Charlotte, North Carolina has long been an aggressive suitor of jobs from all over the country. They are supported by an arsenal of tools, largely financial handouts, to incentivize jobs to take up residence in the Charlotte metropolitan area. This summer has been an extremely busy time, unusually so, for job movement.
It started on a particularly low note on Monday, June 16th – Black Monday as some recruiters might be calling it behind closed doors. It was the day when two large firms with a combined 2,200 employees – LPL Financial and the Lash Group – crossed the state line into South Carolina to claim tens of millions in “new job” incentives. Their 20 mile move didn’t impact the homes of the employees or their CEOs. It won’t change their spending patterns or where their children go school. The commute times are likely to be a wash with some folks driving longer distances with others decreasing their time in their cars. Were new jobs actually created? Not likely, at least not for now, though each is promising to more than double in the coming years. The “jobs” are “new” to South Carolina, but certainly not new to the employers.
For those companies, their location is a ledger-based decision; a $169 million decision to be precise. They can stay in North Carolina and get nothing (or very little) or move across the line and get a pile of tax incentives. End of transaction.
But, for a growing number of employers, there is an added dimension to their ledgers that is playing into these decisions – the place dividend. More and more, employers are making decisions on where to locate based on their proximity to real places and in some cases are willing to pay a premium. Downtowns all over the country are attracting jobs back to their core because of this place dividend. The areas are not only locations where they can be in close contact to similar businesses but they are also some of the most highly amenitized locations in a region. This is true of both large cities like New York and Chicago; secondary markets like Kansas City and Charleston, SC, and smaller communities like Manchester, NH and Davidson, NC.
Take, for example, the town of Davidson, a town located approximately 20 miles north of Charlotte’s center city. They have spent the last twenty years cultivating a walkable, mixed-use town anchored by prestigious Davidson College and surrounded by walkable neighborhoods and vibrant commercial areas. More than two decades ago they consciously made a decision that their growth was going to be on their own terms, slowly in some cases, but always intentional. The net result has been a community whose property values fared substantially better than nearly any other zip code in the region in the past ten years.
Additionally, they have carefully planned their interchange area accessing busy I-77 so that it looks and functions like no other interchange in the region. It is in fact both walkable and urban. With two roundabouts and a form-based code that prescribes building form and design, this “planning area” as they are called in town, is regarded nationally for its beauty and it’s value. It is home to major employers, a Harris Teeter grocery store, a Homewood Suites hotel, two gas stations, numerous restaurants, parks and housing all within a 5-10 minute walk. The basic form and structure are readily apparent even though it’s only half built with lots of available parcels to complete the picture.
Coincidentally and perhaps ironically, the same development company who coordinated the move of LPL and the Lash Group to South Carolina is also a big player in Davidson’s office market. In 2013, Childress Klein opened the doors for MSC Industrial Direct in a $31 million, 180,000 square foot office building in Davidson as the Melville, NY company opened a southern co-headquarters for what will likely be more than 700 employees.
But more recently, about two weeks after Black Monday, Childress Klein announced the construction of a three story, 51,000 square foot mixed-use building – the second in their Davidson portfolio (in additional to the single tenant MSC building). The anchor tenant – the regional office for Valspar Paint – the primary supplier of paint and painting supplies through Lowes Home Improvement Stores. That the regional attractiveness for new business to find a home here is not the story here. It’s the decision-making process to land in a mixed-use building in the center of this emerging village that seems to defy the conventional wisdom that sent others across the state line. In fact, Valspar is relocating from just a few miles up the road in Mooresville, NC. Why?
“We enjoy the culture of Davidson and knew this was the spot,” said Kelly McGlynn, operations manager for Valspar, as reported in Business Today.
And, as Paul Devine, a partner at Childress Klein Properties noted in an interview in the Charlotte Business on July 4, 2014, “…you get right on and off the interstate, which the employers love, and they love the town even more because it’s just packed with amenities. And it’s all about the pedestrian and how many amenities — from housing to restaurants to work — the average citizen can get to on foot. It’s really what got Valspar excited about the location. They can recruit from a large area, but they’re part of a real town. The companies that have come up there have really enjoyed that experience because it is so different from most places in Charlotte.”
In fact, the new location for those other jobs that state-hopped went from multiple office parks with low amenities to the Fort Mill community which has invested in its civic infrastructure for decades, thanks largely to the Springs and Close families. “A lot of corporations have figured out the way to really attract the best and the brightest is to be part of something larger. Not just a slick-looking office building in an area that’s accessible to your employees. You’re part of something greater. These developments that we’re talking about all share that same quality. It’s people-focused, it’s pedestrian-focused and it’s focused on the new work style. The best and the brightest can work anywhere, and you want to be part of something greater if you’re going to have the opportunity to recruit and retain these folks,” said Devine.
“…it’s all about the pedestrian and how many amenities — from housing to restaurants to work…The best and the brightest can work anywhere, and you want to be part of something greater if you’re going to have the opportunity to recruit and retain these folks.”
That’s the definition of walkable urbanism.
This story underscores that in the economic development toolbox, we can now confidently add place as a unique differentiator. Investment in place yields great returns. And, for communities that are truly interested in growing in the new economy, it’s time to start paying attention to what matters most over the long term – being an authentic community for residents, and employees too.