Phones Ringing at the Region's Industrial Parks
MASURY, Ohio -- Rick Liston says the influx of oil and gas exploration to the Mahoning and Shenango Valleys keeps his phone ringing.
“I was getting a lot of calls from Texas, Louisiana and Alabama – three calls a week from these states,” he says. Most were from companies representing the oil and gas industry inquiring about buildings that might be for lease at Liston’s Lee Industrial Park here.
Unfortunately -- or fortunately, in Liston’s case -- the companies were turned away because Liston simply doesn’t have the buildings available for lease that would accommodate their needs.
“We have one building for lease. That’s it,” says Liston, president of Lee Industrial Properties Inc. “It seems like our tenants are expanding through other market sectors.”
Liston reports that interest in tapping natural gas reserves in the Utica shale in eastern Ohio and the Marcellus shale in Pennsylvania has helped energize the industrial leasing market, but by no means is it driving the bulk of business at the industrial park.
“We’ve landed other tenants that are manufacturers unrelated to the industry,” he says.
That wasn’t the case three years ago, Liston recalls, when commercial lending crashed and businesses put the brakes on expansion and new investment. “We were at 67% occupancy,” he says. “Now, we’re at 91%.”
Most of the inquiries he’s handling now, Liston says, are from prospects looking for buildings with high-vaulted ceilings and heavy-crane capacity, all of which are occupied at the Lee Industrial park.
Having just one building available isn’t necessarily a bad position to be in, Liston says, as new prospects continue to show interest. The sole available property at the park is a 58,000-square-foot building suitable for a manufacturing or distribution operation, he says.
“Buildings are going quickly,” confirms Sarah Boyarko, vice president of economic development, business retention and expansion at the Youngstown/Warren Regional Chamber. “We’ve seen more activity and interest over the last two years.”
The chamber promotes and markets any available industrial site in the Mahoning Valley, Boyarko says. “We’re seeing increased interest among prospects in warehousing, distribution and the food-services industries,” she reports.
The objective of the chamber, Boyarko says, is keeping all opportunities and options open for any company considering expanding in or relocating to the Mahoning Valley.
One project the chamber is developing is a mapping system that would stake out large sections of vacant land suitable for future industrial sites, Boyarko says.
By thoroughly mapping the land, potential problems such as wetlands could be identified early on and addressed, or provide enough information to ascertain whether the land could be marketed at all.
The chamber keeps a running inventory of marketable sites in the region, Boyarko reports, emphasizing plenty of available sites remain, including 44 acres the chamber owns near the Youngstown/Warren Regional Airport.
Other developments such as the Mahoning Valley Economic Development Corp.’s two industrial parks in North Jackson and Warren, Castlo Industrial Park in Struthers – which has readied 60 acres as part of an Ohio JobsReady site grant – and the Ohio Commerce Center in Lordstown are prime sites for new businesses, she elaborates.
At the Ohio Commerce Center, more than $27 million of new investment has been pumped in over the last three years, reports Dan Crouse of Routh-Hurlbert Co., Warren, leasing agent for the park.
“At least seven companies have come in,” Crouse reports. In 2010, George and Spiros Bakeris bought the park, and have since launched a massive effort to rebuild the rail infrastructure there and draw more attention to the site.
Crouse reports that the oil and gas industry is likely to factor heavily in the future of the park, but isn’t the only driver behind development. Savage Services, a transloading operation able to handle materials for the energy industry, recently set up offices at the Commerce Center, while other prospects keep pouring in, he says.
“We’ve seen a very large uptick in inquiries and visits from companies,” he reports. “It’s been very interesting over the last month.”
One such company is a manufacturer that isn’t directly related to the oil and gas industry, but whose business relies on using large volumes of natural gas, Crouse says.
Crouse reports that the park is just more than 60% filled. “If we could bring some things together, considering the serious number of people that are looking, I think this summer there should be some very big announcements at the park.”
Interest for industrial sites are also on the rise in Mercer County, Pa., reports Randy Seitz, CEO of Penn-Northwest Development Corp.
“We’ve launched a whole new campaign called ‘Make It in Mercer County,” Seitz says. Last year, the county attracted 120 leads, 13 of which toured sites in the county and resulted in a deal with a Canadian company that manufactures noise-suppression equipment for drilling operations.
“They’re coming into Sharon and it is a direct result of our marketing campaign,” he says.
Overall interest in Mercer County’s industrial parks remains strong, Seitz relates.
“Between Stateline Industrial Park and Greenville-Reynolds Park, we have quite a bit of shovel-ready sites in the KOZ program,” he reports.
The KOZ, the acronym for Keystone Opportunity Zone, program was launched in the late 1990s and essentially eliminates or greatly reduces all state and local taxes associated with a development project until 2020. Twelve regions across Pennsylvania have been designated KOZs since 1999.
“We’re fortunate, there’s a lot of interest in Mercer County itself,” Seitz reports, noting the trend among companies to acquire or lease existing buildings rather than build new.
“We have a large inventory of buildings,” he says. “We’re marketing sites from the northern tip, to the southern tip, and everything in between.”
EDITOR'S NOTE: This story appears on the front page of our MidJuly 2013 print edition.
Copyright 2013 The Business Journal, Youngstown, Ohio.
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