the site as an economic
gold mine. They hoped to transform the ground into a rare find in built-out St.
Louis County — open land suited for industry.
For years, efforts stalled because of fighting among city officials in Kinloch,
Ferguson and Berkeley. Under political pressure, the cities joined with St.
Louis County and asked teams of developers to submit plans for the site in
September.
A six-member committee met privately with the teams. The identity of each team’s membership was released, but details of its plans were not.
Committee members rated the proposals on several criteria, and NorthPark scored
highest overall.
Now, the St. Louis County Economic Council will begin talks with NorthPark over
issues such as how much the team will pay for the land and how much
public-funding assistance will be needed to build the park.
“The other respondents should not consider themselves out of the running,” said
John Temporiti, chairman of the 11-member Airport Joint Development Commission
that’s overseeing the project. “If we’re not able to reach an agreement with
NorthPark, we reserve the right to go to the next developer.”
He declined to release the rankings of the other teams. He also would not
discuss details of the NorthPark plan, nor would Chapman. Temporiti said he
hopes an agreement is signed by January.
TriStar and McEagle are more accustomed to competing on projects than
partnering on them. Each sought to develop portions of the site when the three
cities first tried to pick developers years ago.
“The biggest challenge is that this was not built first as an industrial site,”
Chapman said. “It was built as a residential development, and it has none of
the infrastructure to support a large-scale, high-density commercial area. It
all has to be created new.”
The park is expected to have a large segment dedicated to industrial and
warehouse operations. It’s also likely to include office and retail areas.
At least two of NorthPark’s competitors sought to win the project by involving
firms such as ProLogis, a $700 million-a-year developer based in Aurora, Colo.
ProLogis teamed with local developer Roberts Brothers Properties.
Another local developer, Summit Development Group, tried to sway the committee
by offering to bring in a large, unnamed retailer that would be new to the St.
Louis market.
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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St. Louis County opens fourth small-business incubator
The St. Louis County Economic Council has opened its fourth small-business incubator to support young companies and increase employment. The incubator, on Plymouth Avenue in Wellston, provides 10,000 square feet of office and warehouse space for small businesses. It joins the county's existing incubators in Lemay, Chesterfield and in Midtown.
The newest incubator is built on the site of the former Wagner Electric Co., which had been contaminated with PCBs, lead and arsenic. The county used about $900,000 in federal and state funds to clean up the site, which also includes the Metropolitan Education and Training Center. Additional federal, state and local public funds and private funds helped build the new incubator.
"This incubator is part of St. Louis County's comprehensive effort to rebuild the city of Wellston," said Charlie Dooley, county executive, in a statement. "Environmental remediation, new businesses, job training, job creation, new housing, parks, streets and bridges are bringing this municipality back and making it a strong player in the economy of St. Louis County."
The first companies to move into the new incubator include:
- GSM Development, which provides products and services to the utilities industry;
- BRK Electrical Contractors
- Bloomfield Nutrition, which sells nutritional supplements online.
© 2004 American City Business Journals Inc. |
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KV will add workers if it gets tax break
By Eric Heisler of the St. Louis Post-Dispatch
KV Pharmaceutical Co. plans to invest $130 million and hire 300 more workers at three area operations if the St. Louis County Council agrees to a package of tax incentives next week, county officials said Thursday. KV, based in Brentwood, produces and markets various drugs.
The company, with about $280 million in sales last year, employs 1,000 workers. Its operations in Bridgeton, Maryland Heights and Earth City would expand under a proposed agreement with St. Louis County. As a result, KV would add 300 jobs paying an average of $60,000 a year, county officials said.
For its investment, KV would get a tax break worth up to $15 million over the next 10 years, or roughly half the property taxes the company otherwise would pay on the expansions.
Denny Coleman, president of the St. Louis County Economic Council, said the incentives ensure that the St. Louis area can hold on to a company in a highly sought-after industry. “This adds to the momentum the entire region has gained in life sciences,” he said. “These are companies that are being heavily recruited to other states and countries, and we have to be competitive to make sure we keep them here and keep them growing.”
Before reaching the tentative agreement with St. Louis County, KV had considered cutting area jobs and outsourcing the work overseas, county officials said.
KV has grown quickly over the last decade from a firm with just 300 area employees. Once a contract manufacturer for larger drug companies, it now makes its own brands. KV did not return phone calls seeking comment Thursday. But Steve Anderson, vice president of the economic council who worked on the deal, said the expansion was expected to take place within six months. At least in part, the move will accommodate the launch of new products, he said. “I can tell you this: They wouldn’t be doing the investment if it wasn’t for” the incentives, Anderson said. “Frankly, KV could easily outsource some of their work (that’s done) here.” The new hires will be mostly scientists and researchers, Anderson said.
Since 2000, St. Louis County has offered a handful of companies tax breaks to locate or expand in the county, including Edward Jones and DST Systems Inc., which opened a $50 million data center in Bridgeton last year. The St. Louis area is one of many regions nationwide that have placed a priority on becoming a hub for life sciences companies. The news of KV’s expansion comes just five months after Pfizer Inc., another pharmaceutical firm, announced it would open a $100 million research facility in Chesterfield.
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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St. Louis County seeks to foster business growth
By Eric Heisler of the St. Louis Post-Dispatch
St. Louis County has shelved a plan to build a fifth business incubator in favor of opening a center to promote small-business growth.
The county had announced in April 2003 that it would open an incubator in the mid-county area, using a $1.9 million federal grant secured by Rep. Richard Gephardt, D-St. Louis County.
The county operates three incubators that house startup businesses and help them to grow into larger, self-sufficient firms. A fourth incubator is about to open in Wellston. But county officials said recently that they have changed their minds about a fifth incubator and that they’ll use the grant money to establish the Center for Business Growth in Clayton. “We felt that we could reach more people with the same amount of money,” said Denny Coleman, president of the St. Louis County Economic Council. “This way, we can provide services to far more companies than we’d be able to serve within the walls of an incubator.”
At the time of last year’s announcement, county officials said that the St. Louis Enterprise Centers program had become popular and that more space was needed. Incubators in Chesterfield, Lemay and midtown St. Louis house 10 to 15 small companies each. There, the businesses can take advantage of reduced rental fees, shared facilities and access to mentors. The incubator in Wellston is expected to open this year.
Funding for the fifth incubator was scheduled to come through a grant from the Small Business Administration, but the Center for Business Growth will be “like an incubator without walls,” said Donna Heckler, a co-director for the program. “We recognized that there were so many businesses out there that could use the assistance,” she said, “and we wondered—couldn’t we expand this to serve more businesses?”
The center will focus on services such as education and mentoring for businesses with at least five employees, mainly firms larger than those in the incubators. As such, the center will address a critical stage of a company’s life cycle that few St. Louis-area programs address, Coleman said. “We don’t want to focus on startup businesses. We want to focus on the ones who are in the stage of growing,” said Bruce Hoskins, the center’s other co-director.
The center plans to sponsor a speaker series as well as provide smaller businesses with resources from larger firms and universities in the St. Louis area. Also, the center will set up networking events and study issues that concern smaller companies, such as health care. It’s expected to open in November.
The federal money will keep the center afloat for the first four years or so, Coleman said. County officials are studying the issue of how to pay for it going forward.
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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| Area Companies, Organizations Recognized for International Success The World Trade Center St. Louis has recognized four local companies and organizations for their leadership and success in international areas.
Emerson received the center’s Global Leadership Award for being a world-class company with world-class leadership and continuing global growth, the center said. The Solae Co., which develops and manufactures soy products, received the Growing Global Award for its commitments to research, technology and high-quality management.
The World Trade Center recognized Everything’s Possible LLC with the Global Entrepreneurial Award for its growth and entrepreneurial spirit. The organization provides market research, product sourcing, travel planning, staffing, recruiting and translation services in China.
Finally, the Saint Louis Zoo received the Global Ambassador Award for creating its WildCare Institute, a conservation initiative that puts zoo scientists and resources in 12 troubled habitats worldwide. © 2004 American City Business Journals Inc. |
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County Obtains $1.9 Million Grant for Incubator Program
By Rick Desloge
Startup businesses in St. Louis and St. Louis County can choose from among a half-dozen business incubators. But where does a small business that’s outgrown the incubator turn?
The St. Louis County Economic Council plans to address that question with a new Center for Business Growth it expects to unveil in late October or early November. The new center will have a physical presence on the 10th floor of the World Trade Center building in Clayton, but also will operate as a virtual incubator for companies that are beyond the startup phase, said Bruce Hoskins, an executive director of the new center.
"Many of these later-stage businesses need the same kinds of support as the incubator companies, because they are out there on their own and don’t always have all the necessary skills,” said Jan DeYoung, who also oversees business incubators St. Louis County operates with its partner, St. Louis City Development Corp.
St. Louis County secured a $1.9 million grant from the Small Business Administration (SBA) to pay for the new program, which will focus on businesses that have five or more employees and a commitment to expand. The Center for Business Growth will offer business coaching, executive mentoring on issues such as interviewing techniques and buying health insurance, and networking opportunities and programs to generate business leads. Hoskins, who had been director of marketing for technology firm G.A. Sullivan, and Donna Heckler, also an executive director of the new center and formerly a marketing executive with Medicine Shoppe International, joined the Economic Council staff in May to spearhead the new effort.
"We’re calling it an incubator without walls,” Hoskins said. “It should be able to serve many more times the 50 or so startup businesses” now in the Economic Council’s physical incubators.
The Economic Council currently operates three incubators -- in West County, South County and in midtown St. Louis -- that can serve a total of about 50 companies. A fourth incubator that will serve 10 to 15 companies is scheduled to open in Wellston in north St. Louis County next month. Startup businesses can remain in the centers up to four years. Unlike other specialized incubators for high-tech and biotech firms, the Economic Council’s incubators serve a broad range of companies that are usually financed by the owners or through family and friends.
Originally, the Economic Council was going to use the SBA grant to open another physical incubator. The idea changed to a small-business resource center both because of the need and the opportunity to serve more businesses, Heckler said.
"I’d still like to have access to some of these incubator resources,” said Mary Pownall, who with her husband, Steve, owns Bemas Software Inc.
Bemas, which develops human resource and benefits administration software for clients nationally, moved out of the West County incubator in August 2003. The seven-person firm still faces growth issues and other challenges that the incubator staff helped Bemas address, Pownall said.
"We’d always had in mind putting together an advisory board,” she said, and that task would be easier if the business had a continuing relationship with the incubators.
That kind of help would be available in the new center.
Most of the SBA grant money, 45 percent, is going to run programs for the new center’s small-business clients, Heckler said. Development and management of the center and its facility, combined, will take a similar percentage.
She cited 2001 U.S. Census data that showed the St. Louis area had only a 4.5 percent growth in firms with 10 to 500 employees but managed to achieve the same growth in employment and payroll as the United States as a whole, which had a growth rate for firms with 10 to 500 employees nearly triple that of St. Louis. Of businesses in St. Louis, 96 percent have less than 500 employees, according to Census data.
It’s not clear from Census data why St. Louis does a better job at stimulating growth in jobs and payroll. Heckler speculated that the region has a wealth of former corporate executives who start businesses here rather than leave the area, and St. Louis has strong educational institutions that support the small-business community.
Businesses that work with incubators have a greater chance of surviving, and businesses with five employees or more have a greater likelihood of growing, she said.
The SBA grant came after a push by U.S. Rep. Richard Gephardt, who visited the Economic Council’s incubator in South County last year, DeYoung said. His staff is still hammering out details for the grant, including lining up mentors from some of the region’s larger businesses.
© 2004 American City Business Journals Inc.
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Delayed by cleanup, Wellston incubator will open in October
By Eric Heisler of the St. Louis Post-Dispatch
Project overcomes soil and pollution problems at old Wagner Electric site. Held up by soil and pollution cleanup issues, an incubator to help fledgling businesses in Wellston is set to open in October.
The incubator is part of a larger effort by the St. Louis County Economic Council to revive Wellston as a business and industrial hub. When finished, it will become the fourth St. Louis Enterprise Center, replacing one that closed in Pagedale several years ago.
"What we want to do is create job opportunities,” said Jackie Wellington, vice president of the economic council. “This will hopefully help startup enterprises in an area that we’re trying to rebuild and attract new business."
The building will house between 10 and 15 companies. It’s being constructed for $2.5 million through a mix of public funding sources.
The incubator is part of a larger business and training complex set to rise on the former site of Wagner Electric Co. Wagner, which produced brakes for automobiles, once employed 6,000 workers in the area’s northern inner-ring suburbs. But it closed in 1983, leaving Wellston with a hulking, vacant complex at its center. Even worse, the site was polluted with toxic chemicals.
The incubator is a middle step in the process to remediate the site and build it back up as a new commercial area. The region’s Metropolitan Education and Training Center trains workers nearby. Next door, land is being prepared for two business parks that will be built through a public-private effort. Initially, the incubator was expected to open several years ago in the MET center. The economic council decided instead to construct a building because of a space shortage at the training center.
St. Louis County broke ground in late 2002 and hoped to have the next incubator open last year. But the project was slowed when remediation of pollutants at the site took longer than anticipated. Then, workers were surprised to discover asphalt, wood and concrete in the soil -- the apparent result of debris being dumped years ago from a nearby demolition. “There was a lot more junk than we thought would be there,” Wellington said. It meant engineers would have to redesign the building’s foundation to work around the debris.
The area’s other enterprise centers are in Chesterfield, south St. Louis County and midtown St. Louis. In the centers, startup companies pay reduced rent. They’re able to cut costs by sharing equipment and facilities. The businesses in the incubator receive mentoring and training through the program. Most companies stay for three to four years. Typically, the startups pay a higher rent each year in the incubator to ease the transition. “It’s a program that’s worked exceptionally well for us,” said Jan DeYoung, director of the program for the county. “When the companies graduate from the incubator, they tend to locate in the communities in which they’ve been incubated."
Wellston’s incubator will be 10,000 square feet, a bit smaller than its counterparts, DeYoung said, but the building is designed to be expanded.
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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Charlie Dooley Sees Progress in St. Louis County
By Martin Van Der Werf of the St. Louis Post Dispatch
For decades, St. Louis County has been the destination for people leaving the city for more space, nicer surroundings and proximity to employees. But the county’s leadership role has been slipping. The population has leveled off and begun to drop, the Census Bureau says. A study by the University of Missouri at St. Louis indicates that the people who moved from the county between 1993 and 2002 took about $2.6 billion in household income with them.
Charlie A. Dooley became St. Louis County executive under difficult circumstances. He was elected to the position by fellow council members after the death in October of George R. “Buzz” Westfall.
Dooley, with less than a year on the job, is standing for election in November. He stumbled into politics with an appointment to the parks board in Northwoods.
What are the key issues facing the county?
The key is economic development. It’s about jobs and how we keep St. Louis County as the economic engine of this state and the leader of this region. That, I think, is of utmost importance in our minds.
A lot of St. Louis County is more or less built out. Is it at a tipping point, where it can slip backward, or can it go forward?
See, I have a problem with you saying it’s built out. Let me give you an example. Within the next two to three years, there’s going to be over 4,000 new homes built in St. Louis County. That’s not built out. That’s gonna happen. That’s on the books. That’s in the process now. Four thousand new homes. People don’t build homes where people can’t move to.
Then, you look at the sale of the (abandoned county) jail (in Chesterfield) that’s going to be coming up very shortly. You’re talking about, what, 32 acres of land in prime development area. Think of the tremendous opportunity.
So, to say that we are stagnant population or stagnant business, that is not true. Look what we did with the Ford plant in Hazelwood. We saved those jobs. So, we’re reaching out to the business community and saying, look, St. Louis County is a great place to do business, because people are doing business here, and people doing business like to do business where people are successful.
It seems as if the trends show companies moving farther west, farther north, farther south. They talk about more land, about lower costs for land, less regulation. What does St. Louis County have to offer that other counties don’t have?
Look at the (proposed business park near) Lambert airport. You’re talking over 600 acres of land, and there’s 472 acres of land that is actually developable. You’re talking about the possibility of 12,000 jobs. Can you think of any other place in this state or in this region that has that type of land assembled, that can really bring those types of meaningful jobs? We’re talking about jobs that people can support their families (with), good-paying jobs.
Does the county need to look at the regulation of business? Is there too much red tape?
I don’t think so. Anywhere businesses go, they understand there are requirements. You can’t get away from requirements. No business can. I don’t think our requirements are any different than anyone else’s. I think we do a good job of working with people. So, I just don’t think that that is a true statement. St. Louis is actually one of the few counties where you can get a permit online.
One of the concerns expressed by a lot of people is that problems in the city of St. Louis — blight, homelessness — are spreading into the county. Is that a concern?
That is always a concern to any government. But let me tell you some of the things the county is doing about our inner-ring cities. If you look at, for example, in Wellston and Hillsdale and Pagedale and Pine Lawn, there you have new homes being built (where homes) haven’t been built in decades. The county economic council is working with the city of Jennings to help develop its marketing plan, its redevelopment plan, its land-acquisition plan, all those things.
Would some smaller cities be better off if they merged?
You can say the same thing about the fire districts. You can say the same thing about the school districts. But I think that’s something people themselves have to determine, and the economics will determine that in the future. But . . . we do lose efficiency in government in some respects, there’s no question about it.
We got multiple police departments overlapping; we do have those concerns. There are issues with zoning departments in certain areas. I think as time moves on, when people realize that we can’t do what we do anymore, there will be some more mergers.
In the short run, by the same token, if you ask those individuals in those venues, they’d say, “Yes, it’s the best thing going, because I get to have control, direct control over my taxpayers’ dollars.” I’m not going to argue with those people.
You grew up in North County and went to Wellston High School. Now, you’re the most important government official in St. Louis County. What does your example say about opportunity?
Opportunity is present in St. Louis County at many different levels. There’s business opportunity, there’s no question about that. . . . St. Louis County is the best place to live because we’ve got some of the most affordable housing. . . . We’ve got a tremendous park system in St. Louis County. So, we got a lot of things (about) the quality of life that I think can make a big difference in people’s lives.
I think this is a great place to live; it’s the center of this whole region. It’s where the most activity is taking place. So, why would you not want to be a part of that?
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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Lambert business park begins to take wing Developers will start drafting plans next week for prized 600 acres
By Eric Heisler of the St. Louis Post-Dispatch
A much-discussed idea for a $400 million business park with 12,000 jobs near Lambert Field is about to be tested in the private sector. Planning for the 600-acre industrial and office park has been led for several years by government officials, who’ve hashed out a rough design through sometimes heated discussion. But next week, private developers will get a crack at the project, one of the largest job-creation efforts for St. Louis County in decades.
In crafting plans for the park, developers will seek to reuse a former residential area that was emptied in an airport noise buyout. As directed by the county, their mission will be to turn the site into a rare find in built-out St. Louis County: open land suited for industry. “This land has issues, but there’s really no open ground like it in St. Louis County of that size and potential,” said Paul McKee, chairman of McEagle Development, a developer in O’Fallon, Mo. “But there’s not much you can do with it the way the land is now. It will take a lot of work and investment.”
McEagle, developer of the WingHaven community in St. Charles County, is among the 16 developers expected to submit proposals for all or parts of the park. The company plans to partner with TriStar Business Communities of Chesterfield.
Eventually, the county hopes that the park will have a $7 billion economic impact. An estimated $57 million in tax increment financing would help to overcome several obstacles. Despite its prime location near the airport and several major highways, the site has seen several failed development attempts. Those efforts were harmed by fighting among Kinloch, Ferguson and Berkeley -- all with a stake in the park -- and were tainted by a land scam, where investors were cheated out of millions of dollars.
Until the early 1980s, much of the land was filled by neighborhoods of modest houses. At that time, the city of St. Louis began acquiring the homes in a buyout required by the Federal Aviation Administration. FAA regulations prevent the land from being used for houses but allow commercial use.
Redevelopment is complicated by the way the city demolished some of the houses, crushing them into the ground and covering them with dirt. Another challenge is converting the land for commercial use. “It’s a residential grid pattern, and it’s hilly,” said Jackie Wellington, vice president of the St. Louis County Economic Council. “You can’t put big commercial buildings there without completely flattening the land out.”
After the three cities sputtered in their attempts to develop separate parks, George R. “Buzz” Westfall, the late county executive, stepped in. Under political pressure, the three cities said they’d work together, and a development committee was formed to pursue the project. The committee has crafted a loose plan, and it will issue its request for developer’s proposals next week. This year, it will choose a developer or a group of developers and sell the land to them. The developer will construct buildings and roads on the site and recruit companies to the park.
County officials hope the park will draw employers that otherwise would locate in outlying suburbs or in other metro areas. “If a company wants a large tract of reasonably priced ground and they don’t want to go in the floodplain, they’re not going to be able to find a spot in St. Louis County right now,” said Denny Coleman, president of the economic council. “That’s why we’re putting forward this extraordinary effort.”
The park planned for east of Lambert Field is likely to include . . . Jobs: 12,000 Total investment: $412 million Size: 600 acres Property and income-tax revenue: $320 million Economic impact: $7 billion Public funding: $57 million in tax increment financing
SOURCE: ST. LOUIS COUNTY ECONOMIC COUNCIL
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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| Heuermann takes helm of World Trade Center St. Louis
Robert Heuermann Jr. has been named executive director of the World Trade Center St. Louis, the center said Wednesday.
Heuermann, 38, will be responsible to expand international economic development initiatives and merge its administrative functions with the St. Louis Center for International Relations, of which he is also executive director.
He will also work to strengthen relations with local and international businesses, help companies enter and conduct business internationally and work on promotions and outreach.
The two agencies will maintain separate identities, Heuermann said.
The St. Louis Center for International Relations is jointly administered by the City of St. Louis and St. Louis County and works to promote the metropolitan area’s international profile.
The World Trade Center St. Louis offers global market research and other services to metro St. Louis, the state of Missouri and southern Illinois.
© 2004 American City Business Journals Inc.
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Target Corp., Schnucks Join Revival at Northland
By Eric Heisler of the St. Louis Post-Dispatch
Sansone Group will develop Plaza on the Boulevard, with the two anchor tenants helping to energize the North County location.
Held in limbo for years without a major tenant, a $50 million plan to build a modern retail strip at the site of Northland Shopping Center is back on track.
Target Corp. said late last week that it will be the lead tenant in the Plaza on the Boulevard, which will replace the aging, mostly empty shopping mall in Jennings, according to the Sansone Group, the developer behind the project.
Target will be joined by a Schnuck Markets Inc. supermarket and several yet-to-be-named smaller retailers.
The redevelopment project is part of a larger renaissance that’s taking place in north St. Louis County. Older retail sites are being reused, and a housing boom is under way.
"I think this project restores some retail vigor to a community that’s been sorely underserved for many years,” said Steve J. Anderson, vice president of business development for the St. Louis County Economic Council. “You’re dealing with an area there that’s ... been impacted by the economic downturn. We think this could help resurrect it."
Northland Shopping Center, built in the early 1950s, was one of the St. Louis area’s first suburban malls, and it was once a thriving hub of retail activity in North County.
But as it aged, the mall struggled to compete with contemporary, strategically placed shopping centers. By the mid-1990s, most tenants were gone. A final blow came when Famous-Barr abandoned the site in 1994.
Then, in late 2000, Sansone and the city of Jennings unveiled plans to redevelop the property. Within two years, Sansone had torn down a theater at the site to pave the way for the project’s $7 million first phase: a new Aldi’s grocery and a 50,000-square-foot office building for the state of Missouri.
But plans for a much larger retail center stalled when Sansone struggled to draw a lead tenant.
"It was a combination of factors that slowed it down,” said James Sansone, a principal with the Sansone Group. “Certainly, the economy had some impact, but foremost was the image. You have a shopping center that was once thriving and now is dilapidated, and retailers wonder why that’s the case."
Along with a 270,000-square-foot shopping strip, the center will feature five standalone buildings around the site’s perimeter for restaurants and other retailers, Sansone said.
The project will benefit from about $10 million in tax increment financing, Sansone said. TIF is a method of funding some aspects of a project through future sales tax generated by the site.
Sansone expects to tear down the existing mall and begin construction this year or early next year, in time for the first tenants to move in by the end of 2005. Before then, the developer must attract several smaller retailers and acquire the property.
"We see this as a major opportunity, and we’re excited to be part of plans to remake this retail area,” said Lori Willis, a Schnucks spokeswoman. The grocer plans to close two older stores in Jennings and Dellwood when the new store opens, she said.
Though the mall suffers from an antiquated design, the corner site is still a viable one for retail because of its relative proximity to Interstate 70, said Anderson, of the economic council.
"I think this was just the process of the evolution of malls,” he said. “It’s still a major intersection; there’s still a major employer next door in Emerson. Frankly, it’s still a good location."
Republished with the permission of the St. Louis Post-Dispatch
© 2004 St. Louis Post-Dispatch
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