TUPELO — A new business incubator that will create 200 jobs within the first three years of operation is past the drawing board and ready for action.
As soon as funding for the $2.6-million facility is in place, construction will begin on a 34,030-square-foot facility on a 2.8-acre site on the corner of East Main Street and Elizabeth Street in Tupelo’s Fairpark District. Located near City Hall and across the street from the first Tennessee Valley Authority (TVA) substation in Mississippi, the business incubator could open by the end of 2004.
“The business incubator was part of our Future Focus initiative, when we raised money from the community to help with new strategies for economic development in Tupelo,” said David P. Rumbarger, president and CEO of the Community Development Foundation (CDF) in Tupelo. “We did a feasibility study in November 2001 and it’s taken us all of 2002 to get to this point. We’ve completed a cost construction analysis and have the site picked out. Now we’ve begun the application process for requesting grants to state and federal agencies and we’re waiting to begin the construction process.”
In October 2001, the CDF announced it had raised $2.38 million from more than 120 area businesses and individuals, $780,000 more than the targeted amount in a five-year plan to improve the business climate in Lee County. BancorpSouth, Hancock Fabrics, Journal Publishing Company, Lane/Action Industries, Lee County and the City of Tupelo were among the early supporters of the campaign. Establishing a business incubator was among the top priorities, and work on the project began a month after the campaign ended.
“This incubator is very much needed,” said Rumbarger. “We’ve been working with about a half dozen companies that are looking for space, and we’ve placed them in temporary spaces during this time, probably in about 10,000 square feet in the last 12 months.”
The funding agencies for the facility include $1.5 million from U.S Department of Commerce Economic Development Administration (EDA); $100,000 from TVA, plus a $200,000 loan; $200,000 from Appalachian Regional Commission; $200,000 from USDA; $225,000 from Lee County Board of Supervisors; and $250,000 from CDF.
“Since the Small Business Development Center on the campus of Itawamba Community College closed in September 2001, entrepreneurs have no real resources when it comes to start-up assistance,” said Claudia Zimmermann, director of business development for CDF. “The ultimate goal of the incubator is to develop and grow companies, create jobs and economic wealth. We want to create wealth and high-value job opportunities for our area’s entrepreneurs by helping them become successful and financially viable, so they can graduate into our area and help Tupelo and the surrounding counties grow.”
According to the National Business Incubation Association (NBIA), about 950 business incubators exist in North America, and have contributed to the creation of more than 35,000 start-up companies, employed nearly 82,000 people, and generated annual earnings of more than $7 billion.
The U.S. Small Business Administration reports that small businesses comprise more than 99% of all employers, 51% of private sector employment, 52% of the U.S. gross domestic product, and are the source for two-thirds of net new jobs. If not incubated, small businesses have an overall failure rate of 80%. Roughly 87% of incubator graduates are still in business, according to NBIA.
“The incubator will be a vital part of the commercial downtown Tupelo district,” said Zimmermann. “Our focus is to provide value-added services that will accelerate the formation and growth of early-stage…ventures, not only to the incubator tenants but also to off-site entrepreneurs in need of our assistance. The private sector will help us in establishing the needs for business training and development. The incubator will be targeted towards innovative firms that lack management, technical or financial ability to survive without some assistance.”
Last October, CDF hired Johnson Bailey Henderson McNeel, P.A., (JBHM) to conduct a design/engineering/cost study for the Tupelo/Lee County incubator. Only 1.4 acres of the site will be used in the initial development, with enough space for two expansion phases. The three-story building will feature mostly small offices, beginning at 115 square feet. The facility will provide 26,685 square feet of leasable space, with 22,416 square feet allocated for technology and service related firms, and 4,269 square feet for light/assembly manufacturing. Each office will be equipped with a telephone line, a telephone system and an Internet broadband line.
The business incubator will feature two full-time staff members during the first two years of operation, a Small Business Development Center counselor beginning the first year, and a third staff member will be added in the third year of operations. Three Rivers Planning and Development District will be the primary contact for assisting incubator clients with access to funding sources, such as business loans.
“CDF is anticipating a regional incubation services concept with Itawamba and Pontotoc Counties,” said Zimmermann. “The two counties are expected to conduct their feasibility studies and each put a facility in place. Until the two counties get their own facility, we will support them with services at the Tupelo/Lee County facility.”
Other incubators are located more than 50 miles away, including the North Mississippi Enterprise Initiative in Oxford, Northeast Mississippi Business Incubation System in Corinth, Golden Triangle Enterprise Center in Starkville, and Columbus-Lowndes Business Development Center in Columbus.
Contact MBJ contributing writer Lynne W. Jeter at email@example.com.
BEFORE YOU GO…
… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.
If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.Click for more info