As we celebrate Strategic Development Group’s quarter-century mark, I’ve found myself reflecting on some of our early projects from my initial years at SDG. One of the things I love most about my job is watching corporate leaders make site selection decisions. Our projects are all different, and corporate site selection decisions are driven by the unique criteria most important to an individual business’s success. However, there are overarching themes that run through most of our projects. Over time, some of these themes have changed dramatically, while other factors remain remarkably similar. Here’s my take on priorities and their evolution over time:
Location Access
Focus Then: Proximity to major cities and proximity to interstates were often critical site search components.
Focus Now: Improvements in two- and four-lane highways, rail access, and port facilities, including the development of new inland ports, have increased connectivity between larger cities and more remote areas, expanding the number of project announcements in more rural areas with key transportation infrastructure. Sites near major metros with solid infrastructure in place have been gobbled up over the past five years, forcing us to continually expand our search areas and find innovative solutions for our clients.
Utility Infrastructure
Focus Then: Availability of basic utility infrastructure (natural gas, electricity, water, sewer) was a primary concern.
Focus Now: Additional development of new businesses, particularly in manufacturing, has increased demand for utility capacities over the past twenty-five years. In cities across the U.S., many utility systems are at capacity and cannot support additional site locations without significant upgrades to their systems. With the influx of highly electrified manufacturing operations, such as those in the electric vehicle value chain, demand for electricity service has skyrocketed. More than just the presence of electrical infrastructure, many of our clients have listed “access to electrical capacity” as a number one site selection driver.
Zoning and Other Regulations
Focus Then: Zoning laws were often complex and difficult to change, so appropriate zoning designations frequently drove site searches. Basic environmental considerations were important, but regulations were less stringent compared to today.
Focus Now: Most communities across the U.S. have drastically improved their zoning procedures, allowing for rapid and appropriate adjustments to zoning districts with minimal hassle. While environmental regulations have become stricter over the past two-plus decades, sustainability requirements have moved to the forefront of many client site searches.
Renewable Energy
Focus Then: Most of our process manufacturing clients avoided renewable power at all costs. Reliability was often a deal breaker, as the potential for an outage was too great a risk for many manufacturers.
Focus Now: The availability of “green energy” sources has topped the list of priorities for many of our recent clients. Access to renewable energy sources and sustainable infrastructure has become increasingly important, and electric utility providers have worked tirelessly to improve statistics related to dependability and redundancy.
Cost Considerations
Focus Then: Many of our projects focused on lowering upfront development costs, including negotiations for free or reduced-price land.
Focus Now: Both urban and suburban land costs have risen, impacting site selection decisions. While lowering upfront costs is still often a priority of our clients, projects seldom receive free land in this market. In addition to higher real estate costs, companies are increasing their focus on quality of life, trying to offer their employees more of a work-life balance, access to amenities, and a greater sense of community to help attract and retain talent.
Labor Costs
Focus Then: Availability of affordable labor was a key consideration for manufacturing and service industries.
Focus Now: The availability of skilled labor has become more prominent, with less of a focus on labor costs. Considerations for remote work capabilities and flexible workspaces have become more relevant, as has the emphasis on smarter technologies and cybersecurity.
The Next 25 Years
As many clients have shifted their focus on site criteria over the years, we at SDG have continued to grow and adapt as well, using technological advancements to help us identify and evaluate sites across the U.S. Our alignment sessions with clients ensure that we understand what victory looks like for each project, making us efficient and effective at helping our clients identify optimal sites for their business operations. As times change, our commitment to our clients’ success remains unwavering. This approach has been the basis of our practice for 25 years and is why many wonderful companies have become repeat clients of SDG.
Strategic Development Group
Our experienced team is focused on finding your project the best site for long-term success. We take a holistic approach and have the expertise to negotiate and navigate the intricacies of your unique company and needs.
Founded in 1999, SDG is a highly specialized site selection consulting firm. We focus on promptly identifying optimum locations, maximizing the value of incentives, and minimizing risk for corporations worldwide. SDG has managed projects with capital investments ranging from $15 million to over $1 billion for companies in a wide range of industries, including automotive, chemical, steel, and life science.
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In addition to your summary (which I like), a couple factors impacting those in the economic development world (which I somehow found myself in back in the early 1980s) include information accessibility and needs and the timelines for projects.
Projects have the ability to move faster because of almost instant information and data availability on-line, and those ED professionals at the local level are dealing with companies or consultants that already have a wealth of information on the community before the first contact and expect quicker response times than in the past. And when companies are ready to move forward on a project, site readiness, streamline permitting and generally faster community and/or state commitments are expected in many cases.
Thanks for putting your thoughts and experiences down. I can also add that the number and experience of professional consultants is exponentially larger than in “the old days”, which I believe has increased professionalism and the profile of economic development.
Thank you! We couldn’t agree more. -Danielle