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Coast companies continue rebound from Hurricane Katrina

It has been an absolutely dramatic year. That is how Steve Richer, executive director, Mississippi Gulf Coast Convention and Visitors Bureau, sums up the Coast’s recovery in 2006.

“We started the year practically still in a state of devastation,” Richer said. “Only three casinos opened before the end of the year in 2005. But now we are at 10. We have a lot of people back to work. We have good air service. Lots more restaurants and golf courses are opened. We have seen a transition from hotels filled with insurance adjusters and others related to the storm and more and more visitors who are here for leisure travel. We still have a long way to go, that is for sure. But things are a lot better and absolutely going in the right direction in terms of investments.”

Gaming revenues had reached near pre-Katrina levels by the end of the year. That was a pleasant surprise to many that it rebounded that quickly.

The Coast CVB has recently started advertising again. A short-term advertising contract has been approved with three Coast ad agencies: Prime Time, The Ad Group and the Guice Agency. Richer said the CVB is now in the process of identifying a longer term relationship with either the three Coast advertising groups or other firms. A decision on long-term advertising is expected by the first of March.

A big story of 2006 for the entire Coast has been the rebounding of existing industries from Katrina, says Brian Sanderson, president, Gulf Coast Business Council.

“Northrop Grumman, Chevron, Mississippi Power and the banking industry quickly came back online and not just recovered from the storm but worked to grow and expand,” Sanderson said. “The gaming industry is another noteworthy example of our recovery. We had the best September the gaming industry has ever had on the Coast.”

Sanderson said some specific industry openings included the Northrop Grumman unmanned aerial vehicle facility in Jackson County, Rolls Royce and the Shared Services Center at Stennis Space Center and Trinity Yachts, which has re-located to Gulfport moving from New Orleans. Soprema, a French roofing company, has announced a new development on Seaway Road.

The non-profit Gulf Coast Renaissance Corp. has been formed with the intention of building tens of thousands of new homes to replace those lost during Hurricane Katrina. An executive director of that organization is expected to be named by first of the year.

Sanderson believes the formation of the Gulf Coast Business Council was another major plus for the year.

“For the first time businesses, industries and economic development have come together in a very serious way to become a very significant voice of Coast business,” Sanderson said. “It is not an organization that just advocates economic development, but also quality of life and economic vitality that affects every citizen’s everyday life. We previously have had tremendous private leadership on the Coast from large and small businesses. But they have come together in an important way like never seen before. It underscores the whole necessity to think more as a region than as three separate counties and 11 different cities. We have too much that ties us together not to take advantage of those common needs and objectives.”

George Freeland, executive director, Jackson County Economic Development Foundation, also considers a highlight of 2006 efforts increased cooperation for regional economic development.

“We have made great strides collaborating with the Harrison County Development Commission and the Hancock County Port and Harbor Commission in attracting new jobs and economic development through the organization of the Mississippi Gulf Coast Alliance for Economic Development,” Freeland said.

Hurricane Katrina has produced a new set of issues and obstacles as it pertains to economic development, Freeland says. Labor force availability is an issue companies have to contend with on a daily basis. Part of the reason for the labor crunch is a lack of affordable housing. And the cost and availability of insurance is a big concern.

Freeland said 2006 was also the year that multi-year efforts for economic development have begun to bear fruit. The old International Paper (IP) site in Moss Point has undergone an environmental cleanup, and the old paper mill has been demolished. Efforts to master plan the Trent Lott International Airport are complete. Freeland said they now seeing considerable prospect activity in those two areas with considerably high investment interest on the part of some very notable companies in the IP site.

“Nothing can be announced yet, but the property has garnered a great deal of attention,” Freeland said. “We also now have a great deal of space and aviation attention at the airport property. In May of this year Northrop Grumman Integrated Systems opened a $13-million Unmanned Systems Center. In 2006 the Coast began to manufacture some of the most modern, high technology modern military component currently in production, the Global Hawk and the Fire Scout.”

The year also saw the closure of Naval Station Pascagoula. That property is expected to be turned over to ownership by Jackson County early next year. The ownership transfer date was originally this year, but county leaders asked for a delay until the Navy repairs Hurricane Katrina damaged facilities on the base which will be redeveloped to create new jobs and capital investment.

Building relationships

Larry Barnett, executive director of the Harrison County Development Commission, said 2006 has been a very productive year with new investment in Harrison County, and also with restoring a working relationship with elected officials and the Harrison County Board of Commissioners.

“We have an outstanding working relationship with and respect by the Board of Supervisors, as they have supported the new efforts of HCDC in every way possible,” Barnett said. “With several new commissioners on-board in the Board of Commissioners, we have worked together to move the Gulf Coast forward. A new staffing structure is in place after a year in development with varied talents that meet the needs of our organization.”

Inquiries for land and new facilities have remained steady throughout the year. Barnett said a large portion of inquiries have related to elements of the construction business and specifically in the housing rebuilding effort (modular homes of various types).

Companies that have located and are building facilities include: Soprema, Inc. – waterproof membrane and roll roofing for commercial applications; Gulf Ship, LLC, ship building company serving the offshore oil industry; Trinity Yachts, mega yacht building; USM,Inc., a small boat-building for military applications; and Fed Ex Ground, a distribution facility.

An effort to identify a location for an inland food processing industrial park has been underway and is currently being evaluated through an engineering study. The study is designed to determine the best location and the infrastructure necessary to accommodate food service tenants. Since the seafood industry suffered the most substantial damage of the existing industries, this park would help to restore a major portion of the pre-Katrina existing industry base.

Another major thrust this year has been identifying available industrial land and acquiring land for a new industrial park. Rezoning hearings continue in an effort to develop a new park in Saucier that includes 627 acres of land.

Making strides

Hancock County, which took the worst hit from Hurricane Katrina, has made great strides in repairing infrastructure and getting businesses reopened.

“We have replaced a number of industrial buildings at the airport as well at Port Bienville,” said Hal Walters, executive director, Hancock County Port and Harbor Commission. “I think we have made great strides in infrastructure at both the community level as well as out at the Port Bienville Industrial Park and certainly out at the Stennis Airport. All but three businesses at Port Bienville are up and running. We have 17 compared to 20 before the storm. That is very significant because that was ground zero of where the eye of the hurricane came ashore.
Transportation support serving those industries out there is the Port Bienville Railroad and ship and barge waterways. They are all up and operating at 100%, which is very significant.”

Some businesses in hurricane devastated areas of the Gulf Coast have relocated farther north, but Walters doesn’t think industries are going to abandon the Gulf Coast.

“They are going to be more cautious,” Walter said. “That is borne out by discussions we have had with industrial and business prospects in the past several months. A larger concern than potential hurricanes has been the lack of housing. We have certainly made some progress in that area in terms of housing and infrastructure for housing. But we have a long way to go. And, unfortunately, that appears to somewhat of a hold up or a detriment to attracting business and industry into the area.”

One segment of the economy that has come back stronger than expected is commercial business in Bay St. Louis and Waveland. Walters said nearly all restaurants that were in those two communities before the storm are back in operation, but off the waterfront for the most part.

“And certainly we have more commercial businesses in regard to building supplies in the county that we have ever had before,” he said. “And we will continue to see an increase, I believe, in this kind of activity.”

To the north in Pearl River County, there has been a surge of new residents who lost their homes in coastal areas of Louisiana and Mississippi that has put a strain on the infrastructure.

“A little sleepy community has woken up,” said Glade Woods, president of the board, Partners for Pearl River County, Picayune. “In general, we are choked to death with traffic. A lot of people who moved here have decided to stay and not move back to low-lying areas. That is very evident by the traffic and the people you talk to. There are more Cajun French dishes in restaurants than there used to be. We try to greet all these people with open arms because all of us have suffered from the devastation from Katrina.”

‘Good growing pains’

While there is pressure on roads, sewer and water infrastructure, and greater demands upon the police and fire departments, Woods describes this as “good growing pains.”

“We have to hunker down and plan how we handle this,” he said. “Everyone is trying to be congenial to work through this, but it has put a strain on the county and city leaders who are trying to handle the growth as best they can. It has put a lot of strain on our roads and our resources. We are trying to get funding and grants to take care of those kinds of things. Housing is really the number one event stressing the City of Picayune and Pearl River County.”

Subdivisions with a capacity for 40,000 new houses have been approved for a county whose population was only 54,000 in August 2005. Since then it is estimated the county’s population has nearly doubled. Picayune, which had a population of 12,500 pre-Katrina, is now estimated to have a daytime population of 30,000 people.

“Not having an official census, it is hard to get your hands on an exact number,” Woods said. “You can’t base it on the number of housing permits because so many families have moved into homes with other family members, and we also have a large number of people still living in trailers. We have new subdivisions that have popped up since the storm with a capacity of 400 to 500 houses.”

The lower third of the county that includes Picayune is growing the fastest, and a lot of new commercial businesses such as restaurants have opened as a result.

“Commerce has jumped,” Woods said. “Sales taxes are way up in terms of indicating the trade in the area. Also, from the economic development standpoint, we are receiving a number of inquiries of manufacturing and distribution companies that want to move in here. We have some of those coming on line now. We are about to run out of industrial park space for potential customers who would come into this area.”

The Picayune Airport has also had a great deal of activity with businesses moving out of Louisiana to higher ground.

“Our airport has just exploded with growth and needs to be expanded with longer runways,” Woods said.

Rapid residential, commercialand industrial growin in Stone
Next door to the east, Stone County has also seen rapid residential, commercial and industrial growth in 2006.

“I hate the storm had to come, but we have to look at the bright side of the cloud,” says Russell Hatten, former executive director of the Stone County Economic Development Partnership. “The bright side is that we have on tap nine new industries in the process of locating in Stone County. They range from 200 employees to five or 10.

“The company I work for, Solare, is building high-tech digital signage for the casino industry. Mississippi Metals, which does metal fabrication, is a new industry.

Some of the others include an injection-molding company formerly located on the Coast, and a filter manufacturing company that was located on the Coast.”

In addition to unprecedented industrial growth, Hatten said he has lost count of new retail and service businesses that have opened in Stone County. Some is attributed to the storm, and some to the natural growth of Wiggins and Stone County.

The amount of residential growth planned is staggering. Hatten said 5,000 acres of subdivisions were planned in the county by the end of summer, and since then one developer alone is planning to develop 10,000 to 20,000 acres.

“We are talking about building entirely new communities,” Hatten said.

“Who is going to live in these new houses? It will be a combination of new growth, and migration from the Coast from employees of the casinos and other business and industry. We had a substantial amount of that going on before Katrina, and are seeing that growth continue especially from those who can’t afford home prices and insurance on the Coast. We also like to think it is because of the quality of life in our community and the things we have to offer. Stone County’s time has come.”

George County ‘discovered’

George County appears to have benefited more than it was harmed by Katrina. Sue Wright, executive director, George County Economic Development Foundation and Chamber of Commerce, said the county has seen increased economic activity since the storm.

“I think we have just truly been discovered since the hurricane,” Wright said. “The hot news for us is the positive impact Hurricane Katrina had on our county stimulating the economy and bringing new investment to the community. There has been a definite increase in retail sales. Other choices weren’t available so people chose other places to do business. I think we were just in the right place at the right time.”

The county is seeing residential growth, but not in dramatic numbers. Wright believes what is fueling sales is the convenience and the ease of doing business in George County.

New commercial businesses have opened, and a new manufacturing facility opened the first week of December.

“We have many more industries considering our county who previously considered George County too far away,” Wright said. “Because of the storm, as people had to look at alternatives, they discovered Lucedale and George County are not that far away. Now we are in an ideal situation. Geography is playing in our favor now for retail and industrially. Regionally, we just couldn’t be better positioned. The best is yet to be.”

Contact MBJ contributing writer Becky Gillette at bgillette@bellsouth.net.

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