New and expanded facilities near $5B
by Wally Northway
Published: June 5,2009
Expansion, aerospace and defense help boost state’s numbers
Last year clearly was not the best of times for building new facilities or expanding existing ones. Tight credit markets, the high cost of building materials and the recession delayed many projects. The Toyota plant in Blue Springs is the classic example.
The chilling effect of the financial crisis and the recession on new and expanded facilities becomes evident when exploring the Mississippi Development Authority’s (MDA’s) “New and Expanded Facilities” database. The MDA stresses that this database is not comprehensive. It is gleaned from a number of sources. However, it is the only source of its kind in the state, and does offer a good “snapshot” of activity around the Magnolia State.
According to the database, from May 2008-May 2009 there were 428 new and expanded facilities announced in Mississippi. These projects are expected to create an estimated 7,428 new jobs and represented an estimated capital investment of approximately $5.76 billion.
By comparison, from May 2007-May 2008 there were 562 new and expanded facilities announced, which were expected to create 13,919 jobs and an estimated capital investment of approximately $7.05 billion.
Areas of surprise
Looking at facilities by counties, the usual contenders are back at the top. Rankin County (48 facilities), Hinds County (43 facilities) and Madison County (25 facilities) are first, second and third, respectively. Combined, the new and expanded facilities in the tri-county area in Central Mississippi represent an estimated capital investment of approximately $1.16 billion, roughly 20 percent of all the projects in the state.
In a departure from past reports, the estimated capital investment in facilities in the state’s coastal tri-county area of Harrison-Hancock-Jackson was much higher than Hinds-Madison-Rankin. Together, these coastal counties accounted for only 44 new and expanded facilities, but the projects ring in at an estimated capital investment of approximately $2.58 billion, or 44.8 percent of all facilities statewide.
Other usually top-ranked counties are there again. Forrest County ranks fifth in new and expanded facilities with 23, followed closely by Lee County (22) and DeSoto County (17). Other counties with double-digit facility numbers are Alcorn (13), Jones (11) and Lowndes (10).
The biggest surprise may be Scott County, which does not even have an economic development organization representing it. The Central Mississippi county counts nine new and expanded facilities, more projects than such counties as historical heavy-hitters Lafayette (eight) and Lamar (five). In total, Scott County’s facilities have an estimated capital investment \of approximately $26.28 million.
With the recession and credit obstacles, economic development organizations have put a renewed emphasis on retaining and growing existing business and industry, particularly manufacturing, and those efforts appear to be working. A summary reveals 256 manufacturing expansions over the year. This compares to a mere 23 new manufacturing facilities announced.
The most notable manufacturing expansions are ATK Space Systems and Sensors-Iuka Operations (estimated $230 million and 625 new jobs) and Nissan North America Inc. in Canton (estimated $118 million and no new jobs).
On the new manufacturing front, the largest project — indeed, the largest new facility of any type in terms of estimated capital investment — is Gulf Liquefied Natural Gas in Pascagoula. It is valued at approximately $1.5 billion.
The sector that perhaps catches the eye more than any other is aerospace and defense.
Gov. Haley Barbour said, “Overall, Mississippi’s economic development program is strong and solid, and that’s at least partly due to having the foresight and courage to focus on specific economic sectors. We want to be poised to recover very quickly when the national recession ends.”
A few of the notable new and expanded aerospace/defense-related facilities are ATK, the A-3 Test Stand at Stennis Space Center in Hancock County (new, $175 million, no new jobs), American Eurocopter Corporation in Columbus (expansion, $2.1 million, 65 new jobs), Aurora Flight Sciences in Columbus (expansion, no investment, 200 jobs), GE Aviation in Batesville (new, $90 million, 30 jobs), International Military and Government in West Point (expansion, zero investment, 155 jobs), Northrop Grumman Ship Systems in Pascagoula (expansion, $31.5 million, no new jobs), Raytheon Space and Airborne Systems in Forest (expansion, $3.47 million, 49 jobs), Rolls-Royce Naval Marine Inc. in Pascagoula (expansion, $820,000, 25 jobs) and Stark Aerospace UAS Division in Starkville (new, $30 million, 100 jobs).
This year’s summary is also notable for what is not there. One is mixed-use developments. These projects have dominated the largest new and expanded facilities lists in recent years. The only representatives this year are Town of Lost Rabbit in Ridgeland (expansion, $100 million) The Township at Colony Park (expansion, $20 million) and Stone Bridge in Brandon (new, $300 million).
The other noteworthy no-shows are churches. Church construction is good barometer of the economy and the amount of disposable income within communities. When the economy was humming, new churches and church expansions were some of the most common projects in the report. This year, not a single church project made the report.
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